“We have earned the trust of many diverse, leading organizations”

How we help grow your business through an improved customer experience

Create Business Value Through Customer Insights

Our Advanced Research identifies and measures opportunities to create customer value and deliver customer loyalty, retention, and growth.

Using our proven methodologies for strategy, design and innovation (rapid prototyping), we help organizations create emotionally engaging experiences.

We help make change sustainable by sharing our knowledge, training the team, and helping establish meaningful measurement.

“It’s great to have a philosophy, but you have to go beyond it and do something”

How we make a difference for you

We help clients leverage the power of emotions and subconscious drivers.

Many organizations are deceived and miss opportunities by focusing on what customers say. Our advanced research looks beyond the rational to find hidden, emotional and subconscious drivers of business value. We also identify your customers’ unmet needs providing opportunities for new value creation.

We apply the principles of Behavioral Science to make experiences feel more and natural.

We apply the principles of Behavioral Science to make experiences feel more intuitive and natural. We use our knowledge of Behavioral Science and use of technologies such as facial recognition to improve experience design and customer engagement.

We help you see beyond digital transformation.

Digital technology offers tremendous potential to deliver outstanding customer experiences, but we know that the best results are achieved when you start with the customer. We help you create emotionally engaging digital experiences that deliver value by building on the foundation of customer needs and value.

Our experience and thought leadership are unmatched.

We have been working exclusively in Customer Experience since 2002. We have a proven track record of results with some of the world’s leading organizations and are regularly recognized for our work. With our many books, conference speeches, blog posts, and podcasts, we continue to expand the boundaries of understanding customer behavior and its application to business.

“It’s easy to say you love your customers, but would you ignore emotions of people you care about?”

Are you looking for answers?

What are the key value drivers that will fuel our customer growth?

How do we design engaging experiences?

How can we get more from our digital transformation investment?

How can we help our people to deliver a great experience?

What question do you need help with?

“Your customer experience is a reflection of your processes, systems and culture”

Are you looking to grow your business?

Beyond Philosophy helps you grow your business by improving your Customer Experience. Our proprietary tools identify hidden, unmet customer needs that we can PROVE drive value(i.e., $$$$). Once we know what customers really want, we design a new experience for you that addresses those needs.

Our proven methodology creates customer-driven growth for your organization. For real-world examples of our results, read our case studies. See for yourself how well Beyond Philosophy’s work has benefitted other organizations.

This experience and success at yielding growth is one of the reasons why our peers and customers recommended us to the Financial Times, who have recognized us as one of the leading management consultancies for the last two years in a row.

Our mission is in our name, Beyond Philosophy. We believe that everyone should have a “Philosophy,” a strategy, but that is not enough to get you the growth you want. You need to go ‘Beyond’ strategy and actually do something. Moreover, it has to be practical, and it has to produce results.

Tell me more about how I can grow my business
and improve my Customer Experience:

“Your product or service is inside an experience envelope, what does the envelope look like?”

You need experts in customer acquisition and customer retention.

You have goals for bringing on new customers and keeping the ones you have. Your goals are in safe hands.Beyond Philosophy is recognized as a thought leader for promoting customer-driven growth through Customer Experience.

How do we do it? Customer-driven growth requires determining what your customers really want, not just what they say they want. These two things are often quite different. We uncover these desires by not only considering what your customers tell us but also by watching what they do.

We also identify what drives and destroys value for you. Knowing what is helping you hit your goals and what is getting in your way helps you prioritize your creativity and focus on the areas that give you the most return on your investment.

Show me how I can find out what customers really want:

What our clients say about us

What we’re thinking about lately

It’s Time to Move Your Customers to Where You Want Them to Be

November 24, 2022Customer strategy results in some interesting questions. Recently, Claire Hillman, a listener (and viewer of our new YouTube channel) asked us one she has been mulling in her strategic planning: Should I move to where my customers are or move them to where I want to be? It’s an interesting question. My knee-jerk reaction is to say, where they are. It’s a customer-centric answer, and we know how critical customer-centricity is. However, what if where you want to move them will actually be a better experience for them, even if it isn’t where they are this time? Consider the time before the iPhone. We all used flip phones and phones that had little keyboards that popped out and stuff, and we were happy with that. We packed it with our digital camera and our MP3 player before we slid the laptop into the bag and headed out to enjoy all our mobile freedom. If someone had explained an iPhone to us, we might have listened, and some might have understood the benefit right away without even seeing it. However, the majority would probably regard the iPhone explainer with skepticism that a phone could do all that and that it was worth it to give up what we had now. We wouldn’t have seen the benefit and would have carried on with phones you only see television drug dealers use today. So, knowing what we know now about the iPhone and other smartphones, wasn’t it a good thing that Apple and other technology companies moved us to a new place? Another example of a service that we might not have seen as the benefit it is to our self-interest is self-service at the grocery market. Recently, we had these added at the market near me. I love this kind of stuff, so I tried checking out using it. However, I had questions about how to handle the self-check-out when buying a cabbage since it didn’t have a barcode. The employee that helped me with my cabbage problem explained that I had to look up the item and then showed me how. While doing so, she said, “When I am training people, this is how I tell them to look for things.” So, before, I would have queued up at the check stand, put the cabbage on the conveyor belt, and the checker would have punched in the code for the cabbage. Now, I was a customer getting “training” by the store on how to do it myself at self-service The supermarket was moving me to where they wanted me to be instead of where I had been. Don’t Forget To Keep What People Value But is self-check-out the same amount of a benefit to me the iPhone is? Or even is the iPhone the best option for all customers? The answer here is that it depends on the type of customer I am. Customer Segmentation dictates that some customers will LOVE self-check-out, while others will be indifferent, and another group will hate it. So, it’s essential to remember that when undertaking any moving of customers to where you want them to be. In some cases, if you move them too much, they might just move on. Therefore, when you are deciding whether to meet customers where they are or move them where you want them to be, it is critical to consider what the value is for that customer of doing business with you. Most people prefer the status quo. Customers usually prefer not to make changes and do things the way they have always done. They don’t always have the vision a company does. Henry Ford once said if he asked customers what they wanted they would have told him, “faster horses.” Meeting the needs of customers while you move them requires you to manage change so customers can join you at this new, faster-horse experience customers never imagined. The change itself might feel painful, but once you get the customers over that hurdle, there’s a whole host of new benefits to discover. Consider these better-than-a-faster-horse experiences that we customers have moved to: Electronic bill pay (or even automatic payments) versus writing and mailing checks Digital check-in on mobile devices for flights rather than waiting at the agent’s desk Streaming movies and music rather than purchasing physical copies Sending and receiving money online rather than cash Ordering something online and having it delivered to your home rather than leaving your home and delivering yourself to a retail center to get it Not surprisingly, these experiences are digital services or facilitated by the internet and/or iPhones. These are also easier and have many benefits for customers. However, we didn’t know that until we tried it. Now, we can’t imagine wanting to go back to the old way of doing things. So, How Do you Manage These Customer Migrations? As I mentioned, change is not something many people are excited to make when it wasn’t their idea. Customers do not like to feel like they are losing anything. Therefore, you should frame it properly for them. For example, my wife detests upgrading her operating system on her phone. I recently upgraded to iOS 16, the new operating system from Apple for the iPhone. When I did, I watched some videos on YouTube and learned some of the new features and how to use them. Then, to get Lorraine to do the same, I show her on my phone a couple of things the new operating system does that she could gain if she upgraded. Then, after she sees that she can have pictures of the grandkids rotate on the home screen, she will go ahead and upgrade, too. Now, I don’t show her everything the new iOS can do; she wouldn’t give a hoot about most of them, anyway. However, by focusing in on a benefit I know she will like, the one that matters to her most, I can get her on board with the change. By holding back on ALL the features, and focusing my efforts, she decides she wants to get the iOS update. Same goes for customers. Are you making the effort to explain the advantages of a couple of focused, valuable features or throwing them all at the customer? It does make a difference in the response you get. Even if we choose to move them, we still need to meet customers where they are first. Meeting customers where they are also means remembering what mindset they are in. I have mentioned before the two different systems that run our decision making, the fast and emotional Intuitive System and the slow and logical Rational System. When your customers are hanging out in the Intuitive System, they are focused on what “feels” right. So, persuading these customers requires an appeal to emotions. Plus, framing it as a quick decision, a last-minute add-on, if you will, might also be successful. However, sometimes customers have more cognitive resources available to them in the moment when they are hanging out with the Rational System. In these cases, you can resort to facts and figures to convince them to move with you. Plus, you can frame it as something they can spend some time with, so customers can concentrate on what you are telling them. Meeting customers to move them is something that can happen on multiple levels. The more you know about their cognitive state at any given moment in an experience, the more success you will have in providing a suggestion that can move them where they should be even when they weren’t thinking of making a change. So, What Should You DO with this information? Organizations should consider these options and make a deliberate and strategic choice. Ultimately, the needs of your customers should drive the decision either way. People often make buying decisions to solve a problem. So, should you solve a customer’s problem at the surface level by meeting them where they are, or should you look deeper and find out how to resolve this problem before it forms? If you choose the latter, it might require moving customers rather than meeting them. Once you do decide to move customers, it is essential to invest in training for customers. Like the supermarket that helped me buy cabbage, you should have a person there to help customers navigate the change. Also, measurement is critical. You need to see if your efforts are successful. Plus, the new experience will likely need some refining. Testing will show you where you are succeeding and where the opportunities are. So, if you’re moving from customers from one place to another, then you should learn from that. Test it out, study the results and commit to making the necessary changes. Plus, don’t forget your customer segments. It is imperative to understand your customers from a behavioral standpoint, not just from a product standpoint. Recognize that early adopters will move towards that change and others need more time. Kudos to Claire for bringing us such a great question to discuss. I don’t think many organizations consider whether to meet customers or move them. Many firms just do what they want to do and expect customers to show up. However, a deliberate strategy to meet customers’ needs by either meeting them or moving them is a better way to go, which results in more revenue showing up in your bottom line. If you have a business problem that you would like some help with, contact me on LinkedIn or submit your pickle here. We would be glad to hear from you and help you with your challenges. [...] Read more...

In an Increasingly MAD World, Here Are 5 Rules for Managing Uncertainty

November 17, 2022The world is crazy. There’s a war in Ukraine. The UK has a cost-of-living crisis as energy prices are rising, and loads of people are moving into fuel poverty. There’s inflation, strikes, and the looming threat of a recession and catastrophic climate change. The current environment I describe is very stressful, with many things you cannot control, which makes a few things on the path forward uncertain. So, to help us all cope with the road ahead, I thought we could discuss the 5 Rules for Managing Uncertainty we shared on a recent podcast and our YouTube channel. I thought maybe my interpretation of the world was just me getting old. So, I put it out there on LinkedIn to find out what some of you felt about everything with a poll question, “What are you expecting the business environment will be over the next year?” The results were fascinating. I thought it would be worse (and I’ll explain why), but 42 percent of you thought it would get better. Another 37 percent agreed with me it was going to get worse, and 21 percent said it would be the same. I feel things are getting worse because I have been in the UK for the past two or three months. Energy prices here have tripled. Also, we are a lot closer to the war in Ukraine and Russia, so that is a stressor we feel more keenly here than we might over the Atlantic. (Of course, Hurricane Ian just hit my Florida home, and now there’s a rise of flesh-eating bacteria there, so it’s not like being in the states is worry-free.) Some of you felt differently than me. For example, René Bomholt said it depends on where you are and your business. For instance, if you work in a company in northern Europe that provides an alternative to using imported gas, the environment will likely be better. If, on the other hand, you’re in a low-paying segment, Bomholt says you might say it will be worse because you are struggling to find people to fill open positions. Also, Asia still has restrictions due to COVID, which impacts the mobility of the workforce. Once those restrictions lift, it might be better there. But, ultimately, Bomholt says he settled for answering it will be the same. Some of you thought how we think about things is how things become, like Andrew Safnauer. Safnauer believes that the general populace’s mindset will determine how the business environment goes. It could get worse if we decide things are bad and react that way. On the other hand, if we are cautious but still “engage in commerce,” it might not get worse. In other words, Safnauer is saying if we think there will be a recession and stop buying things, then there will be a recession. Economists agree with Safnauer that a significant part of recessions is psychological and sociological. First, we all decide that there will be a recession, and then there is one because we all pull back on our spending. So it becomes a self-fulfilling prophecy. So, we always have uncertainty, which isn’t a great feeling. So, let’s talk about how to manage uncertainty, starting with these 5 Rules: Recognize uncertainty is uncomfortable. Remember, the upside of uncertainty is that it provides opportunity. Control the controllable. Be alerted to be prepared. Hope for the best and plan for the worst. Now, let’s take a closer look at each of these, shall we? Rule #1: Remember uncertainty is uncomfortable. Human beings like certainty. Plus, we’re creatures of habit, as we’ve spoken about many times before. First, however, we must recognize that uncertainty makes us uncomfortable. This discomfort has a lot to do with the psychology of decision-making. For example, many shortcuts in decision-making (i.e., heuristics) are things we do to make ourselves feel more confident or that we have more data than we do. Perhaps this concept is why we like to use the phrase, “Well, that’s a no-brainer.” If we see an obvious best choice, you don’t have to feel uncertain about your decision, and you will feel more comfortable moving forward. However, you can’t always have a no-brainer, which can be stressful. Moreover, I have often said you can deal with one part of your life being off kilter, but not all of them. When more than one part is causing you stress, it can increase uncertainty. So, recognize the source of it and try to prioritize your actions to manage them in turn—and try not to torture yourself over them. Many decisions we make are not as significant as we think. Instead, let it go and focus your effort on the stuff that might be relevant. That will help. Confronting uncertainty around insignificant decisions is something you can pull an Elsa on and just let it go. I used to buy my managers a book called One Minute Manager Meets the Monkey by Ken Blanchard, which is about prioritizing things as a manager or leader. One of the premises in the book is that, as a leader, you think it’s your responsibility to do everything and to make every decision. However, you end up overloaded and, therefore, unable to prioritize. Rule #2: Remember the upside of uncertainty is that it provides opportunity. People don’t like reorganizations. They worry they will lose their job or get a new one they don’t like. However, my view when I was in corporate life was that reorganizations provided me with an opportunity to move ahead and change my current job to one I wanted next. That worked out for me much of the time. Therefore, I recommend not assuming uncertainty will be all negative. It can be, of course, but it is also an excellent time to disrupt things. The natural reaction is to withdraw, to be conservative, and not to take risks. So, as we enter a recession, organizations should look for ways to disrupt the market. Is there an opportunity? Has the competition become large and cumbersome and unable to respond to market changes? Is there a way to maneuver around them in some way? Recessions can reveal opportunities for those who are willing to take them. Rule #3: Control the controllable. If you look at the YouTube version of the podcast where we shared these rules, you will see I am wearing my Luton town football shirt. I wear it because I love my team even though they are not very good these days. I can’t make them win, but I can show my support for them through my apparel choices. I can’t do anything more than that. Luton Town Football club’s former manager used to say in the interviews after the game, “Control the controllable.” I always thought that was a good lesson for life, especially surrounding uncertainty. Another phrase that goes along with this is, “I’ve had several crises in my life, but few have actually happened.” This phrase does a brilliant job of pointing out that we often think everything will come crashing down on us, but it doesn’t always. It rarely does. So, when you’re in times of uncertainty, focus on things you can control or influence. There’s no point in worrying about the rest of it. The reality is I can’t determine if there’s going to be a recession or not. There’s very little I can do about the war and energy prices. I can’t control those things. I can control the way I react to those things. I manage how we plan. With energy prices rising, I can control how we deal with those things. It’s a bit like chess. You’ve got to think two or three steps ahead, not only short-term. Rule #4: Be alert and prepared. Rule number four builds on the third one by encouraging you to go to different sources to understand what is happening. As a result, you might have a better idea of what will happen over the short term and what those effects could be long-term. Again, getting more information allows you to prepare. For example, how long is it likely to be if we enter a recession? What sectors will it hit? Then you can build some plans. Uncertainty is psychological, and it can be paralyzing. Getting more information helps because we feel less uncertain and build confidence, which can be empowering. Perhaps most importantly, having more information can motivate us to move forward. Rule #5: Hope for the best and plan for the worst. We hope that things settle down and uncertainty and the rest of it go away. However, you’ve also got to plan that it won’t. You’ve got to prepare for the worst things or at least think them through. If you don’t, then you’re going to be caught unawares. So instead, be as prepared as you can be. Remember, humanity’s been able to climb out of every hole it’s found itself in thus far. So let’s prepare and plan around what we can while we figure our way out of this one. If we can recognize uncertainty makes us uncomfortable and identify the opportunities it creates, we will be in a better mindset to weather the storm. Also, if you seek to control your reaction to things and be alert to changes so you can prepare, you will be in a better spot. Finally, be prepared for the worst, but don’t lose hope that things will be okay. They always have been before, so why would this time be different? Over the past 21 years, Beyond Philosophy has weathered three recessions. They are not pleasant, but there are opportunities. If you can look at things from a positive perspective and see things differently, you could come out even better on the other side. If you have a business problem that you would like some help with, contact me on LinkedIn or submit your pickle here. We would be glad to hear from you and help you with your challenges. [...] Read more...

Learn How to Make Influence Your New Superpower Today!

November 10, 2022Change is hard. So, when you have to make changes in your organization, you face many challenges. However, we have a secret superpower you can unlock to help you: Influence. On a recent podcast, we hosted writer, teacher, researcher, and Climate philanthropist Zoe Chance, Ph.D., author of Influence is your Superpower: The Science of Winning Hearts, Sparking Change, and Making Good Things Happen. Chance is an assistant professor of marketing at the Yale School of Management, where she teaches the most popular course, “Mastering Influence and Persuasion.” Her research on influence has been published in top academic journals and often garners the attention of global media outlets. Her website, zoechance.com, also has numerous content resources regarding using interpersonal influence for a positive impact. In addition, half of the profits from her book go to 350.org, a global network of climate activists seeking change through the power of ordinary people. And, if that wasn’t enough, she also narrated the audio version of her book. Chance tackled a subject that content creators and authors had covered well over the years because the methods they touted felt transactional. People on the other side of the tactics felt, well, used, as if they were a means to an end rather than part of meaningful interaction. Chance didn’t like making people feel like that, nor did she appreciate when she was on the other side of these transactional relationships. In promoting her book, interviewers will say things like, “I’d like to pick your brain,” or “we’d like to get as much content from you as possible,” which she doesn’t appreciate. She thinks we as humans are aware of and do not appreciate feeling or being manipulated. Instead, we would feel recognized as human beings and treated like individuals with agency and freedom of choice. In some ways, she calls it the opposite of Donald Trump’s book, The Art of the Deal. Chance’s style of influence is for people who want to do good things in the world and collaborate with others rather than trying to get something out of them. The psychology of influence is the same, whether you are convincing your friend to choose the restaurant you want for dinner or if you are trying to solve the climate crisis. Chance’s brand of influence is about getting people to want to say yes, and not regret it afterward. Chance believes that if you can get other people excited about your ideas rather than manipulating them into saying yes means they will be more on board with the plan. Chance’s strategy is intriguing to me. As you know, on another podcast, we hosted the president of the American Customer Satisfaction Index (ACSI), where he shared that between 2010 and 2019, only one-third of organizations improved their Customer Experience. Moreover, those numbers might have devolved since the pandemic, especially since we know that the ACSI has been at its lowest point for 17 years. So, like many of you reading this, I wonder how to influence people that committing resources to improve Customer Experience is a worthy enterprise and results in improvements to the bottom line. Chance has two ideas related to this concept. First, Chance says that you cannot improve the Customer Experience without improving the Employee Experience. It is an unfair expectation of employees to make people feel happy and valued if they don’t feel that way. Second, Chance says that the concept might be too vague for people to take up the mantle on your behalf. She advises Customer Experience champions to be specific in their requests. So, what part of experiences should organizations focus on? Chance says research shows that making things easy for customers is an essential and underused marketing metric. For example, the customer effort score measures how much work it took to do what customers wanted to do. The higher the customer effort score, the more likely people were to complain about the experience and vice versa, regardless of the outcome of the interaction. Chance says that customer loyalty was influenced more by effort than satisfaction. Low effort or ease is an essential part of behavior changes, too. There is something called the Intention-Behavior Gap, which describes how we mean to make a change, but once we try, it’s too hard, and we don’t follow through. For example, New Year’s Resolutions usually fail. Chance says that is because it was a change we knew would be hard; that’s why we resolved it in the first place. So, Chance suggests that making it easier for people to act is a way to facilitate behavior change. An example of using this concept to improve a bottom line comes from a seminar company that used a low-tech solution to enhance its profitability by 13 percent. During the seminar event, they printed out a sheet of paper that asked attendees which of their future events (listed on the form) they wanted to attend. The attendee marked the boxes and turned them in at the end of the seminar. Then, using their contact and payment information on file, the seminar company enrolled the attendees in future programs per their request. The Strategy for “Working Around the Roots” However, we realize that not everyone that needs to influence people or head up a program that requires change is the CEO or the business owner. Instead, they have to convince other people to do what they want. Chance says that a way to do this is consensus building. In Japan, they call it Nemawashi, which means “work around the roots.” Nemawahsi describes using individual discussions with group members to get people on board with an idea. Chance says that having these discussions is like building a team with input and ownership of the concept. Chase says when you are using the method to build consensus, it is essential that you share the bare-bones version of your idea. Also, there is a strategy to whom you ask and when. For example, the first people or person is the decision maker. You are looking for advice about the idea and influence process here. The asking and their answer start to foster the idea of a team. Then, the next group or person is the person you think won’t like the idea. The idea behind this conversation is to hear their concerns so that you can resolve them. The last group or person would be people or a person you consider an ally. The point of this conversation is to get a commitment of support. This strategy will set you up with the best version of your idea that addresses potential concerns and already has some support amongst the group. Moreover, you will benefit from positive body language, like head nodding around the table, once you introduce the idea at a meeting, which will build positive momentum. The Power of No, for You and Others Chance’s book has a chapter about empowering yourself to say no. In some ways, that might feel like the end of influence. However, Chance says that saying no is one way that you can make yourself more influential to others. Chance uses this as the first challenge in the MBA course she teaches. It’s also part of her free course this fall, How to Ask for Anything. The exercise requires people to say no to everything for 24 hours. The idea is that it shows how often we say yes when we don’t want to because we are inherent people pleasers—and often more than we think we are. Also, it demonstrates how quick we are to give away our most valuable resource, our time. Saying no can allow you to be more influential in your life. In addition, practicing teaches you how to be better at saying no in a way that doesn’t make people feel bad. Chance says saying no is essential. You can’t influence people if you are tapped out and exhausted. If you give everything, you have nothing left. Also, once you get more comfortable saying no, you also get more comfortable hearing no. You realize it’s not as personal as you thought it was. People won’t hate you for saying it, and you won’t hate people for telling you no. Then, you feel comfortable asking for things because you realize a no answer is not the end of the world. Also, people get more comfortable saying yes because your invitation is more comfortable, warm, and low-key. In some ways, Chance reasons, saying no is the first step to becoming someone that makes other people want to say yes. So, What Should You Do with This? In addition to building a consensus and being reasonable with your time, Chance would encourage all of us to ask the magic question. The magic question is something that you ask that makes it possible to move forward. Chase says the magic question is: What would it take? Chance says the question feels like magic because it helps determine what you need to do to get what you want. It works for small things, like getting a child to clean a room, and big situations, like avoiding and global economic shutdown for a healthcare crisis. Chance says the question is transformational regarding influence in a positive way. Zoe Chance is a writer, teacher, researcher, and climate philanthropist. She’s obsessed with the topic of interpersonal influence and her science-based but fun and life-changing book is called Influence Is Your Superpower: The Science of Winning Hearts, Sparking Change, and Making Good Things Happen. It is being published in more than 20 languages. Zoe earned her doctorate from Harvard and now teaches the most popular course at Yale School of Management (Mastering Influence and Persuasion). Her research is published in top academic journals and covered in global media outlets. She speaks on television and around the world, and her framework for behavior change is the foundation for Google’s global food policy. Before joining academia, Zoe managed a $200 million segment of the Barbie brand, helped out with political campaigns, and worked in less glamorous influence jobs like door-to-door sales and telemarketing. She lives with her family in New Haven, CT. zoechance.com @zoebchance LinkedIn If you have a business problem that you would like some help with, contact me on LinkedIn or submit your pickle here. We would be glad to hear from you and help you with your challenges. [...] Read more...

