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Category: Customer Engagement

“Persona-lize” Your Strategy To Change the Face of Customer Centricity

Posted on by Neosperience Team

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Recently, we have talked about Gamification as an unconventional way to engage customers and increase loyalty, in a world where the two go hand-in-hand and are intimately related.

Now we take a step back to move forward, shifting the focus from the engagement to the understanding. Even before thinking about ‘how’ to drive customer loyalty, in fact, you need to figure out ‘who’ your loyal customers are.

Behavioral science has done a lot of work to provide marketers with valuable insights. The aim is to put customers in a buying mood, by pushing the right buttons, finding the right needs to tap and shaping them with the right words.

As an effect, you will be able to drive customers’ preferences and other virtuous behaviors, including positive word-of-mouth, loyalty, and so on. These goals are of primary concern to all marketers, regardless of the industry or the competitive arena.

If word choices reveal - consciously or unconsciously - our state of mind, so the shared language reveals shared meanings, and shows a certain view of the world which continues to strengthen over time.

In the same way, marketing language says a lot about the relevant culture, mindset, and attitude amongst professionals, and the more we think about it, the more we get skeptical about the long-term effectiveness of this approach.

We can sum it up in two questions. The first one is of a purely linguistic nature.

Who Takes Center Stage?

Reach the target audience, shape customers’ needs, drive preferences and choices, stimulate customers to buy. All these expressions have something in common, beyond being overused: the brand takes action, not the customer.

We talk a lot about customer-centricity and the shift from passive to empowered customers, but the reality is that more is said (and “story-told”) than done.

Our language reveals what implicit stereotypes and beliefs are still embedded in our brains, including such of companies and brands actively shaping customers’ attitudes and thus driving desired behavior - but does this not represent a step back from the very concept of customer empowerment?

One of the most important - and most sensitive - issues for brands is customer loyalty. When it comes to loyalty, we use to say that loyal customers are typically those more satisfied, engaged, and delighted.

That is absolutely true, but we are again taking in account solely the perspective of the Brand, and so considering an oversimplified and incomplete version of the reality, the one that better explains marketers’ goals rather than those of the customers.

And here comes the second question:

What about individual differences?

This approach takes into account customers as if they were a single monolithic entity, to be treated in the same way. Of course, as human beings, we are not totally separable: we share common basic human needs, motives and cognitive patterns that determine our spontaneous behavior in response to certain stimuli.

Individual differences, however, play a crucial role in determining people’s preferences and choices, whether it comes to personal life, professional decisions, or purchase behaviors.

Sometimes consciously, sometimes not, our dispositional motives continually shape and drive the experiences that we have, including our buying experiences. So, why should these factors not be considered in your marketing and communication strategy?

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There is clear evidence that tailored messages are considerably more effective than one-size-fits-all campaigns, and that the effectiveness of tailoring increases with greater customization and adaptation to the unique features of the recipient.

For example, as suggested by Higgins in 2000, you should frame your message to match the recipient’s personal goals by focusing either on promoting gains (e.g., “Product X makes teeth stronger”) or on preventing losses (e.g., “Product X prevents cavities”).

Moreover, many other researchers have shown that messages that are consistent with an individual’s motivational orientation are processed more fluently and evaluated more positively than inconsistent ones.

The effects of what we can call the “message/person congruence” have been examined in correlation to differnt psychological characteristics, including the Big Five Factors, by changing the framing of a message to target specific motives, such as desires for excitement and social rewards, connection with family and community, efficiency and goal pursuit, safety and security, creativity and intellectual stimulation (i.e. see Personalized Persuasion).

For years, retailers have been using a variety of personal information, such as purchase and the website journey history, to tailor their online offers to individual customers. But an emerging literature in the field of Marketing Psychology says that personality traits are no less important.

“If there is any one secret of success, it lies in the ability to get the other person's point of view and see things from that person's angle as well as from your own”, Henry Ford said.

One of the first rules of persuasion is: Know your audience. In a world of companies and Brands striving for relevance, understanding your audience’s point of view is a strong element of differentiation. Understanding every single customer’s point of view? That would be the turning point!

First of all, customers are individuals, and every individual is unique - the way we think, behave, and act, we all do it differently. As the way we communicate to others reflects our mindset, even the way we respond to (and are attracted by) different communication styles changes significantly, depending on our personality. We are more likely to interact, listen, share, believe and be persuaded by communication styles tailored on our peculiarities.

To cut it short, understating customers’ ability to shape the world around them proactively gets into conflict with the very idea of customer-centricity. More, overlooking customers’ individual characteristics undermines the concept of personalization, turning it into a ‘buzzword’ without any substance.

Taken together, these two ‘gaps’ offer huge opportunities for those who are willing to overcome the ‘Business As Usual’ (to quote Brian Solis) and define a real turning point in the world of customer experience. What would you do if you were able to “persona-lize” your marketing strategy?

Download The 7 Pillars Of The New Customer Loyalty to define the foundations on which to build your engagement and loyalty strategy, create innovative experiences and establish a lasting and valuable relationship with your customers.

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Mythological Marketing – The Future of Your Brand is in The Past

Posted on by Neosperience Team

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What is the meaning of your marketing? What are the roots of your storytelling? More and more companies embark on a long journey to discover the hidden traits of their identity. And what they find is a long red thread that goes straight to the roots of culture and society.

There is a persistent wave that moves underneath the structures of modern business, molding everything we do. Sometimes we recognize it, sometimes not. This wave is made of myths and heroes, and it is shaping a new marketing. Mythological Marketing.

