Friday, February 28, 2020

Dominate Anxiety Around Radical Innovations

When introducing innovations to your customers, it’s best to make the unfamiliar familiar. Work in phrases like, “…the same way as with the method you’re accustomed to…,” and “Once you do this a few times, it will be as second nature to you as what you’ve been doing up to now….” This reduces consumer anxiety.
     However, when the innovation is radical, the anxiety can overflow in ways that demand additional measures. In a set of studies, York University researchers asked groups of consumers to consider products such as black facial tissue, a beverage sold in a flip-top bag, and a bendable mobile phone. The consumers’ responses were compared to those of groups presented with white facial tissues, the beverage in a bottle, or a typical mobile phone.
     Overall, the anxiety level of the people exposed to the radical innovations was initially higher and judgments of the items were initially more negative. The radical innovation participants also were more likely, when given the opportunity, to select a well-known brand over a lesser-known brand or select an item from a geographical region with which the consumer identified. These consumers were easing their anxiety by choosing the familiar. Once the study participants made this additional item selection though, anxiety eased and judgments of the innovative items became more positive.
     A related study at York University and Canada’s Western University found that radical innovations which carry clear benefits will be better accepted by consumers when introduced by a dominant brand rather than a minor brand. The dominant brand introduction changes people’s perceptions of what an alternative in that product category should be like.
     Marketers not clearly dominant should view introduction of a radical innovation by the dominant brand as a signal to introduce such an innovation in their own product or service line. If the introduction is by a minor brand, the pressure to make changes is not as great.
     On the retailer side, prefer to carry items incorporating a radical innovation if those items come from a major name in the item category. And whenever introducing a highly innovative item, encourage shoppers who might show interest in the item to purchase other items which carry well-known brand names or come from geographical areas with which that shopper identifies. This could be where the raw materials were obtained or where the item was manufactured.

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Introduce Unfamiliar Products Like Old Friends
Fence In Consumer Anxiety
Choose an Item’s Country of Origin

Monday, February 24, 2020

Color Appetites with Fitting Hues

Would lime juice and cucumber-flavored potato chips be liked better by your shoppers if the items came in green instead of red packaging? Yes, say consumer psychologists at China’s Tsinghua University. Unless those shoppers are seeking innovative products, in which case they’ll probably prefer the red packages for lime and cucumber flavors and green packages over red for a strawberry juice and for tomato-flavored potato chips.
     Color exerts a strong influence on perceived taste. Researchers at University of British Columbia and University of Florida found that consumers say an orange juice tastes sweeter when the juice is a brighter orange. This held although the extra hue was due to taste-free food coloring. Juice color had more influence on taste reports than did information given about expert quality ratings or item price.
     Consistency across sensory attributes generally enhances item appeal. Incongruous sensations jar shoppers. Marketing professionals at University of Oregon and York University found that ratings for a bag of coffee beans were lower when the bag looked like burlap but felt smooth like paper than when the surface both looked and felt like burlap.
     The argument for consistency goes beyond attributes of appearance, on the one hand, and flavor or texture on the other. Effects of different sensory modalities are quite interdependent. “Synesthesia” refers to the cross-sensory phenomenon where certain sounds produce in the shopper’s brain perceptions of colors, each sound bringing forth a particular hue. Or how the sounds of music can arouse sensations of taste. The quality of background music in a restaurant influences gustatory experiences when eating and thereby the image the diner carries away as the restaurant image. Specifically, research from Oxford University finds:
  • Sweet tastes and sour tastes are accentuated by higher-pitched music 
  • Bitter, smoky, and woody tastes come through better with lower-pitched music 
  • Piano or woodwind strengthens fruity flavors 
     But for shoppers in a playful mood, those with innovative personalities, or those seeking to improve their creativity, incongruity in sensory experiences attracts positive attention to an item. When Apple released the first iPhones, the case looked like plastic, but felt like metal because of the aluminum bands. This contrasted with the cases from Samsung and Nokia at the time, phone cases which both looked and felt like plastic. Those marketing professionals at University of Oregon and York University report that the surprise offered by the iPhone plastic look and metal feel operated to Apple’s advantage.