FEAR! One of the Greatest Marketing Motivators of Human Behavior

November 3, 2022Fear is a powerful motivator for what we do. It is also a powerful tool for marketing. So, with Halloween coming up, we decided we would dive deeper into why this is and why it works to get people to do things. Some of the reasons might, well, scare you. Okay, they probably won’t scare you but will surprise you. See, we were tricking you. Wasn’t that a treat? Don’t worry; we won’t have any more Halloweeny things here. But on the video feed of the podcast, I did model my Halloween mask. So, why is fear so motivational? Fear is a primary and powerful emotion. It can tap into something primal for us humans, which causes almost involuntary responses. Getting people to care about what you have to sell is often challenging—getting people to care about something they don’t is also problematic. However, this task is the heart of a marketing person’s job. So, fear provides a motivational emotion that can get people to care—and marketing people like to use it to get their job done. Another way fear plays into customer behavior is our old friend Loss Aversion, which is part of the larger behavioral concept of Prospect Theory. Loss Aversion, you might recall, describes how we hate losing things more than we love gaining things. Therefore, we are sometimes less likely to risk things because we hate the feeling of losing so much. So sometimes, we say on the podcast, losses loom larger than gains. In other words, we get a stronger emotional reaction from losses than gains. However, it is essential to remember that while fear and Loss Aversion associate with each other, they only overlap. Loss Aversion can exist outside of fear appeals and the other way round. One example of the fear/Loss Aversion overlap is the fear of missing out (FOMO). Marketers often use FOMO. It works because we don’t want to be left out or left behind if there is some excellent experience everyone else is having. So there is fear here, but it isn’t terrifying or soul-crushing. My sincerest hope is that no one lies awake in their bed, unable to sleep because of a FOMO marketing campaign. So, an example of using this in marketing would be a renewal appeal for a subscription service. If a person doesn’t subscribe to the service, they will not get the 20 percent off offered that day. Another example was the launch of Tylenol back in the 1970s. The marketing team positioned Tylenol as a painkiller safer for your stomach than aspirin. However, only about one percent of the population had stomach problems from Tylenol. That didn’t matter; people thought Tylenol could save them from all that. Tylenol users didn’t have to worry about stomach problems, even if aspirin didn’t cause them any issues before. Drug ads today are slightly different but not above using fear as a motivator. For example, have you seen ads for drugs treating skin conditions like psoriasis? Psoriasis is a skin problem that causes unsightly sores that people who have it feel embarrassed to expose to others. The medicine ads show people with the condition doing things like wearing short sleeve tops in public or wearing a bathing suit around other people. The implication is that you don’t have to be afraid to show your skin and feel embarrassed because people are staring at your latest flare-up. A British comedian Michael McIntyre does a funny bit about bees and wasps: So which one are you? I’d like to think I am a wafter, but I might be a total panicker. I guess as a wafter I have that option, no? The point is, we all do this a bit, don’t we? We try to control our fear and be calm when we are freaking out inside. Horror movies are a great place for us to try out controlling our fear, or not. So, it is not my film genre, but other people like them. So, why do they seek out movies that will scare them? Or go to crazy roller coasters that seem to defy sound principles of engineering, haunted houses in old abandoned buildings, or jump out of perfectly good airplanes while skydiving? People do these things because fear is such a powerful emotion that it can appeal to us to feel it in “safe” spaces. We like the excitement of it and the adrenaline boost it gives us. But only when it is in a safe space where we aren’t in danger. So, we understand fear appeals and how it motivates us. We also talked about how it overlaps with Loss Aversion. However, if you want a fear appeal in marketing to work, you must provide a solution to the fear. It’s like Tylenol did with the stomach problems aspirin caused that 99 percent of people did not have. Political ads are masters at this tactic. For example, you have likely seen a few political ads in the US over the past month. Many times, a candidate will launch a campaign against their opponents’ political positions and voting records to demonstrate how they single-handedly destroy the American Dream and everything the founding fathers ever stood for. But, then, the candidate cashes in on this fear appeal by telling you how they would never do that, and if you vote for them, you have no worries. Home security ads also use fear to motivate sales. They show you what could happen if you don’t have one. For example, the Mayhem Campaign by Allstate is based on what could happen if you “don’t have the right auto insurance coverage.” Political campaigns, home security companies, and insurance firms use fear in their ads because it is very effective. However, there are risks. Fear-based ads produce intense negative emotions. Fear tends to be very harmful, so there is a risk that the negativity of your ad blows back on your brand. The more extreme the fear, the more blowback there could be. There is also the risk of reactance. Any time you persuade people a risk exists, you could get an unexpected response. For example, fear appeals favor the heavy-handed, and people don’t like to feel manipulated. So, if you come on strong with a fear appeal, there’s the risk that people will reject your message because they don’t like how hard you’re pushing. Worse, they can move in a different direction. For example, some of the anti-smoking campaigns blow up this way. If they try too hard, then the message could be interpreted by teenagers as, “oh, this is dangerous and cool.” Finally, there is the need we all have for dissonance reduction. Fear imposed on us by others can be very unpleasant. We sometimes go to great lengths to escape that unpleasantness, including psychologically disengaging. For example, if we see something that disturbs our sense of safety, we might say, “Oh, that doesn’t apply to me.” Sometimes, with the anti-smoking campaigns, young people will think, “Yeah, but that’s an old person’s problem.” These reactions reduce the effectiveness of the ad. So…What Should You Do with This Information? Fear works in marketing. Too much fear or not enough solution can mean it doesn’t. So, what does that mean you should do? Practically speaking, use fear appeals when they make sense but have a light touch. If you shake your audiences by the shoulders, screaming about how crucial it is to use your product to save themselves, you will likely lose them. However, there are a lot of things people don’t like. So, reminding them how they don’t like it and how your products or services avoid those things could have the effect you want. Fear is a powerful emotion that inspires a reaction from your customers. However, it can manifest in customer behavior in different ways. With a careful approach and a light touch of fear in your customer strategy, you can hopefully inspire behavior that is in your customers’ best interest while at the same time serving what’s best for your organization. If you have a business problem that you would like some help with, contact me on LinkedIn or submit your pickle here. We would be glad to hear from you and help you with your challenges. [...] Read more...

Despite All My Hard Work, My Key Performance Indicators Are Not Moving! Why?

October 27, 2022We’ve got a pickle. I love a pickle. Tonya Dunn, an insurance professional, wants to know why her Customer Experience efforts aren’t moving the numbers. She wants to know what we think they should do. For those who don’t know, Tonya listens to our podcast and is using our “I’m in a Pickle” feature. The pickle is a business problem with which she wants help. I am sharing her pickle here also because I am sure some of you have the same problem. We all need to move the numbers, as it were, so it’s a familiar business problem, and the advice will be widely applicable. There is a lot we can talk about here. (And if you want to watch us talk about it, check out our Intuitive Customer YouTube Channel) So, let’s begin from an academic viewpoint with some theoretical explanations for Tonya’s pickle. Let’s Start With Reference Points The first that comes to mind is Reference Points. This theory is a favorite of mine because it explains a lot of customer behavior. Reference Points describe what we use to compare one thing to another. This theory is helpful because we always evaluate things by comparing them to something else. That’s how our mind works for everything, including Customer Experiences. No experience is good or bad unless you compare it to something else, right? So, suppose we want to know why our Customer Experience scores are not improving and why our customers are responding positively to objective improvements that we’ve made. In that case, part of the problem might be that we don’t know their reference point. It is essential to know what customers use for comparison. It could be our previous performance or our direct competitors. It might be some experience they had in a completely different industry. So we need to know what that Reference Point is. Moreover, there are two Reference Points here, the customers’ and Tonya’s companies. The customer puts you up against their Reference Point, whatever that may be, and the organization is comparing against one, too, probably using its performance in the recent past. These are not right or wrong. Each entity uses different perspectives to evaluate an experience. However, it might be contributing to Tonya’s pickle. Most organizations, in my experience, don’t look at competition from a customer satisfaction perspective. I’m not saying all, but most don’t know how their Net Promoter Score® (NPS) stacks up against their nearest three competitors. However, comparing the competition’s NPS is essential because your customers might be doing that. So, even if you have performed better than you did last month and score way lower than the competition regularly, customers might not be ready to up their evaluation of you yet. However, this comparison to the competition works the other way, too. For example, if someone moved to Sarasota and wanted my advice about a cable company, I would tell them to choose one over the other. My NPS score for the cable company I recommended would still be low; they are not great. However, I would, in reality, recommend them because they were marginally better than the other one, which was loads worse. It’s a bit like politics, too. In a two-party system, there are likely two candidates you are not wild about in every way. However, one is marginally better than the other, so they get your vote. Making Experiences Easy to Evaluate The mention of politics reminds me of another theory that might relate to Tonya’s pickle. It’s the Evaluability Heuristic. You’ll remember that heuristic means a shortcut for decision-making. With the Evaluability Heuristic, we view a complex decision and make it simpler by using a metric that is easy to evaluate. So, for example, with politicians, people sometimes vote for the candidate that would be more fun to have a beer with rather than examining their stand on every social and economic issue or, if they were already in public service, their voting record for the past ten years. In this case, the candidate’s likability matters more than all that, and it’s because it’s easier to judge. I have an example from my customer behavior. As you might know, Europe has an energy crisis at the moment. So, I am considering adding solar panels to my home in England. However, I got the quote from the solar panel company, and it was three pages long and full of things I couldn’t make heads or tails of. So, instead of going through this whole thing line by line, I compared how many kilowatt hours I used versus how many kilowatt hours the system would output. The solar panel industry is very technical and has many brilliant people working there. So much of that information I skimmed over probably matters and is impressive, indicating a higher quality or product than the competition. But, like most people, I am not an expert in electrical engineering, so it isn’t very meaningful to me. In Tonya’s case, they might have made improvements in the areas of the insurance experience that regular people can’t evaluate. So, those improvements have yet to affect their NPS. But, finding a way to make it straightforward for customers to assess the experience might help. Other Factors Affecting Tonya’s Pickle Some other factors might affect Tonya’s results. It could be that they are measuring the wrong things. I had a similar thing happen recently with a company we consult. If you are familiar with my model for customer-centricity, Naïve to Natural, then I would describe them as Transactional, which isn’t the least customer-centric. Still, it is only the next level up from it. The company is very process and quality driven, which is fine but doesn’t consider the emotions of the business. Getting into emotions would move them to the next level of customer centricity, Enlightened. One of the impediments to progress was their current scores were very high in the metrics they used to measure performance. They couldn’t see that they needed to change anything else because they were getting nearly 100 percent on these metrics, so it didn’t seem worth spending resources to improve. However, they weren’t measuring customer emotions. If they had been, they would have seen they had enormous potential for improvement. (To their credit, this company took our advice and is making the necessary changes to take this on in their experience.) My point with this story is that there are different levels. It could be that Tonya’s company is measuring its performance on metrics that are too basic to see an NPS move. For example, if a hotel asks you if they provided a bed or if the room was clean, you might say yes, but not change your NPS evaluation of them. Why? You expect a room you pay for to be clean and have a bed. However, you might not expect a cocktail hour, free high-speed internet, a way to use your Netflix on the TV, etc. These are next-level hotel experiences that matter to you. Getting those things might change your score. In Tonya’s pickle, it could be that things are not moving because they are measuring things that don’t move that needle for customers. Going for improvement there might also be a waste of time because it’s already great. Getting it perfect will probably not be worth the time and resources needed for such a marginal improvement. Another factor might be that Tonya’s company is measuring the right thing in its self-evaluation of improvement, but the methodology is flawed. For example, the company might be using the wrong idea or aspect of the experience to track progress. That idea or part might not drive value for customers. Or it could be getting the number wrong, so you don’t have an accurate assessment. If you don’t measure what moves the NPS needle, you have a problem with your methodology. The improvement you make should be in areas that customers value the most. Providing those things will show in any metric you measure, from NPS to revenue to customer emotions. Finding what those things are is always tied to emotions. For example, in our work with Maersk lines, which we discussed in a recent podcast, we asked many questions, but the ones that pushed value were emotional. If Maersk had improved the questions they scored lowest on without considering the emotional engagement with that area, they might have spent a lot of money on something that didn’t fix their problem, such as a low NPS score. In another example, an auto insurance company did make that mistake. They asked customers on a survey what they needed to improve. The answer was that their billing required improvement. So, the company spent a fortune on fixing the billing, but customer satisfaction did not increase. Why? The customers didn’t care much about the billing system, despite what the survey results said. Those who have read my newsletters for a while know I often discuss this concept with a Disney Theme park example. Disney had asked theme park guests what would improve their dining experience in the park. Guests told them they wanted the option of a salad. However, Disney knows that people don’t eat salads at theme parks. So, they improved their possibilities of food that people like, which are squarely in the junk food category. So, What Should Tonya Do about Her Pickle? To answer Tanya’s question about her pickle, what should she do? We have a few things: Determine what improves your experience from the customer’s perspective: This requires understanding customers’ reference points. If you don’t know what they use to compare you, you can’t identify where your opportunities are. Ensure you measure the right things: Do the metrics you use to drive the outcomes you want in the marketplace? If not, change the measurement to get an accurate read of where you are. Provide what customers really want: If you improve areas that don’t matter (or don’t matter enough) to customers, then you spend valuable resources where you shouldn’t. Make sure that the improvement area you identified is something that matters to customers and would change their perception of your organization. Hopefully, this advice will help Tonya in her efforts to improve their scores. Do you have a business pickle? If so, contact us here and let us know. We might choose your pickle to solve on our podcast and YouTube feed. So, let us help you. If you have a business problem that you would like some help with, contact me on LinkedIn or submit your pickle here. We would be glad to hear from you and help you with your challenges. [...] Read more...

Incredible! Why So Many Organizations Are Missing This Massive Opportunity!

October 20, 2022This newsletter issue is the second of a series based on a podcast we did with Beyond Philosophy’s own Zhecho Dobrev (@ZhechoDobrev), author of The Big Miss: How Organizations Overlook the Value of Emotions. We talked with him before on our podcast a month ago about how emotions drive customer behavior. This week, we dive a little deeper into this concept and explore how emotions affect the insights we get from Customer Science. Customer Science is a relatively new development in the area of customer strategy. It combines data, behavioral science, and artificial intelligence (AI) to gain insight into customer behavior and predicts what they will do next. On another podcast, we learned about how AI has some shortcomings, but they are humanity’s fault. For example, some experts assert that AI is opinions written in code. That said, AI technology provides options for predictive analytics in experiences we never had access to before. We can anticipate customers’ needs tomorrow based on their behavior yesterday. Therefore, imperfect or not, we see that if AI is applied intelligently and with a deliberate approach, it has the potential to problem solve and help organizations achieve their customer strategy goals. One significant area that could use improvement regarding AI is the area of emotions. We know that emotions drive customer behavior. If people build AI systems and miss this, they can have problems. Dobrev addresses those areas of emotion and AI. AI needs a lot of data and needs to be the correct data. Therefore, the data must include emotional data. Otherwise, the insights you discover with Customer Science may not reveal the authentic drivers of customer behavior. Researchers and Customer Experience champions must be aware of this fact. Good Examples of Organizations That Get It Dobrev points out that some organizations already get this concept and are doing an excellent job gaining insights from it. First, he discovered a company through shared interests, conferences, and research articles, called NICE Enlighten AI CX Program, which he covers in the book. One of their clients was a big US bank. They discovered through AI analysis of hundreds of thousands of call center interactions that agent behavior leads to positive customer interactions. The behavior that led to these positive outcomes echoes Dobrev’s research in the book. Listening to customers, empathizing with customers, and showing respect led to positive results. The AI tool from NICE Enlighten AI helps agents by coaching them to better customer interaction and giving them a sentiment score, which measures the emotional outcome of that interaction, for each call. Another example of an organization using AI well was a mortgage company in the UK that used a model that predicted which contact center agent might be the best match for an incoming customer. It used the customer’s characteristics and history to match them to the different agent types in the contact center. Therefore, if a customer is more of a thinker, they would go to agent A; an actor might go to agent B, and so on. Dobrev also liked a Canadian Start Up using AI to predict when an account holder was about to default on their loan payment. The company works with large companies, like banks, telecoms, and the like, to determine through data analysis and behavioral science when a loan holder is likely to defer a payment, which is the first step in a default. Then, the start-up will intervene, nudging the customers to restructure their payments through a self-service menu. Moreover, the AI uses natural language processing (NLP) to determine the sentiment of the customer reaction. The next nudge they send will adapt based on this sentiment. Dobrev appreciates how that creates a more empathetic and proactive customer experience without driving more traffic (and costs) to the contact center. Moreover, it improves customer interaction. One of the significant problems in experience is replacing people with systems. While the systems do not cost as much and tend to be more efficient, they lack the flexibility to respond to change. Unfortunately, systems that cannot respond to a need to change transform an efficient and inexpensive experience into a bad Customer Experience in some instances. The start-up in Canada is an excellent example of creating the best of both worlds: an efficient and inexpensive system (compared to human labor) and the ability to respond to change when needed. Bad Examples Are There, Too Organizations jump on the AI bandwagon like any new trend without understanding it well enough. However, they think they do. It’s an example of getting insights from a Wicked Learning environment. Some of you might remember from our podcast on The Myth of Experience that a Wicked Learning environment is where you think you have all the information but don’t. Many organizations believe they have enough data to decide, but they don’t. Then, when these organizations go to build AI systems, they go wonky. Why? They don’t work because the AI is based upon what the organization thinks they understand about customers. Overall, the danger is that organizations build their AI-based solely on the assumption that the customer has only rational experiences and leaves out the emotional and behavioral sides of things. Without them, the nudges Zhecho describes in the good examples will not be possible. It’s an example of the old standby “garbage in, garbage out.” Guess what? If you don’t put anything into the data about emotions? You aren’t getting anything out about feelings—hence, “The Big Miss.” We believe that AI is the future. We don’t think that AI will replace humans. However, we believe that human managers who use AI will replace those who don’t. Likewise, organizations that use AI to create better customer experiences will replace those that don’t. However, it all starts with what data you have. Then, you can determine what information you need in the future to create the experience that you want. If we begin to get some of that together today, we can prepare for the greater good for organizations and customer strategy tomorrow. If you have a business problem that you would like some help with, contact me on LinkedIn or submit your pickle here. We would be glad to hear from you and help you with your challenges. [...] Read more...

Why Video is the Untapped Jewel to Greatly Enhance Your Customers’ Experience

October 13, 2022Why Video is the Untapped Jewel to Greatly Enhance Your Customers’ Experience We created this newsletter in partnership with Streem. Have you ever used the word “doohickey” or “thingymajig” in a call with a contact center? I have. I didn’t know what the whatchamacallit was, but I knew it wasn’t working. Unfortunately, the expert at the contact center didn’t know what the doodad I described was either, so we were at an impasse. We needed a better way to communicate. We recently had a guest on the podcast who has a solution for situations like these. Jóhann Hannesson, Lead Product Manager and the head of Web Development at Streem, says that video could be the missing link between your customer and the expert in the contact center. Seeing the whatsit on screen might mean the expert can help the customer faster. (And seeing us on screen might make this topic more fun. Watch The Intuitive Customer YouTube Channel here.) I could have used this in a recent exchange with Delta. I had a flight canceled, and my replacement routed me through Boston, which I wasn’t excited about. Online I found a flight with the same fare that routed through Atlanta. However, I couldn’t book it myself and had to call an agent. They didn’t find the flight for the same fare as I did. They wanted an additional $500 for the fare difference. I told them the online fare was different, but they sounded skeptical. I thought, wouldn’t it be great if I could show them on my screen so they would know I was an honest bloke? If we had a video option to communicate, the entire experience would have been better for both sides of the call—and I would have the flight I wanted on an upcoming trip. Video can be the untapped jewel of your experience design. The video is excellent for these situations because it allows the customers and contact center teams to work together on the problem. If the contact center or tech support relies on a customer, who is not an expert, to relay the details of the problem, there could be communication failures (I’ll refer you to the nonsense words above). The video takes this imbalance out of the equation. Also, it facilitates communication by allowing two people to look at each other and the problem together and collaborate on a solution. Hannesson says contact centers can have what feels a bit adversarial to their setup. For example, in support experiences, the employee questions the customer about the problem, gently challenging the facts. Why? The employee wants to understand the real problem, which may or may not be what the customer is saying it is. For example, have you ever called tech support for IT and had them ask you if you turned on the technology in question? The question can feel insulting if that isn’t the problem. However, tech support starts there because it is ruling out some of the more straightforward solutions to determine if the problem is real or not. Hannesson says Streem allows contact centers to bypass that authentication experience and quickly gets to the real problem. Instead, a link goes to the customer to hop on a video call with support. Then, the two can look at the situation and work together on a solution. Some support situations where this works exceptionally well are with an outdoor grill or an eBike. With the video call, the customer can show the tech the “real” problem with the thingamabob down by the whatnot. As a result, organizations no longer rely on customers’ technical understanding, which can be challenging for non-expert customers. In addition, customers are no longer negotiating facts—and getting frustrated—with the company. I have another example where this could have helped me. I wanted to install a rear-facing camera on my car, but I didn’t want the cable to interfere with the liftgate. In my phone conversation, I had a hard time communicating my concerns. With a video call, I could have shown the company what I meant. Video feels like a natural next step for contact centers. Not only does it smooth out these friction-ridden experiences on the phone, but it could also save organizations a lot of money. For example, expenses related to sending an engineer to a customer site at British Telecom would have decreased. When I worked there, the cost of a phone call into a call center was £3 to £5 (or about $3 to $5). The cost of sending an engineer to a customer site was about £40 ($40). If the engineers brought the wrong part and went to see the customer, that’s a lot of money wasted. A video call that confirms the part needed could have prevented expenses like this one. Hannesson says most of Streem’s customers realize these cost savings through first-time resolution or avoiding a truck call altogether. However, it saves customers money, too. Hannesson says video enhances the quality of life for folks involved here and streamlines the process while saving customers and the organization money. For example, he says that often the technician has common parts on the truck when they go out for a service call, but not everything. Suppose the problem involves one of those parts, then great. However, if the technician comes out and spends $100 of their time, which is $100 of the customers’ money, to find out the problem, then returns to fix it, they rack up more charges. Streem allows the employee to have the customer move the phone up to where the part is and tap a button. Streem’s product then takes a screenshot from the phone with the Part ID number or barcode they can look up. The employee might be able to mail the part to the customer or send it to the technician on the first trip. As a result, the company saves money, the customer saves money, and everyone enjoys a shortened repair or service cycle. The Psychology of Video In addition to providing a higher level of information, there are other reasons we humans like video. Video facilitates communication. We like looking at another person when we talk to them. It creates an interpersonal rapport that isn’t possible over the phone. Plus, it facilitates all the nonverbal communication we use in our daily interactions. Hannesson agrees that video enhances the communication between people, adding that it also elevates the employee experience at the contact center. For example, Streem’s eBike client noticed that call times in the contact center went up significantly once they employed Streem’s product. This increase triggered an inquiry. The eBike company learned that the expert on the call was using that time to have a showroom-style bike session with the folks calling in. The experts loved it because it felt like the customers were with them, and they could share experiences and anecdotes, making a personal connection. Before, they might have received the call, run through the script, hit the checkbox, and moved on to the next call. So, employee satisfaction was high because the employees felt they could provide excellent customer service and build relationships with customers. Their employee for the contact center Net Promoter Score® was in the 90s. Other Streem clients have also found benefits of video. For example, responding to in-person service calls with available technicians has been challenging with the post-pandemic labor crunch. So, streamlining that process and eliminating the need for some in-person calls has been helpful for response times for these companies. A boiler company in the UK could increase their sales quotes for boiler installs by 200 percent because they didn’t have to go on site. Instead, they could see the video, do an assessment, and create the quote. It was a colossal cycle time improvement. In addition, fewer people can do more work, which is helpful for companies fighting for talent in a thin talent market. Video also enables direct feedback from customers. Hannesson says that after using video for a while, it was clear that some common problems existed. This data allows organizations to build a strategy for handling these situations efficiently and effectively. For example, American Home Shield had this experience. They use Streem for the majority of their warranty claim support cases. Using video for their assessments, Hannesson says American Home Shield eliminated repeat home visits on 70 percent of their calls, a massive reduction. Also, they resolve ten percent of their calls without an on-site visit. These calls required cleaning something, making a minor adjustment, or doing a hard reset, which contact center agents could handle on the video call. So, What Should You Do with This Information? There are a few practical things an organization can do with this advice. First, start small. Hannesson says that many companies have a good idea of what (expensive) problems lend themselves to video resolution based on the escalation in the contact center because more information is needed. Next, look for employees in the contact center who can help identify times when seeing the customer’s problem would enable swift resolution and the questions necessary for triage. This approach gives you a starting point and makes it easier to train with the new video solution. Finally, once people gain comfort and experience some wins with the contact center video technology, the employees can expand the use cases for the video calls. This technology is the kind that I like to see. It isn’t technology just for technology’s sake or a new toy. It’s a practical solution to a real business problem. If a video can solve challenges that improve efficiency and customer and employee experience, it is worth a look. There’s never a time when building a relationship with customers will be a bad thing for an organization. Video can be that facilitator. By seeing your customers, solving their problems, and providing excellent service that you couldn’t over the phone, you are bound to have great things happen. If you have a business problem that you would like some help with, contact me on LinkedIn or submit your pickle here. We would be glad to hear from you and help you with your challenges. [...] Read more...