The union between myths and marketing is not a new thing. The art of selling has always been closely related to the ability to leverage on the hidden meanings we all bring in. That is, in example, the reason why a Brand rarely offers the same type of message in different markets, even for the same product.

To be compelling and engaging, the storytelling must resonate with the feelings and perceptions (and prejudices) of a particular audience. The content and the context are inescapably entwined, more so in a time of technological revolutions where the concepts of space and time lose relevance.

“Myths are the stories people tell to explain nature, history, and customs. Myth is a feature of every culture. Mythologizing continues, as shown in contemporary mythopoeia such as urban legends and the expansive fictional mythoi created by fantasy novels and comics. A culture's collective mythology helps convey belonging, shared and religious experiences, behavioral models, and moral and practical lessons.” (Wikipedia)

As human beings, we come from different narratives, layered over the centuries, but these stories are all rooted in myths: Greek, Roman, Mesopotamian, Norse, Celtic, Egyptian, African (with all its nuances), Biblical, and so on. They all provide a reference to the many stories that have been formed by peoples throughout all of time.

Long gone are the days when marketing was considered a ‘left brain matter’. Today, we know that the emotional elements guide our decisions, not only as people but also as customers. The marriage between the left brain and the right brain is essential to unlocking the unreleased and untapped power of mythological marketing.

If we consider the last couple of centuries, however, it is easy to see how the Western economies have dismissed the emotions in the name of a more rational approach to productivity and economy.

We find it hard to communicate with our emotions. Sometimes, they are even considered a sign of weakness (“You are too emotional!” is a negative catch phrase we hear too often). But now we know that understanding the emotions plays a pivotal role in the creation of meaningful experiences.

To drive positive behavior, goodwill, and business results, you must engage with customers by deeply appealing to their emotions with delightful, person-centric experiences. If you agree upon the fact that customer experience is the primary differentiator in today’s markets, then you recognize how critical is to study the myths that lay the foundations of our right brain.

Even though the entire human species shares a few basic, hard-wired emotions, in fact, most of them are a product of the cultural and anthropological substrate. Today more than ever you have to understand and drive the major clusters of emotions that either destroy or drive added value and create loyal customers.

So, we can define mythological marketing as the marketing that can speak both to the left and right brain. A marketing that can bring the emotional dimensions back to the role they deserve, and blend them with the functional elements, forging a storytelling that is unique and relevant to the customer.

Customer experience, customer journey mapping, content marketing, social media management, psychographic profiling, product development and launch: every single activity you plan and execute is influenced by what you are and what your customers are. Even your company’s archetype comes from there.

At a basic level, it is pretty easy to recognize the Brands that have been heavily influenced by the ancient myths - especially Greek mythology, embedded into our everyday culture. Nike comes from the Greek goddess of victory; Pandora originates from the ancient Greek “all gifted” woman; Amazon derives from a Greek woman warrior (and so does DC Comics’ Wonder Woman).

Way more difficult is to find companies that have used mythology as the building ground for their storytelling and content marketing efforts. The lack of examples highlights how ‘young’ this marketing trend is, and how many opportunities lie ahead for those who can catch them.

Recently, the Italian fashion house Prada has launched a jewelry line named Talisman. According to Luxury Daily, this is an “homage to what the Brand refers to as the original designs, as individuals in ancient times would construct and revere objects for their magical properties.”

The main object of the communication campaign was to build belonging, leveraging on a shared narrative every customer could connect with. The launch of the collection, in fact, has been accompanied by a short film that:

“Celebrates the potential for the supernatural that exists in these pieces (...) The Talisman film speaks to modern tribalism and the simultaneous coexistence of individual and affinity-centered communities. The talisman itself, a finely made and unique piece, is portrayed as a source of mystic strength, protection, and desire while making a strong statement in support of handcraft."

Another brilliant example, reported by Harvard Business Review, is about Future Group, India’s fastest-growing retailer, and shows the differences in the approach to myths between Western and Eastern cultures.

Kishore Biyani, CEO of Future Group, shows respect for how the West is innovating the customer experience, but he is also well-aware that such a vision must come to terms with the peculiarities of the Indian tradition.

Thus, he has tried to design innovative customer experiences - aimed at improving employee engagement - that blend the best of West and East, collaborating with consultant and mythologist Devdutt Pattanaik, one of the world’s leading experts on Indian mythology.

“Devdutt explained that all employee training programs at Future Group always start with storytelling, inspired by Indian mythology. The goal is to galvanize and inspire workers - from store clerks to senior execs - to adhere to the vision by unveiling it as a story drawn from, say, the Mahabharata with well-known characters like Krishna that they can all relate to.”

Mythological marketing is about discovering your true self, understanding the traits that form people and embracing the emotional side of our world. A ‘whole brain’ approach that helps customers believe they are not just purchasing something, but they are taking part in a story. The oldest and most engaging story ever told.

Cover Photo by Austin Neill on Unsplash

Download The 7 Pillars Of The New Customer Loyalty to define the foundations on which to build your engagement and loyalty strategy, create innovative experiences and establish a lasting and valuable relationship with your customers.

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The Seven Pillars Of The New Customer Loyalty

Posted on by Neosperience Team

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Is Brand Loyalty still relevant for customers? In a market where the limitations of space and time are canceled by technology - and we can buy everything we want directly with a tap on a mobile screen - does it make sense to talk about loyalty?

