Techniques that have been demonstrated to aid comprehension of financial propositions, key content and important information.
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This information is published in the BIT Best Practice Guide. Improving consumer understanding of contractual terms and privacy policies: Evidence-based actions for businesses.
This work was commissioned by the Department of Business, Energy and Industrial Strategy (BEIS), undertaken by the Behavioural Insights Team (BIT).
You can obtain the Best Practice Guide “Improving consumer understanding of contractual terms and privacy policies; evidence based actions for businesses published by The Behavioural Insights Team here:
Simplify terms by shortening long sentences, using simpler words, and removing jargon. However, while simplifying sometimes improves comprehension, the evidence is mixed. We recommend testing comprehension, rather than assuming that simplifying a piece of writing will make it easier to understand.
You can reduce the estimated reading age of your policies by shortening sentences and words. Online tools can help you identify long or complex sentences and maximise readability by offering a reading age which is comfortable for your customers. Testing with real customers as well is ideal.
We suggest you focus on writing clearly, rather than having a target reading age for a policy. Policies with a low reading age are sometimes harder to understand than policies with higher measured reading age. A text’s reading age comes from the length of its sentences and words, but these indicators don’t always reflect how easy or difficult it is to understand.
Give people information about the terms and conditions when it is most relevant. For example, provide information about terms and conditions as customers fill in their personal details. Research showed that using this approach increased understanding by 9 per cent.
Use pop-up notifications or comments to the side of forms. These notifications do not need to interrupt a customer journey or task, but they provide key information when customers are giving personal data, making purchases, or filling in forms. Given at the right moments, these ‘just in time’ explanations improve customers’ understanding of how the terms or Privacy Notice affect them.
At the top of important information, such as full terms, use a short summary table. Test results showed this approach increased understanding of the points detailed in the summary table, but had the side-effect that it reduced understanding of terms not in the table.
Choose the most important or unusual information to illustrate in a summary table. Give each term a simple title, and then explain how your policy relates to each point. Note that this design choice may mean that customers pay more attention to the terms in the table, but pay less attention to the other terms.
Show customers key information in a scrollable text box instead of requiring a click to view them. Showing the terms as a scrollable block of text in the customer’s journey on your website or app means they can easily read the terms and conditions (if they want to). Research showed that using this approach increased understanding by 26 per cent.
Show all customers the information as a scrollable block of text. The text does not need to interrupt the customer’s process or task. Customers who wish to learn more can do so without needing access a separate document.
Summarise key terms and illustrate them with explanatory icons, to reduce the amount of information given in one go. Our test results showed that using this approach increased understanding by 34 per cent.
Highlight information that is most relevant, important, or unusual to customers as part of the customer journey, instead of keeping all terms and policies in separate links or documents. Choose the most important points that you want customers to understand and illustrate these with simple icons. Using icons with summary text helps customers understand these key points, but icons may not increase understanding when used to illustrate long blocks of text.
Use a question-and-answer format to present what you consider to be key terms. BIT research showed that this improved understanding by 36 percent.
Choose the most important or unusual points from your terms or policy. Write them as questions with simple answers. For example, if your returns policy causes confusion, rewrite the key points as questions.
Tell customers how long a policy normally takes to read. Research results showed that using this approach increased the number of people reading important information such as company policy by 105 per cent.
Show the number of minutes it takes to read a policy. To calculate how long text takes to read and count the number of words and divide by the average reading speed of your audience. We recommend using 265 words per minute as an average reading speed. This approach increases transparency by letting customers know how long they would need to understand important information such policies and terms.
Tell customers when it is their last chance to read the information before they make a decision.
When a customer is about to buy something or set up an account, let them know that it is their last chance to read any relevant policies before they do so. Our test results showed that using this approach increased opening rates by 41 per cent.
Notify customers when it is their last chance to read something important about exclusions or matters which may impact their rights before they make a decision or complete a transaction. For example, agreeing to terms when making a purchase or signing up to a new service:
Also Remind them with a further link to your Privacy Notice – ie (where you can find in more detail how we use your personal data, including how we personalise our communications to you).
Use of illustrations, and where appropriate graphic stories, to explain step-by-step actions and processes. Speech bubbles give customers information about facts, dates, and figures, and their illustrations give context and emotional cues. Research has found that this approach increases understanding rates by 24 per cent. Using graphic stories and illustrations are more appropriate to online channels.
Explain your key information, terms or Privacy Notice in the form of illustrations which convey the key points. Using this technique can be effective where the customer is using a larger screen and the context is suitable.
Shorten terms and conditions to make them easier for customers to read. However, while shortening sometimes improves comprehension, research did not conclude that it improved comprehension of a full policy. Also, care must be taken to ensure that shortening does not lead to the use of jargon or unclear wording.
Remove sections of text that are repeated elsewhere in your policy. Summarise unnecessarily long sections.
Making summaries expandable, allowing customers to click each summary point for more information was not found to be effective. Many companies design terms and Privacy Notices in ‘layers’. Customers see short summaries of each section or term; when they click the summary, the section expands, allowing them to learn more. This technique decreased customer understanding by 4% in tests, with comprehension levels lower than for customers who had seen the same information with no layering.
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