Memory Mini Series Part 3: How Memories Can Be Altered and Why We Forget Things

October 6, 2022Memory is one of my favorite topics in the behavioral sciences, so we did a podcast series on them. This newsletter is the last of a mini-series on memory, the series finale. Last time, I wrote about the network structure of memory and how the different types of memories we have connected in surprising ways from the information we shared on our second podcast. This issue will discuss how we store, retrieve, and forget memories. If you’d like to listen to part 1 of our mini-series you can find that episode here. Memories are essential to Customer Experience, and their importance is often underestimated. Memories link us to our past while at the same time affecting our actions today. If you think about it, memories define us. How We Remember Things and Make It Easier for Ourselves When we talk about memory, two core processes handle storing and retrieval. However, to understand how things are stored, you must first know the limitations of memory. When items are not stored, we are not working with the system as designed. In other words, we expect too much out of memory. As we discussed last week, memories exist in network structures. So, if you want to remember something, it helps to tie it to other ideas already there. For example, mnemonic devices, like reminders or cues that link ideas, serve as a shortcut to make remembering easier. Some people use visualization of different rooms where they place various parts of the information they want to remember. Then, they “walk” through the rooms, collecting the data. However, some people remember things based on images or smells, called multisensory memories. The additional inputs help solidify the information a person needs to remember. So, suppose we can reduce a complex set of ideas into an easy-to-remember acronym. In that case, it becomes easier for us to remember because we’re compressing that into a smaller idea. For example, anyone who has taken Trigonometry and learned about trigonometric functions (or is the parent of someone who is) is likely familiar with SOHCAHTOA. This acronym stands for sine equals opposite over hypotenuse (SOH), cosine equals adjacent of the hypotenuse (CAH), and tangent equals opposite over adjacent (TOA). This trig trick is an example of taking a more extensive, challenging-to-remember set of info and making it easier by connecting the ideas to a shortcut. How Do We Retrieve Memories So, now that we have some context about how we remember things and make that easier let’s look at how we retrieve memories once we form them. But, first, it would be helpful to understand the Zeigarnik Effect. Named after the Russian psychologist Bluma Zeigarnik that first identified this phenomenon in 1927, the term describes how we remember interrupted tasks easier than completed tasks. In other words, goals influence our memory. If you have an active pursuit, you are more likely to remember things related to that goal. However, once the purpose is satisfied, you free up that memory to work on something else. For example, if you cram for an exam in school, you remember that information. However, a week later, you would fail that same exam. Why? The failure is an example of the Zeigarnik effect; you remembered it when you needed to pass the exam but let it go to make room for other information afterward. Repetition is another way we remember things. For example, when you learned the multiplication tables or the alphabet, you repeated them over and over. I have an example regarding the repetition of something driving me mad at the moment. We had a sofa ordered and scheduled a pick up for the old one the same day the sofa company would deliver the new one. The old one left, as expected, but the new one didn’t make it. So, now we sit on fold-up chairs in the living room while we wait—and I am thoroughly annoyed. Every time I go to the lounge and sit on what is not my new sofa and is not comfortable, I get more aggravated, reinforcing my bad experience with the sofa company. This example shows that I am an impatient and unforgiving customer when things are late. However, it also indicates the reinforcement possible for memory with repetition and powerful emotions. Other things easily remembered are what goes in first and last. For example, accountants talk about the LIFO method, or last-in, first-out for inventory. LIFO means that the last thing ordered will be the first one sold. Our memories can work similarly to LIFO; only we call it something else in psychology. The first thing remembered within a category or setting tends to stick, called the Primacy Effect. After that, however, the last item will stick, too, which is the Recency Effect. Forgetting It Have you ever walked into a room purposefully and then forgotten what you went there for? It’s maddening. It is impossible to talk about memory without also talking about forgetting. We have already discussed the difference between short-term and long-term memory. Short-term memory is for things like one-time passwords, and long-term memory is for things like your childhood. However, one influence on them that we haven’t talked about is storage decay. Storage decay gets back to some of the biology of memory. So, we think about memory in our minds instead of our brains. It can feel magical; we store this information in a certain way with networks and connections, all of which are abstract representations of the biology occurring. However, the reality is memories are chemical traces left in the neurons. As you remember things, you leave more profound chemical traces or overlay those chemical traces, which leads to a stronger memory. However, chemical traces decay. So, the information we haven’t engaged with in a long time becomes weaker and more challenging to access than those memories we access all the time. This effect is memory decay. In other words, it goes away if we’re not using something. (An interesting parallel phenomenon is the Google Effect. The Google Effect is that we use our memory strategically. As a smartphone and tablet-enabled species, we humans don’t remember facts as well as we used to because we have access to information. We now remember how to get to the data rather than the information itself.) Our memories are not as reliable as we think, either. Other people can manipulate you to misremember things. Elizabeth Loftus is an expert in misremembering things. Loftus talks about some ways that our memories can go wrong. For example, she describes an experiment where two groups watch the same video of a car accident. In both cases, she asks the viewers to estimate the speed of one of the cars in the accident. However, she uses different words in her request. In one question, she uses the term “hit,” and in the other, she uses the word “smashed”: How fast was the car going when it hit the other car? How fast was the car going when it smashed the other car? The group that heard the word smashed estimated that the car’s speed was much faster than the group where she’d used the word hit. Later, the group that listened to the word smash were twice as likely to say that there was glass on the floor from the car wreckage. However, in the video, there was no glass. So, we think of memory like a Word document, where we save it and retrieve it just like we kept it. However, that is not accurate at all. Our memories are fluid and easy to influence and change. Recent research on memory suggests that every time we remember something, we erase that memory and rewrite it. So, it is possible that every time we remember something, we remember it differently. What Does This All Mean? Memory is critical from a customer experience perspective. Professor Daniel Kahneman said we don’t choose between experiences; we choose between the memory of an experience. So, understanding how memories form is essential to designing an experience. What we need to do is a few things. First, we should consider how we handle mistakes in the experience. For example, if you have a system requiring the customer to recount their problem more than once, you might have them rewrite the memory and make it worse every time they repeat it. Part of this is natural. When telling a story, we try to focus on the elements that make it compelling. But, if it was a problem, finding and emphasizing the exciting parts will make them more extreme over time. So, even the most conscientious person trying to be accurate might end up remembering the story more negatively over time. So, consider if you are building into your procedures a process that makes customers’ negative experiences more memorable, intense, and damaging over time. Perhaps look for ways to minimize repetition of the negative experience or find ways to turn the experience positive, quickly, and work on repetition there on the positive side. The language you use is essential, too. As we learned from the word smashed, it matters how you ask questions. In our Memory Maker Training, we cover these issues. Once you’ve defined the experience you’re trying to deliver, making a customer feel valued or cared for, whatever it may be, the words, phrases, and body language should provide that. They should reinforce making that memory. In addition, we would have you consider how those memories are structured and what the inputs are to those structures. How are individual memories made? Are they implicit or episodic? Emotional or explicit? It is essential to map out how your inputs into the experience help form these memories. Customer Science takes the concept of memory full circle. Customer Science is the future variant of customer experience, built upon an understanding of behavioral science, data, and AI. So, are you making the AI system with that in mind to replicate customers’ memories and the data part of Customer Science? Are you dragging in the data sources to build that network of memories? We can draw an interesting parallel between artificial intelligence and human memory. It turns out that a lot of AI systems are just about looking for similarities and co-occurrences. Our long-term memories form the same way. This network structure is formed by things happening at the same time in nature. So if we’ve got an AI system that can track how often ideas co-occur or experiences co-occur in our systems, there may be opportunities to see what ideas our consumers associate in their minds. I hope this mini-series has been helpful. We believe that memory is essential to customer loyalty and retention in your experiences. Understanding how and why they form, where they are stored, how you retrieve them, and why you forget them is essential to designing a customer strategy that works for your organization. Now, it’s your job not to forget. If you have a business problem that you would like some help with, contact me on LinkedIn or submit your pickle here. We would be glad to hear from you and help you with your challenges. [...] Read more...

Memory Mini Series Part 2: Loyalty is a Function of Memory. This is How Memories are Built.

September 29, 2022Memory Mini Series Part 2: Loyalty is a Function of Memory. This is How Memories are Built. This newsletter is the second in a 3 part series related to one of my favorite topics in my continuing mini-series on memory. Last time, we discussed how recall drives our behavior and where memories are formed based on a podcast that covered the same topics. In this issue, we will cover how memories are connected and the different types of memories we have. Memories exist as a network structure. What that means is that no memory is isolated from all other memories. They’re tied together. One way to think of the memory network is to picture a fishing net flat at the bottom of a shallow pool. This net represents our network of memories, so each knot in the net symbolizes a single memory, and the shallow pool is our subconscious. Everything below the pool’s surface is our long-term memory in the background, like storage. When we remember something, we retrieve it from our long-term memory and put it into our short-term memory. So, imagine that retrieval is you grabbing one of those knots in the net and pulling it up past the surface. Once it’s past the surface, it is now into consciousness. We now remember that. However, when we remember something and grab that knot, it drags along the rest of the net. So by remembering this one thing, it breaks the surface of the water, but so do a couple of other knots in the net. Now, we may also remember related ideas. However, the other ones, the knots that didn’t break the surface, are closer. Therefore, even those memories we were not choosing to remember now are more active and influence us. For example, if you were choosing a restaurant for dinner and decided you wanted Indian food, you might think of some nearby Indian restaurants you like. However, you might also think of some that are not nearby, or maybe even India itself. Or perhaps you think about a favorite character in a television show you liked who had a funny bit about hating Indian food and its effects on their digestive system afterward. You might even remember that the neighborhood nearby to your favorite Indian food place also has an Italian place you like, in case you change your mind. All of these knots (aka memories) were drawn to the surface by the retrieval of Indian restaurants in your memory. The Different Types of Memory Memories, while connected, are different. We have various types of memories. For example, we remember vacations as a kid, but we also remember the dates and facts about famous battles of history. These are very different types of memory. Psychologists came up with categories of memories, which include: Explicit: Explicit memories, or declarative memories, are like memories that you would find on a test, like historical dates, times, names, and other bits of factual information, like passwords. Implicit: Implicit memories are procedural memory of the order you do things or how things work, meaning remembering how to make a recipe or log into your computer. We might learn this explicitly, memorizing it, but we often learn implicit things by doing it. Habits are also like a memory, and many times, they’re best considered as this procedural implicit memory. They tend to be procedural or implicit, and you access them automatically. Episodic: Episodic is the type of memory that would go into your journal or diary. Many Customer Experience memories are episodic, like the last shopping trip or vacation. Evaluative: Evaluative memory is different than these other types in that it describes how you feel about the memory when looking back on it. Evaluative memory is the context we use to talk about the Peak-End Rule. Nobel Prize-winning economist Professor Daniel Kahneman came up with the Peak-End Rule. The Peak-End Rule describes how what we remember about something is the peak emotion or the most intense feeling we had and how we felt at the end. These two moments form memories. From a Customer Experience perspective, the Peak-End Rule is essential. It clarifies what two moments are the priority in any customer experience and also begs the question of what emotion you want your customers to feel. That question begs another: What emotion drives the most value for you? Professor Kahneman also came up with something that I had a profound effect on my thinking about memory. He said that customers don’t choose between experiences but their memory of them. So, therefore, the experience isn’t as essential as the customers’ memories of it. Therefore, for your customer strategy, managing the Evaluative memories your customers have is vital. Working all of this in your customer strategy is essential to getting customers to remember you the way you want and come back for more. Let me tie this back together with the fishing net. There are no separate fishing nets for these different types of memories. Remembering an explicit or declarative memory pulls up a network that might contain other explicit or implicit, or episodic memories. All kinds of memories are tied together in the net, and remembering this (explicitly, of course) is essential for managing customers’ memories of your experience. I love the fishing net analogy. I also love this subject and look forward to our next part, the series finale. In the final installment of our mini-series on memory, we will examine how we store memories and what techniques we have for that. We will also look closely at why we forget things. But, perhaps most importantly, we will discuss what all of this memory stuff has to do with customer strategy and how you can apply it practically to Customer Experience. So, whatever you do with this information, don’t forget to check back here for our third part of the mini-series on memory. If you have a business problem that you would like some help with, contact me on LinkedIn or submit your pickle here. We would be glad to hear from you and help you with your challenges. There you have it. No promotions, no gimmicks, just good information. Think reading is for chumps? Try my podcast, The Intuitive Customer instead. We explore the many reasons why customers do what they do—and what you should do about it. Subscribe today right here. [...] Read more...

Memory Mini Series Part 1: Our Behavior is Motivated by What We Recall. So, How Are Memories Formed?

September 22, 2022Memory Mini Series Part 1: Our Behavior is Motivated by What We Recall. So, How Are Memories Formed? This newsletter is the first of three I will publish on the subject of Memory. Memory is fascinating and a broad topic related to experiences. Therefore, one issue of the newsletter won’t be enough. In this issue, we explain why memories are essential to experiences, when we use them to decide sometimes, and how memories form. So, why is memory crucial? It’s essential because understanding people, particularly customer behavior, mainly involves memory. We remember things like previous experiences, relationships, and emotions as we go about our lives, and these memories guide us forward. Therefore, memory is vital to understanding almost everything, even at the moment. Memories define us, from what to do to who we trust. The context of memory helps us understand the cues that influence our actions. Heuristics and Memory Sometimes when we think about things or make decisions, we use shortcuts called Heuristics. I have written about a few of these before in this newsletter. An example is the Evaluability Heuristic, which describes how we assign more importance to something easy to evaluate in a decision. Most of us do this at some point or another. For example, we might buy a car because we like the seats’ comfort. Or vote for a politician because we think they would be more fun to have a beer with than the other. But is that because of memory or how our brains work? The Evaluability Heuristic’s universal nature indicates that it might have more to do with how our brains work than memory. However, we learn other shortcuts from memory. For example, Stereotyping is when we make assumptions about people or situations based on experience. An example is a bias we have for physical attractiveness. Often, we assume attractive people are more friendly or successful, or other positive things, than we would someone we find less attractive, which research suggests is a widespread assumption people make. But, again, memory influences this intuitive response. So, as we receive cues about the world around us, our memory forms those into these shortcuts that we can easily access. So, does memory bias us and lead to specific decision rules or heuristics? Yes, memory can prejudice us in many ways. Memory and Customer Experiences Moreover, we like patterns. Professor Daniel Kahneman, Nobel-prize-winning economist and the father of behavioral economics, described us as “pattern recognizing machines.” He implies with his playful description that our brains like patterns, and we couldn’t turn off this preference even if we wanted to. So, we usually don’t. Hence, the stereotypes and jumping to conclusions we are fond of as a species. We see this pattern recognition in customer experiences, too. For example, you sometimes know by subtle cues whether a company will give you the hard sell. Or you can tell what’s coming next based on the steps you experience. These are learned based on how you felt the last time you were in a hard sell situation. Many of us are uncomfortable in these situations, so we develop a sense for when we see signs that we might end up in one again—and a trusty escape route. However, memories in Customer Experiences manifest in all kinds of ways, including: Remember what you like off a menu at a particular restaurant, which drives your decision-making the next time Reading the prices at a retail store and thinking that things are more expensive than they used to be—a familiar one these days Feeling a fondness or repulsion by a brand, as brands are just a collection of memories in a customer’s mind Thinking an experience was good or bad is based on comparing previous experiences from the same place or other places Having expectations about what will happen in an interaction with a company formed from previous interactions As you can tell, memory is vital in customer strategy. So in many ways, managing your customer experience is managing customers’ memories. The Significance of How Memories Form Understanding how customers’ memories form is foundational to managing customer expectations, experiences, and behavior. So let’s first explore how memories exist in our minds. Memories do not exist in isolation. Instead, our memories live in a network structure, meaning each memory is connected to many other memories. So it’s helpful to think of memories branching out in connections. Memory is also classified into two types, short- and long-term memory. Sometimes people call short-term memory working memory. Think of it like the things you are working on now. Working memory is immediately available to you, just like the project on your desk. However, once you have worked with the memory enough, you file it away. Picture a project file you store in a filing cabinet. The filing mechanism is long-term memory. Sometimes, you don’t file the working memory; you pitch it in the memory wastebasket, like a discarded draft in a crumpled-up ball. Once you do that, it’s often gone. It never makes it to long-term memory. For example, we are redecorating the house, and I need to buy some electrical sockets. When buying them, I used some aspects of the electrical sockets to compare. However, after buying them, I discarded those criteria, crumpling them into the wastebasket. Now, a few days later, I can’t remember what I used to compare them. However, emotional experiences often automatically make it to the filing stage. It’s as if the long-term memory says, “Clearly, that’s something we want to hold on to.” That said, some dumb things can also make it into long-term memory. For example, I can rattle off my telephone number from my childhood. I don’t know any of my children’s mobile numbers to save my life today, but that disconnected line will be there forever. There are advantages and disadvantages to both kinds of memory. Long-term memory is crucial because it’s our experiences. However, long-term memory is also not as immediately available to us. Short-term memory is helpful in the moment and easy to access and use, but not always available later if we need it Next week, we will continue the memory subject in our second part of the Memory Mini-series. Over the whole series, we will cover the different types of memories, how we store them, why we forget things, and, perhaps most importantly, how all this memory stuff applies to customer experiences. So, please remember to come back next week. If you have a business problem that you would like some help with, contact me on LinkedIn or submit your pickle here. We would be glad to hear from you and help you with your challenges. There you have it. No promotions, no gimmicks, just good information. We hope you enjoyed this issue of Why Customers Buy. If you have, please forward it to a friend or colleague. Think reading is for chumps? Try my podcast, The Intuitive Customer instead. We explore the many reasons why customers do what they do—and what you should do about it. Subscribe today right here. [...] Read more...

September 15, 2022The Big Miss: How Organizations Overlook the Value of Emotions We all had different ways of coping with the lockdown. Some started knitting or scrapbooking. Some of you binge-watched all of Netflix. Some of you read books. One of the things we did on the Beyond Philosophy team was look at data. What we discovered became a book, and we had the author on as a guest in a recent podcast. So I thought I would share what he said here with you. The data came from our Emotional Signature product, which is research that measures the emotional engagement you have with your customers. However, we’ve collected quite a database over the years with many projects. Zhecho Dobrev, Senior Consultant at Beyond Philosophy for 13 years, Customer Experience and Behavior Science Consultant and Trainer, and, now, Author of The Big Miss: How Organizations Overlook the Value of Emotions, digested all that data and wrote a book about it. You can follow Zhecho on Twitter here. I always told the team that we were sitting on a gold mine with all our consumer research projects using Emotional Signature research, and it is true. Since 2005, the Emotional Signature has been a project where we determine what drives value for an organization’s customers. However, we’ve never looked across the whole thing and said, what is this telling us? However, Dobrev did. He looked into how valuable relationships are to organizations and how we can prove them. Then he looked at all the customer journey maps and how they helped form a customer relationship. Finally, Dobrev explored how important emotions are to organizations, what role emotions play in the Customer Experience, and what that was worth to the organization’s bottom line. Dobrev’s book, The Big Miss, is based on 20,000 customers from 24 organizations within nine industry sectors, including finance, healthcare, telecoms, utilities, and others. There were nearly 60 models, and almost half were business-to-business companies. There were also customer responses to almost a million questions in the US, UK, Canada, and Europe. In many ways, Dobrev says, this is very representative of a global study across different industries. Dobrev discovered three primary findings from this deeper dive on 20 years’ worth of data: 1. Emotions matter a lot. The most significant driver of emotional attachment was customers feeling they had a relationship with the company. Feeling that the organization cared for them as a person, listened and understood them, and responded to their needs reliably was more crucial than even the product experience, including price, reliability, and brand promise. 2. Customers won’t say it. If you wait for customers to tell you that emotions matter a lot to them, you will be disappointed. Most customers will tell you that price or product reliability is their most important thing. Emotions come way later and far down the list of customers’ stated priorities in decision-making. People are notoriously bad at telling you the real reason they do something; they can tell you, but it won’t be the real reason. However, it’s not deception. They often don’t know themselves. 3. People fail to act on what they fail to notice. Research is only as good as the questions you ask. Therefore, your research findings will not reflect their importance if you neglect to ask about emotions. We know customers have feelings, for good or bad. If you do not include them, you are creating what we described in a past newsletter about The Myth of Experience as a Wicked learning experience. A Wicked learning experience means that you think you have all the information but don’t. Therefore, you have not learned what you thought you did. In other words, just because you didn’t ask about emotions doesn’t mean emotional context is not critical to the decision-buying process. Dobrev’s book covers seven areas that will help organizations understand the importance of these findings and use them in their experiences moving forward. There is a mix of strategic things and tactical ones. In the strategic area, Dobrev covers areas like measuring emotions in your customer feedback, engaging in more implicit research, finding the difference between what customers say they want and what actually drives value, focusing the experience design on emotions, and measuring emotions in the employee experience also. Tactical suggestions start with simple things, like demonstrating that you know customers and care about them by trying to build a relationship with them. An example of a tactical suggestion that was small but worked was in a project with American Express. Adding the text “member since XXXX” to the front of the card was a powerful tool for acknowledging that they knew their customers. For example, Dobrev uncovered in his research a quote that American Express executives shared that one customer didn’t cancel the card because it read the customer had been with them for ten years. Knowing customers is essential to building a relationship. For example, when I walk into my house and shout hello to my wife Lorraine, I know how she feels in one word from her intonation—and whether I should walk straight out through the door again! Also, because I know her so well, I have many things I can do that will make her feel better if she’s unhappy or worried. Your employees will not know their customers like their spouses or significant others. However, employees can read body language, gestures, tones, and all the other little cues customers give that communicate how the customer feels. Then, once employees know how customers feel, employees can convert customers to feeling the emotion that drives value for the organization (or keep customers feeling the emotion if employees are lucky enough to land there already). So, What Should You Do to Ensure You Don’t Miss it? There are few insights an organization can glean from Dobrev’s insights. However, we have suggestions for an organization reluctant to miss out on the benefits of managing the emotional experience and outcome in a customer strategy. Accept that emotions have a place in your functional design. At a basic level, the primary thing organizations can do to ensure they don’t miss is to accept that emotions are a part of the decision process for customers. As Dobrev’s research shows, that step alone will put you ahead of the game in this area and ahead of your competition. Have a game plan. Your customers have emotions all the time; before they interact with you. They often come into a direct experience with an emotional state that needs management. Your emotionally intuitive employees will pick up on that and manage those customers with care. However, not every employee understands how to do this or even recognizes the emotional state of customers. Therefore, you must consider training employees that need help in this area. How can they acknowledge and support customers’ emotions and manage the experience to an improved outcome? What words and actions can employees use to enhance customers’ emotional experience? Having this game plan is essential for your customer-facing teams. Design an experience focused on evoking strategic emotions. One of the things we talk about in this newsletter (and books, blogs, and podcasts), is having a strategy to evoke a feeling that drives customer value and inspires the customer behavior you want. Suppose you only focus on efficiency or profitability in your customer process. In that case, you miss out on an enormous opportunity to build a relationship with your customers that leads to customer retention and loyalty. Showing customers you value their relationships and that they can trust you will make a significant difference in your organization’s customer engagement. The Emotional Signature is where Dobrev’s research from the organizations originated. We designed this to help organizations figure out where their customers’ unmet needs were in the market and also identify the emotions their experience should evoke to drive customer value. As a result, many of these companies discovered that it changed how they looked at customers and their market. If you have a business problem that you would like some help with, contact me on LinkedIn or submit your pickle here. We would be glad to hear from you and help you with your challenges. There you have it. No promotions, no gimmicks, just good information. We hope you enjoyed this issue of Why Customers Buy. If you have, please forward it to a friend or colleague. Think reading is for chumps? Try my podcast, The Intuitive Customer instead. We explore the many reasons why customers do what they do—and what you should do about it. Subscribe today right here. [...] Read more...

