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Are Brands Connecting Emotionally With Consumers?

February 25, 2013

In its recently published Customer Loyalty Engagement Index (CLEI), Brand Keys tracked brands in categories such as beverages, quick service, pizza, banks, beer, car insurance and cosmetics amongst others. As qsrweb reported, emotional engagement proved the most important factor in purchasing decisions and brand loyalty. Its 17th annual report showed promotions and discounting reaching "saturation levels."

To create "points of differentiation," brands need to meet customer expectations of empowerment and discounting by using social networks to build communities. Brands cited as successful in this goal, and therefore building high levels of loyalty, included Dunkin' Donuts (in two categories), Coke and Diet Coke.

Robert Passikoff, Brand Keys' president, explained that marketers without handles on "the emotional side of the purchase and engagement process" may become what he calls "placeholders" whose "name people know but don't know for anything in particular and have absolutely no [brand] advantage in the marketplace," adding "if that's where you are, you might as well spend your entire marketing budget on coupons, deals, and promotions."

The company's blog explained, "Last year, the Brand Keys Customer Loyalty Engagement Index found customers were looking for 'delight' from their brands. This year evidence mounts that it's still delight that will continue to define the consumer landscape, and what brands can do to cement customer loyalty and profitability."

The blog added that 49,000 consumers "self-selected among 598 brands in 83 diverse categories" and assessed them "based on an independently-validated technique that fuses rational and emotional aspects of the categories, using a combination of psychological inquiry and higher-order statistical analyses." This technique "has been used in B2B and B2C categories in 35 countries around the world and is proven to identify the real category drivers for the consumers' ideal. Along the way it allows us to determine how well brands meet — sometimes even exceed — expectations consumers hold for the Ideal in their category."

Although expectations varied by category, Brand Keys concluded that success comes from understanding the link between differentiation and delight. Those attributes related to "experience" and "brand values" proved to be most important when it came to decision-making, expectations and engagement.

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Discussion Questions:

How well do retailers recognize the value of emotional engagement? What are the best methods merchants can use to connect on an emotional level with shoppers?

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Instant Poll:

How effective are retailers in connecting with consumers on an emotional level?

Comments:

We put words together like emotion and engagement as if they have to go together. Emotion in decision-making simply might refer to learned rewards that become part of the dopamine-based, emotional decision-making system (Lehrer's book).

I find it hard to believe that more than 15% of buyers or 50% of business is driven by engagement (based on Hendry curves, shopper research about decisions made in store, low percent of buyers who like a brand on Facebook). Hence, any explanation of brand performance that is completely rooted in emotion+engagement is a partial explanation at best.

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Joel Rubinson, President, Rubinson Partners, Inc.

The challenge is how do you measure emotional engagement? Happiness? Satisfaction? The bean counters want verification—I paid X and received Y. That "fuzzy stuff" is hard to prove ROI so it has languished. Just like what we're seeing in education that if it can't be tested, it doesn't get funded.

This study seems to say if you aren't going to engage, just spend all your money on discounts and own the space as a placeholder brand. If ever there was a recipe for a zombie retailer, that would be it.

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Bob Phibbs, President/CEO, The Retail Doctor

First of all I have no earthly idea what, " an independently-validated technique that fuses rational and emotional aspects of the categories, using a combination of psychological inquiry and higher-order statistical analyses," is—or might be, but it seems a convoluted way of validating the obvious.

In mature product categories brands must clear all the standard hurdles—say taste, packaging, efficacy, price, etc.—just to survive.

Of those surviving brands, the winners will be those that transcend the demands on form and function—which all brands in the category probably meet—and form some kind of emotional bond with a consumer.

Do retailers value this principle? In the main, absolutely not. The supermarket itself is the reification of the abnegation of retailer to consumer emotional attachment. Put another way, this is the ground retailers voluntarily ceded to the manufacturer.

As is so often the case, the exception proves the rule. Look at Wegmans, Trader Joe's and Whole Foods; all have done a great job of building this emotional relationship and have, as a result, separated themselves from the pack.

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Ryan Mathews, Founder, ceo, Black Monk Consulting

Retailers are often too fixated on "operationalizing" a particular initiative and often do so at the cost of efficacy. Furthermore these initiatives are rarely implemented because it's what their shoppers really want, but rather another effort to push something onto their shoppers because they can. An emotional bond is built with a brand over time and is founded upon a dialog.

Shoppers want their opinions and wishes to be heard and acted upon by the retailers. These exchanges or, more accurately, the implementation of these customer wishes, are often very difficult to implement in a meaningful way, but that is the challenge brands face today. Listening to and activating even the smallest shopper request will reap rewards and begin to build an emotional bond with your customers.

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Adrian Weidmann, Principal, StoreStream Metrics, LLC

Brands are better at emotional engagement than retailers, and this has been the case for a long time. While there are exceptions like Nordstrom, most retailers are unwilling to do the heavy lifting needed to turn satisfied customers into committed ones. The perfect example is the large number of so-called "loyalty programs," which are really focused on price incentives instead of true loyalty.