The answer is ‘Yes’ to both questions. Customer Loyalty is still relevant, but it is hard to get and even harder to retain as the competition is so tight. This is the starting point of The 7 Pillars Of The New Customer Loyalty, our new checklist that will help you improve your strategy and evolve to stay relevant.

As said, loyalty is still important and will continue to be in the next future. Indeed, in times when we have become accustomed to brand switching and polygamous loyalty, the ability to attract and retain the attention and engagement of customers is even more critical.

The reason lies not only in the economic value of this long-lasting relationship - loyal customers buy more and more often - but also in exponential effects regarding competitive advantage (i.e. the sharing of 'positive vibrations' in their communities and social networks).

If the intrinsic value of the customer loyalty remains unchanged, however, the same can not be said of the relationship between companies and people. This connection has been deeply altered by the advent of the digital technology, that has shaped the market scenario in which we have been immersed for more than ten years now.

Not to mention that the pace of this change has further accelerated with the advent of the mobile devices. In a few years, in fact, the smartphone has become the primary point of reference we all turn to when we need information and make weighted decisions.

Whether it is a car purchase, a comparison between two TV models, a holiday booking, the choice of the perfect outfit for the evening, or the sharing of our opinions, the answer is always there, in the palm of our hand.

If we turn the focus on the Brand, the story remains the same: the smartphone is the primary means of spreading contents and messages. When it comes to digital customers (Millennials and Generation Z above all), there is no engagement and loyalty strategy without mobile technology.

We want to emphasize the fact that technology is, as always, a means and not the ultimate goal of your strategy: the solution is not to recreate, in the digital context, the old dynamics of engagement and fidelization typical of the offline world (a virtual loyalty card, to name one).

The reason is that today people do not just want to buy products or services. They want to live experiences. At the heart of any loyalty strategy, there should be the awareness of the value of customer experience as the primary factor of differentiation on the market.

According to Gartner, 89% of companies expect that the decisive battle for relevance on the digital markets will be fought in the field of customer experience. It is not a coincidence: people already consider the experience more important than price and the product itself.

In order to grow your business, you must build personal relationships with customers. Focusing on the experience is the only way to move from a utilitarian loyalty (I spend, and you give me a tangible prize in return) to an emotional loyalty (I choose you because I feel I am an integral part of the Brand).

The evolution from a traditional fidelization to the 'new customer loyalty' is not easy or immediate, but it is necessary if you want to survive in an ecosystem increasingly saturated and competitive. To move towards the future, you must first take a step back, admitting that you do not know your customers, despite the Big Data and your CRM.

The amount of information about customers that the technology makes available to companies is of no use if you do not know what to look for, how to move from macro to micro, and ultimately how to get an intimate understanding of the person.

Before even thinking about customer engagement and loyalty, you have to understand people. Choices are mainly driven by emotional elements, so you need another key to read the traits of personality, behaviors, attitudes, thought patterns, and prejudices.

We are talking about the final step from the study of the Demographics - which tell you who the customers are - to the Psychographics - which tell you what they think and what they want.

Only by studying these essential hidden traits you will be able to gather and select the data you need to personalize experiences and messages. Understanding is the basic requirement to convert customers into Brand Ambassadors.

The purpose of The 7 Pillars Of The New Customer Loyalty is to define the foundations on which to build your engagement and loyalty strategy, to create innovative experiences and establish a lasting and valuable relationship with your customers.

You can download it for free at the following link:

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How Augmented Reality Can Strengthen Your CX

Posted on by Neosperience Team

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When Tim Cook took center stage to kick off Apple's WWDC 2017 conference, we knew that something was coming. A lot was discussed yesterday: watchOS 4, macOS High Sierra, iOS 11, the arrival of Siri on a hardware called HomePod.

Of all the announcements, though, the one that really resonates with the digital and marketing leaders is the launch of the ARKit: a set of tools for developers to create augmented reality apps, that has been boasted as the “largest AR platform in the world”.

The analysts have immediately considered this new platform as the definitive consecration of the AR technology for business. Apple did not show a dedicated app, but the ARKit - with its support for Unity, Unreal Engine and Scenekit - puts the AR at the heart of Apple's (and your) future.

In the 1990s, virtual reality (VR) was expensive. Smartphones made high-quality small screens, motion sensors and processors affordable, enabling the Oculus Rift to launch in 2012. In virtual reality, a virtual world replaces the physical reality.

VR immerses the user in a believable situation. Users can experience traveling the world, exploring space or seeing inside the human body. Touch elements like the floor sinking slightly as the user steps on virtual stairs add to the illusion.

“Mixed reality” (MR) inserts virtual items into the physical world. Users can add virtual elements to a room or make parts of the room disappear.

“Augmented reality” (AR) – what Google Glass offered before being terminated as a pioneer market experiment – is transparent and is layered on top of the natural world.

At its best, VR, AR and MR are highly social. People can play with objects together, enjoying a compelling shared environment. Some systems also map and save their surroundings, allowing users in different locations to meet in a virtual version of a real place. On the downside, users can find them overwhelming and need a rest after some time of virtual activity.

In the next 15 years, VR, MR, and AR are likely to become part of everyone’s working and recreational lives (Apple officially praised the success of Pokémon Go), and of our relationship with brands. In 10 years mixed-reality technology will be used as much as, if not more than, smartphones.

