Category Archives: Consumer Loyalty

Customer Experience and Employee Engagement

The marketplace demands more than a great product. You know that. It starts there, and requires a sound strategy to both position the brand and engender a conversation with the target market. The foundation continues to evolve and build new facets that creatively destroy or enhance all that has come before.

In the 1990’s success depended in large part on gaining distribution, in getting your brand and the message visible in an emerging on-line marketplace, amidst a fast-growing global competitive base, all trying to gain an advantage in access and logistics.

In the 2000’s, the focus moved to information…content became “king” and the distribution challenges were no longer “new and different”. The notion of paid-owned-earned media became of increasing importance as the decade flew by. Crowdsourcing, flash mobs, guerilla and viral marketing went merged into the mainstream marketing toolkit.

In the decade of the 2010’s, continual reshaping of the landscape is taking place, with an emphasis on customer experience. The consumer has no problem finding the options to address a want, need or desire. The relative value propositions are in full display. Branding efforts surround consumers in their daily lives, with an explosion of new media ventures.

It is against the backdrop of this ever accelerating evolution that customer experience has been elevated to a central factor in determining acceptance, trial  repurchase, loyalty and advocacy. A new generation is overtaking the market, demonstrating a far more transactional relationship with products and brands. What is “hot” today, may be passe by tomorrow. What will keep consumers coming back? One answer is a powerfully positive experience, starting with the promise of the brand, through to the acquisition of the product or service, to how the experience makes the consumer “feel” about themselves, others (both users and non-users) and the sometimes subtle nuances that shade one product differently than another.

The ability of the front-line employees to deliver a performance, a shared experience, a uniquely positive interaction, that embeds a positive memory, seeding a desire for engagement, is vital for survival, and indeed for endurance. It is for this reason that a culture and environment that breeds and encourages a commitment on the part of the employee to the mission of the brand or company is critical.

Unfortunately, in most companies today, employee strategies are housed in a wing of the organization chart that is distanced from those responsible for customer experience engineering, marketing or branding. In fact, there is a clear need for both to be connected, measured and aligned if the customer experience is to be optimized. As Vineet Nayar put so eloquently in his book of the same name, “Employees First, Customers Second” may represent a prioritization that is both counter intuitive and essential.  If you fail to serve the desires, needs, goals and characteristics of those who bring your brand promise to life, how well do you think the customer experience will be?

On Wednesday, November 7th, myself and Rodd Wagner (author of several best-selling books on the topic of organizational culture and employee engagement) will lead a discussion in Boston, in concert with the Ad Club of Boston (as part of their ongoing “Under The Dome” series) and the New England Chapter of SHRM. The central theme will be building a better customer experience through employee engagement. You can find details on the event here: http://tinyurl.com/b6e5423

This is a conversation that will continue in future posts as well. It is one that will differentiate market leaders from also-rans for years to come. I would love to hear your thoughts on the topic as well, and hope to see some of you at the Microsoft NERD Center in Cambridge on the morning of the 7th!

The enormous power of collaboration and coalition…

Recall the old saw, “the enemy of my enemy is my friend”? There are times in business when competitors are better off cooperating to drive market change than to face off against each other, denying any potential for synergy. I was reminded of this today as I listened to a collection of five agencies, any of which might have viewed the others as a competitor, delineate a unified approach  to elevate consumer values of sustainability and environmentally conscious decision-making.

In combining their respective strengths to support  a unique coalition that informs, educates, guides and rewards consumers for seeking and buying earth-friendly products and services, they are achieving far more than any single agency could do on its own. The common ground is moving the public that is neither an early adopter nor a disinterested laggard, to skew buying behavior toward brands that are eco-conscious.

What’s beautiful about this coalition (among many outstanding attributes) is that the portal to awareness, knowledge, consideration, trial, repeat purchase, loyalty and brand advocacy, is one that integrates a myriad of dimensions, any one of which is best-in-class. Together, they represent an undeniable force, capable of reshaping consumer behavior in the best possible way: to reduce our footprint on the ecosystems of the planet.  Surely anyone with children or grandchildren can appreciate the wisdom in that strategy.

As this “coalition of the willing” continues to build, one product, one brand at a time, there is a groundswell of support for both the message and the outcome it promises. Most people (in general) want to make “better” decisions, but share frustration in the lack of readily accessible, competent information as to what brands to seek, where to find them, and how they are different/better.