5 rules for a highly successful customer experience implementation with amazing ROI! – A case study

September 8, 2022 Over the 20 years of my Customer Experience consultancy, I have led Customer Experience program implementations. My best was with Maersk Line, the largest shipping container company in the world. The results were a 40-point increase in their Net Promoter Score® (NPS) over 30 months and a 10 percent increase in shipping volumes. Implementation is everything in these success stories, and today I want to share the five rules for proven success with a CX implementation. On a recent podcast, we had a guest, Michél Patterson, a continuous improvement expert in Lean Six Sigma who has consulted numerous industries, including technology, freight forwarding, and even the Department of Defense. Patterson shared her five rules for a successful implementation, which were: Define. Measure. Analyze. Improve. Control. Let’s dive deeper into each of Patterson’s rules, shall we? Rule #1: Define. For those of you familiar with Lean Six Sigma, you probably recognized the five rules. Patterson says that for her first project in the implementation area, these were the natural inclinations she had. For the first phase or rule, Define, she worked to discover what the company wanted to accomplish with the program. It is surprising how often this gets skipped and bad results arrive from cutting it. However, having that clarity drives the actions that follow throughout the rest of the project, she says. Discovering this definition required talking to the team. Patterson and her team spoke with the customer service teams, customers, and sales teams. They found that there were many moments where the organization interacted with the customer throughout the journey. Therefore, they viewed the project title as a customer experience innovation, part of a business strategy. Then, they needed the senior management to buy in on that project title. For Patterson, there was a contact, Hannah, who was that sponsor. Hannah sailed the project in the organization with the executive management board, and it helped Patterson move her project deeper into Maersk. Next, she assembled her team within the organization. She included people in the organization from different parts of the world and at different levels of the organization. This diversity brought many perspectives to the project implementation, which was vital. Rule #2: Measure. In the measurement phase, implementation teams establish what they consider an improvement. It could be increased market share, improved NPS, or higher customer retention. Whatever you choose as the metric, Patterson says, it is essential to get a baseline early so, as you test things, you’ll recognize improvement. In this phase, you also need to get the voice of the customer and the voice of the process. Regarding customers’ voices, you are looking to understand what they value. This bit, you might recall, is part of Beyond Philosophy’s idea of the Emotional Signature. For example, I always share the story about Disney asking guests what they wanted to eat in the park and the guests saying, “a salad.” But people don’t eat salads at theme parks; they eat junk. So this story demonstrates how people cannot always tell you what they value about your experience. Regarding the voice of the process, Patterson says this was the idea behind the Naïve to Natural model we use at Beyond Philosophy. She wanted the organization to recognize that the way they had their customer process established reflected who they were as an organization. Therefore, it was essential to assess where the company was on the model and identify areas of opportunity to improve the experience there. Moreover, these were areas we revisited throughout the process of the Maersk project. The measurement consideration comes at the beginning before we do things. People often assume that whatever action they take, the results will automatically show whether the action was successful. However, this assumption is false. First, one must establish how to measure the results. Then, once you take action, you can measure—and see—your success. Rule #3. Analyze. Patterson explains that by this rule or phase, an organization can determine what actions will result in improvement. In other words, for Measure, you ask, “What is the journey?” In Analyze, you ask, “Which areas can improve that journey?” Then you test your ideas in pilot programs. There were three emotions Maersk Line wanted customers to experience. So, they designed pilot programs to evoke those emotions. To increase success for the Analyze stage, Patterson and her team involved as many people as possible from the company’s various locations. For example, one engagement activity was a Brown Paper Fair, where the customer experience innovation team put brown paper on the wall and asked the employees for suggestions on what to do about things. In another, groups of the team would gather the information from other people, which they called Maersk Google. Patterson recalls that this was a fun activity that inspired one team to collect data (Google) dressed up in cow costumes. Rule #4: Improve. After testing, the next phase is rolling out the pilots on a larger scale. Here, Patterson says, is where you learn whether your changes implemented in the pilot are an improvement or not. There wasn’t a massive budget in the Maersk case, so all possible ways to innovate the experience involved little (inexpensive) changes. However, that turned out to be a strength. The little strategic changes they could afford to make with their budget significantly affected the outcome. For example, more employees took ownership of the customers’ needs and thought about the customer in a new way. Even this change in mindset had an enormous effect on the experience. Best of all, the changes happened quickly, and employees loved it because making customers feel better made employees feel better, too. Rule #5: Control. The final phase is control, where an organization sustains its gains from the Improve phase. The key here is communication. However, communication doesn’t mean email. It meant getting out with people and working with customers. It also involved communicating with leadership regularly about what the team learned and needed. From there, the communication travels to senior management. Patterson says every day, the team learned something new, and with this communication network established and maintained, they could continuously improve their efforts to innovate the experience at Maersk. However, this project with Maersk, and all the change involved, wasn’t without problems. It was a tough time for the industry, and the strategic initiatives by Patterson and our company were getting blowback from regions and countries worldwide. Consequently, the senior manager contact at Maersk, Hannah, decided that she would not require the other countries to implement our innovations and left it up to them. However, to our relief, 49 of the 52 country clusters (similar to a regional area) agreed to go to the changes. At the time, I thought this was a bad decision to leave it up to the country clusters. However, it turned out to be positive. The country clusters owned the decision rather than having it imposed upon them, which empowered them and made them want to make the changes rather than “just following orders.” Patterson says she has used these five rules in many different projects. First, you Define what it is you’re trying to accomplish. Then you establish how you will know if anything is working by taking a baseline with Measure. Next, you Analyze the types of changes possible, followed by a test to see if you were right. Then, you Improve those on a grander scale with plenty of communication throughout the company. Finally, you Control it by staying in touch to continue to improve and celebrate successes. If you have a business problem that you would like some help with, contact me on LinkedIn or submit your pickle here. We would be glad to hear from you and help you with your challenges. There you have it. No promotions, no gimmicks, just good information. We hope you enjoyed this issue of Why Customers Buy. If you have, please forward it to a friend or colleague. Think reading is for chumps? Try my podcast, The Intuitive Customer instead. We explore the many reasons why customers do what they do—and what you should do about it. Subscribe today right here. [...] Read more...

The Myth Of Experience

September 1, 2022We’ve all had experiences where we can anticipate what’s coming. So, today we are going to talk about intuition. But you knew that already, didn’t you? Intuition might be more valued in business than analysis. Many of us want a quick answer we can trust from somebody who would know. Some proponents of intuition suggest that we should rely on our intuition more, that our guts are very wise, and that our lizard brain is very well attuned to what’s happening. Malcolm Gladwell’s book Blink made this argument. Unfortunately, it’s not that simple. We should not trust our intuition; it’s not always right, only sometimes. The economic psychologist Robin Hogarth has researched intuition for four decades. He’s posted many videos and written several excellent books on the topic, including The Myth of Experience. We discussed his theories and their practical applications on a recent podcast, and I wanted to share them here, too. What is Intuition? Let’s talk about what our intuition is. Psychology Today describes it as “a process that gives us the ability to know something directly without analytic reasoning, bridging the gap between the conscious and nonconscious parts of our mind, and also between instinct and reason.” We talk about intuition as in our gut or sometimes in our hearts. However, it doesn’t exist there; instead, it exists in our minds. Moreover, it is based on our experiences in the past. We’ve discussed our shared two-part cognition model, the Rational System, and the Intuitive System. Our intuition comes from our Intuitive System’s faster, automatic thinking. Therefore, to understand what guides intuition, we must understand what drives the Intuitive System. The automatic part of your brain’s primary job is putting ideas together from all the information it receives (experience). So, the Intuitive System looks for things that co-occur. Then it links those things. When that happens enough, the connections strengthen, and, eventually, when you see one part, you expect to see the other. My intuition aids me when I need technology by sending me to buy Apple products. I’m not interested in looking at anything else. My choice may be automatic but has grown over the years based on my experiences with Apple products. However, these are automated decisions, not conscious ones. We cannot concentrate and make these connections form intuitively. It happens based on our exposure and experiences. Intuition Takes Two Forms: Automatic and Learned. Some are hardwired; some are automatic. For example, if you show pre-verbal infants pictures of snakes and spiders, the babies will have an automatic adverse reaction. Those intuitions from our Intuitive System come preloaded. Some people overcome them; others can’t. But preloaded intuitions exist for everybody. Learned intuition results from exposure to ideas and patterns over time. Eventually, our brain can call these connected ideas or patterns automatically. Experts develop excellent intuition through these functional correlations in their areas of focus. Therefore, an expert can sometimes give an accurate intuitive response to a query in their area without much deliberation or research. To clarify, I am not saying experience replaces intuition or vice versa. Neither am I saying that experience is terrible and intuition is good. On the contrary, there are times when each is useful and understanding when those moments are is essential. Hogarth talks about two types of learning environments for your experience or intuition, kind and wicked. Kind environments have fewer things happening that can be causing the effects, so a person’s intuition is probably going to be right about the source of what is happening. However, a wicked environment has many different things that could cause the effects, so a person’s intuition is more likely to get it wrong here than in a kind one. This video does an even better example of explaining the difference between the two. It will not always be evident to us when we’re in the situation, whether we’re in a wicked learning environment. However, I offer this caveat: things with humans will always be a wicked environment. Humans are complicated; in any given situation, many different influences can be causing the effects. So How Does This Apply to Customers? Many organizations think they know everything about their customers. However, when you ask them how their customers feel and what drives value, they don’t know. Therefore, organizations make decisions based on what they think they know. We still have an intuition if we’re trying to anticipate customer behavior but don’t know how customers feel. It’s just wrong. Therefore, applying a much more analytical framework incorporating science, slowing down, and using more data will have a better outcome. For example, imagine you are in an organization implementing a Customer Experience team. Six months after the implementation, the company launches a new product, and revenues soar. An intuitive response might be that the new product increased revenues. However, a company is a wicked learning environment, with many influences on the effects. It turns out that the experience team had implemented some of the changes they determined were necessary to change how customers feel in interactions with the company. The effects of these changes happened to coincide with the product launch. Now, which influence caused the increase in revenue? The numbers will show you for sure. However, if your gut was driving that call, chances are your instinct was that the revenue was linked to the product, even though there was no evidence showing you that was true. Of course, the numbers might prove it was the product. My point here is that intuition can be wrong. The movie (or book) Moneyball is a great example. Baseball recruiting has always happened in a specific way with desirability details determined by the talent scout. However, one baseball professional (Played by Jonah Hill in the film) decided to use statistics, and a very specific one, to determine a player’s desirability and find undervalued players to recruit to the Oakland A’s, a team with a limited budget for talent. The players with this statistic might not have looked like what you thought they should to be great ball players, but they were. That statistic drove the intuition about who was valuable to the team, and it was not an intuitive one. So, What Should You DO with This? First, you should probably not rely on intuition as often as you are. Sure, it makes you fast, and decision-making feels efficient. However, you are perhaps in a wicked learning environment, which makes the chances of your intuition being “right” less likely than if it were a kind learning environment. Therefore, we suggest you at least pair your “gut feeling” with some data and a more analytic approach. Maybe you get a bad vibe from somebody, and you shouldn’t ignore that. However, if that’s the only way you make decisions, you’re setting yourself up to fail. Remember also that artificial intelligence systems are artificial intuition systems. As you feed data into it, the machine is doing its version of making connections and finding links. So, as great as AI machines are, we must remember that the systems have the same challenges as we do to a certain extent. The data must be fed to the machine in kind environments rather than wicked ones to draw the proper conclusions and, eventually, intuitions. Finally, if you develop a great set of intuitions in one setting and then move to a different setting, many people bring their intuitions. However, it is essential to remember that it is now a different setting, and the intuitions should be different also. We see this in business leadership, where someone excels in one business model but fails in the next. Part of that failure could result from bringing old intuitions into a different environment, where they are no longer as reliable as before. Therefore, your intuitions are great, but we need to be cautious about how broadly we apply them. You need to be curious. We need to experiment and not just rely on our guts. It’s never one thing or the other or black or white. It’s always grey. So, it’s not that you shouldn’t listen to intuition, but it also says you can’t make every decision based on your intuition. If you’re sensible, you’ll use a bit of both. If you have a business problem that you would like some help with, contact me on LinkedIn or submit your pickle here. We would be glad to hear from you and help you with your challenges. There you have it. No promotions, no gimmicks, just good information. Think reading is for chumps? Try my podcast, The Intuitive Customer instead. We explore the many reasons why customers do what they do—and what you should do about it. Subscribe today right here. [...] Read more...

The Future Today! How to Build a Proactive Experience to Gain Growth and Save Costs!

What Is Your Personality Type, and How Does This Affect Your Success?

August 18, 2022In the book, Quiet: The Power of Introverts in a World That Can’t Stop Talking, Susan Cain makes the case that the world values extroverts but that introverts also have strengths that people should not overlook. Furthermore, Cain thinks introverted personalities also have much to offer the world. Today, we discuss personality and try to correct imbalances placed on one type of personality over another. People misunderstand what introversion and extroversion mean. The common misconception is that introverts are shy, timid, and socially awkward. While all of those things can be true, and people that way are likely to be introverted, it is not necessarily the case for all introverts. For example, many actors are introverts, as well as stand-up comedians. Of course, many teachers are, too. However, these are all occupations that require being in front of people. So, introverts are not necessarily afraid of people or have a fear of performing in front of an audience. Instead, introversion means the person requires quiet, alone time to recharge. Introverts find being around people exhausting. Extroverts, on the other hand, feel energized by being around people. One way to think of the two personalities is how they get their power. If they get it by being around people, then extroverts. If they get it from quiet time, introverts. Cain says people think about leaders and people who change the world as extroverts, and many of them are. However, some influential historical figures were introverts and relied on those personality strengths, like Rosa Parks, Chopin, Dr. Seuss, and Steve Wozniak. Personality vs. Situational Psychology Personality research is fascinating. Psychologists fall into two large camps: Personality Psychologists and Situational Psychologists. Personality Psychologists study people based on their enduring traits. There are specific characteristics that make people different from other people, and we can group those. Situational Psychologists agree that we have differences, but those are less significant than how we interact with our environment. For example, behavioral economics is Situational Psychology. When you consider the concepts of Nudging or Choice Architecture, the idea behind them is when framed in a specific way, people will move in a predictable direction because of situational cues. The Big Five Personality Dimensions Another exciting area that falls into personality research is the Big Five Personality Dimension. Five areas come up in personality research, often referred to as “The Big Five,” which include: Conscientiousness: This area measures your thoughtfulness and how good you are at impulse control and goal-directed behaviors. If you can motivate yourself in that way, you are considered high in conscientiousness. Extroversion: This one we already covered, but I will add some argue that this is the most dominant dimension. Agreeableness: This area measures your kindness and affection toward others and your charitable nature. Prickly or standoffish are descriptions used for people with low agreeableness. Neuroticism: Neuroticism measures how stressed you get and what stresses you. Openness: This one deals with your imagination and creativity, as well as how open to new ideas you are. If you are locked into a particular way of doing things and are resistant to change, then you are low in openness. (If you’re curious about these five dimensions and where you fit on these, there are quizzes that you can take online.) Exploring these areas can be helpful from a self-diagnostic standpoint. First, it helps us think about ourselves differently, emphasizing or identifying some things that might be strengths for us or areas of opportunity. Also, they might make us more empathetic by understanding that people think differently from ourselves. The Facets of the Big Five When researchers created this Big Five Personality Dimensions structure, they created substructures under each trait, called facets. So, let’s talk through each of these traits’ elements that might help us understand the overarching characteristics a little more. Conscientiousness has the following facets: Competence, which relates to efficiency Order, which refers to the organization Dutifulness, which relates to how careful you are Achievement Striving, which is how thorough you are Self-Discipline, which deals with laziness Deliberation, which deals with impulsivity Agreeableness has these: Trust, which is how forgiving you are Straightforwardness, which relates to being demanding Altruism, which is associated with warmth Compliance, which refers to stubbornness Modesty, which represents humility Tender-mindedness, which covers how sympathetic you are Neuroticism has: Anxiety, which is how tense you tend to be, Angry Hostility, which is how irritable you are Depression, how contented you are Self-consciousness, which is related to how shy you are, Impulsiveness, which connects to moodiness Vulnerability is related to self-confidence. Openness has these: Fantasy, which is how imaginative you can be Emotionality, which explains how much significance you put on feelings Esthetic, which relates to artistic interests you may have Action, which describes how adventurous you feel Ideas that cover your relationship with authority Curiosity, which represents how much you explore Extraversion includes these facets: Warmth, which is another way of saying friendliness Gregariousness, which relates to how to like the company of others Assertiveness represents how you present your ideas Activity describes how you feel about being busy and the speed you do things Excitement Seeking, which details how much stimulation you like Positive Emotions explains how you can experience positive feelings So, How Can You Use This Information Practically? I see myself and where I would rank in these facet lists, as I would wager many of you do also. For example, I am curious, naturally. When I get a new iPhone, I don’t go to training for it to find out what it does. Instead, I push buttons and see what happens. That’s how I learn. However, I also recognize not everyone learns best by pushing buttons willy-nilly and hoping for the best. To be clear, I don’t see that as a criticism; one is not better than the other. There are differences, though; understanding them can help you work with people to improve outcomes. I don’t see this information about personality as a way to manage people. For example, the Myers-Briggs test that many of you have probably taken and I used to use in my corporate career is not reliable enough, in my opinion, to make management decisions. Nor do I think that these personality traits are either. So, in other words, I wouldn’t use results from this to make decisions about hiring or firing, management training, or anything else. Most of us do not have clinical training for this type of application. Instead, exploring these Big Five Personality Dimensions and their related facets is an excellent tool for self-discovery. The Big Five and its facets are excellent for self-understanding. I think that understanding yourself is the first call of leadership. You need to know what you are like to understand your impact on others. If you extend that understanding to a customer experience, you will also know what’s impacting you and why. The Big Five Personality Dimensions help us better understand our strengths and why certain things might be difficult for us. For example, it feels empowering to know why you think the way you do in situations and realize there isn’t anything wrong with you if you feel anxious in social settings or haven’t had enough social interaction. Perhaps most importantly, understanding these things about yourself and others opens our minds and makes us more empathetic towards others. Realizing other people might feel something different in these situations can make us better managers of employees and customer experiences. If you have a business problem that you would like some help with, contact me on LinkedIn or submit your pickle here. We would be glad to hear from you and help you with your challenges. There you have it. No promotions, no gimmicks, just good information. Think reading is for chumps? Try my podcast, The Intuitive Customer instead. We explore the many reasons why customers do what they do—and what you should do about it. Subscribe today right here. [...] Read more...