Wearable screens will replace physical monitors, and, as it happened with the smartphone, the more popular this technology become, the faster it will grow. No matter which company gets there first, virtual reality technologies are set to have a real impact on people’s lives.

Among the initial steps of this path, Apple announced yesterday its tool ARKit, which will provide advanced augmented reality capabilities on iOS. It is supposed to allow for “fast and stable motion tracking” that makes objects look like they are being placed in real space, instead of simply hovering over it.

On stage, Apple showed off a very basic implementation of ARKit: you can map the flat surface of a table and place a teacup on it with realistic perspective, drawing information from an iPhone or iPad’s sensors and cameras.

However, as a marketer, you can make much more complex experiences: imagine allowing your customers to see your products in their home before buying them. Or, if you are a luxury goods maker, show how they would be wearing your accessory. Or, if you are a car maker, dream your dream car in their box. And share their experience on all social networks.

 

Note: to this purpose, Neosperience Cloud already incorporates ARKit capabilities in the upcoming Summer '17 release, to the benefit of all our customers.

As also shown by Facebook during the last F8 Conference, the Customer Experience will soon become the new currency in VR/AR/MR. This shift from the creation, transmission, and consumption of content to the creation, transmission, and consumption of customer experience will define a whole new approach to branding and product marketing.

Now it is your turn to make the world a better place for customers and brands. How do you think it is most effective to use this innovation in your marketing and sales activities?

Download The Mobile Engagement Playbook, a collection of relevant insights that'll help you to overcome the challenges of the digital transformation and grow your business exponentially.

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Retail Apocalypse – How Technology Will Help You Survive

Posted on by Neosperience Team

“It’s the end of the world as we know it.” Well, at least for retailers. Today, they have to face their toughest challenge ever: Reinvent their identity, innovate their business and try to survive the Retail Apocalypse.

Easier said than done, at least judging from the rash of closings and business failures. Apparently, thousands of brick-and-mortars are shutting down, and foot traffic to retail stores is sagging. The only way to escape the fate is to tackle head on the underlying causes of the ‘Zombie Mall’ situation.

The term ‘Retail Apocalypse’ comes from the United Stated, where it began gaining widespread usage in 2016, following the closing of a vast number of American retail stores. Where are all these customers going?

“Overall, over 4,000 physical stores are affected as American consumers shift their purchasing habits due to various factors.” (Wikipedia) This shift has brought to multiple announcements of plans to either discontinue or significantly scale back a retail presence.

Of course, the seeds of what we are living today were planted many years ago. At the same time, some countries have more obvious symptoms (the US, for example, where stores per capita far outnumber that of any other country).

A quick look at this chart published on Business Insider makes the idea of what is going on in this beginning of 2017:

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To tell the truth, not all analysts agree to believe this situation is so dramatic. In a recent article published by Forbes, the retail and tech analyst Paula Rosenblum states that there are at least five reasons why the ‘retail apocalypse’ is a click bait, a false scare story.

But is it? Honestly, there is one fact that none can deny (but many retailers still understate): the behaviors of customers have deeply changed in the last decade, and this evolution was driven by the technological innovation (mobile and connected devices, social networks, artificial intelligence).

With ‘behaviors’ we mean: How they search for information about services and products; how they connect with the physical and digital presence of a brand; how they compare the different solutions; how and where they finally purchase the product they have chosen.

Different behaviors demand different approaches. While the customers evolve, however, the retail brands often can not keep up with the change. To quote a post by Brian Solis
, “The concept of future retail is constantly evolving. But what is not evolving as quickly is the understanding and widespread experimentation to bring the future to life today.”

The disruption of retail brings with it a critical corollary: What really matters is not what you do but how you do it. It is not the new fancy technology that you think can save your business with a snap, but how you implement that technology in the complex of activities that define your retail customer experience.

In the era of Digital Darwinism, when you stand in front of a new business challenge, you have three choices:

  • Ignore the evolution and condemn yourself to the irrelevance (Business as usual).
  • Wait to understand what others are doing and what are the real benefits (Business for the moment).
  • Take advantage of the wave of disruption to face not only what is happening on the outside, but also what is not happening on the inside (Business for the future).

The majority of retail companies usually fall into the first two categories. They do not feel the urge to change a strategy that has so long proved effective; they are scared of the investments needed to move to the new approaches; they do not recognize an ROI hidden behind the digital transformation.

Unfortunately, the hard truth is that inaction always leads to irrelevance. For each brand that fails there is another brand that gets the spotlight. The competition is tougher than ever, and the race to success is mostly a competition for relevance.

Competing solely on products, price or features is not sufficient to gain a competitive edge. The new rules of engagement demand that you invest and work to reinvent your identity - starting from the physical store - and deliver a memorable and unique customer experience, online and offline.

How can you do it? Brian Solis (again) gave a significant speech a couple of months ago, talking about the ways for retailers to survive the apocalypse. The first step is to adopt a (new) human perspective and compete for customer experience, the main differentiator in the digital era.

We want to leave you with the video of that speech, not before pointing out the element that we consider the most critical: Invest in the trust economy, be transparent, and earn reciprocity through the facilitation of open engagement and commerce.

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F8 2017 – Facebook And The Augmented Reality Platform [VIDEO]

Posted on by Neosperience Team

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“Today at our F8 developer conference, we're making the camera the first augmented reality platform.” With these promising words, Mark Zuckerberg opened the annual F8 conference in San Jose, California.

Year after year, the meeting has gradually lost its ‘developers only’ nature, to become a mainstream event where Facebook presents the new products that will - eventually - change the life of millions around the world.