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Construct Shopper Certainty Using Consistency
Coordinate Store Atmosphere Stimuli
Use Synesthesia to Reinforce Store Image
Play Full with the Sales Potential of “Playful”
Show Shoppers Selective Transparency

Friday, February 21, 2020

Multiply Recovery from Double Deviation

Consumer rage is down. That’s according to the latest National Rage Study, which is conducted periodically by Customer Care Measurement & Consulting in collaboration with Arizona State University. The figures reflect a drop from the intensity reported last time.
     Still, even though the rage is down, you’ll never want to get down with customer rage. Instead, continue to take it seriously, and work diligently to avoid it being set off by double deviations. A double deviation occurs when a customer believes a service failure to have occurred and subsequently considers the provider’s attempt at a remedy to be inadequate. Revenge can be the result, with the customer setting out to sabotage the provider. Short of that, the customer can choose to cease doing business with the provider.
     Researchers at IMED Business School in Brazil, Federal University of Rio Grande do Sul, and Katholieke Universiteit Leuven find that an apology for the service failure and a promise it won’t happen again are both effective in recovering trust after a double deviation. But the timing of each influences the effectiveness. An apology, which is seen by the victim as demonstrating integrity, best comes promptly. A promise, seen as a sign of competence, best comes a few weeks after the incident. Perhaps this is because a credible promise requires gathering information about what occurred and what will work to correct the problem. The researchers found that issuing a promise a day or two after the double deviation has worse effects on customer good will than does not issuing a promise at all.
     Keep your promises, but this might require modifying those promises. When there are changes in what you can deliver, tell the customer. In any case, notify the complaining customer of what you’ve done. You’ve only one chance to make a good first impression, but you can avoid the damage from a bad first impression.
     Issuing a promise after some time has passed probably requires you to reach out to a customer you’ve not seen for a while. If the customer had decided to stop doing business with you because of the double deviation, your reaching out demonstrates your interest in winning them back. Is this personalized touch worth it? Yes, say researchers at Georgia State University, at least for customers who, prior to the double deviation, had expressed high satisfaction with you or had recommended you to others. Prioritize those defectors.

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Prevent Store Brand Sabotage
Get Second Chance for Good Impression
Keep Up On Your Promises
Shepherd Profit-Potential Defectors
Put Customers to Sleep After Irritating Them

Monday, February 17, 2020

Segment Marketing of Ecommerce to Seniors

About 25% of older adults embrace the use of ecommerce, according to a University of Seville study. However, an almost equally large segment resist use of ecommerce, not as much because of enjoyment of visiting shops as because of low confidence in using a computer device. You’ll want to shape your marketing of ecommerce in different ways to these two groups.
     The fervent embracers of ecommerce depend on the internet for updates, so marketers should be sure what is posted is always the latest and is perfectly accurate. This segment of the elderly enjoys social networking, with the most common use being exchanges of message. Therefore advertise on platforms like Facebook and Twitter and encourage posting of reviews. These consumers enjoy a challenge along with a bit of risk. One thing this means is that gamification could work well. Another thing it means is that this group is receptive to ecommerce offerings like travel and food tourism.
     As for the ecommerce resisters, determine whether spending resources to change their minds is worthwhile. After all, there are advantages in having shoppers come to your brick-and-mortar sites and feel the merchandise. But if you do want to influence the resisters, they are most likely to be won over with systems that feature ease of use and the ability to reverse buying decisions. About 80% of this segment are women, so female oriented themes might be useful.
     I’ve particular confidence in making these recommendations to you because of distinctive features of that University of Seville study I use as a basis. With 474 survey participants, there was a relatively large sample size of older adults. The computer use explored was specifically ecommerce rather than other applications of digital technologies available to seniors, such as video games, self-checkout kiosks, or companion robots. The survey items used to develop the segments had previously been validated to particularly fit personality characteristics of older adults. And the statistical methodology—a latent class cluster model—is a sophisticated analysis tool equal to the task.
     Still, a senior’s decision to embrace or reject ecommerce use is determined by the situation as well as by personality characteristics. For instance researchers at University of South Dakota, Florida State University, and The Economist Corporate Network-Tokyo found that an earthquake can shake up habits. Japanese seniors experiencing the 2011 earthquake-induced Fukushima Daiichi nuclear disaster reported a subsequent drop in use of technologies.