The World Is Going Crazy

August 11, 2022I posted on LinkedIn recently that the world is going mad (or crazy, depending on which side of the pond you read this). I did it to see if I was becoming a grumpy old man or if others had noticed this too. It turns out I am not alone in my assessment. Many of my followers weighed in with their own experiences that tell a truth that is hard to swallow, the world has changed for good, but it’s not good for customers. I felt worked up about a few things around this time. First, I had flown for a quick trip to New Jersey, landing at JFK in New York, which is anything but quick at seven hours flying time. Then, we sat for an extra 45 minutes on the tarmac while the airport found us a gate. Sure, it happens, I thought. Then, on my return flight, we learned after taxiing through Heathrow that we were delayed because “the gate was not calibrated for the plane.” That was a problem I had never heard of, and that is saying something because I fly a lot. Then, to add insult to injury, we had a lot of projects at the house that had gone haywire because of delayed timelines for radiator deliveries and a decorator’s inconsistent approach to project management. So, to answer my question, I was a grumpy old man. However, was I justified? Is it me alone? It turns out it wasn’t. Mandy Morgan wrote in with a litany of comments that support how I feel. She thinks customer service is out the window and that getting a good experience is a pleasant change from the usual. Also, great people out there who are still trying to deliver good experiences are exhausted. Mandy is right. Customer service is not going well these days, and many problems are out there. People are exhausted. Mandy also wrote that nobody wants to work anymore, and everyone wants more money. However, that’s always been true. It’s human nature that people want more money for less work. So, we must try something else. Some other readers had good advice. For example, Justin C. Reviczky wrote as a leader, learning from the team what makes them tick at an individual level. Then, he encourages them to see the bigger picture for the group dynamic. Using this approach, he says at the end of the day, each team member should be proud to embrace the culture, vision, and goals and work towards achieving them. Why? Because they’re pleased and thankful to be part of something that not only sounds good but that benefits them and their families over the long run. In England, hiring managers are having a hard time getting people to show up for interviews, let alone jobs. This situation could be a money thing; however, I think there is something more. After the pandemic, people realized what they wanted out of a job, and many times, it wasn’t these customer-facing positions. Moreover, people don’t feel like they are part of the organization. However, if you can create a culture that makes them feel like they are part of the organization and that the company has a vision and a path for them, it can help them overcome these feelings that the job isn’t worth it. Neal Woodson had a similar experience to mine at Heathrow, which was a madhouse. He describes a scenario where people hardly knew what they were doing, patience was in short supply, and tempers were flaring. He said he thought the combination of high customer expectations, lack of customer awareness, insufficient staffing, and absence of empathy led to a perfect storm for poor experiences. It’s not just airports that seem understaffed. The postal service isn’t breaking customer experience records right now either. Michael G. Bartlett wrote to me about a recent experience dealing with the United States Postal Service. When rescheduling a package that failed to deliver, a typo in the postal code ended up with him unable to use self-service, then spending half an hour trying to reach a human employee to remedy it. Big-name brands are blowing it, too. Recently, life-long customer Doug Rabold could not renew annual passes at Florida’s Disneyworld Park, after getting the runaround on the phone and at the park in Guest Services. The reason he was given? The system is not updating Annual Passes right now. As he writes, the lessons learned is that Disney tells customers “no,” now, a policy is more important than serving loyal customers, and $1200 in recurring annual revenue is not a compelling motivator for them. Rabold’s story reminded me of a funny sketch by Little Britain, “Computer says no,” although it has a bit of fruity (aka: bad) language at the end: Another reader, Robin Domek, cites that the problem with employees is a lack of empathy and compassion for overworked, overwhelmed workers from business leadership. Moreover, the job is more complicated; many customers are impatient and angry, and these front-line employees have to deal with them all day. In this environment, it is impossible to recruit customer-facing workers. Then, you try for warm bodies, which gets people in the jobs, but now they aren’t the correct type of people for that position. As you know, having the wrong people working with customers doesn’t do your experience any favors. Esther Quinlan discussed the shortage of pilots. The deficit happened because people were not flying as much during the pandemic, so the airlines laid off the pilots. Now, travel is back on, so airlines need pilots. But some retired, others got into other businesses, and there aren’t any pilots. So now, airlines have staffing shortages and cancellations. Short-term, the pilot layoffs made sense since no one was flying during the pandemic, but long-term, not so much. Similar things have happened at restaurants. However, the restaurants re-opened without sufficient staff. Whether understaffed or undertrained, diners like Kaylor Hildenbrand were told at a recent experience that they couldn’t order a meal just then as the kitchen was shutting down for a while to get the orders they already had out. But wouldn’t she like another drink while she waited? However, some of these things were broken before COVID. For example, many of the problems in the UK have to do with Brexit. People left the UK after Brexit, which caused a shortage of people in the labor pool. Also, trade is down with Europe, which doesn’t help with inventory and related issues. As Laura Spoelstra, who is from the Netherlands, points out that many things broken in experiences British people have learned to accept, from potholes in the roads to trains and appointments that are “on time” even when they are five to ten minutes late, to A & Es (Emergency rooms in the UK) that don’t accept emergencies. So, maybe the world has been going crazy for some time now. It’s not all bad out there. Patty Soltis had problems with her seating assignment on a recent flight with Delta Airlines, which couldn’t be resolved at the time. However, the empathy and extra effort she witnessed from the humans in trying to fix the digital system issue made up for the inconvenience it caused. So, all is not lost. So, What Should You DO about This? One of my readers, Jose V., wrote: Business failures mean business opportunity. We live in a special time. Beating broken businesses is easier than ever. With this idea tucked up front in our minds, let’s consider what this means for you in today’s business: Accept that the world has changed. From both a customer and employee experience perspective, nothing is the same. It can be challenging to accept and deal with, but it is a fact. How things used to be and how life used to operate are different now, and the sooner we accept it, the faster we can move toward success. Be honest with customers and employees. In the flight example, it was clear that overbooking is currently rampant, as are last-minute cancellations. Both actions create problems for your experience, for which your front-line employees shoulder the burden. Stop making these problems for yourself, and when you discover a problem, communicate openly about it with everyone—and give everyone as much notice as possible. Consider the long term. Too often, organizations are tied up with short-term gains, making decisions that benefit them in the present. However, these same decisions are killing their long game. When making business decisions that you need to make for short-term gains, it would be best if you implemented a long-term strategy to help you counteract what it will do to your business down the road. Define what drives value. We helped the world’s largest shipping organization, Maersk Line improve their customer experience to the point that their Net Promoter Score® improved 40 points over 30 months, leading to a 10 percent rise in shipping volumes. So, what was the secret? There were many, but the best way to summarize it is to say that they determined what drove value for their customers, and—this is the critical part—Maersk gave it to them. This strategy has proven successful time and again for many different organizations, and even ones like yours. The world is changing. It doesn’t do us any good to complain about how things used to be and wish they were better. We need to make changes. We need to adjust. If business failure makes business opportunities, which side of that saying do you want to be: the failure or the opportunist? We hadn’t been through something like this before. So, these supply chain issues that delayed my radiators, the information chain issues that don’t have the gate ready at the airport for an arriving flight, and the recruitment issues experienced by many customer-facing departments are the result. We haven’t had these problems; labor inventory and supply chains have been predictable for a long time, making the “just-in-time” way of doing business popular for some time now. However, things have changed, and it is probably time to figure out the new standard moving forward with new ideas. If you have a business problem that you would like some help with, contact me on LinkedIn or submit your pickle here. We would be glad to hear from you and help you with your challenges. There you have it. No promotions, no gimmicks, just good information. Think reading is for chumps? Try my podcast, The Intuitive Customer instead. We explore the many reasons why customers do what they do—and what you should do about it. Check out our latest episode on iTunes here. Subscribe today right here. [...] Read more...

AI Is Just Opinions Written In Code

August 4, 2022Artificial Intelligence (AI) is such a promising technology. It’s so exciting that I worry a little that people treat it like magic. However, it could be that magic is the wrong word. Instead, it could be the same old human biases coming out in ones and zeroes but given a new authority it might not have earned. We discussed this on a recent podcast with our guest, Broderick Turner, Ph.D., Assistant Professor of Marketing at Virginia Tech. Dr. Turner founded TRAP LAB (Technology Race and Prejudice LAB) intending to expose the inherent biases about race and racism that have mixed into the foundations of marketing, market places, consumer technology, and market research. They have a weekly lab meeting that will resume in September, and he invites our audience to join. The Zoom meetings feature research-active faculty from across the globe and from all academic disciplines and are designed to enhance organizations’ economic, environmental, and social outcomes. Click here to join the TRAP. Dr. Turner explains that he thinks of AI the way author Cathy O’Neil does in Weapons of Math Destruction: Algorithms are opinions embedded in code. Dr. Turner believes that description is exactly how algorithms and machine learning works. In his classes, Dr. Turner asks students if they are familiar with the basic linear regression formula, Y=X + B? They are (although I might have been hard-pressed to remember that one without his help, I must admit). Dr. Turner explains that AI decides the “Y” of an outcome. For example, approve a loan or not? Approve parole or not? These are the Y. However, what Dr. Turner says matters is how much weight is placed on the “X.” Since AI is only doing the math, what matters is how much importance the programmer puts on the inputs and who decides them. As of now, only humans decide; AI hasn’t progressed to that level of decision in this scenario. So, Dr. Turner says, AI is not magic. Instead, it’s a 10th-grade algebra formula stacked on top of itself. Moreover, we have not reached the point where AI decides its inputs’ importance; human beings did. So instead, we humans made a bunch of small decisions that add up to something that looks big and magical but is, in reality, a 10th-grade algebra equation stacked on top of itself. The misconception is that machine learning and forms of AI are pure. That technological brains built ideas from scratch without the influence of emotional clutter and self-developed to generate new revelations. So it might someday, but today, Dr. Turner explains, it is built by humans, and, like anything made by humans, it is at risk of human influence, which can imbalance the results. In other words, there is no need to build a panic room or stock up on canned goods for a SkyNet takeover just yet. A machine takeover is purely (ridiculous) fiction with the technology we have today, per Dr. Turner, because using a bunch of linear regressions to replace the complexity of human thought and cognition doesn’t make any sense. The way humans process information is much more complex. Dr. Turner says a person with below-average intelligence has more to offer than the “smartest” AI today. As it stands, Dr. Turner says AI should not stand for artificial intelligence but for artificial ignorance. So, What’s AI Good for Then? Even with these limitations, it is clear that people are excited about AI and its future potential. People are looking for it for use in various applications. So, what are the advantages of it? Dr. Turner says it depends on the weights that humans put in there. Humans make those decisions, even in unsupervised machine learning, which means it is still an opinion about what those will be, affecting AI’s suitability. Therefore, Dr. Turner says today’s AI works well in spaces with limited inputs that we humans have high confidence about what that weight should be. From a consumer perspective, it is interesting to consider the most successful AI robotic product. Any guesses? If you said, “The Roomba,” you are right. Let’s be honest. That’s not quite what we were promised in our youth about the future of robotics. But the Roomba does clean the floor decently, and when it bumps into the sofa, it turns around and goes the other way. So Dr. Turner says we should get used to it because that’s as good as it will get for quite some time. AI tends to work well when there are limited numbers of inputs, when the correlations with outputs are pretty straightforward, and there are rule systems to access, such as mapping a room or playing chess. So, if algorithms are opinions written in code, and it’s lots of opinions, we can start to use some of the tools that we’ve learned as social psychologists or cognitive psychologists, or consumer behavior researchers to investigate what those opinions are and what outcomes come out of those systems. The Opinions in Algorithms Affect What You See One of the things that Dr. Turner learned in his research with an Algorithm audit was that algorithms are only as unbiased as humans can make them. Unfortunately, our biases creep into results in many ways. For example, when an algorithm is used to suggest a thumbnail for a social media platform content, the biases become clear. If a video has a person in it, nearly all the platforms will gravitate toward a frame for the video that includes a human face. However, which emotion they show on their face differs between platforms. For example, YouTube is likely to show a smiling face; on Facebook, a frowny one. No matter its expression, it is most likely to show a white male. Twitter’s algorithm gained notoriety for its racial bias. The automatic cropping of images favored a crop to include Senator Mitch McConnell instead of President Barack Obama when they were in the same large photo that needed resizing. Twitter decided to ditch it after this bias came to light. So, What Should You Do About This? This fascinating area of bias and algorithms and AI is a discussion I can indulge in for a long time. However, in terms of practicality, what is the key takeaway here? Besides that you don’t have to worry about T-800 in Arnold Schwarzenegger’s likeness rolling up on you with a sawed-off anytime soon. Dr. Turner has a few for you, starting with: Investigate claims. Dr. Turner encourages you to look into who is making the claims that a new AI is sentient or “superhuman.” For example, if a Google engineer says the language model is aware, it probably isn’t. AI isn’t there yet. Find out who put the inputs there. If you use the technology and are developing it, find out who decided what the information was in the algorithm and how they were weighted. The AI isn’t capable of choosing it themselves. Someone had to select it, and that’s where the biases will start. Experiment with your algorithms. Dr. Turner encourages researchers to use their skills to experiment with their inputs and see if they pass the test for biases. The tools are in place, so use them to perfect the organic nature of your results. This discussion gave me a radically different view of AI. It certainly gave me another way of thinking about it. We all need to become more familiar with these systems as consumers. Moreover, for those of us that work for companies or systems where AI use is becoming more widespread, it is essential to overcome some misunderstandings of what AI is and how it works at this point. Sure, it does incredible things and is advanced. However, AI also introduces a black box effect where we optimize these outcomes and get better results but don’t remember why we are getting them. The system is opaque and doesn’t allow us to see what led to these outcomes and what caused them. Audits will enable us to reclaim some in-between knowledge where we can back away into that original Sophomoric equation. This process is valuable and essential and can apply to all spaces. There you have it. No promotions, no gimmicks, just good information. Think reading is for chumps? Try my podcast, The Intuitive Customer instead. We explore the many reasons why customers do what they do—and what you should do about it. Subscribe today right here. If you have a business problem that you would like some help with, contact me on LinkedIn or submit your pickle here. We would be glad to hear from you and help you with your challenges. [...] Read more...

The Implication of the Long Tail in Today’s Environment

July 28, 2022Netflix has a great show called “The OA,” but you shouldn’t watch it. You will wish you hadn’t if you ignore me and queue it up. This fantastic and disappointing show is the victim of using old metrics for televisions’ success to measure performance in a new delivery channel. The problems with this show represent how the implications of the Long Tail in today’s environment dictate changing how we invest in our businesses and experiences, and that ignoring it will be detrimental to your customer strategy. Now, you might be thinking, what is the “Long Tail?” and are prepared to Google it. Moreover, you might feel tempted to look up “The OA.” Let me save you the trouble on both counts, starting with “The OA”: https://youtu.be/DvHJtez2IlY As you can see, this mysterious program was a Sci-Fi show about people that could travel between realities in the multiverse. The show was written with a five-season arc. At the end of season 2, it ends with a shocking cliffhanger. Fans of the show couldn’t wait to see what happened next. But they will never know; Netflix canceled the show after season 2. “The OA” was the victim of Netflix’s policy to give deals for two seasons of new content. Netflix bases renewals on engagement with the show. Netflix determined that not enough people were watching the show to order any more seasons. However, if you wanted to—and, again, I don’t recommend it—you could watch those two seasons, which they call parts, on Netflix right now. You could also feel profoundly unsatisfied after Part 2 when you don’t know what happens next. This situation leads me to my explanation of Long Tail (which Investopedia explains well). The Long Tail refers to the difference between what is possible with brick-and-mortar and virtual inventory. The Long Tail is the business strategy that allows businesses to sell low volumes of a large number of products to people, as opposed to a more traditional business model, which involves selling large numbers of a few products to people. However, it requires a distribution channel that is large enough to handle this inventory. For example, a book store can only put the most popular books, the top of the top best sellers, on their shelves for customers to come and buy in their physical location. Amazon did not have those restrictions on inventory. They could have any number of books, even an infinite amount because Amazon didn’t need to consider shelf space. Many of their books might only sell to a few readers, but it doesn’t matter to Amazon because it cost them practically nothing to have them “in stock.” The books were part of the Long Tail catalog of books, available when needed and not in the way when they weren’t. Netflix content is Long Tail, too. For example, if you missed the “Squid Game” wave last year, you could watch it now. Netflix has it on their platform. Many people might watch it later, too. “Squid Game” has five Emmy nominations for 2022. Moreover, a second season is coming, so you might want to binge it before that season drops. Netflix isn’t the only content provider that uses the “perform-or-get-canceled” model for renewal. Television broadcasters have used it for years. Television broadcast networks, like ABC, NBC, CBS, FOX, etc., would order a season or several episodes of a new TV show for airing on the network and then see how it performs with audiences. The show’s rating or market share would determine if the TV show was renewed. In other words, if no one or not enough people watched the show when it aired, the network canceled it. However, many people don’t watch shows the same way these days and certainly not when they are watching content on streaming services. Someone today might see a show pushed toward them in recommendations but not watch it for six months or six years. However, when streamers do watch, they might watch the whole season in one weekend. So, using the old broadcast model for streaming shows doesn’t make sense because it doesn’t match people’s new TV-watching behavior. Plus, it creates a new problem: unresolved content. Netflix paid all that money for the first two parts of “The OA.” It’s part of their catalog now, but it’s incomplete. So that investment is now more or less wasted because the content is unresolved. People that watch it will leave the series feeling unsatisfied, which will not reflect well on Netflix’s experience. Netflix is paying attention to what’s happening with their experience, too. Earlier this year, Netflix reported that they were losing subscribers. Soon thereafter, they lost $50 billion in market capitalization. There were a lot of reasons why this happened and other streaming services lost subscribers, too. So, we don’t mean to imply that their renewal policy is the culprit here. However, providing incomplete subscriber experiences isn’t going to help matters. People need things to conclude, not an unresolved cliffhanger, to feel satisfied. Fixing Things with Their Long Tail Content Streaming services want a blockbuster that everyone watches. Finding those series might mean that you have to cut resources to another that is still finding an audience. That makes good business sense. However, there is a Long Tail to consider regarding your investment, also. When things are unresolved, it creates cognitive dissonance. That’s an uncomfortable state for many of us, and some more than others. As a result, we develop strategies for overcoming cognitive dissonance. Unfortunately for Netflix, that could mean not exploring unknown (read: as-yet-unpopular) content that could leave the audience hanging. All of those assets will linger, unwatched. Eventually, it could mean subscribers leave the streaming platform altogether because “there’s nothing there to watch that I haven’t already seen.” Cliffhangers were a technique for the old way of watching television. If you ended a broadcast season on a cliffhanger in the spring, people were eager to tune back in the following fall to see what happened. Moreover, viewers tolerated this uncomfortable “hanging” state because there wasn’t another option. However, as I mentioned before, people don’t watch TV as they did during the broadcast era because they have other options. So, while the cliffhanger strategy was good in the old days of TV, it isn’t for the new. Or at least it isn’t for the end of every season. Moreover, if Netflix keeps its content that was canceled after a cliffhanger ending of season 2, they could get a reputation for it, poisoning their Long Tail content. Netflix could change that for themselves, however. For example, they could stipulate that no new show can end in a cliffhanger for the second season. That way, they could stick to their two-season investment strategy and still have a complete show for their long-tail content if the show doesn’t thrive in viewership the way Netflix expects. So, What Does That Mean to You? The conversation about Netflix hits several critical points for organizations and their customer strategy. Looking at the situation that Netflix finds itself in now, there are some essential lessons from which we all can learn. Remember that you should resolve things in your experience for people. Creating cognitive dissonance for your customers leads them to take matters into their own hands to resolve it, and you might not always like the way that goes for you. Ensure that you are competing in today’s business model. What are the “ending the season on a cliffhanger” moments in your experience that you might need to address to compete in today’s market? Consider your Long Tail inventory opportunities. People approach purchases today differently than when brick-and-mortar locations dominated the marketplace. Have you taken advantage of the options in your business vertical to optimize your Long Tail inventory? No matter your customer experience, the need for completion is an essential driver of customer behavior. Part of the reason that Netflix has some of this unresolved content in their Long Tail is they were competing in a new industry using an old strategy. Now, they must confront the realities where they’re no longer seeing growth. This situation often happens in business where we get stuck competing under the previous reality. It’s a natural human thing for us to look back and try to anticipate the future based on what we saw in the past instead of looking at the reality on the ground right now. With a new expanded inventory business model, organizations need to optimize their customer strategy and use different metrics for success, or they might find the opportunities with their Long Tail cut short. There you have it. No promotions, no gimmicks, just good information. We hope you enjoyed this issue of Why Customers Buy. If you have, please forward it to a friend or colleague. Think reading is for chumps? Try my podcast, The Intuitive Customer instead. We explore the many reasons why customers do what they do—and what you should do about it. Subscribe today right here. If you have a business problem that you would like some help with, contact me on LinkedIn or submit your pickle here. We would be glad to hear from you and help you with your challenges. [...] Read more...

Two for One: The Cost-of-Living Crisis and Increase Response Rates

July 21, 2022As many of you know, I also have a podcast. We invite our listeners to share their business problems, which we call pickles, with us and address them in the episode. This past week, our podcast featured two pickles, and I thought I would share them here since many of you are facing similar issues in your organization. Pickle #1: How can you increase survey response rates to create a more robust voice of customer data? Jane writes: In August 2021, you did a podcast about increasing email response rates, and I was keen to learn from this. However, I realized that my issue is not quite the same. We’re implementing a Voice of the Customer (VOC) program on a customer platform in a large business-to-business (B2B) organization. The data needs to be robust to get buy-in from colleagues to use the insights and identify critical improvements. So how would we go about increasing the response rates on surveys sent through email to busy customers? So, how can Jane get busy customers to complete emails and get the buy-in from people that this effort is worthwhile? We did a podcast a little while ago with one of the researchers from Attest around the Five Rules of Customer Research. One of the key points from that episode was organizations sometimes forget to consider the respondents’ experience, which is essential. If there is a lot of friction in managing the survey process, it can frustrate respondents and discourage their response. Therefore, making it as easy as possible to get the data you need is necessary. Otherwise, you can spend all that money for nothing. When it comes to increasing response rates to customer surveys, we have some other specific advice, including: Consider how you can motivate customers to respond: At the heart of this effort is the art of persuasion. In other words, you need to encourage customers to respond. The easiest way could be monetarily, but compensation is not the only way to motivate responses. In some cases, particularly B2B situations, giving some of the data you collect back to respondents through quarterly reports of your data responses or something along those lines could motivate them. In addition, you might generate insights that the respondents find helpful. Another motivation might be to explain how their responses can form an information-sharing community where the respondents can communicate and solve problems collectively. Leverage your company’s relationships: Many B2B companies are set up where customers have employees they work with regularly, whether that’s their sales representative, account manager, or customer service point of contact. These relationships are an outstanding resource for getting responses from customers. However, be warned that you might need to babysit your employees (and convince them that this is a good thing for the customers, more on this later…); your employees guard those relationships and will want to know that their customers won’t be annoyed or inconvenienced by the process. Remember that quality still trumps quantity: The one bit from Jane’s pickle that worries me is that she said, “the data needs to be robust.” I’m not too fond of the implication that volume is better than quality responses. I would prefer “the data needs to be the right amount.” As long as you have statistically valid answers, I wouldn’t worry about sheer volume. However, once you get into numbers, my antennae go up because you start to get into politics within an organization. Relying on numbers as a metric could lead to members of the organization dismissing your results because the perception is that the data is not robust enough. The numbers should still be statistically valid: Quality is essential, so lower numbers would be okay. However, if your numbers are too low, you can get a skewed perspective, negative or positive, driven by the sample group and size. So yes, Jane, get more data, respect the statistics, but don’t overgeneralize from a small sample. Get as many responses as you can. Follow through with communication after the survey: Imagine that you are the client who fills out a survey repeatedly but never knows what happens after that. It would feel pretty frustrating, and their interest in responding will eventually wane. To combat this ennui, ensure that you act on the communication you receive and follow up with respondents to let them know how their responses inspired it. If you do, then in a year’s time, when you ask them again, respondents will be far more likely to continue to participate. Don’t bombard customers with requests: If you ask too many times, you become easier to ignore. Organizations often feel pressure to get their feedback at a statistically relevant level by a deadline. However, I would argue that getting responses takes time, and rushing them will only damage the quality of your answers. Instead, understand that getting enough responses might take longer than you anticipated, and let it go. Involve the internal team in your process to gain buy-in: Ask the internal team to assist in the survey design. Ask them what problems the employees are having with customer engagement in the experience and what might help them move forward. This approach shows that you want to fix things, not just tell the internal team what the customers say they are doing wrong. Measure whether your efforts are working: Are the surveys having the desired effect internally? Externally? Are the metrics that your organization values being met or improving? When you can show your results, people will see something in it for them, which makes it easier for you to get what you want: responses. Hopefully, that information for Jane was helpful for you, too. Now, for something from Elizabeth. Pickle #2: How is inflation affecting people’s ability to buy? To answer Elizabeth’s question, I visited Attest customer research, where they have Attest’s US inflation sentiment tracker, which has up-to-the-minute data on what people think about it. When I was there a few weeks ago, it said that nearly 25 percent of people say inflation has a very high impact on their lives, and another 26 percent say it has a high impact. Around 36 percent said the effect is moderate. So, in other words, over 50% of people say the impact is high or very high. The UK numbers are slightly lower, coming in around 43 percent for a high or very high impact. So, the question becomes, is the difference that inflation isn’t as severe in the UK, or is it that Americans react to it differently than people in the UK? We had a podcast about inflation a little while ago, and one of the points we made is that this is a massive concern for people. Attest also reports that consumers are changing their spending habits due to inflation. In the US, 49 percent of people are cutting back on non-essentials, which means things like clothes and meals out. Another 35 percent are cutting back on essentials like food and fuel. As I read this data, nearly 80 percent of people are cutting back on things like clothes, gas, and food. I saw an opportunity for companies to build customer relationships. Communication and understanding can go a long way to creating a connection with customers, as they did during the pandemic. However, a price increase is probable, even inevitable, for most businesses. Therefore, how you raise prices is an essential consideration. Past work we have done with a cancer clinic and a financial organization collecting debts has proven that challenging situations can still have excellent customer experiences. For example, people in cancer treatment judge how they were treated during their experience. Sure, the patients hated having cancer, but they appreciated how hospital staff treated them while they had it. So, it is essential to treat customers with dignity and respect for organizations today facing price increase pressures and the bewilderment of customers facing them. Even better if you can help them solve their problems. If you have a business problem that you would like some help with, contact me on LinkedIn or submit your pickle here. We would be glad to hear from you and help you with your challenges. We produced this article in partnership with Attest. There you have it. No promotions, no gimmicks, just good information. Think reading is for chumps? Try my podcast, The Intuitive Customer instead. We explore the many reasons why customers do what they do—and what you should do about it. Subscribe today right here. [...] Read more...