CEO Zuckerberg spent almost 20 minutes outlining Facebook’s augmented reality platform, a new way for developers to build features into Facebook’s built-in camera, and a new way for users to create communities and share their experiences with friends and family.

On the developer’s side, the Camera Effects platform has two main tools:

  • Frames Studio, a sort of online creative editor to build frames that will be used with the Facebook Camera;
  • AR Studio (still in beta), an editor to develop layers, scripts, animations to be used with augmented reality through the camera.

The augmented reality has gained momentum during 2016 thank to the enormous, and somewhat unexpected, success of Pokémon Go. Blending augmented features with the power of the virtual reality technology, Facebook has developed a new world called Spaces, where users can create an avatar, then meet up with others in a digital world.

“We're all about extending the physical world online - says Mark Zuckerberg in a post on his Facebook profile - When you become friends with someone or become part of a community on Facebook, your real relationships and physical communities become stronger. AR is going to help us mix the digital and the physical in new ways, and make our physical lives better. That's why it's so important, and this is just the beginning.”

What they have in mind is a new frontier in the engagement through VR technology; an effort to turn something that has been perceived as a ‘solitary’ activity into a community activity. Pokémon Go tried the same thing, transforming a ‘static’ mobile app game into ‘moving game’ dynamics.

The potential of this new approach is endless, but the result resembles - at least now - a Second Life upgraded with virtual reality headsets. We will have to wait and see what kind of AR and VR tools the developers will build using the open platform. What we already know is that the camera of our smartphone has become the cornerstone of the customer experience.

The first day of the F8 2017 was not only about augmented reality. The AR platform was the highlight, but there were two other major announcements: the chatbot discovery tools, and the open platform to improve collaborative company work.

The first one aims at offering the easiest way to find bots. Facebook Messenger has tens of thousands of bots on its platform, so Messenger is launching a dedicated discovery tab and new QR codes that bring users directly into conversation with a bot.

The second one is Facebook Workplace: Facebook launched the enterprise version the social network last fall. The big news is that now Workplace has different enterprise partners, like Microsoft and Salesforce, to create a complete suite for coworkers to share and organize files.

If you want to discover everything that was announced at the F8 2017, here is the entire streaming video of the first day of the conference.

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Generation Z – Understand And Engage The Mobile-First Customers

Posted on by Neosperience Team

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We have barely started to understand millennial customers, and it is already time to move on. Say hi to the Generation Z, the first ‘truly mobile-first’ generation of customers, set to disrupt (again) the way you plan and execute your business.

Till now, the GenZ has been overlooked in marketing research, because younger customers did not have the same purchasing power of the previous generations. The spotlight was on Millennials, but things are swiftly changing.

Just so we are clear:

  • The Generation Y, what we call Millennials, includes those born between the early 1980s to the mid 1990s.
  • The Generation Z, also know as Post-Millennials or iGeneration, includes those born between the mid 1990s to the early 2000s.

Millennials have captivated marketers and researchers for the past five years or so because they have represented the final transition from an analog to a digital world. They were - and still are - the first digital customers, with a very peculiar mindset and unprecedented needs and desires.

The digital customer is, still today, the primary focus of business planning, but there are new kids in town, and you should not ignore them. We are talking about almost 60 million teens in the US alone, that translates into more than a quarter of the entire US population.

While the two generations have some traits in common, in fact, they also show different behaviors and approaches when it comes to technology. The GenZ grew up submerged in a digital world, shaped by mobile devices. They do not know other world but this.

Millennial customers were mobile pioneers, but today’s teens are mobile natives. A huge difference. They live in symbiosis with their smartphone; they rely on Google, social networks, and communities for all daily activities.

They are not shy about buying online from their mobile devices and, even when they go to the retail store, they walk in expecting something fresh, innovative, engaging. A powerful customer experience, in a few words.

This generation of customers brings to completion the evolutionary trajectory started with the Millennials. They had phones when they were in elementary or middle school, and that shift is already shaping customer journeys that you need to study and understand.

Your business will be affected by their behaviors sooner or later. They are young but, even today, they spend something like 44 billion dollars annually (in the US alone). This figure is set to grow exponentially in the near future.

The first step to understanding the post-millennial customers is to compare them with the previous generation. Last year, in an article published on The Huffington Post, George Beall tried to identify how the GenZ differs from the GenY. What came out is something that you should bear in mind when you plan your next marketing moves.

Among other things, post-millennials teens are:

  • Less focused: They process information faster thanks to mobile apps, and their attention span is significantly lower than other customers.
  • Multi-Taskers: Whatever they do, they do it using multiple devices. This behavior is critical when you try to frame their purchase behaviors.
  • Less price-obsessed: They favor the experience over the bargain. Price is steadily losing weight in the list of factors that influence the purchase.
  • More demanding: “They expect businesses, brands, and retailers to be loyal to them. If they do not feel appreciated, they are going to move on. It is not about them being loyal to the business.” (Marcie Merriman, Ernst & Young)
  • More social: born and grown with a smartphone in their hands, they are strictly linked to their social communities and communicate mainly through mobile apps (Snapchat, YouTube, Instagram).
  • More global: Millennials were the first global generation, thanks to the Internet, but the GenZ is even more ‘global’ in their thinking, interactions, purchase behaviors.

Putting all the pieces together we see that the smartphone is the pivot around which the whole existence of teenagers revolves. A further confirmation comes from a recent report by Google titled “Generation Z - New Insights Into The Mobile-First Mindset Of Teens”.