Not every CPG company is equally adept at building brand equity, but most of them put retailers to shame.

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Dick Seesel, Principal, Retailing In Focus LLC

First: discounts are easy, emotional connections are hard. Brands and retailers have to make a huge commitment strategically to connect to their customers in an emotional way or it's not going to ever happen. In fact, I'll argue that the company culture has to be based on this idea or else, any attempts will be fraught with failure.

We know the examples of brands and retailers that delight their customers because unfortunately, they are the exception. Nike, lululemon, Nordstrom, Apple, etc. have made their customers their culture and focused products and service on the elusive goals of delight and amazing user experiences. Just look at Microsoft, always trying to play catch-up to Apple in this area and never achieving it, likely because the culture (starting at the top) doesn't see things this way.

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Ken Lonyai, Digital Innovation Strategist, co-founder, ScreenPlay InterActive

This is a really interesting way of thinking about a product or service. Emotional engagement goes on every day in stores, and in some of the products. Look at the iPhone, as consumers get a real attachment to the Apple products, and the satisfactory level of Apple in general is very high.

Great service is an emotional component that enhances the product experience; just ask a great chef in a restaurant about his personal dealings with the customers. Believe me, it is easier to sell your products if the personal touch you give to your customers is outstanding, and we can as owners do a better job of this in training our employees.

No matter what you do for a living, you are selling something, and the emotional experience will vary from one person to another.

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Tony Orlando, Owner, Tony O's Supermarket & Catering

Isn't this like asking "What 'method' did you use to fall in love?"

Well, you might say, I used "an independently-validated technique that fuses rational and emotional aspects of the categories, using a combination of psychological inquiry and higher-order statistical analyses."

Wow, if that doesn't make you feel all tingly I don't know what would. Kind of sounds like an e-Harmony ad!

Let's get real. If indeed this "technique" has "proven to identify the real category drivers for the consumers' ideal" then why isn't every product launch a winner?

I've quoted Nikola Tesla before and I'll quote him again here: "If you want to understand the secrets of the universe look to energy, frequency and vibration." Sounds a little mushy I know, but LOVE, emotional engagement if you will, is the highest level of energy we can know.

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Ian Percy, President, The Ian Percy Corporation

Consumers expect retailers to listen to their opinions, offer products and services at a reasonable price and do this in a welcoming, friendly atmosphere. Retailers that do all three will build loyalty. This is not easy to do. Too often retailers only offer one or two of these attributes and feel that they are adequately serving their customers. The result is a less than satisfying experience. That might work for a while, but it does not build loyalty.

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Max Goldberg, President, Max Goldberg & Associates

The loyalty aspects of CPG products should be more often leveraged to retailer "brands." Social channels are the human digital extension of emotions. Therefore when one looks at the following and passion aligned with great CPG brands, we cannot help but think about the very few retailer brands that have similar followings.

The retailer brands have a commitment to their communities and keep their digital presences fresh and interesting. You can't post random, obligatory thoughts in social channels and expect a true following.

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Ralph Jacobson, Global Consumer Products Industry Marketing Executive, IBM

For most retailers brand engagement is considered to be a concept for manufacturers unless they consider their store as a brand. If there is a strong collaboration between retailers and manufacturers, the brand of the store and destination category products become intertwined. Determining the small number of brands that are destination brands is a competitive decision and the concepts of engagement for the shopping experience and brand need to be connected. For non-destination category items, brand engagement is is probably a store-level concept rather than a product level concept.

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Camille P. Schuster, Ph.D., President, Global Collaborations, Inc.

The consumer purchase decision process has been studied for decades by some very qualified researchers, using increasingly sophisticated tools. But it seems to me that the complex analytics may be clouding the fundamentals, which I think are still valid.

Setting aside all the price/value messages because they connect with the intellect rather than emotions, a new brand wants to create curiosity so the consumer tries it. An existing brand wants to build trust so the consumer repeatedly uses it.

"Delight" is a nice goal, but if it is not delivered each time, there goes trust. And there goes the repeat purchase.

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Dan Raftery, President, Raftery Resource Network Inc.

Retailers are a much maligned lot who are frequently considered to be unemotional, routine, mechanical and price oriented. It's true many retailers get wrapped up in minutia, a disease that has no heart. But that isn't true of all retailers today nor was it in the past.

When I was a kid I used to look forward to going to a particular store from a selection of five because the store owner liked me and always gave me a penny candy. That established an emotional engagement and I would never go to any other stores when my mother sent me out to a store for some items.

That's one example of an emotional link. Historically, King Kullen connected with our emotions when he gave us the first supermarket. That phenomenon was an emotional high. There were other examples of emotional connections created by retailers. Today we have retailers such as Trader Joe's, Wegmans and Whole Foods successfully tap dancing on the emotions of their particular shoppers.

A very good method for retailers to get into an elevated emotional connection with shoppers is create conditions that make customers emotionally happy, which is the most beneficial retail aphrodisiac. That goal demands more retailer concentration.