How to Be Funny and Use Humor in Business to Your Advantage

July 14, 2022When I was ten, the teacher wrote on my school report, “Colin is the clown of the class.” To this day, I am still proud of that report card. Humor matters and can provide business benefits. Today we will talk about how to be funny and use humor to your advantage. When we make people laugh, it’s disarming. People are often more willing to listen after someone makes them laugh, making way for us to be more persuasive. There are also a bunch of documented health benefits of laughter. It can reduce tension. It can be good for our relationships. I’ve coached team members to let their humor come out in business. Of course, it must be appropriate and provided at the proper time. However, using humor is essential in our team because cracking jokes and having a sense of humor is a significant business advantage. Many of you know I also have a podcast called “The Intuitive Customer.” We had a 5-star review titled “Delightfully Humorous and Informative” that I thought I would share: “The dynamic between the two hosts absolutely makes the podcast. Each brings their own unique take on the topic, their own unique perspective, and plays on each other’s sense of humor. I come away from each episode feeling a little bit of joy and feeling a bit smarter. A win-win.” I love that review, and not only because it was 5-stars. It demonstrates that mixing a complicated topic like behavioral science with humor allows the topic to be informative and fun simultaneously. Let’s talk through the theories of humor, which sounds like the worst idea in the world. Naturally funny people know some of these rules intuitively. But for the rest of us, if we want to become more amusing, it is helpful to consider what makes things funny. So as we go through these four theories of humor, let’s consider how we can apply these concepts to business, whether through the contact center, account management, or marketing. Humor Theory #1: Superiority Theory Also known as “the sudden glory theory of humor,” this theory is humor generates from feelings of superiority over others or even a past version of ourselves. It is also called sudden glory because of this quote from the philosopher Thomas Hobbes in the 1600s, “the passion of laughter is nothing else but sudden glory arising from some sudden conception of some eminence in ourselves by comparison with the infirmity of others or with our own formally.” Here’s a great example of this type of humor from Studio C featuring Scott Sterling’s face: A lot of sarcasm, especially barbed sarcasm where the other person doesn’t pick up on it, would be an example of humor inspired by the Superiority Theory. Other examples would be physical comedy, like Fails videos where you watch people slip and fall or crash their go carts or break their ceiling fans. Also, practical jokes and pranks fall under this theory. Consider this clip from Between Two Ferns Bloopers: There are also dark examples. Racist, ethnic, and sexist jokes are examples of it, too. I’m not endorsing those types of humor, especially not in business. However, the Superiority Theory explains why they are funny in certain contexts to specific people. Humor is universal, but what makes people laugh is not. Culture filters comedy and humor. Preferences and history do, too. For example, a religious person will often find jokes about religion not funny at all, whereas a non-religious person might find them very funny. Superiority Theory doesn’t do a good job explaining why that is. It says, “Well if you feel superior to somebody, you should find that funny.” But it misses a lot of this nuance. Humor Theory #2: Relief Theory This theory has a long pedigree. It goes back hundreds of years to medical views of the human body and the idea that we had various pressures within us caused by the “humors”(which, in this usage, refers to our bodies’ makeup, not comedy). It was essential to balance the humors. Doctors used bleeding to relieve pressure from an excess of one of the humors. Not surprisingly, doctors also killed a lot of people back then. The word humor comes from this belief. For example, if you were laughing, it was because one of your humors was unbalanced. So, the nature of the word has changed over time, but the idea was similar. Humor is the release of the pressure within you that something is funny. One of the proponents of relief theory was Sigmund Freud. He used it to explain inappropriate humor or Gallows Humor, which is about death. In other words, you laugh about something you know you shouldn’t. If there’s something we feel uncomfortable about, it creates this psychic pressure within us. Or, if we’re in tense situations, the nervous energy is trying to escape. Laughter can relieve that pressure. I enjoy making people laugh. So when a situation is tense, I feel responsible for saying something funny. A lot of joke-telling artificially ramps up the tension. Jokes with a twist ending are a good example. Also, long, rambling stories increase the anticipation where we know there’s a punch line, but dragging it out increases the tension and the relief from laughing. Here is an example from Norm MacDonald on The Conan O’Brien Show: Humor Theory #3: Incongruity Theory Cicero once said, “The most common kind of joke is that which we expect one thing, and then another is said. Here our disappointed expectation makes us laugh.” Many one-liners and short jokes work using this theory. A lot of times, the expectations are formed by leaving out information. For example, stand-up comedian Jim Gaffigan had a one-liner about the genetic tests you can get to discover your ancestry. He said, “You do learn things from those genetic tests, like how I discovered I wasted $100.” The expectation was that he would make a joke about what he learned about his ancestry, but instead, he takes you in a different direction. Wordplay falls in this category, too. The classic setup punch lines use it. We have Abbott & Costello, Who’s on First: There’s a branch of incongruity theory going back to Monty Python, which is Absurdist humor. Here’s an example from Kids in the Hall, I Don’t Speak English: Consider this famous scene from Monty Python and the Holy Grail: Or this one from the same movie, The Constitutional Peasants Scene: Parody uses this one, too. Here is an example from Brooklyn Nine-Nine, I Want It That Way: Humor Theory #4: Benign Violation Theory I saved the best, most scientific of the theories for last. It’s called Benign Violation Theory, the newest of the four. It’s usefully applied in conjunction with the three I already mentioned. Benign Violation Theory is humor derived from breaking a social or linguistic norm. Puns are an example of this type of humor. Puns violate language’s meaning. A critical part of this theory is that the violation must not be threatening. The release of the humor is related to the offense. Comedians say, “Comedy=tragedy + time.” This phrase encapsulates the idea behind Benign Violation humor. In essence, it indicates that a situation can be funny once it is distant from the present company. For example, making a joke about Alexander the Great conquering a huge empire could be funny; making one about Putin’s attempt to conquer Ukraine, not so much. Jim Gaffigan has quite a few examples of this in his Funniest History Jokes: So, What Does Humor Have to Do with Improving an Organization’s Experience? When it comes to business, it is crucial to understand the different effects of positive and negative humor. Positive humor brings people together; negative doesn’t. If you lead a team or work with people, you want to use positive humor. Positive humor makes people like you better than negative humor, too, which is essential in business. Positive humor provides an enormous opportunity for organizations at all levels. It can make work more fun for people, which leads to happy employees and, in turn, satisfied customers. But, of course, the critical word here is “positive.” Using humor that is negative or inappropriate is a bad idea. Moreover, it can set up an environment where it is okay for employees to use that kind of humor, which is not going anywhere good—or that doesn’t require a lawyer. I use humor to my advantage. I use it to build a team, reduce tension in uncomfortable situations, and loosen up an audience in a keynote address. Too many organizations steer their culture away from it and to their detriment. While there are clear lines and boundaries for what is appropriate, humor provides an opportunity to build relationships for any company. If you have a business problem that you would like some help with, contact me on LinkedIn or submit your pickle here. We would be glad to hear from you and help you with your challenges. There you have it. No promotions, no gimmicks, just good information. Think reading is for chumps? Try my podcast, The Intuitive Customer instead. We explore the many reasons why customers do what they do—and what you should do about it. Subscribe today right here. [...] Read more...

As Brick & Mortar Retail Bounces Back Where Does The Future Lie?

July 7, 2022The Future of Brick and Mortar One of the features of The Intuitive Customer podcast is “I’m in a Pickle,” where listeners come to us with business problems that they would like our advice on solving. We had a pickle about the future of brick-and-mortar after the pandemic that I thought I would share with you, too. Here’s what Bjorn had to say: Hello, Ryan and Colin, and thanks for a great show. I follow you every week, and I have a pickle. It’s about brick-and-mortar retail because, after the pandemic, physical retail is bouncing back as people want a real-life experience after the lockdowns and other events. Customer Experience management has been absorbed into Customer Science in the past couple of years; how will that apply to brick and mortar? How can these retailers benefit from the new technologies? Thanks for considering this topic, and have a great day. Retail is Back, But Different The other day, I was in a store thinking, “it’s great to be out and about, putting the pandemic behind us.” However, the effects of the pandemic linger as the market, and brick-and-mortar experiences have changed. One of these changes, as Bjorn says, is the introduction and adoption of Customer Science. Customer Science is the integration of artificial intelligence (AI), customer data, and behavioral science. I see this development as the new variant of Customer Experience moving forward, even in brick-and-mortar settings. Stores were doing business the same way for a long time. Then COVID hit, forcing them to change everything. Now, they are transitioning back to unrestricted in-person interactions, but not to the same place they were for all those years. The new skills and technologies business developed with digitalization have changed how people shop at a fundamental level. So, what Bjorn wants is something I think all retailers should want: a way to combine the best of everything we’ve learned in physical and digital spaces to create a great Customer Experience. Since I assume many of you are scratching your heads about the same problem, I thought I would also address that here. Almost Perfect Let me start by sharing a recent experience that can help shed some light on what I mean about integrating Customer Science into physical interactions. So, I have lost nearly 100 pounds over the past year and needed to replace my wardrobe. I was in a retail store for Nautica, a clothing brand in the States. While in the store, I took them up on a promotion that if I gave them my mobile number so they could text me, Nautica would give me a discount. After receiving a few texts after the shopping trip, I browsed the website. I looked at a few things and then got off the site. Half an hour later, Nautica texted me, “We’ve seen that you’ve been on our website. Why not check this item at 70% off?” I like a bargain, so I looked at it. It was 70% off. However, it only came in extra small. The experience was annoying to me. Everything I looked at on the Nautica site was Large. It didn’t seem like a great leap to send me a link to view an item that came in Large. I have done well and dropped a lot of excess weight, but I am still far from an XS! This story represents the good and bad that can occur when integrating the two types of shopping: It was good to marry the in-store experience with the digital one. It was good to motivate me in the retail store to give them my mobile number so Nautica could present me with opportunities I might fancy putting into my virtual cart. The engagement rate was high for me, which is saying something because I usually skip this kind of stuff. These are the opportunities that Nautica capitalized on nicely, but the (extra) small detail at the end was a miss. Nautica’s approach was almost perfect. All that was missing was a holistic approach to the integration that included my sizing before showing me a “must-see” item. Without a holistic approach to the combination of these channels, it could also be a problem for Bjorn and end up annoying his customers instead of surprising and delighting them. Knowing All the Pros and Cons Helps One of the most important things to understand for the successful integration of technology into physical experiences is what people get from the various channels for your business. Once you consider that motivation, it’s much easier to develop an effective customer strategy that will enhance those experiences. For example, the same people might shop in a different channel than usual because of the circumstances of the purchase, e.g., they needed it faster than the online channel could get it to them. However, it might also be a customer segmentation issue where different people want different things at different times, e.g., this group likes people, so they go to physical stores. This other group avoids contact with other humans, so they only shop online. A significant part of this motivational understanding starts with knowing the advantages and disadvantages of each channel. For example, one of the primary differences between a brick-and-mortar place and an online exchange is the presence of people. But, then, you apply that to both experiences. So, in the online experience, how do you make up for the lack of a human representative? For the physical experience, how is the human presence facilitating instead of detracting? Customers are almost split on this issue, too. In my due diligence regarding Bjorn’s problem, I came across a report by McKinsey called, “What’s Next for Digital Consumers? May 23rd, 2021.” The report says some consumers went to digital channels because of COVID 19 or for convenience, but others still preferred the physical channel. Here are two of the stats McKinsey shared also: 45% of people’s main reason for switching to digital was the pandemic, but 43% was for greater convenience and availability. The main reason for not switching to digital was because the respondents favor talking to a human being (24%) Another essential consideration in your strategy is customer intent. A few months ago, we spoke with GroupBy, which has done much with Customer Science integration. One of the significant discussions we had in that webinar was about customer intent. Google had to work hard to get their AI to understand the meaning and get the right results in front of searchers. However, that isn’t as difficult in an in-person interaction. The difference is the presence of people. We underestimate the power of human beings to interpret what customers are looking for rather than what they put in a search bar. With specific problems, and despite AI bots’ improvement, humans are better at making those soft connections between things. So, there are times when human interactions make things a lot easier, but there are also times when humans introduce noise and make it more difficult. It’s not that one is better, and one is worse; it’s just that they do different things. We touched on these topics before. First, we covered a case study about Nissan in the Middle East that found a way to change how people shopped for their cars to an online experience. Second, one on the Metaverse discussed how stores could augment reality with technological integrations. So, the question becomes, can you leverage the strengths of both of those things? For example, are there opportunities within the physical space for people to interact with a computer rather than a sales clerk? Because that would be more efficient and useful for that segment of customers in that specific purchase paradigm. Likewise, are there opportunities on your website to interact through chat or some other feature with a human being if that facilitates? So, What Does This Mean to You? In terms of looking at this whole topic, I have a couple of summary points. Have a holistic approach. To successfully meet the challenges of the brick-and-mortar experiences of the future, the different channels of your experiences should be holistic. I can’t emphasize that enough. Operationally, you might have divided up the responsibility for these channels among other teams, i.e., one team for online, one for retail, etc. However, customers don’t see it that way. To them, all the channels are the same thing. So, if you aren’t integrating those touchpoints effectively, it doesn’t portray your brand in a way that enhances the experience for anybody. Use online to reduce pain points in the physical experience, and vice versa. Another bit of advice for rising to the future of brick and mortar is to leverage what works online to fix pain points. Consider opportunities to use digital through an app or in-store to improve moments in the store’s customer journey that do not work well. Digital interactions in a physical experience might be able to fix those friction-causing moments. Likewise, you can also look for ways to incorporate physical advantages into the digital experience. Perhaps it is introducing humans into the process, which is an area that might have genuine benefits for you. It’s not all or nothing. I do not support a strategy where you abandon one experience for another. People will always want to go to a physical store and touch the product or see the scale. Some people need to hold things to know whether they suit them. Brick and mortar will always have a place, but the integration with the online experience will keep it relevant. We were all in person before we went all online, and now we have both. Can we use the advantages of each modality simultaneously to make things better overall for everyone? The answer is yes and doing it is the future of retail. If you have a business problem that you would like some help with, contact me on LinkedIn or submit your pickle here. We would be glad to hear from you and help you with your challenges. There you have it. No promotions, no gimmicks, just good information. Think reading is for chumps? Try my podcast, The Intuitive Customer instead. We explore the many reasons why customers do what they do—and what you should do about it. Subscribe today right here. [...] Read more...

Breakthrough Thinking: Why Do We Believe Things That Are Not True

June 30, 2022That Apple is an exceptional brand is an idea I hold near and dear to my heart, and I cannot be convinced my beloved technology company could do wrong. Even with an indisputable truth that they had done wrong, I would choose not to believe it. Like your loyal customers would be, I would be reluctant to update my previous beliefs about it. So, why is it that no matter what data you give a person that conflicts with their firmly held beliefs, it doesn’t alter their thinking? Why do human beings reject information out of hand? Today, we are going to take a look at why. We will see what is going on psychologically when we refuse to update beliefs and how that affects your customer strategy. Because…Irrationality Part of the problem is that we are irrational beings or emotional, if you like that word better. If we were rational, when we got new, updated information, we would incorporate that straightaway. Our beliefs would be up-to-date with fact-based foundations built upon the latest and greatest data available about any given subject. But they aren’t because we aren’t. Or at least we aren’t rational all the time. Because…Self-Image Another reason we reject information if we disagree with it could be because we define ourselves in part through the brands we buy. If a brand message resonates with you, you may pull it into your identity or how you see yourself. It’s not embedded to the same extent as your family, but it’s there. In my case with Apple, I push away negative information because I don’t want to associate my self-image with that negativity. Because…Exclusivity A third contributing part of this irrational reaction is that a person might reject facts for something they like better because embracing a non-mainstream theory or understanding can make you feel unique or intelligent. The outlandish tale has a forbidden knowledge aspect, like “Most people are not smart enough to have dug this up, but I did!” Many people embracing non-mainstream theories say, “I’ve done my research,” indicating that they’ve earned their knowledge instead of accepting a crazy idea they read on social media. (Unless that was the “research.”) Sometimes counterintuitive brands we associate with might provide some sense of identity or superiority if we frame it that way. Changing Minds over Time Climate change has been one of those areas that have been hotly contested (see what I did there?). I was reading Attest’s Sustainability trends report 2022, and a few interesting stats came out of that about climate change: The vast majority of Americans, 94 percent, believe that climate change is happening, and only six percent think it’s not. I read that 52 percent say their view on climate change has altered in the last year, and 38 percent believe that climate change will directly affect them in their lifetime. This change happened over a while with a concentrated effort by proponents of climate change, including changing the terminology from global warming to climate change instead. There is also a vital social component to the climate change issue. In the US, the two-party system took sides on climate change. Democrats believed in it; republicans were skeptical. It came to a head in the presidential election between Al Gore and George W Bush. Al Gore was an advocate for climate change, so Bush wasn’t. It wasn’t until the end of his term that Bush started using the term climate change and talked about how it affects global warming. That gave republicans social permission to begin accepting it was a thing. In other words, it was okay for republicans to stop doubting climate change. So, bringing this back to business, companies can change their situations, too, but it can take some time to change customers’ minds. For example, the car brand ŠKODA is making a significant comeback. However, 30 years ago, this was a terrible car company (equivalent to the YUGO). There were jokes about how a ŠKODA car and a baby had something in common: They never went anywhere without a rattle (insert rim shot here). I repeated this joke to my son, who is in the market for a new ŠKODA, but he still wants one. On the other hand, ŠKODA is about the last brand of car I would buy. So, how long until ŠKODA could change my mind? One way to estimate this would be the different effect data and experience has. So, for a long time, the case that climate change activists made was data-driven. They showed things like temperature changes and ocean acidification rates in charts and graphs. People rejected these charts and graphs replacing them with their experience, i.e., “Global warming? Ha! We had a cold snap just last week!” Even meteorologists were saying that the weather predictions weren’t that different than before. However, this recent belief shift in climate change could be because the experience has changed. More people have weathered (see what I did there again?) the effects of climate change in the form of massive heat waves and the increasing frequency of large storms. In addition, we’ve had forest fires all over the world at a higher rate. This experiential evidence persuades people that climate change is real and severe. Let’s say you are talking with a cable company, feeding it to them about their experience. The cable company responds by telling you the company has improved response times by eight percent and reduced wait time in the contact center by 14 percent. However, suppose you still had to wait hours for a repair or recently spent too long in the contact center queue. In that case, your negative experience trumps their data about improvement and drives your evaluation. In the early days of my global customer experience consultancy, we worked with a water company in the UK. One of the things we learned was that their customers usually only called the water company once every seven years. That’s a mighty long time, enough time for the water company to change many things about their experience. However, since there was no interaction frequency, many customers would never know it. They would still have the perception from their previous call nearly a decade ago. There is also something known as the Fluency Effect, which affects peoples’ ability to accept new information. This psychological concept describes how when things are easier to explain and understand, they seem more factual. The simple explanation often wins, even when the simple answer is wrong. Another influence might be the Expertise Effect. One of the effects of expertise is nuance. So, as we learn about something, we discover it at its highest levels, in its most abstract terms. Then, as we get deeper, we understand the exceptions, which introduce the nuance. However, those that are not experts won’t get the nuance. There is also something called the Dunning Kruger Effect, named after the two people who discovered it. The Dunning Kruger Effect says that people with little knowledge are often the most confident in talking about a subject. As you learn more, your confidence wanes and continues to do so until you reach a mastery level on a topic, when it climbs again. The Dunning Kruger Effect explains that sometimes the most confident people are among the least informed. So, What Should You Do About This? The point of these psychological theory explanations is that you should expose yourself to different sources of information and question things. Organizations often say they know what’s happening and don’t need other data. They know better than the data. That’s a mistake. Instead, I would advise organizations to: Overcome your bias. Using multiple sources of information and assuming that things are more complex than you think can help you do this. Dig into the nuance and seek our real experts to hear what they have to say about the subject. Also, the danger of relying too much on one source of data is that you’re going to be biased towards that source of data and think that everything they say is 100% true, which can never be the case. Keep in mind customer biases. Simple explanations will tend to get through to them. If you recognize that your customers have less expertise than you, you can help them by simplifying nuance. They will be looking for things they can understand and process. So, work with them, and communicate at that level because that’s what will be compelling. Please don’t give them data; give them experiences. Also, recognize that if you are a capable company or your experience isn’t bad, it will take time for things to turn around. Changing customers’ minds from something that is not (or no longer) true happens with the frequency of presented facts. If you have a business problem that you would like some help with, contact me on LinkedIn or submit your pickle here. We would be glad to hear from you and help you with your challenges. There you have it. No promotions, no gimmicks, just good information. Think reading is for chumps? Try my podcast, The Intuitive Customer instead. We explore the many reasons why customers do what they do—and what you should do about it. Subscribe today right here. [...] Read more...