The first finding is precisely the importance of phones. Getting a phone is a life-changing event, up there with graduation and driving license. While teens have more devices than ever at their disposal, the smartphone is the most used. Moreover, they usually get it earlier than previous generations (the median age is 12).

 

GenZ - Cool Brands(Click on the picture to enlarge)

The smartphone acts as a bridge that connects the offline and online experiences of teens. Visual contents, messaging apps, social networks, and video games create the environment in which they share their life and find entertainment. Fun - or maybe not fun at all - fact: Nearly 3 in 10 teens say they text with people who they are physically with at the time.

Another research finding states something we have already said: GenZ is a mobile-first shopping generation. Teens have a peculiar idea of what is ‘Cool’, they know what they want, and they buy it online. Video games, books, and apparel are the most common products bought online.

What is really interesting is that they buy online not only because it is more convenient and they can find better deals, but also because they can see multiple brands and retailers without leaving home, and they can choose faster than going to the physical store.

All in all, 53% of those between 13 and 17 years old mostly use the smartphone to make online purchases. If you are a retail brand trying to establish your position in a hyper-crowded market, you might want to take note of this new habit.

The technology is ‘how’ they make purchases, and the ‘Cool Factor’ is the foundation of ‘why’ and ‘what’ they choose one product over another. What aspects make a product cool? The word-of-mouth (offline and online) is still the main factor affecting the choices, and the new forms of advertising come right after.

The third factor, though, is what draws our attention: Something is cool if it is personalized to me. Millennials have been called the Me-Generation because of their self-obsession; with the GenZ, this trend is expected to undergo a fast track.

Personalization is the foundation of cool contents, products, and experiences. Something is cool if it is unique, impressive, interesting, awesome. If they perceive that it is tailored to them, on their dreams and desires.

They expect big things. Your challenge is to live up to the standards and exceed their expectations. After all, these young customers represent the future of your business. A future that is already here.

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What Drives Customer Loyalty? Look Beyond Traditional Programs

Posted on by Neosperience Team

What are the drivers of customer loyalty? One of the major challenges brands face today is to create meaningful, satisfying experiences for their customers. Experiences they will love so much that they will come back again and again.

The spread of disruptive technologies undermines the ability to conquer and retain customer’s heart using traditional loyalty programs. When technology changes, so do the drivers of trust and engagement. Are you willing to look beyond the usual way of doing things?

In the last few months, we have witnessed a wave of new, interesting researches on the issue of loyalty and its impact on what we call “the relevance of a brand”. Creating and retaining a customer base that is faithful to the company is the top priority. There is a direct link, in fact, between loyal customers and their profitability.

Back in 2015, we wrote a piece about customer retention, and how to improve the way you plan and execute your strategy. A few statistics, taken from that article, still give us valuable hints:

  • The probability of selling to an existing client is between 60 and 70%;
  • The probability of selling to a new customer is just 5-20%;
  • It costs six times more to attract a new client than to retain an existing one;
  • A 2% increase in customer retention has the same effect as decreasing costs by 10%;
  • A 10% increase in customer retention result in a 30% increase in the value of a brand.

It is easy to see why investments in loyalty are booming. According to a recent report by Accenture Strategy, not coincidentally titled ‘Seeing Beyond The Loyalty Illusion’, “more than 90 percent of companies currently employ some form of customer engagement or loyalty program. In the United States, alone, loyalty program memberships grew at a rate of 26.7 percent from 2012 to 2014.”

While the investments are growing, however, customer satisfaction remains an overlooked and underestimated field of study. This casual approach leads to an inevitable conclusion: the costs are increasing, and yet most loyalty programs fail to deliver valuable engagement or actual business results.

If something is not working, you put it down, right? Not this time. Traditional programs do not work, but they are still there; because sometimes it is easier - in terms of money and time - to keep them than shut them down. It is hard to admit a failure. So, billions are spent each year in traditional incentives, collections of points and non-cash rewards.

What is the result of this effort? Back to Accenture Strategy:

  • 71 percent of customers claim loyalty programs do not engender loyalty;
  • 77 percent of customers retract loyalty more quickly than they did three years ago;
  • 23 percent of customers show negative or non-existent reaction to companies’ loyalty efforts.

All in all, the propensity to switch from one brand/product to another “is six percentage points higher among customers for whom traditional programs have a negative or negligible effect.”

This gap is destined to increase now that millennials - the first true digital native generation - are showing their full potential, becoming critical to driving revenue growth. The digital customers:

  • Take faster purchase decisions - The attention span lowers to 8 seconds.
  • Live online and offline at the same time - The customer journey gets disrupted.
  • Reward the most innovative brands - ‘Mobile-first’ becomes ‘Mobile-only’.
  • Show different purchase patterns - The 4 Ps of marketing change forever.
  • Choose experiences over products - The customer experience becomes the key.

Of course, retention is a long-term run, not a short term activity. However, given the premises, how can you react if loyalty programs cost significantly more, and deliver significantly less? How should you adapt to avoid that the value of loyal customers slips through your fingers?

You have to look beyond usual, and you can do it starting with your customers. ‘Engage’ and ‘Convert’ still are two critical keywords in the age of digital transformation, but they are now complemented by a third - and increasingly important - element: ‘Understand’.

