What really drives customer behavior?

Consumer behavior is a fairly big racket at some level. For smaller purchases — so, if your widget costs less than about $100 or so — you could argue that there’s no rational way to predict the behavior of a consumer. I can buy this detergent or that detergent. At that point, it’s probably about brand name — although the power and value of brand is probably declining — because I doubt I’m calling 10 of my friends and asking them about detergents. (If I had small children, I might do this.) We spend billions (probably trillions) of dollars every year trying to figure out exactly how to segment, target, and outreach to the consumers we desperately want/need, and probably about half to 3/4 of that money could essentially be flushed down a toilet, because the companies take the data and analysis and advice and completely eff it up or don’t put it in context or one of about 12,682 other things. We’re all servants at The Temple of Busy at some point, chasing our no-ROI deliverables instead of really thinking about how to reach, and impact, consumers.

Harvard Business School is a pretty big brand name (vetted), and their November 2015 issue of Harvard Business Review has an article about ‘the new science of consumer behavior.’ Again, take everything with a grain of salt on this topic; it does vary by industry, price point, families targeting, etc. But let’s start with a visual:

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So you’ve got 10 high-impact motivators that drive consumer behavior, according to this research. Notice that 40% of the list starts with the word “feel” and that the majority of the list — stand out from the crowd, a sense of well-being, a sense of freedom, be the person I want to be, feel secure, succeed in life — relates not to the product itself, but what the product can actually do for the person.

This is a key narrative that sales, marketing, and advertising have missed for decades. It’s not about pushing product; it’s about pushing the end value of the product. Visually, again:

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Now let’s shift over to discussing revenue, because anyone could read this and be like “This is a bunch of fluffy list shit, and I’ve got sales targets to hit!” No doubt. So what can the impact of having emotionally-connected, emotionally-resonant consumers on your bottom line? Let’s begin with some words, then move to a visual.

This is from HBR:

Our analysis showed that although fully connected customers constituted just 22% of customers in the category, they accounted for 37% of revenue and they spent, on average, twice as much annually ($400) as highly satisfied customers. Enhancing emotional connection could be a viable growth strategy if the retailer could attract fully connected customers from competitors, transform satisfied customers into fully connected ones, or both.

We’re dealing with low numbers here, yes — $200 vs. $400 — but 37 percent of revenue from one base area ain’t bad. Many CFOs would slit their inner thigh for numbers like that from one segment you can count on consistently. Now, a visual:

So if you have consumers who are not emotionally connected, that’s bad — an 18-percent drop, essentially. Fully-connected, emotionally-there consumers are about 52% above a baseline. That’s good. Who doesn’t want 52% more coming in the coffers, right?

You may say to yourself at this point: Well, I work in an industry or on a product that isn’t meant to inspire emotional connection. At this point, you would be wrong. Everything, from a widget to a bar of soap to an iPad, has a story about how it changes the lives of the people that use it. The entire function of marketing comes down to two things, really:

  • Figure out what that value is (with other stakeholders)
  • Tell that story as a support function for eventual sales

That’s it. We over-complicate it running around screaming about KPIs and power branding and re-branding and logo placement, and that’s all good, nice, fuzzy stuff to make us feel busy and important and like we’re making key decisions that are driving strategy forward. Thing is, it’s not really marketing. It’s just the in-between deliverable work that constitutes a marketing department. What you really need to do is figure out a story and tell that story — or heck, let your consumers help you tell it — and that will drive revenue and sales.

Here’s where some of this logic dies in the river, tho: most people don’t understand the basic concept of “relationships before revenue.” Oftentimes, you need to develop relationships — which involves trusted content and stories — before you can chase revenue. That’s terrifying for executives, though. They often feel like they need to hit quarterly targets and showcase value immediately. Building through emotional connection takes time, whether you’re talking about a friendship, a marriage, or a brand. The revenue isn’t there immediately. That’s hard for a lot of people. We live in a RESULTS-NOW world, a lot of the time.

I could come at you with 91 different links about the science of using different colors, or different header fonts, or different logo styles, or whatever … but really it comes back to all this, above. You need to develop an emotional connection with your consumers, which is a goal every brand can hit if they think about it the right way. And in the end, that will pay back dividends to you.

My name’s Ted Bauer; I blog here regularly and you can learn about hiring me for freelance and contract gigs as well. You can also subscribe to my newsletter.

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Blogging, largely about work and how to improve it. How I make (some) money: http://thecontextofthings.com/hire-freelance-writer-ted-bauer/

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