5 Rules for Effective Customer Research That Make A Difference

June 23, 2022It annoys me when I ask clients what their customers say, and they tell me what they learned in a survey seven years ago! That’s too bloody long to go between customer research projects. The world has changed enormously in the past two years, let alone the past seven. Customer research should be a priority every year. So, today I am covering the 5 Rules for Effective Customer Research That Make a Difference. Our guest is Sam Killip, a lawyer and Director of Customer Research from Attest, a consumer research platform. Attest strives to help organizations understand customers, and Killip says the online consumer platform taps into hundreds of thousands of consumers around the globe. On a practical level, Killip says their clients survey consumers to understand consumers’ views and what they’re doing, thinking, and feeling to feed into their customer strategy. To that end, the 5 Rules for Effective Customer Research That Make a Difference are: Define the right method. Get under the skin of the customer. Cast your net wide. Respect the respondents. Do it little and often rather than large-scale. Let’s take a closer look at each. Rule #1: Define the right method. You can get customer data in many ways and with various customer research tools. However, all have different methods, strengths, and weaknesses and answer different questions. So, before choosing one, you need to know what answers you need. For example, customer feedback surveys are excellent ways to hear what customers say about their experience. However, if the answer you want is why customers buy from you, a survey response might not work. Those of you that have been with me for a while know that is because customers can’t always tell you why they did something because they don’t know themselves. Rule #2: Get under the skin of the customer. A small business, like a Mom-and-Pop store, knows its customers. These business owners knew what customers bought and why customers said they purchased it and also understood why customers really bought it. Often, the customers were people the shop owners knew personally from shopping in their small business for years. A sizeable multi-location company or a global organization cannot have that relationship with all its customers. Instead, they must rely on customer research. Moreover, as Killip points out, there is a plethora of information about why customers do what they do. So, really knowing customers requires different tactics than mom-and-pop shop owners employ. An example of an effective tactic is how car manufacturers market cars to different segments. Killip says that cars are, at a foundational level, not that different from each other. Sure, they have various features and styles, but one mid-sized sedan is not wildly different than another. However, the car industry taps into types of customers and what those customers want to buy. For example, some drivers want to seem like James Bond, so car manufacturers with a car that fits the bill will market their car with that idea in mind. Other car buyers want to feel safe, so the car manufacturers will demonstrate how their cars’ safety issues keep the drivers and passengers safe from harm in their vehicles. Killip says targeted messaging to specific audiences illustrates how today’s brand can “get under the skin” of customers and use it to move metrics for the company. Rule #3: Cast your net wide. There are always some presumptions before you carry out research. First, you want to act on your opinion. That means you might check in with a couple of colleagues. However, that net is too small and leads to you having assumptions about your customer base. For example, Tillip used to work with a financial institution, and if she were around, her financial client would invite her to help select their new creative—on which the financial company would spend thousands and thousands of pounds. This strategy was horrible, Tillip says, because they were thinking about what they liked, not what the potential customer wanted. She says their net was too small. Second, making assumptions about your customers can narrow the net, too. For example, relying on demographics can lead you to make these assumptions. If you group your customers by their age, where you guess they live, and what you gather their interests are, you could miss out on the potential to expand that group. Worse you could be wrong. So, in general, I would advise you to think broadly, give yourself opportunities to be surprised and learn new things. Plus, get excellent professional help with your net casting. Otherwise, your net could be missing what you wanted to catch. Rule #4: Respect the respondents. When we undertake research, we rely on the quality of the respondents we get. Moreover, it is critical to remember we need the respondents way more than they need us. So, no matter how much you compensate them for their time, what they bring to the relationship is far more valuable. Therefore, the research experience should be engaging, enjoyable, manageable, and not confusing so that respondents can give quality answers to our business questions. If we skew it by bungling the experience, it won’t matter how much time and energy you spent on it. The most critical part of this exercise is to keep the respondents engaged. Engagement can be challenging when you’re doing quantitative research. Focus groups are easier to keep the energy up during, as is a telephone conversation. Surveys are different; it’s a one-way conversation. You cross your fingers and hope that the study is interesting enough and clear enough that you will get a quality response. It would be best to keep surveys short, the questions varied, and the meaning clear. Rule #5: Little and often rather than large-scale studies. There are two main things to focus on here. First, an extensive report is not digestible or manageable. It isn’t easy to get the main points from such a large study. Second, you need to keep the conversation going with customers. Attitudes, behaviors, and expectations change all the time. Demands change, too. Keeping the finger on the pulse of the customer is critical to read not only their vital signs but also yours. This bit might be the most important regarding research. Killip agrees that it is rare that a massive research project is necessary. Instead, she thinks research is more useful when you can track changes over time. Therefore, taking a bunch of small snapshots and gathering little bits of data over time is essential to see trends and patterns. You will be up-to-date, and the research will be easier to digest and more helpful in drawing insights. Moreover, frequent and small-scale research projects across a year capture the seasonal influences on your customers, Killip explains. For example, a financial client wanted to run an annual brand tracker and wanted to know if they should run it around the end of the tax year. Killip says their answer was both. Organizations need customer sentiment at noisy and quiet times. You might do well in the noisy period but not in the quiet period, and understanding both standpoints is essential. However, it all starts with having the endpoint in mind. An organization should go into any piece of research with goals in mind about what they want to get out of it. Also, they should know what questions they are trying to answer, which will determine the necessary regularity and depth of the research. As a result, the whole process is more efficient and valuable and ultimately more successful. If you have a business problem that you would like some help with, contact me on LinkedIn or submit your pickle here. We would be glad to hear from you and help you with your challenges. There you have it. No promotions, no gimmicks, just good information. Think reading is for chumps? Try my podcast, The Intuitive Customer instead. We explore the many reasons why customers do what they do—and what you should do about it. Subscribe today right here. [...] Read more...

Why Too Many Organizations Do Not Take Customer Complaints Seriously

June 16, 2022As you might know, my podcast does an “I’m in a Pickle” feature where business people send in their business problems with customer strategy for our consult. I wanted to share this one with all of you because I realize many of you might have the same pickle. Today’s pickle is sent in from Christine Jones. Christine writes, “Our organization does not take complaints or our Voice of the Customer program seriously. So, what can we do now?” I know how she feels. When I was back in corporate life, my role was to improve the Customer Experience. We undertook this customer survey every year, and then ignored it—every year. Sure, we’d have a conversation about the survey results, including complaints, but we never did anything about what the survey told us. It drove me mad. When I complained that we didn’t use the survey results to do anything, someone suggested that we stop doing the survey. If I hadn’t known he was serious, I might have laughed. As it was, I couldn’t believe we were having this conversation. Unfortunately, this feeling of checking a box with customer feedback and then ignoring results is a significant part of the corporate culture. My podcast partner recalls working at a grocery store and seeing a suggestion box on the wall that he was pretty sure no one had a key to anymore. There are so many serious points that come out of Christine’s pickle, but ultimately it comes down to this: is this the right company for you? When I experienced that same situation, I realized the company and I were at opposite ends of the scale when it came to improving our Customer Experience, so maybe this wasn’t the company for me. Ignoring the Voice of Customer is a sign of an unhealthy corporate culture. So, if you can’t fix the problem, it may be time to look elsewhere. Figure Out the Why Before You Try the What So, why are they like that? If I reflect on the organization I was with, they were like that because the company was the dominant player, in a position a smidge below a monopoly of the market. A lack of customer-centricity goes hand-in-hand with monopolies. On the other hand, commoditized markets are forced into customer centricity because the market is so much more dynamic and variable than a monopoly. However, just because you’re in a dominant position doesn’t mean you will stay there. Ignoring the Voice of Customer and the experience you deliver creates long-term vulnerabilities. In the early days of our global Customer Experience consultancy, we worked with a water company in the UK, which is highly regulated but has a monopoly in their area. I asked the CEO why he hired us if he didn’t have any competition to best, and he said, “We want to employ the best people, and the best people will want to come to the best company.” I always considered it a visionary statement that belies a healthy company culture, where employee and customer experiences are valued. What to Do If You Stay However, let’s assume that Christine would like to stay. What can we do to help her turn things around? My second book was Revolutionize Your Customer Experience (Palgrave MacMillan, 2005), about customer-centricity. This content is an excellent background for our advice in this area. As I mentioned, Christine should figure out why they do not take the Voice of Customer seriously. The main reason is they don’t think it’s essential. So, Christine’s first order of business is to make it essential to them. For me, the answer to this is in measurement . I talk about measurement and why it is essential to customer strategy programs. That’s because what gets measured gets done. However, I would amend that to say, what gets paid for on those measures gets done even faster. For example, if people’s pay were tied 100 percent to the results of resolving customer complaints and listening to the Voice of Customer, it would get done without a doubt. However, that is hyperbolic, and I am not suggesting that Christine do something like that. It should cause enough pain to the organization’s leadership that the senior team notices and realizes the company should do something about it. Next, you need a champion. Prioritizing customer centricity might be beyond someone like Christine’s power to change, which means she needs allies higher up in the organization. (Our podcast, 5 Rules for Engaging with Senior Executives , might help here.)These allies are who decide where to allocate resources. While tying compensation is an effective way to motivate people, it is not the only way. A culture that celebrates employees that solve customers’ problems and tells their stories to others is also effective—and that culture comes from the top. So, take the time to make your case to the senior team, educating them on the benefits to the organization (read: $$$$) that making this a priority will produce. Recognize the Impediments to Change Christine should also recognize the psychology at work here, specifically Confirmation Bias and Reference Points. You might remember that Confirmation Bias is how we look for things that confirm our worldview. Reference Points are what we use to compare things. So, if Confirmation Bias is working against Christine, the senior team will read the Voice of Customer feedback and attribute it to what they think it means and what they think causes it, even if they are wrong. So, senior management will be less likely to make the necessary changes with this psychology. With Reference Points working against her, senior management will compare themselves to everyone else in the space. If they are all bad, the complaints will not seem so important. After all, your organization might be the best in a bad area or, at the very least, only as bad as everyone else. The flip side of overcoming these psychological obstacles for Christine is that this situation presents plenty of opportunities. First, an enormous upside exists to getting this experience right for people. Even a slight improvement in an industry that is terrible across the board might make a significant difference in the results. Moreover, like the visionary British water company CEO said, the improvement to the culture and the pride people would take in working for what customers consider the best company will make a world of difference in recruitment and training costs. It is also essential to understand that change is difficult. When companies hear customer complaints, they might choose to downplay their importance because the challenge of changing business as usual seems too daunting to undertake. They know that these problems cause pain for customers and the employees that work with them, but that is nothing compared to the pain everyone would feel from overhauling things to fixing the problem. Moreover, Christine should see that she is the agitator for change. Most of us want things to stay the same and be where we’re comfortable, and have things figured out. Somebody that wants us all to change will be unpopular. It’s only when we recognize that we have to change because the businesses around us are changing, and if we don’t keep up, we’re going to fall behind and fail that we are willing to take on that pain. That’s when Christine’s plan will get more traction. Practical Steps to Take to Get Organizations to Take Customer Complains Seriously Educate your organization. We have a lot of resources that can help, like this newsletter or our podcast. Another education would be to have them deal with customer complaints or even listen to the Voice of the customer. The critical aspect here is getting them exposed to the customer who has got real-life situations, Work with one area. Early wins help you build momentum, but it takes some strategy. I recommend putting all of the resources into one problem area that gets a lot of complaints. Then, track customer satisfaction scores and revenue to show that your customer strategy works. Then, you can use those results in customer satisfaction and revenue to convince the team to allocate more resources to improve other areas about which customers complain. Don’t butt heads with the haters. There will be people who are not on board with your plan. Don’t waste all your energy fighting them or trying to convince them. Instead, focus your efforts on supporting those that want to work with you, get some proof it works, and then move into the areas where you have more resistance. Present your evidence. If you can find other sources that share examples of where listening to the Voice of Customer turned things around for an organization, present them to the powers that be. Harvard Business Review, Fast Company, and Businessweek are great places to start your search. Then, when someone questions the validity of your programs, you can cite (reliable) sources. Or do the opposite, and find some serious fails in the area. (Like the United Breaks Guitars music video.) Those might be even more compelling resources. Listen, if you’re a monopolist, you don’t have to worry about this as much. Customers can complain all they want; you are the only game in town. However, companies that don’t have to worry about complaints or Voice of Customer are shrinking. So if you are one of these companies in the majority, the ones that have plenty of competition, you should address customer complaints and listen to the voices of your customers before it’s too late—and they use their voices to decry you to everyone know. Maybe you have a different pickle with your customer strategy? If so, tell us about it at www.beyondphilosophy.com./pickle. We can feature you on the podcast and help you, too. There you have it. No promotions, no gimmicks, just good information. Think reading is for chumps? Try my podcast, The Intuitive Customer instead. We explore the many reasons why customers do what they do—and what you should do about it. Subscribe today right here. [...] Read more...

Is The Move to Self-Service Better For Your Organization Or The Customer?

June 9, 2022Many organizations bust their backs trying to deliver excellent Customer Service. However, it might surprise you to learn your Customers want self-service—and the reasons why might surprise you even more. Attest is a company that does consumer research, and they’ve got several great reports that I’ve been reading. In particular, two stats from their US Food and Beverage Report from July 2021 emphasized to me how essential a topic this was. We discussed them on a recent podcast: 72% of Gen-Z prefer self-checkout options over cashiers in grocery stores 68% of shoppers want virtual try on tools for clothes and makeup Self-service has been one of the most significant trends in all business in the last two decades. So, why? What’s the human thing behind it? When do people want more or less human interaction? Self-Service Versus Full Service The first stat above suggests a generational shift from a traditional way of doing things. It could be that younger people want to do things a new way. Reference Points also play a role here. People who have been shopping for a while (e.g., older generation X, Boomers, and Silent Generation) form Reference Points about what that interaction should be like. For example, if you’re used to full-service checkout, anything different from that might bother you. You might feel self-checkout is extra work. However, the full-service checkout isn’t as ingrained into your expectations as a younger shopper (e.g., younger Gen X, Millennials and Gen Z). So, you might have a more positive reaction to self-service than older people. For me, I would use self-service sometimes and not others. It’s a tradeoff between speed and efficiency. For example, if I have a full cart of groceries at Publix, self-service would be a no-go because it would be a hassle. However, at McDonald’s, I would probably use the self-ordering screens to speed up the delivery of my heart-stopping meal. In both cases, my choice to use or not use self-service has to do with how easy it is for me. These examples bring me to the most critical question every organization should ask: is the move to self-service going to make customers’ lives easier? Motivations for Wanting Self Service Vary Most organizations like self-service because it reduces their labor costs. Improvements to the Customer Experience are secondary to saving the company money. So, some self-service helps, and some hurts. These outcomes, both positive and negative, occur by chance because the customer is not at the center of that decision, overhead is. Customers have their reasons for wanting self-service, too. My grocery store and McDonald’s scenarios with self-service cover efficiency. Other reasons could be that the interaction will be complex, or the decision process is still happening. For example, I belong to the Freedom Boat Club, which is a subscription service with access to a company’s fleet. When I need a boat, I can call and work with someone or go on the app and use self-service. I always choose self-service. For efficiency? No. Quite the opposite. There are times when I parse my options for the better part of an afternoon. I would feel mortified to put someone through my decision process of which boat to choose for what location and how I will use it, which involves trying lots of different options, comparing the outcomes, going back to the first one again, and so on. (Freedom Boat Club Customer Service reps, you’re welcome.) Another example of my preferring self-service over customer service is when booking flights. For instance, I like to know what seats are available and where in the plane. I also look at the different planes that are flying the route. In business class, I only want an odd-row-numbered seat because the odd row are by the window. I would rather choose and peruse these details for myself than communicate them all to someone else. However, in both of those examples, I am an expert on what I want (read: very, very picky). If you don’t know much about boats or planes or business class particulars, then talking to a person might be more helpful for you. People want to feel like they’re in control. How much control they want will vary by segment, and it depends in part on how expert they are. Experts will find self-service empowering, whereas non-experts may find it worse or intimidating. Therefore, having different options will give you the opportunity for the best results. Other motivations might drive people to self-service, too. For example, hating the conventional experience might cause people to skip human interaction. Car buying is a great example here. Many online car interactions have grown in popularity over the years. Another example of a motivation toward self-service might be feeling stupid because you don’t know about something. Learning about it from a YouTube video feels less embarrassing than admitting you don’t know what you are doing to another person face-to-face or on the phone. Why Do We (Not) Want Interactions? A tremendous evolutionary psychology book called The Rational Animal suggests we all have fundamental human needs. However, those needs percolate through the layers of culture, socialization, and technology, which changes how those needs manifest. Therefore, we still have a fundamental need to connect with other human beings, but what constitutes connection has changed. For example, young people see texting as a valuable way of communicating and consider texting as being social. Older people might not, and instead prefer talking on the phone or meeting face-to-face. So, both groups still need socialization. However, we want it in a way that feels comfortable to us, and what is considered comfortable changes over time. Does that mean that we want to have small talk with a sales clerk? For some people, yes, but for others, no. If You Build It, Will They Come? There is an old movie, Field of Dreams, where a farmer in Iowa plows under acreage of his fields to build a baseball field based on the urging of a mysterious voice whispering, “If you build it, he will come.” Spoiler alert: He built it, and the “he” came (and bring a handkerchief because it’s a beautiful moment.) But movies aren’t like real life. If you build self-service, your customers might not come unless you help them. For example, in the old flying days, you used to check in at a desk beforehand after waiting in a long line. Then, self-service terminals emerged right next to the check-in line. I love technology, but I didn’t venture to the self-serve kiosks without help. Airline employees were combing the queue to convince us to try it. Once I did, I never waited in the check-in line again. Now, I don’t use the kiosks either; I check in on my phone. Would I have ever tried it on my own? Probably. If I saw other people like me using it, I would have eventually. My point is that they knew we passengers needed some help making the transition, and the airline invested in resources to train us. So, I recommend the same for you. When moving to self-service, invest in training your customers on how to move to that environment. So, What Should You Do with This Information? The critical advice is self-service is usually an opportunity for firms to cut costs, which is excellent. However, self-service can also be an opportunity to improve the customer experience. So, look for those opportunities. Am I serving a segment that would be open to this? Am I serving an expert segment that knows what they want and gets through the interaction without problems? Also, are you serving segments where the common problems or hiccups are predictable and easy to articulate? In that case, things like an AI chatbot can be like a quasi-self-service instrument instead of something where you have to interact with another human being to get your answer. Using this can improve the customer experience if it is more straightforward, efficient, and less stressful for that segment. However, it would be wise to train customers on self-service once you introduce it. Even though customers want it and like using it, they might avoid it if it’s new. Self-service presents a real opportunity. Moreover, there are more ways to interact with customers and provide customers with an experience that offers a chance to meet people where they are. However, when implementing self-service in all of its various forms, ask yourself if you are doing it to improve the customer’s overall experience or imposing it to save the company money? Hint: the second one is not a great long-term strategy. If you have a business problem that you would like some help with, contact me on LinkedIn or submit your pickle here. We would be glad to hear from you and help you with your challenges. There you have it. No promotions, no gimmicks, just good information. Think reading is for chumps? Try my podcast, The Intuitive Customer instead. We explore the many reasons why customers do what they do—and what you should do about it. Subscribe today right here. [...] Read more...

Do Your Customers Trust You? Here Are Four Secrets to Discover What They Really Think

June 2, 2022How do you know if someone trusts you? Is it what they share with you? How do they spend their time with you? Is it the language they use when talking about you or what they do when you aren’t around? I would argue it’s all of the above. But, also, these things are true about people’s trust in your life or customers on your sales reports. On a recent podcast, one of our listeners contacted us with a Business Pickle with which he wanted our help. Bob has recently joined a company, managing the relationship of a large customer account with a long history with Bob’s company. Bob is hoping to learn what level of trust exists between the two companies and wanted to know if we had any tips for determining that. So, today, I thought I would share the four things we advised Bob to do here on our NL, too. Then, we will talk about measuring trust and how these principles extend to other necessary measurements in companies. (We covered some of this information in another podcast, The Five Rules for Creating Behavioral Experiments.) The Four Things You Can Do to Discover if Customers Trust You 1. Ask the customer directly. Sure, it’s direct and a little obvious, but it might work. Also, this approach works for many emotional questions you have. Ideally, you ask through a survey. Also, request it at strategic moments over time. For example, immediately following interactions with customers might show you moments in the customer journey where the trust scores increase or decline more than others. However, there is a good news/bad news bit about measuring things. First, the good news; it’s easier to design a survey than you might think at first. While there are things that can go wrong, and experience does improve your surveys, writing surveys does not require a lot of special training. So, jump in and start and learn from what you do. Now the bad news; the real challenge is what to do with the data. When they ask directly, people make one mistake: they assign meaning to the number they get back, but it has none. Instead, the number you get over time gives it meaning. So, for example, if you score a 4 out of 5 for trust on surveys, that is not as meaningful as scoring 4 out of 5 after scoring a 3 two months earlier. Comparing your results across different points in the customer journey and various customer segments is also meaningful. But, again, the comparison of direct measures is the most useful and not necessarily as raw data itself. 2. Ask the customer indirectly. In addition to asking the customer if they trust you, you can also ask questions that seem unrelated to trust that also tell you if they trust you. Why would you do this? People may have reasons for not wanting to come out and say they don’t trust you, even in a survey. For example, you can ask customers to imagine the company and its three largest competitors were people. Then, you ask them which of the four people the customer would most likely loan $5? Or you could ask the customer who they would call if they needed someone to come and pick them up during an emergency? These indirect questions sound silly, but they permit people to give an honest answer where it doesn’t feel like they tell you they don’t trust you. One way we do it is to give customers magazines and ask them to pick out an image that portrays how they feel about the organization. Then, when they do, we ask why they picked it. The insights you get you would never get if you asked them standard questions. 3. Use behavioral measures. You can also look at what your customer is doing to determine if they trust you. This type of customer data can take many forms. For example, declining purchased level data clarifies that there’s a problem, and trust might be one of the causes. If you combine different data about customer behavior—what they say about you in reviews, how they interact with your social media, and channels like this—you see firsthand what they talk about regarding trust issues. You can also get specific in interpersonal interactions if you have this kind of data. For example, can you observe how your customers interact with your employees? Do they seem hesitant? Do they have closed-off body language? Do they have their arms crossed a lot? Are they not making eye contact? If you can video customers, you can look for micro-expressions where people might have flashes of a distrustful expression, skepticism, or fear (even if they cover it up very quickly). So, people might be giving you access to data already on trust that you haven’t analyzed yet. Human beings communicate a lot through their body language. And therefore, we are picking up all of these little signals all the time. So, the issue is codifying it effectively. 4. Create an experiment. The idea that you can measure trust using experiments is an idea that goes back decades. Economists and behavioral economists have been doing it for a long time. As a result, there’s a whole classification of trust experiments designed and run repeatedly. For example, the classic trust game has two players, and you give Player A $20. Then, Player A can give as much money as they want to Player B. Whatever Player A gives gets tripled, and Player B can decide how much of that money to give back to Player A. So, this trust game is about reciprocation. They experiment with this game in different ways, e.g., same gender, different gender, acquaintances or strangers, multiple rounds. The Brits put a version of it on TV called Golden Balls. The idea of these trust games is they could be a jumping-off point for Bob. We would need to customize the experiment to apply to Bob’s business to make something like this work for his questions about trust. Without more information, I recommend looking for points in the customer journey where trust is crucial and zero in on those. Are there things that you can measure here that would indicate trust? I hope that helping Bob was helpful to you, too. Maybe you have a different pickle in your customer strategy? If so, please tell us about it at www.beyondphilosophy.com./pickle. Perhaps we can feature you on the podcast and help you, too. There you have it. No promotions, no gimmicks, just good information. Think reading is for chumps? Try my podcast, The Intuitive Customer, instead. We explore the many reasons why customers do what they do—and what you should do about it. Subscribe today right here. [...] Read more...