To keep it simple, you will never engage and monetize your customers if you do not know them in the first place. Knowledge is the foundation of today’s marketing. You must know who your customers are (Demographics) but also what moves and motivates them, what are their main psychological traits. Why they do what they do (Psychographics).

Loyalty is more than merely collecting points for every purchase. Loyalty involves an emotional investment, a personalized relationship, a relevant connection.

Even when you employ new technologies in your programs, you must remember that technology is the means by which you create value for customers, not the ultimate goal of the entire strategy.

“We get tons of information from customer service, but it Is really important to know how to use that information and not just take it at face value. It Is necessary to interpret customers, not just take them word for word.” (Maryam Mohit, Vice President of Amazon)

In recent times, customer research and analysis have gained brand-new momentum. The most innovative companies have realized that the in-depth knowledge of clients is mandatory, in order to exceed their needs and provide the best customer experience.

All the data in this world, though, will not help if you keep focusing on the most obvious findings. Today more than ever, you have to understand and drive the important clusters of emotions that either destroy or drive added value and create loyal customers.

A wrong approach to customer research translates into wasted opportunities (and budgets). The investments grow but not the understanding of how customers behave, and why. Loyalty still matters but you need to move beyond the old rules, and rethink the way you build and deliver engagement through your entire brand essence.

In other words, you need to find the new drivers of customer loyalty, those that fits perfectly with your customer’s profile, habits, and behaviors.

According to the American Marketing Association, “there are five variables that have been uncovered to be potential drivers of brand loyalty; several have multiple indicators that are combined.” These variables are:

Dependable - When your brand can exceed expectations and create consistent experiences across all touch points of the customer journey.

Better - When you establish your brand as the best solution to fulfill customers’ needs, when and where it matters most.

Social media - When your brand is able to speak your customer's language and connect with them delivering engaging, personalized contents.

Light emotional connection (LEC) - When your brand can close the link to your customers as human beings, not just mere consumers.

Heavy emotional connection (HEC): When your brand can tap into your customer’s heart and mind, leveraging inspiration and emotional advocacy.

Study, analyze, act: this is the proper sequence. Today, loyalty is not just a program; it is a full-time commitment at all levels of your organization. If you make the necessary adjustments, you will unlock the power of technology, to create business value, sustain growth and gain competitive advantage.

Interested in Customer Loyalty? Check the following posts:

CUSTOMER LOYALTY - WHY IS IT SO IMPORTANT?

5 THINGS SPORTS CAN TEACH YOU ABOUT LOYALTY

GAMIFICATION - ENGAGE CUSTOMERS PLAYING WITH THEM

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How Artificial Intelligence Is Disrupting Your Organization

Posted on by Neosperience Team

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Whoever reads a science fiction novel ends up thinking about smart machines that can sense, learn, communicate and interact with human beings. The idea of Artificial Intelligence is not new, but there is a reason if big players like Google, Microsoft or Amazon are betting precisely on this technology right now.

After decades of broken promises, the AI is finally reaching its full potential. It has the power to disrupt your entire business. The question is: How can you harness this technology to shape the future of your organization?

Ever since the human has learned to dream, he has dreamed about ‘automata’, objects able to carry out complex actions automatically. The mythologies of many cultures - Ancient China and Greece, for example - are full of examples of mechanical servants.

Engineers and inventors in different ages attempted to build self-operating machines, resembling animals and humans. Then, in 1920, the Czech writer Karel Čapek used for the first time the term ‘Robot’ to indicate artificial automata.

The rest is history, with the continuing effort to take the final step from mechanical robots to intelligent machines. And here we are, talking about a market expected to reach over five billion dollars by 2020 (Markets & Markets).

The stream of news about the driverless cars, the Internet of Things, and the conversational agents is a clear evidence of the growing interest. Behind the obvious, though, we can find more profitable developments and implications for the Artificial Intelligence.

Back in 2015, while reporting our annual trip at the SXSW, we said that the future of the customer experience goes inevitably through the interconnection of smart objects.

The AI is a top choice when talking about the technologies that will revolutionize the retail store and the physical experience we have with places, products, and people.

The hyperconnected world we live in has a beating heart of chips, wires, and bytes. This is not a science fiction scenario anymore; this is what is happening, here and now, even when you do not see it.

The future of products and services appears more and more linked to the development of intelligent functions and features. Take a look at what has been done already with the embedded AI, that can enable your product to:

  • Communicate with the mobile connected ecosystem - Just think about what we can already do using Google Assistant on the smartphone, or the Amazon Alexa device.
  • Interact with other smart objects that surround us - The Internet of Things has completely changed the way we experience the retail store (and our home, with the domotics).
  • Assist the customer, handling a wider range of requests - The conversational interfaces, like Siri and the chatbots, act as a personal tutor embedded in the device.

As the years pass by, the gap between weak and strong AI widens increasingly. A theory revived by a recent report by Altimeter, not by chance titled “The Age of AI - How Artificial Intelligence Is Transforming Organizations”.

The difference can be defined in terms of the ability to take advantage of the data to learn and improve. Big data and machine learning, in fact, are the two prerequisites of the modern smart technology.

So, on the one hand, we have smart objects that can replace the humans on a specific use case - i.e. to free us from heavy and exhausting duties - but do not learn or evolve in time.

On the other hand, we have the strong AI, the most promising outlook: An intelligence so broad and strong that is able to replicate the general intelligence of human beings. It can mimic the way we think, act and communicate.