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Gene Hoffman, President/CEO, Corporate Strategies International

Penney's thought they had the right idea about how to emotionally connect with whatever customer base they had remaining. They were wrong. Now they have shifted course, and are almost back where they started except with a new logo. Sears can't decide what they have to become to draw some of their lost customer base back.

Until the brand is recognized and emotionally accepted, there will always be a problem. First you have to know what the customer wants. Then you have to stock what the customer wants at a price they are willing to pay. Then you have to creatively entice the customer to purchase it.

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Ed Rosenbaum, CEO, The Customer Service Rainmaker, Rainmaker Solutions

We see here a very good discussion designed to demonstrate differentiation not just as a qualifier, but also a tool that is most successfully used to create customer ownership of the "BRAND."

Taking ownership of an abstract marketing concept transcends the traditional understanding of a retail sales experience, which is the time honored perception that brand sales are driven by eye catching visual displays, jingles and three (single syllable) word catch phrases. Product item and labor service categories that are routinely purchased by businesses and consumers can be studied and observed for the intangible motivations that triggered ownership selection.

The three most common reasons that are used to identify emotionally charged purchase decisions are fear, greed and prestige. The ability to identify the customer's emotional reasons for any transaction will allow the retailer to create a common appeal to any one group's specific areas of concern that is in concert with their practice and reasons for the purchase(s).

A steady follow up of emotionally driven reassurance messages that are supported with verifiable statistics will assure a substantial percentage repeat business opportunity as the consumer's needs arise. The tangible reasons for a transaction, price, value and support, are not superseded in this sales approach. The priorities are changed to the new order of value, price, and support. Follow up with the right messages should reduce buyer's remorse and grow the confidence for long-term relationships. There are many companies that very discreetly and methodically follow a sales and marketing plan like we see here in this discussion. They are easily identified by their continued and steady growth in all market conditions and the market perception of their quality and reliability. If there were a better way to maintain growth, I have no doubt these companies would be all in on the different direction.

'gjarnoldjr'

Ryan and Ian said what I was hoping to communicate about this—only better—so I will echo what they wrote and say, "me too."

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David Zahn, Owner, ZAHN Consulting, LLC

Wow, how can anyone select brands among 583 different choices? This survey is suspect from the very start. This means that the presumptions and assumptions that it includes are also suspect. Merchants can best connect with their shoppers through the time-proven methods of product, price, promotion, place and customer service. Great retailers offer all of these. Good retailers only offer some of these and bad retailers....

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Kai Clarke, CEO, American Retail Consultants

The seminal work on this topic is "Emotional Branding" by Marc Gobe. Well worth a read.

The inverse can work too. In categories that are built around emotional appeal, coming up with a functionally oriented offering can help a new brand or retailer stand out. Great example is what the Body Shop did to the cosmetics category.

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Martin Mehalchin, Partner, Lenati, LLC

Retailers can connect on an emotional level by providing customer experiences that match the expectations of their customers. This is by no means one size fits all and does involve some investment by the brand. Smart retailers know this and many of them are now looking at customer ownership as a very important piece of the executive round table.

Being able to have a single view of the customer across channels and deliver the desirable experiences will be key to the future success of retail. If the plan is just to throw merchandise on the rounders and expect customers to show up, they will indeed have to spend their entire marketing budgets on coupons, deals and promotions...until they go under.

Lee Kent, Let's meet share and succeed in Retail, YourRetailAuthority

It's early days for many retailers here. There are so many touchpoints, retailers focus on familiar metrics that work across the organization. Staying competitive through the last years has been difficult—many of the survivors are winning with aggressive promotions and discounts, which consumers expect to continue—a difficult platform for growth.

The shopping experience as discussed by panelists is still the basic truth—why are Trader Joe's packed? Fun to shop, new products to sample, great customer service. Why is Costco growing? Great assortment, new products to try, easy returns; there are other well known examples, but its all about the consumer experience and perception of value.

Brands understand the consumer usage experience and make connections across the touchpoints that drive purchase. Consumers start with the experience that creates emotional engagement; many retailers are still on the steep side of the learning curve.

Anne Bieler, Sr. Associate, Packaging and Technology Integrated Solutions

My experience has been that retailers talk a good game in terms of emotional engagement, but fail to take the essential actions that will produce that result. Remember, emotional engagement is usually the result of customer experience, and customer experience is the result of store associate empowerment, training and sufficient staffing levels to permit superior service.

Most retailers seem bent on saving their way to prosperity, where they cut and cut staffing to the point where the associates are just trying to stay above water. At the same time, lack of training and empowerment lead to very high attrition rates.

If retailers really want to drive loyalty they have to staff for it, with the right people, paid the right wages, with the right training and the right culture (recognition, measurement and empowerment). When they do, the results are dramatic. Yet most retailers fall back on the old approach of reducing staffing and training....

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Mark Price, Managing Partner, LiftPoint Consulting, Inc.

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