Are You Really Confused? How You Describe Yourself is Not Seen By Others

May 26, 2022Many organizations are trying to figure out how to win the hearts and minds of customers. Unfortunately, they are not like to find the answers in the ways they have grouped customers in to segments. The designation of small, medium, and large customers doesn’t reveal much about what customers want or why they are in the group they are. Perhaps a different tack is in order. If a company wants to know how to win the hearts and minds of customers, they must first understand how customers feel and how they think. Much of that thinking centers around the self. Understanding customers’ self-perceptions is essential for successful targeted customer strategy. Lucky for us, Sara Dommer, Ph.D. Assistant Professor of Marketing at Penn State Smeal College of Business was a guest on a recent podcast, and she explains perception of self and how it drives customer behavior. Dommer says the definition of self is a hard one to nail down. Twenty different research papers will likely give you twenty different meanings. However, she views self as everything that makes you, you. For example, Dommer sees herself as a Mom, Professor, wife, and former intramural dodgeball player. Dommer says certain personality traits relate to people’s identities more than others. For example, Dommer says her mom and professor’s identity became blurred during the pandemic. However, the blurring of these two parts of her life is an excellent example of how these different aspects of the self work together and influence customer behavior. How Would You Describe Yourself? Dommer says that when you ask people to describe themselves, some start with personality traits. For example, they might say, “I’m funny, intelligent, and . Others begin with broader identities, like their roles in life, marital status or what they do for a living, and so on. However, we also define ourselves by what we are not. For example, ensuring that everyone knows you are not a fan of the local football team or a popular genre of music or film that might be associated with your “type” is a significant part of people’s identity. In the US, an example of using what they aren’t to define oneself might be to clarify that they are far bluer than the red state where they live. In addition, there is also our public versus private selves. Sometimes, these identities overlap, meaning certain parts about us are both a public part of who you are and a private part. But, then, other parts of us are strictly one or the other. Moreover, there is the actual self vs. the aspirational self. So, who we currently are, how we perceive ourselves, and the people we want to be. Let’s not forget that other-selves are lurking around there, too. There are the selves we are afraid to become or the past selves we are leaving behind. So, Dommer says that’s why it’s challenging to define the idea of self. It is many, many things all at the same time. Wearing Our Different Self Hats People talk about like wearing different hats in their lives. People switch between the different roles they play throughout the day. They “put on different hats,” which relates to the responsibilities or perspectives of that part of their life. Dommer says this is another side effect of self-perception. Research suggests that these different roles and how strictly we separate them affect our customer behavior. Dommer has research that indicates how much we overlap our parts affects what we buy and don’t. For example, if a person saves some money on a work purchase, would they then feel like they could spend the savings on taking their child to a special outing (if they are self-employed, of course)? Dommer’s research suggests that whether you connect the work savings with the personal spending depends on whether you wear both the self-employed worker and the parental hats or wear them one at a time. Our mental accounting is influenced by how integrated these two self-concepts are. My wife Lorraine has weighed in on this crossover before. Usually, it comes up when she asks me something, and I use my management skills on her. She usually says, “You are not at work now.” Dommer thinks that is because my two roles have too much integration, which eliminates those boundaries between managing your team and personal life. The Hierarchy of Creating Self Many of you are likely familiar with Maslow’s hierarchy of needs. The top triangle on the pyramid is usually labeled self-actualization. Self-actualization is the fundamental understanding of who you are, or at least the goal state. As you can see, self-actualization comes right after esteem. So, you could say that indicates that once you feel good about yourself, the next level is the actualization of that. It is feeling of “being comfortable in your skin.” This self-understanding guides your behavior. When your thoughts and feelings affirm your concept of self, you repeat them consistently, creating the cycle of affirmation. The Power of Reflective Messaging Now, let’s introduce messaging. Many of our marketing communications messages are about convincing you that this product says something about you. This product is for you, and that boils down to who you are and the self. This approach implies that organizations need to understand the different segments of the self. For example, how will you speak to customers if you don’t know who your customer is? Therefore, every organization’s first question should be, who is our customer? This understanding of people is essential. Also, it is essential to break it down into more than demographic information. Knowing that a customer is a 40-year-old man from New Jersey is not enough information. However, it is easy information to gather, which is why demographics are ubiquitous in so many segmentation exercises. However, if you know that he is a 40-year-old man from New Jersey who enjoys cycling and drinks craft beer, you learn more about him and how to talk to him. Dommer says much research suggests that consumers see themselves reflected in products and brands. This reflection of self leads to beneficial purchase behaviors. She says that companies recognize this and are capitalizing on it in unique ways. For example, NikeID’s Made For You program where you can create your own Nike shoe in whatever color and style you want. Nike isn’t the only one exploring the self. The M&M characters are getting nuanced, too. The press release about the program explains the idea is to create a world where everyone feels they belong. So, What Should You Do with This Information? Practically speaking, there are a few implications Dommer’s research has on experiences. As a Customer Experience professional tasked with managing customer behavior and outcomes, here are a few practical suggestions: Start with understanding customers. Your customers have perceptions of themselves, and you should be aware of those. Then, follow up with segmentation targeting. Once you know who customers are and how they view themselves, group them into like-minded clusters so you can target them. Reflect customers’ selves at them in unexpected ways. Then, look for ways to reflect that self-image to customers and attract them to your product or service. There are obvious areas to do this, like marketing messaging and customer communications, but there is another level. You could use those concepts in packaging or consumption, too. For services, it could be in the follow-up practices you employ. It’s fascinating how many decisions are driven by self-perception. We can gain many benefits as marketers, as customer experience professionals, by understanding who people are and what’s important to them. This information about the self is the next stage of segmentation and targeting. If you have developed your segments and targets, the next step is to understand them. And that understanding is tightly linked to how these customers see themselves and who they want to be. Moreover, it serves what seems to be a fundamental need for self-expression and self-identity. If you have a business problem that you would like some help with, contact me on LinkedIn or submit your pickle here. We would be glad to hear from you and help you with your challenges. There you have it. No promotions, no gimmicks, just good information. Think reading is for chumps? Try my podcast, The Intuitive Customer instead. We explore the many reasons why customers do what they do—and what you should do about it. Subscribe today right here. Verint sponsors this article. Verint helps the world’s most iconic brands build enduring customer relationships by connecting work data and experiences across the enterprise. The Verint Customer Engagement Cloud Platform draws on the latest advancements in AI and analytics, an open cloud architecture, and the science of customer engagement to meet shifting customer interactions and their ever-increasing demands. [...] Read more...

Subscription Model? Is This Really The Best Approach for Me?

May 19, 2022We are in a bit of a subscription economy. You can subscribe to almost anything, anytime, anywhere. So today, I want to talk about the subscription economy, why it is so popular with customers, and the organizations that offer them. We discussed this idea of subscriptions on a recent podcast. I got interested in it because it involves my favorite company: Apple. Last year, Apple increased its subscription service, and its services revenue went up 24 percent. Apple’s services segment is up to $19.5 billion (which probably is loose change for Apple), so it’s no wonder that they’re turning their attention to subscription services. In addition, there is talk that Apple will soon launch subscription services for their iPhones. Buying your phone on a subscription probably feels familiar. You might make payments for your phone already and pay for service monthly. However, the difference is that you wouldn’t own the phone on a subscription. Subscriptions are everywhere. There is talk of making features on a car a subscription, like heated seats. (Thankfully, things like brakes and the seats themselves will stay standard features). Streaming is another example. Is there a day when there isn’t a new streaming service available? However, consumers like subscriptions. In a recent report from Attest, a consumer research platform, I read that 78% of Gen Z would pay a subscription to have 24/7 access to a grocery source. That one seems a little crazy to me, but then again, I am nowhere near the age of Gen Z. From that same report, I learned that 65% of Americans are either actively looking for new product subscriptions or open-minded to them. You can subscribe to anything. On Amazon, you can subscribe to paper towels. On Stitch Fix, you can subscribe to clothing services, where a curator picks outfits for you. In addition, there are subscription services for content, hobby materials, art supplies, meal plans…literally anything. You pay for it monthly, and it will show up at your door. Why Do Consumers Love Subscriptions? So, from the customer’s perspective, subscriptions provide a more attractive way of paying for things. Subscriptions break up high costs into small costs, which are more palatable. Sometimes, this method is called the ala carte model or a two-part or multi-part pricing model. Instead of giving customers one large bill, the company charges a series of small bills. Each of those small bills feels like nothing compared to one large one. The psychology behind that’s pretty straightforward. We tend to be bad at aggregating and remembering a precise numerical amount of the multi-part pricing model. So, if the subscription amount slides under your notice each month because it’s not significant enough to draw your attention, then you never think about it. It provides some psychological comfort. You’re not distressed by these large bills. Why do Companies Like Subscriptions Services? From the company’s perspective, the payment amount that slides below notice is an advantage. Customers that wouldn’t buy if the offering was $200 a year will buy when it’s divided over 12 months. There are even firms that walk an ethical line and, in some cases, cross an ethical line by tricking people into this type of purchase model. (I’m looking at you, gaming apps.) Many downloadable kids apps will charge $5 a month to play the game. Several years ago, old dial-up internet services took a different tack. The company didn’t speak up when a customer no longer needed their service because they had migrated to broadband. As a result, many customers forgot they were paying $15-$20 a month for dial-up and continued to do so. That company planned to lay low and let them. I’ve got several subscriptions, as I’m sure everybody has. Netflix is one of them, and it is also the best example of handling subscriptions well. They make it easy to cancel or put their service on hold. They don’t try and hide it. Within a couple of clicks, you can put it on hold. Other organizations make it impossible to cancel. For example, the other day, I signed up for one of these photo stock images and then tried to cancel. That was a nightmare. Gym memberships are another example. If you try to cancel a gym membership, they make you meet with the manager and jump through hoops. So, you can see that how you handle this can be a competitive differentiator. Customers are more loyal to a company that gives them the flexibility to cancel rather than making it complicated. Trying to hide it or make customers jump through hoops only drives them further away. Many people that quit Netflix go back; few people that had a terrible experience canceling their gym membership will. The Role of Mental Accounting in Subscriptions Mental Accounting plays into this principle of subscriptions. Mental accounting puts money in psychological buckets, even though money is fungible. If we break up high costs into small parts, they feel like you are saving money. If the subscription is a small enough cost, we can slip it into a bucket where it will not cause us any problems. On the contrary, if it’s a large enough expense, then it requires more attention. It might trigger a response in use to reject that subscription or, at the very least, not renew it. From a mental accounting perspective, subscriptions often are not accounted for. For example, I have Amazon Prime, which I purchased for faster shipping times. So, the video streaming through that subscription feels free to me. However, the subscription itself is not considered an expense because it’s part of the background. So, in some cases, the subscription itself doesn’t even go into the appropriate mental account. Customers Don’t Like Losing Subscriptions. Have you ever subscribed to something, never used it, but then didn’t want to cancel because you might need/want/use it? Yeah, me, too. This happens because of Loss Aversion. We feel bad about losing things even more than we feel good about gaining something. So, when you think about canceling the subscription, it can be challenging to get over this feeling. You see it with streaming services. Many of them you don’t watch. But you don’t cancel them because you might watch. You don’t want to give up something that you already have gotten used to be available, even if you don’t watch it. This situation presents a significant advantage for the organization. They have regular amounts of money coming in, and it will keep coming because we are too worried we will miss it if we drop it. So, What Should You Do About This in Your Organization? Subscriptions will likely generate more revenue for firms. In addition, there’s lots of psychology suggesting that people will respond positively to it. So there are lots of advantages to companies to offer it to them. However, take heed. This massive shift to subscription feels like a “Tragedy of the Commons” scenario. The Tragedy of the Commons that economists came up with draws upon when civilization was made up of small villages. Most of the residents did not have land for their livestock to graze upon, so they shared a commons where all the villages’ livestock grazed together. The problem is when we’ve got a shared resource like that, there’s individual pressure for us to take more advantage of it. Over time, some villagers added to their livestock because why not? It wouldn’t cost more to feed them since you had the commons. But, as everyone added livestock, the commons were taxed beyond their resources and killed the field. So now, nobody can feed their livestock. Hence, the tragedy. There is a danger of that happening with subscriptions. Customers respond to them, so individual firms offer them. However, customers will likely participate in a backlash in time as the subscriptions pile upon their credit card bills. If there is too much of a good thing, people will start to cancel in droves. It all goes back to Customer Experience. Organizations that provide the best experience and flexibility regarding cancellations will win out. Those that don’t will stand in a dried-up field with nothing to feed their livestock. Tragic. If you have a business problem that you would like some help with, contact me on LinkedIn or submit your pickle here. We would be glad to hear from you and help you with your challenges. There you have it. No promotions, no gimmicks, just good information. Think reading is for chumps? Try my podcast, The Intuitive Customer instead. We explore the many reasons why customers do what they do—and what you should do about it. Subscribe today right here. [...] Read more...

Discovering Hidden Customer Insights in New Places is Critical for Future Success!

May 12, 2022Customer Science is an exciting new variant of Customer Experience. One of the crucial ways that the science is more powerful is the quality of the customer data you feed into the process. So, the question becomes, how complete is the data you would feed into the scientific process? If you are like many organizations, the answer is likely not complete enough. I came to this realization in a discussion I had recently with a voice of customer expert. I was a guest on a webinar with Verint on the Engagement Capacity Gap, which discusses where organizations need to be in this area vs. where they are with the Chief Marketing Officer of Verint, Celia Fleischaker. Afterward, we discussed Customer Science and the role customer data will play in this latest evolution of customer experience. I invited her to the podcast to continue our discussion and wanted to share some of that insight here. It Starts with Customer Science Customer Science is where customer strategy is headed. It’s the convergence between behavioral science, AI, and data. The voice of the customer in the new world of Customer Science is going to become vital to your customer strategy. The voice of customers is another set of data that people can use to feed the AI and receive great insights about how they improve working with that customer, Fleischaker explains. Integrating the various data sources is something many organizations have on their to-do list. For example, companies tend to view customers in their profile data, meaning their transactions and interactions with different departments like sales and service. However, data requires layering from various sources. If you only have one type of data, it’s challenging to make a meaningful insight from it. When you layer in the experience and voice of the customer data, you drive understanding. However, it can seem overwhelming to bring all of that together from the various organizational siloes to drive insights, Fleischaker explains. Moreover, many organizations need help interpreting their data. For my part, if a company isn’t looking at their data through the lens of the behavioral sciences, they aren’t leveraging the most valuable aspects of it. Fusing the data and then using a scientific approach to drive actions will. In other words, it’s not only looking at the bulk of the layered data but also using science to make sense of it. Fleischaker has a great example of a firm doing this well on the contact center side. A European insurer uses AI to use the data and the feedback to determine the next best action. However, she says they’re using it in real-time, meaning looking at that interaction as it’s happening. The insurance company uses AI to understand the sentiment along with acoustic analysis and then coaches agents on where to take that interaction and help that customer. Fleischaker says the company improved its first call resolution and enhanced the Customer Experience to create a substantial impact for them. Sentiment analysis is critical here. It means you’re looking beyond the words that customers are saying and using to discover what they mean by them and how they are feeling. Fleischaker’s example shows a company interpreting that data using a behavioral science perspective. How the data is collected is an essential consideration, too. For example, Fleischaker says many companies use audio and speech analytics. She also sees firms using text analytics for digital channel interactions. She considers all of these improvements over waiting for survey or feedback results. Furthermore, Verint is seeing clients combine those sources to analyze the overall experience and understand more about each interaction and determine what’s needed to improve and drive better engagement. Engaging with Voice of Customer Data However, as encouraging these examples are, I can’t help but feel pessimistic about how many organizations will respond to these challenges. I admonished my colleagues for never using the voice of customer research we undertook to do anything different in our approach during my corporate career. Instead of rising to my challenge, my colleagues thought we should stop doing the research. This example is one of many reasons I am no longer in corporate life. Fleischaker has a different approach to spark engagement regarding the voice of customer data in companies Verint consults. First, companies should bring together all their data sources into a similar format so they can be analyzed together. Then, with a single data hub, AI can access it for analysis. Having these two processes in place makes it easier to create actionable insight with multiple data sources. From a marketing perspective, Fleischaker thinks having Customer Science integrated into your customer strategy expands what you can do. It’s an opportunity to uncover and leverage additional insights from interactions that occur across the organization. For example, the contact center was not part of marketing’s strategy in the past, but it is today. Fleischaker recognizes enormous customer strategy opportunities in the contact center’s data. Contact center teams are not only solving a service problem but also uncovering a chance to market and sell to customers. So, yes, Fleischaker has the traditional lead and pipeline building marketing efforts but discovered an even better opportunity to build a better relationship with customers when they contact the company. Moreover, Customer Science provides an understanding of customers and the ability to empathize more with where customers are in that relationship. Layering that together to understand how they’re connected is very interesting and drives a lot of value. (I’d like to encourage all of you to download the new Engagement Capacity Gap study and to register for Verint’s annual engagement conference in Orlando from June 13 to June 16.) So, What Should You DO about This? So, what’s the takeaway? What should you do about the Voice of Customer in the mix of data sources you fuse for your forays into Customer Science. Here are a few suggestions: Understand the data you have and where it is in the organization. Like many things, having a good inventory of the various data sources is an excellent place to start. It is essential to survey what you have, where you keep it, and how it’s collected. It will let you know what you have plenty of, but it will also shed some light on what you need. Moreover, you can build a map to bring that data together in one place. This ability to integrate your data into one system, a single data hub, is foundational to using the AI to the full extent of its benefit. Try new things with your data. It’s easy to do what you have always done, running an analysis on your website data or charting your purchase data. The challenge is trying something new, like feeding your voice of customer data into your analysis models. However, excluding data because you don’t have as much experience with it is a foolish way to search for answers. The excluded data might hide the answers you need. So, try the new thing, combine the data even though it’s challenging, and you are far more likely to find the insight you need to drive your customer strategy. Remember, “Experts lose to data.” This great quote from Nobel-Prize-winning physicist Richard Feynman says it all. If you have the opportunity to join expertise with empirical results and then test, refine, and iterate to improve, then that’s a beautiful place to be. It is essential to use all your customer data to combine AI and behavioral sciences. So, if you haven’t got one hub for all your data, including the voice of customer data you have, how can you be sure that the insights you get will be accurate? Moreover, the improvements to your experience based on what is possible with the customer and behavioral segmentation are outstanding. Without that data, layered and comprehensive, you miss out on a lot. I don’t see how you could get to the new land of Customer Science without it. So, I would encourage people to get serious about how they will make that change and take their customer strategy to the next level. Verint sponsors this article. Verint helps the world’s most iconic brands build enduring customer relationships by connecting work data and experiences across the enterprise. The Verint Customer Engagement Cloud Platform draws on the latest advancements in AI and analytics, an open cloud architecture, and the science of customer engagement to meet shifting customer interactions and their ever-increasing demands. If you have a business problem that you would like some help with, contact me on LinkedIn or submit your pickle here. We would be glad to hear from you and help you with your challenges. There you have it. No promotions, no gimmicks, just good information. Think reading is for chumps? Try my podcast, The Intuitive Customer instead. We explore the many reasons why customers do what they do—and what you should do about it. Subscribe today right here. [...] Read more...

5 Rules for Creating Behavioral Experiments

May 5, 2022Have you ever heard of the Milgram experiment? This behavioral experiment tested whether one participant would deliver electric shocks to another participant at a fatal level even as they listened to the second participant’s screams of pain. Shockingly (ahem), they did. Luckily, no one died. The other participant was an actor, and the shrieks the first participant heard were recorded. This disturbing experiment got me thinking, how do you design a behavioral experiment, and how would that work regarding customer behavior in your experience? Luckily for me, my podcast partner, Professor Ryan Hamilton from Emory University, is an expert in this, so he shared his five rules for creating behavioral experiments in a recent episode that I thought I would share here well. Before I share the rules, let’s review why you should care about setting one of these up properly. The most important reason is that experiments are the gold standard for determining causality. When set up correctly, we know that the actions taken in the experiment caused the outcome. However, for most other data sets—from sales numbers, customer surveys, web traffic reports, and so on—we have to infer causality from that data. If determining causality is a strength of experiments, the weakness is that they have to be abstracted. Once you abstract the experiment, it reduces the general findings. However, this tradeoff is essential to maintain the determination of causality. I have run into this problem in the past. I have presented to organizations that if they make my suggested changes to their experiences, it will bring in $X revenue. They then ask, “How do you know that the revenue increase is because of this change you suggest and not something else we have done?” My answer is very unsatisfying; “I don’t.” We can never know the causality of behavior at 100 percent certainty. However, we should still try. Per Professor Hamilton, there are three things needed to establish causality: Have a temporal precedent, meaning the cause comes before the effect. Establish correlation, which refers to combined movements of the cause and effect, meaning if I increase the cause, I should also increase (or decrease) the impact. Allow for no better alternative explanation, which is the tricky one. The more data we have, the more we can confidently rule out alternative explanations. However, it’s always contingent. A new reason might explain the information better tomorrow, replacing the one we have as the causal explanation. That said, the results of a good experiment will always be the best explanation we have that gets us closer to confidence. Sound experiment creation strategies will help us build a solid case for our causality. So, here are Professor Hamilton’s five rules for it: The 5 Rules for Running Behavioral Business Experiments Define your metrics and what you’re going to measure. Establish comparison conditions. Randomize or get as close to randomization as you possibly can. Define the theory…or not. Foster a culture of experimentation. Let’s take a closer look at each of these. Rule #1: Define your metrics and what you’re going to measure. The first thing you need to do if you want to run an experiment with your business is to figure out your dependent variables. Knowing what you want to measure before you design everything else is essential. For business, the ultimate goals are often distant, things like profitability or happier customers (that will lead to more profitability). However, for the experiment, profitability may be an unreasonable metric to use. We want a dependent measure. It would be best if the measure happens close to when we run our experiment. It should also be simple to measure related to what we care about and sensitive enough to detect any changes. Most organizations might choose a different measure than profitability. It could be revenue, Net Promoter Score®, customer satisfaction, etc. Whatever it is, your measure should move along a continuum. Which one you choose depends on many factors, like how easy it is to measure or how close it is to what you want (profitability). Rule #2: We need comparison conditions. There are a few things you need to have an experiment. One of the most significant is establishing different conditions to compare. So, first, you need to divide up people or things and then treat each group differently in ways that make sense for your question. Many of you might think of a control group as an excellent example. However, there does not always need to be a control. For example, it could be multiple treatment groups, meaning each group gets a different experiment version. What is essential here is to establish other conditions to compare the outcomes. Rule #3: Randomize or get as close to randomization as possible. When you’re running experiments, randomization is like magic. It solves so many problems. For example, if you have two conditions, treatment and control, and groups from two geographic regions, the worst thing you can do is divide the conditions by the areas. People from those two areas might be fundamentally different from the other area somehow, which leaves the door wide open to a better alternative explanation for the causality in your experiment. Randomizing people individually into those different conditions takes care of that. Randomization used to be challenging. Now, with technology, it is accessible in many cases. For example, if you want to experiment with different versions of a website or an email campaign, you can randomize the lists you send the links or email. However, it is more challenging to randomize two versions of a TV campaign because you have to work with the specific markets the ad reaches. Same for retail locations. If you have different geographic areas for brick-and-mortar locations, avoid assigning the same conditions to similar places. Instead, try to mix it up by assigning treatment conditions with something arbitrary, like even vs. odd store numbers, to get as close to randomization as you can. The same goes for your groupings. If you are testing something on multiple customer segments, you don’t want to give one component all one condition and another part the other. Instead, you want to assign both conditions in both pieces to randomly specified individuals. Then, you have data you can use. Rule #4: Define the theory…or not. It’s become trendy, especially online, to do AB testing. The idea with AB testing is to see what works. For example, you change the background color on the website and see how customers respond. That is an experiment that produces valuable information. However, without a theory about why it works, you don’t know why customers responded the way they did, which makes further insights around this difficult. If we start with some hypotheses, we can build toward a theory. Then, we can build towards a more significant understanding of what’s going on, which can be more helpful. For instance, we’ve done AB testing on different titles for emails. The ones that present the urgency for the email as a loss perform better than the general titles. Without understanding our natural preference not to lose things over gaining things, which is part of Loss Aversion, you might not realize that. Instead, you might only think these titles seem to work better than the general ones. When you have a hypothesis, you are testing something. So, if you hypothesize that Loss Aversion applies to this setting and find that it does, you have greater confidence for the next time you test. Or, if you don’t have time to test, you know that email titles positioned as potential losses do better than other titles. Then, you can write one that leverages our aversion to losing things and feel confident it will boost your results. It doesn’t mean to say that it’s universally going to work. That’s why we test these well-worn theories because they don’t apply universally. However, in this setting, the principles behind Loss Aversion will work in these current circumstances. Having a theory is a head start. A view gives you a more advanced place to begin further improvements than without one. Rule #5: Foster a culture of experimentation. So, this may seem like a strange rule, but it is crucial. The sad truth is that most experiments fail, meaning they fail to produce significantly different results. However, these failures are crucial. If we didn’t run the experiment, there’s a good chance we would never know if our idea worked or not. But if we do run it and it fails, well, now we know. We know that it didn’t work in this setting, so we need to try something else. The goal of experimentation is not to celebrate when experiments fail. On the contrary, we would rather they worked. But, if they do fail, the experimenter mustn’t be punished. After all, we now know something because we tried. This one is vital in business today. Many organizations do not have a culture of experimentation. Furthermore, people don’t like a failure, so a culture of failure will never be okay. However, knowing what doesn’t work is also valuable information as we advance. If we don’t experiment and recognize that it’s not working, we develop a culture where people hide things. If what we try doesn’t work, and we know failure of this sort is cause for punishment, our incentive is to obscure the truth. We’ll pretend it does work, which would be terrible because we cannot change and improve when we operate in those conditions. A culture where we try things, fail, and learn from failure is better for progress. Hopefully, these five rules take your business experiments to another level. I encourage you to implement these in your experience improvement programs and customer strategy. Moreover, I hope you celebrate your losses or failures. Maybe you didn’t find what worked but at least now you know what doesn’t. If you have a business problem that you would like some help with, contact me on LinkedIn or submit your pickle here. We would be glad to hear from you and help you with your challenges. There you have it. No promotions, no gimmicks, just good information. Think reading is for chumps? Try my podcast, The Intuitive Customer instead. We explore the many reasons why customers do what they do—and what you should do about it. Subscribe today right here. [...] Read more...

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