Food companies that market organic products, mass transits that cut fossil fuel consumption, natural and alternative cleaning products that help keep surface water pure, beverage bottlers which keep our kids free from unhealthy additives, and others from packaging companies to urban bike rental companies, are banding together to offer average citizens the opportunity to change what they do and how they do it for the better, and to be rewarded on multiple levels for doing so.

It was shared at a LOHAS (Lifestyles of Health and Sustainability) reception in Minneapolis last night that socially conscious consumption is expanding across demographic and psychographic segments at an ever-increasing rate.  Those who were once considered “leading edge” in this regard are now actually  closer to the center, and the numbers are expanding. This is good for all of us, and bears many lessons from which we can all learn. Today, as I spoke with and listened to the wonderfully  diverse group that has come together to build EcoBonus® into what will surely become a centerpiece in the shift to a more enlightened future, I was inspired by  the power created when great intentions are channeled with undeniable energy around an idea whose time has come. For all the right reasons, marketing came together with intention, and in the process, gave us all another reason for hope.

When smarter choices make for a better world…

It isn’t very often a promotion creates as many “wins” as the up-and-coming EcoBonus® consumer coalition. Imagine a growing array of consumer products and services, numbering in the thousands, all of which are environmentally friendly, banding together to help purchasers make better decisions, while rewarding those buyers for their loyalty.

The sponsors “win” – by selling more and reinforcing a critical brand message around sustainability. The channels “win” – by drawing additional consumers into their stores and onto their websites. The consumers “win” – by earning valuable EcoBonus award points (which may be redeemed for thousands of ecologically sensible goods or services). And, best of all, our planet and future generations “win” by benefitting from increased consumption of earth-friendly goods.

The coalition concept is a terrific approach for driving consumer loyalty when faced with the challenge of offering up a meaningful reward for lower ticket/high frequency purchases. How much can an organic dairy-products brand, for example, afford to give back to consumers as a reward? Or a “green” line of household cleaners? The  price point simply can’t afford it. Discount coupons can induce trial. But how do you create multiple, ongoing purchase decisions in a space that is dominated by bigger, more promotionally oriented and less environmentally sensitive brands?

Aggregating rewards across a wide band of products and services makes too much sense. I can be rewarded for riding mass transit instead of taking my car to work or shop. I can realize multiple opportunities to be rewarded for making better choices around what I eat and what I use in my home. I am rewarded for buying CFLs instead of energy-hungry  incandescent lights. Bottom line: I earn rewards for making a difference.

On its own, no individual purchase is very significant. But when you create a community of like-minded products/services,  taken in sum, they become a pattern…a new behavioral path…and they migrate from an occasional one-off decision to a sustained lifestyle.

Visit http://www.ecobonus.info/blog to learn more.  If you or someone you know works in marketing, especially if the brand they work on plays in the “green” space, you should encourage her/him to look closely at this unparalleled promotional opportunity.  Feel free to contact me for more information on EcoBonus as well.

Note: EcoBonus® is a registered trademark of BI Worldwide (Minneapolis, MN)

Groupon, we have a problem….

There are several reasons why this marketing hysteria over Groupon (and all the lookalike offers clogging email accounts daily) will be a promotional “flash in the pan”. To understand why Google was sufficiently infatuated with Groupon to want to spend $6,000,000,000 buying them is easy: localized marketing is one gap in the massive Google portfolio. Groupon, in theory, would help them to plug that hole.

As a consumer, I have purchased Groupons (although after their Super Bowl debacle, I will reconsider in the future), largely for one of two reasons:

  1. They offered 50% off at a restaurant or retailer that I already was a customer at, and was intending to purchase from in the future anyway, or,
  2. They offered 50% off at a restaurant that I had not been to, but would go to at a greatly discounted price (although I would not go back as a “full price” customer again).

I am pretty sure I am not alone in my motivations for having purchased a deal from Groupon. And, to the dismay of the restaurants or retailers I visited with my Groupon-in-hand, I either: (a) won’t come back again (unless there is another 50% deal that entices me), or, (b) would have made my purchase there anyway, and paid the regular price. So in either case, the retailer did not benefit from my participating in the offer. Now multiply that experience by the number of Groupons sold, and you find a mix of unnecessary discounting coupled with a likely void of future purchase intent. This situation is then magnified by both the number of competing “deals” that show up from other sites.  The result: a huge drawdown of consumer dollars which could have been directed into more profitable transactions that would build customer loyalty, frequency, and word of mouth.