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Subtract from the Senior Digital Divide
Segment Your Senior Market
Game On with Consumer Competition
Tell Seniors to Get Out of Here
Sense the Pleasure from Tactile Ordering
Expand into International Safe Harbors

Friday, February 14, 2020

Provide Support Service Like a Customer

Ecommerce customers having thorny post-purchase problems come away more satisfied when receiving advice from an online user community than from an employee of the seller. This is especially true when the advice fails to promptly solve the problem.
     The researchers at Menlo College, University of New Hampshire, and University of Richmond who initially documented the phenomenon went on to explain why. One reason is the likely amount of product familiarity. Users offering advice do so because of experience both with using the product and with any difficulties mastering how to use the product as a beginner. The firm’s employee might not have this experience and so lack adequate knowledge of what’s gone wrong or overestimate the expertise of the novice user.
     Another reason for greater satisfaction with help from a customer community is the social support in a situation where the customer is feeling frustrated. Often, a number of users will reply to a posted question. The firm’s support generally comes from a single individual. Further, that individual customer service employee may come across as rushed. Related to this, a group effort shows commitment to solving the customer’s problem, and people are more forgiving of other customers than of a firm’s employees when the problem is not solved.
     The researchers validated these explanations by showing how the advice is more satisfying for a customer when a set of employees participate in analyzing the problem and when those employees make clear that they’ve thorough experience with the product. The customer service is being provided by employees who are behaving like customers.
     The same dynamics apply when support is provided over the telephone or with a store visit. Put the customer in touch with someone knowledgeable about the item causing the problem. When you are that person, frame your advice in terms of your actual experiences learning to use the product and then using it. Acknowledge the customer’s frustration. Show patience and empathy.
     Also show respect during necessary handoffs. Online or on the phone, explain any delays as you seek help from a colleague. In the store, walk the customer to the expert. Before letting go, briefly explain the problem. This saves the customer the trouble of repeating themselves. It also proves to the customer that you were listening carefully. In that description of the problem, reflect the trouble for the customer, even if you happen to think the issue is trivial.

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Prepare Your Staff to Endorse Products
Provide Group Support with Customer Discomfort
Hand Off Customers with Care and Caring

Monday, February 10, 2020

Cultivate Creative Deviance in Your Staff

There are circumstances in which we don’t want our employees to follow the rules, say organizational science experts from University of Cologne in Germany and Woolworths Group in Australia. Those are the circumstances in which creative deviance produces superior results and, as a consequence, might inspire a change in the rules.
     In exploring how well that approach worked in a total of seventeen stores, the scientists did spot certain types of rules which were exceptions: safety and stock replenishment. Here the supervisor is open to discussions about revising the rules, but strict adherence to the existing standards must be maintained. More generally, the advantages of employees’ creative deviance occur only when there is a network of norms. People feel most comfortable experimenting within environments which are structured and predictable.
     Supervisors who themselves practice creative deviance serve well as models for staff. This should be combined with granting employees authority to make decisions, but also responsibility and accountability. When your employees do go beyond what the store policies say, they should be expected to let their supervisor know so the issue can be discussed. Another element in this empowerment is making clear that some employees will be granted more latitude than others while your objective is to give progressively greater empowerment as employees demonstrate progressively greater wisdom.
     Attention to good business practices is essential. An example of creative deviance gone rogue is sweethearting, which refers to a store employee:
  • Giving away products for free or at a deep price cut 
  • With plans to get, in return, an extra tip, increased social status, or a product for free or at a deep price cut from the sweethearting recipient 
  • And all this violating policies set by the store owner/operator 
     Studies at Michigan State University and Florida State University suggest ways to rein in sweethearting:
  • Set policies which are unambiguous and easily understood. What sorts of items can be given away or deeply discounted? Which employees are granted the discretion to do this and under what circumstances? What practices, such as trading discounts, are forbidden? To audit the extent and the effectiveness of the practices, what degree of reporting and accountability are required from those employees? Keep reporting simple so you don’t discourage appropriate gifting. 
  • Enforce policies by punishing offenders, but be careful not to make the punishments out of proportion to the offense. Severe punishment does not curb subsequent sweethearting by staff. 

