The Hierarchy of Effects Theory Applied to Digital Marketing
How Digital Advertising Works
Most people look at ads on Facebook and Google and see them as annoying. The general idea of a non-professional is that marketing is easy to do. You just put a picture of the product, state that’s it’s the best and the cheapest and, there you go, your product sells like hotcakes.
But any website owner, let alone marketing manager, knows that selling products and services as a small business can sometimes seem like an unfathomable daunting task.
Most people still think that “built it and they will come” is the norm. There is nothing more fake news than that!
A Sales Funnel is one of the building blocks of modern Digital Marketing & is based on several intertwined marketing theories.Actually, any marketing specialists know that consumers go through a process when they decide to buy goods. It’s the basic of Digital Marketing. If your website is not working, ask your marketing manager what is a “Sales Funnel” or “The Hierarchy of Effects.”
If they don’t know what that is, they are useless, so just fire them.
A Sales Funnel is the basis of any transaction on the internet and is directly adapted from the “Hierarchy Of Effects.” This model tells marketers how to create ads in such a way that your prospect goes through six different stages. It was created by Robert J Lavidge and Gary A Steiner in 1961 and is still the ground zero of any marketing activity on the internet.
Breaking Down ‘Hierarchy-of-Effects Theory’
The hierarchy-of-effects theory is an advanced advertising strategy in that it approaches the sale of a good through well-developed, persuasive advertising messages designed to build brand awareness over time.
Even though an immediate purchase is always better, most companies using this strategy expect consumers to need a longer decision-making process. The goal of marketers is to guide a prospect through all 6 stages of the model.
The hierarchy-of-effects theory is an advanced advertising model.
The behaviors associated with the hierarchy-of-effects model can be summarized to the following behaviors:
- think (cognitive)
- feel (affective)
- do (conative)
The 6 steps in the process are:
Understanding how this hierarchy is working and how your prospect flows from one step to another will give your small business a slight edge.
Understanding how this model is working gives your business a slight edge.
You have read that everywhere! Up to 96% of people who visit your website won’t buy any of your stuff.⁷ At least on the 1st time.
You have also probably read elsewhere that you need at least 6 touches with a customer until he is ready to buy your products or services.
But you never know why and where this rule would come from.
As a marketer, our job is to make sure that our prospects will go through all the 3 stages and 6 steps of the model. That’s the only way to make them buy what we want to sell.
This model tells marketers how to create ads so that your prospect goes through 3 different stages.
Hierarchy of Effects Steps
Marketers use 3 stages of consumer behavior.
a) Cognitive stage
The awareness & knowledge stages happen when a consumer is informed about a product or service and in turn, how they process the given information.
In this stage, it is essential for marketers to dispel information in a useful and easily understandable manner that compels the prospect to learn more and make a connection with a product.
The “cognitive” stage is where the consumer gathers knowledge about the product and becomes aware of it.
Here are the 2 steps of the cognitive path:
1. Awareness: This is the most essential step because it is the introduction that leads to the purchase. You must make sure that your prospect is aware of the availability of your brand in a particular product segment.
For instance, if Bob usually purchases premium dog food from company Y. As the marketer of company Z, you have to make sure that Bob knows that your company is also making a premium food grade for Dogs. Your ads must be directed to Bob with the message that premium food exists in your store for the category of Dog that Bob has.
2. Knowledge: This is where your prospect is going to evaluate your products or services against other brands. Make sure enough positive knowledge is available about your product – through the internet, retail stores and the product package itself.
For instance: now Bob knows that your company is making premium food for dogs, but that’s not enough. To win Bob from your competitor, you need to let him know why your premium food is better than the food Bob has been buying all those years because you have dieticians, breeders, and trainers working with you and giving you the best dog food advice to make the best product.
b) Affective behavior
The liking and preference stages are when customers form positive feelings about a brand. It is not the time yet when a marketer should focus on a service or product, its positive attributes or technical abilities. Instead, marketers should appeal to a consumer’s values, emotions, self-esteem or lifestyle to create a bond.
The “affective” stage is when the consumer starts developing an emotional bond with the product.
These are the 2 steps of the affective behavior
3. Liking: This is where the consumer builds an emotional bond and like your products or services. This is where your service or product is being considered for its emotional benefits; be sure to make them prominent. In this stage, you need to focus on the emotion.
For instance, now Bob has evaluated the pros and cons of buying your food vs the competition and they understand that your products are at least as good as the competition. What your prospect needs to see now is an image showing that since they have used your product, dogs are healthier and owners are happier.
4. Preference: By this time consumer may be convinced to try out your product, but may like other brands of dog food too. The question to ask yourself os what is it that will make your consumers prefer your brand over the other brands? These points of differentiation or unique selling points (USP) need to be highlighted to ensure that the consumer likes your brand more than the others in her consideration list.
For instance, Bob is now considering between 2 different premium dog food from your company. Even though the 2 choices are excellent, you need to tell him more about your products, its characteristics, why is your product different and better than the competition. Maybe one has added vitamin C and beef flavor and the other has more amino acids with chicken flavor…
5. Conviction: This is the stage where the positive emotion in your prospects’ minds about purchasing your service or product needs to be transposed into action. Marketers can help in this step by giving out free samples, test drives etc. This step should also decide if the consumer will stick to your brand i.e. actually buy your brand, or switch after testing the sample.