So what is a retailer or a restaurant to do? Well, for starters, find a better way to entice new customers than the vaporous allure of cheap pricing. All you are doing is setting the stage for consumers to lower their perceived value for your store or retail category.

One alternative that would have a more powerful, long-term effect is to differentiate by elevating the customer experience, so that more consumers leave your establishment raving about the service quality, or the selection, or the flexibility, or the designs, or the depth of product, or some other meaningful driver of loyalty. Here’s a thought: Build a personal relationship with your customer…be a friend, a confidant, a supporter, an empathetic listener or just plain genuinely interested in earning their business. I would take the positive word-of-mouth that this approach creates any day over a price-shopper.

Let’s face it, driving down prices, while driving up discounts, is a self-fulfilling prophecy. It may work for WalMart but it won’t work for most others, in any category, especially those local retailers who have to compete daily against the big boxes. So why would you want to showcase, and take a financial hit on, a one-time discount that only increases your costs and marginalizes customer loyalty?

I understand that the tide of discontent with Groupon is rising, particularly in the restaurant segment. Customers may become loyal to Groupon, but the participating eateries are not feeling the love. My guess is that the illusory lift in store traffic and sales will be short-lived by those in other retail categories as well.

$6,000,000,000 for Groupon, and they turned it down because they felt it was too low? Should have taken the money and run. I doubt that they will see a knee-jerk, ego-driven offer like that come by again.

(Footnote: Hats off to Tom Fishburne for the great cartoon… Visit Tom at http://tomfishburne.com)

It’s not the brand, it’s the connection that matters most….

You have a terrific product. You have secured financing. You have researched the market, defined your audience, created a hot-looking web site, labored over a solid SEO strategy, targeted your messaging, factored every value and price consideration, built a channel strategy from the ground-up, made ready your  Facebook and Twitter identities, and set up your blog…. What could possibly be missing? Maybe just one thing: the consumer connection…that intangible, emotional, behavioral linkage that moves awareness to interest to purchase intent to trial to loyalist to advocate.

Think of the brands that “had it all” and somehow failed to launch or sustain themselves over the long-term… AOL, MySpace, Saturn, and Atari come immediately to mind.. AOL arguably initiated the biggest consumer drive ever for the internet, demystifying it and becoming synonymous with electronic communication (think “You’ve got mail!”). MySpace opened up a new, personal identity to a generation who grabbed on to  this new way to define themselves along with their new-found cyber “friends”.  Saturn redefined the American car-buying experience, and begat a new hope for Detroit (until it crash-landed in a neverland of blandness and failed dreams). Atari set off the race to make video gaming a part of everyday life for generations to come. Now if you want to see one of their consoles you probably have to visit the Smithsonian.

 Point here is that you need a solid connection, not a passing interest…a firmly planted stake in the emotional and psychological values, hopes and dreams of those with whom you wish to build an ongoing relationship. Apple, Lexus, Bud Light, Google, and Electrolux have all built brand fortresses on turf that was once the domain of another competitor’s “household name”.  How’d they do it? For starters they had everything that was described in the opening paragraph, plus they brought something new to the market: A connection that not only bound them to their market, but secured, welded, their identity with that of the consumer.

 There is an old saying that “People don’t sell stocks…people buy stocks”. This is well understood in the financial marketplace. Same is true for brands. If your product positioning is all about what it does, not what it does for me, then we may never fully engage. If your product is a ‘low price leader”, then forget about creating a brand, and just sell price (while you can, until you get knocked off that hill). Think of all the former category leaders which have been relegated to the heap of “has beens”, selling cheapness over innovation (remember Polaroid, or Pyrex, or Gateway?). If you are creative, innovative, and unique in your space, great. But really, why should I care? Will your product make me feel more creative, be perceived as more innovative, and will I be seen as unique by my affiliation with your product?

 This is Marketing 101. But in this golden age of social media, it seems that too often the rush to build a huge network of “personal” relationships results in an execution that places a higher value on quantity than on quality. You see, at the end of the day, it doesn’t matter nearly as much what your brand stands for. What really matters is that your brand stands for what I stand for. Miss that connection and you miss the chance to see how big your market really could be.