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Stab Sweethearting
Hide the Cake After Delegating Decisions
Trade Ethics with Consumers
Delegate, Empower & Collaborate

Friday, February 7, 2020

Beware If These Zip Codes Are Buying

A while back, marketing researchers at MIT warned retailers not to be misled by successes selling to what they called “harbingers of failure.” Ironically, booming sales of a newly introduced item to these customers constituted a strong sign the item would broadly flop.
     The existence of this strange but important category of consumers was subsequently verified in studies of over 100,000 shoppers and 400 retailers. Now, joined by a University of Washington colleague, the MIT researchers find that there are not only individual harbingers of failure scattered in among other customers. There are entire zip codes populated by these reverse indicators.
     If you’ve highly profitable sales to such a zip code, proceed cautiously in expanding to other markets or assuming longer-term profitability. Residents of harbinger-of-failure zip codes are comparably less likely to build store loyalty.
     How to identify the neighborhoods? Monitor for generally unconventional or unpromising preferences. The residents maintain a track record of frequently purchasing niche existing items of all sorts which are markedly less popular elsewhere. These people donate to different political causes than do people in neighboring zip codes. The congressional election candidates they vote for usually lose. During periods of a sellers’ market in real estate, prices of their homes increase at slower rates than in otherwise comparable areas.
     There’s reason to think harbingers of failure have an exaggerated need for variety. At the same time that you won’t depend on them to accurately predict long-term sales, you’d like to meet their need. The fact that they cluster in neighborhoods is good news for brick-and-mortar retailers.
     If you want to introduce these customers to a new item, their interest in switching is fine. However, if the equivalent item the customer has been buying delivers good value for them and high profits for you, I’d think you’d prefer to at least delay the switching.
     Slow it down by encouraging customers to think about alternatives they’ve already tried. If the shopper talks about “breaking out of my brand routine,” ask, “What are some other brands you’ve used in the past, and what convinced you to start using the current brand?” If the customer talks about delaying a purchase so they can try out a store which opened recently in the area, ask, “What are some of the stores you’ve shopped at before or in addition to shopping here, and what about our store keeps you coming back?”

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Monitor Variety Seeking
Analyze What Your Shoppers Say and Do

Monday, February 3, 2020

Cut to the Chase of Old Voters’ Shortcuts

Writing in Politico Magazine, Timothy Noah points out two big reasons candidates should pay close attention to how senior citizens make voting decisions: First, seniors are the fastest growing age demographic among eligible voters. Second, old people love to fill out ballots much more than younger people do. It’s estimated that in upcoming elections, one quarter of the electorate will be at least 65 years old. And in the 2016 U.S. elections, about 70% of eligible voters age 65 and above cast votes. In contrast, only about 45% of those ages 18 through 29 did so. A Pew Research Center analysis of ten other countries found similar results in each.
     This doesn’t necessarily mean elderly voters prefer older candidates. But it does mean that the caution and nostalgia associated with aging will assume increasingly greater importance in decisions about candidates’ policies and about proposals on the ballot. Advancing age also increases interest in local issues. The difference between older and younger voting participation is even greater for regional contests than for national ones.
     Old adults are more likely than young adults to use decision making shortcuts, such as selecting a candidate who is good enough rather than perfectly ideal for them. Compared to younger voters, seniors engage in a higher frequency of maximizing—aiming for the very best candidate. They also engage in a higher frequency of satisficing—settling for an acceptable candidate when holding out for the maximum becomes difficult.
     Along with making decisions simpler for their elderly thinking, the dual peaks of maximizing and satisficing help deal with the high distractibility of old age. A set of University of Kentucky studies found that voters of average age 24 years were especially likely to select a candidate by considering the stand each in a large field had taken on a bundle of issues. By contrast, those of average age 72 were especially likely to select the first candidate they came across whose stand on the issues pleased them. In appeals to seniors, candidates benefit by stating positions of high interest to that age demographic and placing less emphasis on other positions.
     For similar reasons of simplicity, repetitive presentation of brief TV and internet ads using rhythmic elements—visual drumbeats—can persuade seniors. Any politician can attest to the value of rhyming jingles. But don’t make the drumbeats too strong or you’ll irritate instead of induce the elderly brain.

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Market by Political Propensity
Retire Impatience with Seniors’ Price Decisions
Tell Seniors to Get Out of Here
Satisfy Seniors Who Satisfice
Drum Up Interest with Drumbeats