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behamics - Decreasing Product Returns and Increasing Conversions in E-Commerce Shops

Behamics background

How would you describe your business idea to a potential investor?

behamics is a cloud-based software as a service that optimizes conversion and product return rates in E-Commerce by combining Behavioral Science with AI.

Based on 1000+ science-backed behavioral nudge solutions, the behamics AI targets the right behavioral nudge for the right customer in the right situation.

The AI-driven use of behavioral science drives online shopping behavior and improves the customer experience leading to higher conversion and lower return rates without the need for monetary incentives or extensive changes in the shop architecture.

Online shops can implement the behamics tool in minutes without any technical effort.

Behamics Founders
The founder of behamics: Dr. Thilo Pfrang (left) and Valon Xhafa (right).

What problem do you want to solve, what is your goal?

We help solve the problem of high product return rates inducing high costs and additional transport emissions on the one hand, and low conversion rates forcing retailers to more and more costly monetary incentives which dilute brands and their profitability on the other hand.

What we actually address is how companies deal with those problems:

First, in order to reduce the return rate retailers often use restrictions (e.g., offering only prepayment for customers with high return rates) or even sanctions (e.g. ban heavy returners) alienating their customers.

Second, in order to activate purchase behavior at all, retailers mostly use monetary incentives (like price promotions) which are costly and reduce their profitability.

However, insights of behavioral science show that human behavior can be influenced without having to restrict customers or provide additional monetary incentives.

behamics enables E-Commerce to use behavioral science at scale to lower return rates and increase conversion rates by improving the user experience with the right psychological mechanisms in the right situation.

How did you come up with your idea/concept?

The idea was born in Thilo’s dissertation. He examined how behavioral nudges can influence return behavior in E-Commerce.

The insights of numerous field experiments showed that the effect of psychological mechanisms on purchase and return behavior can differ significantly between customers, product categories, touchpoints and many other variables.

This led to the idea of combining behavioral science with AI to find out which psychological mechanism works best for which customer under which circumstances.

This was the starting point to build a tool which is able to target these mechanisms intelligently along the entire customer journey.

What is your business model?

It’s a performance-based pricing. We are participating in the net revenue uplift that we generate through the intelligent nudging.

As a Spin-off of the University of St.Gallen using only science-backed approaches, we assume that we can achieve an added-value. Therefore, with a performance-based pricing we offer companies a risk-free entry in using behavioral economics at scale.

How can you prove the uplift?

We always have a control group: We compare our group of customers who receive our behavioral communication with a control group receiving nothing at the same time.

The size of the control group can be much lower than 50% of the sample, so that we can still target most of the traffic.

Is this only working for specific product categories?

Behavioral science explains human behavior. This means that the psychological mechanisms we use work everywhere, where human decisions are made.

Purchase decisions are made when shopping fashion, but also when shopping for office materials or anything else. The question is which psychological mechanisms explain the respective decisional context.

So the challenge is to find the right psychological mechanism for the right situation, regardless of the product category.

Is it GDPR-compliant?

Yes. Personalized data are not relevant for us since we focus primarily on behavioral data, e.g. from individual user sessions without creating personalized user profiles.

As a data processor according to GDPR, we act fully GDPR-compliant.

Why did you decide to work with XPRENEURS?

Valon is an alumnus of TUM and we knew XPRENEURS as one of the best accelerator programmes out there. So it was not a question for us to apply.

You can get more information about behamics on their website, follow them on Facebook or LinkedIn.

You want to become part of the XPRENEURS incubator program as well?
Get more information and apply at

Written by

Rike Brand

Rike Brand

Marketing & Community Manager on Parental Leave