For instance, you gave Bob a sample of your product and it looks like Bob and his dog like the product. But when the time came to make a new purchase, Bob brought your competitor’s product. Even if Bob knows that your product has the same (or better) qualities than your competition, he is still used to buy from them and doesn’t want to go into the unknown. To make sure that doesn’t happen again, you need to make sure to break Bob’s resistance to the new product.
c) Conative stepThe conviction and purchase stages focus on actions. This happens when a marketer attempts to compel a potential customer to act on the information they have learned and the emotional connection they have formed with a brand by completing a purchase. It may involve converting the last doubts about a product or service into an action. In this last stage, marketers should try to convince prospects that they need a product or service. If possible by offering something of value: an eBook, a test drive or a sample of your product. Marketers should also create a high level of trust between the prospects and the brand by focusing on the quality, usefulness, and popularity of a product or service.
The “conative” stage is when the consumer, after weighing the pros and cons, purchase the product.
6. Purchase: The last & most essential stage of the consumer buying cycle is the purchase. You need to make sure that the purchase experience is obvious and rewarding for your prospect. Some of the ways to encourage purchase is by making your purchasing process very simple and offering multiple paying options, making the product available easily, easy to understand usage instructions, offers etc.
For example: after you gave a free Dog Food sample to Bob, he tested it on his dog and is happily surprised to find out that his dog likes your food. Now, if your food is well-priced, easily accessible and has good quality, there is no reason why Bob should not start buying his Dog food from your company. As a last push, you may give him a free shipping or a discount coupon as a 1st-time buyer…
From Hierarchy of Effects to sales Funnels
The essential goal of the Hierarchy of Effects Model is to serve as a marketing publication tool to encourage prospects to go through the 6 steps so that it eventually ends in the purchase of the product.
You may not think that customers go through all 6 stages, but believe me, they do. Now, each customer is different. Some customers might be convinced very quickly that your product is the best for them, so others need more convincing.
Let’s take Bob again and its dog food. Imagine that Bob went through a lousy customer service with your competitor. Still, he doesn’t know that you exist, but the moment he understands that you offer the same (or even better) product, he may go through the 6 steps in a matter of minutes, because … he needs to buy dog food….
By going on your website, Bob can see:
- your products offering (awareness)
- information about your food processing (knowledge)
- videos testimonials of dog owners (liking)
- your product differentiation (preference)
- a coupon for the 1st-time buyer (conviction)
- a limited free shipping offer (purchase)
In a couple of minutes, Bob went through all the 6 steps of the model…
The cognitive, affective & conative stage represent the building blocks of The Hierarchy of Effects.
Now, let’s review a case where it takes more than 2mn for your prospect to decide on a purchase.
Let’s say you are a lawyer specialized in Intellectual Property (IP).
Mr. John, CEO of a drone company just found out that one of his competitors has stolen some trade secrets.
Mr. John decides to turn to Google to find the best IP lawyer. He finds your website and looks at:
- your offering: you state that you are an IP lawyer (awareness)
- information about how you fight again stolen IP (knowledge)
- case studies about other IP cases that you won (preference)
- a free assessment of your prospect case (via email exchanges, phone or video conference) (conviction)
- a push from you telling your prospect that he needs to file a lawsuit right now, otherwise, other companies might get an advantage and steal more IP from him. (purchase)
Note: Because his case might cost him anywhere between $5,000 to $50,000; your prospect is very unlikely to retain you just after discovering your website on the very first step…
Of course, you understand that given the volume of work that has to be done and the high cost of your service, you need be in touch with your prospect at least 6 times.
Between each step, your prospect might likely look for a couple of other IP Lawyers, and compare all you of you.
So, between the awareness step (he finds your website) to the conviction step (free assessment,) a couple of weeks might have passed.
Your prospect might even repeat the free assessment with a couple of your competitors. So, even between the free assessment and the purchase (of a retainer) another couple of weeks might pass…
Warning: if you don’t remind your prospect of the urgency to act immediately, he might forget, or go with a more aggressive lawyer.
Marketers have tools to know who your prospects are THE VERY FIRST TIME they land on your website and retarget them with an ad or a series of ads. Or they can capture your prospect data and nurture them with an email, messenger or text sequence.
The idea is to stay present all the time in your prospects’ mind.
Retargeting and nurturing are not part of the Hierarchy Of Effect Model but not doing it would be like not filling out your gas tank when the red light is on. Even if your car is in perfect condition, not following up on an assessment will stop your car.
That’s the same in digital marketing.
If you are a marketer or if you are a businessman planning to do your own marketing, The Hierarchy-of-Effects Model is a theory that you must know so well to the extent of being able to apply it to every marketing move you make.
A lot of other customer-response models are based on those 3 stages (Cognitive, Affective, Behavior):
- AIDA model
- Innovation – Adoption Model
- Information processing Model
- Operational Model
- Customer Awareness Model
In turn, those models are very important when you want to:
- apply them to copywriting
- build sales funnels
- design landing pages.
How to relate that theory with the Sales Funnels?
In my book “How To Acquire Customers On The Internet”, I have a chapter about Customer Awareness. I especially use this concept in copywriting and it also goes through 5 stages.
The 5 stages of Customer Awareness are:
- Unaware: people don’t know their problem even exists
- Problem aware: prospective buyer is aware they have a problem
- Solution aware: prospect knows a solution exists
- Product Aware: prospect knows that your solution is a good one for them
- Most Aware: Most Aware readers are your biggest fans
The last step is obviously the Purchase.
These five distinct levels of customer awareness were first identified and systematised by the legendary marketer, Eugene Schwartz in his book “Breakthrough Advertising” first published in 1966.
The 5 stages of Customer Awareness are somehow similar to the Hierarchy of Effects Model, but when the Customer Awareness model is especially used in Copywriting, the Hierarchy of Effects Model is used in the sequence of events a prospect has to go through before he becomes a buyer.
Do you want to know more:
P.S. This post is using the principle of Dual Readership.
Related: Hierarchy of Needs (Maslow)