The “pure AI” is aspirational but - apart from the Blade Runner charm - this is the field where all the tech giants are willing to bet heavily. The development and implementation of intelligent machines will define the competitive advantage in the age of AI.

According to BCG, “structural flexibility and agility - for both man and machine - become imperative to address the rate and degree of change.” As you can see in the following graph, you should look at the AI through four lenses:

  • Customer needs
  • Technological advances
  • Data sources
  • Decomposition of processes

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First things first. It is important to incorporate the technological advances, gather the different data sources, and map the different processes involved. However, it is way more important to start from the basics, the customers.

Many types of research tend to focus on the tech-side of the moon but there is something you should never forget: everything starts with the customer. This is the pillar of every organization, and it is not going to change because of smart machines.

“Know your customer” means that you must to understand their needs, desires, pain points, and behaviors. Your business potential lies in the acknowledgment of the centrality of people.

The AI is a tool, not the purpose. The ultimate purpose is to create the best customer experience, blending technology and emotions so that you can engage your customers, monetize the opportunities, and increase the relevance of your brand.

Everything is connected to the customer:

“The opportunity (and risk) of AI is not just in a device that will play a song or order tickets to a concert. The value of systems based on machine learning is based on their ability to sense, communicate, learn, act, and adapt over time and to connect with other systems that do the same so that they can anticipate and act on a range of needs - be they related to medicine commerce, service and support, or customer experience.” (Altimeter - The Age of AI)

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Now that the boundaries between what is human and what is artificial blur, there is one last element that you should never forget. The relationship with your customers is grounded in trust.

Transparency (in the use of data, in the management of the real-time interactions) is essential to win the distrust when the distinctions between human, AI-assisted, and AI interactions could very well disappear.

As Pedro Domingos, the author of The Master Algorithm, once said that the “Artificial Intelligence is not so scary as it seems when it translates into artificial smartness.”

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Emotions 2.0: A Science Of Sentiment Primer

Posted on by Neosperience Team

Let me take you on a walking tour through the gardens of philosophy, psychology, neuroscience, not to mention popular culture. It's just a three minutes walk that you won't regret.

Emotions are an evolutionary necessity that plays an essential role in ensuring human survival. Some basic emotions seem to be hard-wired into our human species, innate and invariable, notwithstanding cultural differences. In example, fear and anger have helped human survival by encouraging reflexive flight and hard fighting.
Enlightenment philosophers recognized that emotions are necessary to human life and to the cohesion of society. But as this understanding started to widespread, Romantics opened a breach between reason and emotion by extolling emotion.

Scientific investigations during the 1990s shed new light on the emotions and revealed them to play a major role of the human mind. Anthropology, cognitive psychology and neuroscience all contributed importantly to this understanding.

For example, until recently many scientists thought that emotions were a product of culture and that people from one culture would no more recognize emotional expressions from another culture than they would recognize words from another language.

This today seems incorrect: a few basic, shared emotions apparently are "hard-wired" to the human species, suggesting that emotions are not an impediment to survival, but a necessity.

In our "age of the customer, of abundance, of the fourth industrial revolution", emotions seem so essential to intelligence that efforts are underway to develop technologies capable of experiencing and communicating them.

In example, at Neosperience we are doing some incredible research on mobile and social customer engagement and purchase behaviors and:

- Big Five: a widely examined theory that analyzed five broad dimensions to describe the human personality and psyche: openness to experience, conscientiousness, extraversion, agreeableness, and neuroticism.

- Locus of control: the degree to which people believe that they have control over the outcome of events in their lives, as opposed to external forces beyond their control that they cannot influence, or that chance or fate.

- Need for cognitive closure: the individual's desire for a firm answer to a question and an aversion toward ambiguity.

If you agree upon the fact that building a great “Customer Experience” is so important to your company, then you recognize how customer emotions play a pivotal role in the purchasing experience. More than ever, today you have to understand and drive the important clusters of emotions that either destroy or drive added value and create loyal customers.

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Emotions have an extraordinary ability to focus the mind. Moods, longer-lived than emotions, are similarly effective, for better or worse. Depressed people tend to focus on failure. Anxious people focus on safety. Emotions also influence memory. Individuals in an upbeat mood tend to remember happy things; those in a sad mood recall sad things. Psychologists call this "mood-congruent recall."

Thus, emotions color the way people perceive others. An individual in a good mood views people more positively than does someone in a bad mood. Anxiety, which seems to bond people, is paradoxical. Consider the "Stockholm syndrome," which occurs when hostages show deep concern for their captors.

Those who lose part of their emotional capacity through brain damage tend to be easy victims for the unscrupulous. Forced to rely entirely on their logical reasoning, they make disastrous choices about whom they can trust.

Emotions even affect our proclivity for logical analysis. People who are in a good mood and have little time are apt to accept weaker arguments than people who are in a neutral mood or who have more time to consider the arguments.

Emotions are valuable and necessary. German researchers find that people who deal with several choices by picking the most comfortable, familiar option, tend to make better selections than people who take time for careful analysis.

Overconfident people may attempt more than reasonably reserved people. Although the latter may make more factually based judgments, overconfident people will succeed some of the time. Their very overconfidence may help them gain the trust of potential allies and helpers.

By training yourself to eliminate thoughts that provoke bad moods and to encourage thoughts that foster pleasant emotions, you may be able to gain some measure of control over our emotional state and lift yourself to become more productive and happy in your personal and professional life.

Blaise Pascal was right, after all; the heart has its reasons, and they may be completely beyond the reach of reason.

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