On a recent podcast about these 5 rules, I shared a recent digital experience that was definitely on the “could use some work” side of the spectrum. It was Glasses Direct, which is where you order the frames you want with your prescription, and then they send you the glasses. The experience started to trigger some uneasy feelings when they asked me to put a credit card on my forehead and take a picture of it to send to them. They needed the photo since my prescription didn’t have my measurements on it. Ostensibly, they could figure out how to size the glasses based on the credit card’s image between my eyes.

The glasses were not cheap, so I was feeling uneasy about this credit-card directive. Moreover, the glasses were taking a long time; weeks it seemed to me. Meanwhile, while I was waiting, I had no email about my glasses’ progress but at least ten promotional emails from them hoping to sell me something else before I received my first order. (Later, I learned that they did send an email about my order, but I missed it.) To summarize my experience, Glasses Direct was a great idea for a business model, but the digital experience fell short of my expectations.

Since the pandemic, everyone’s doing a lot more of their customer business online, making digital transformation mission-critical these days. I used Glasses Direct for the first time during the pandemic, as I didn’t fancy contracting COVID-19 at the opticians. It is critical to remember that people are still people even when they’re interacting with a computer. These five new rules can help bring your digital experience in focus rather than ending up with a blurry vision.

The Five Rules for Designing a Great Digital Experience

1. Design in a digital “nudge.”
2. Analyze how customers really behave.
3. Design your experience to anticipate your customers’ needs.
4. Plan to evoke emotions and measure them.
5. Humanize technology.

Rule #1: Design a digital “nudge.”

Nobel-prize winning economist Richard Thaler and Cass Sunstein wrote a book called “Nudge” a few years back. They suggested that small changes we make in choices shift people in one direction or another. However, you don’t force people in a direction; instead, the way you present the options with subtle clues affects what they choose. So, to take this idea into the digital space, consider how you can influence your customers to behave the way you want them to act with the way you present your online interaction choices.

There are a few different ways to do this. For example, scarcity works to get customers to act fast. If you make an offer, always put a time limit on it. Giving an “expiration date” to the deal makes it scarce, which helps customers prioritize their buying decision. Disney used to do this with their movies. They would bring classic Disney cartoons from the 60s and 70s, like The Jungle Book or Dumbo, “out of the vault” so you could buy them—but only for the next six months. Then, they go back in the vault! Parents felt compelled to snap up these old cartoons for their newborn children, who wouldn’t watch them yet, just so that in a few years, the movies would be in their collection.

Scarcity is just one of the principles of the behavioral sciences you could use. You could also employ the effects of Social Proofing, which uses the reviews and comments to attract attention to your product. You could utilize the impact of Extremeness Aversion, which means that people usually like the middle option. By presenting your desired purchase as the moderate choice between a more expensive and elaborate offer and a pared-down, more affordable one, you can nudge people to do what you want. Also, don’t forget the whole area of first impressions and the esthetics of your experience. The way your site looks and how the product is featured can also nudge people in the right direction.

Rule #2: Analyze how customers really behave.

One thing I love about the digital space is you can measure everything. You have a better capacity to analyze what people are doing. You can measure where people have come from, where people are going, and even the hotspots on the screen. Having all that data enables you to make predictions.

Also, I like to test the tactics I use in a safe environment. You can test if you use this icon in one position how customers behave and then move it somewhere else and see what happens. Moreover, you can do these types of tests quickly.

Customer Science uses this blend of data, which you get in abundance with a digital experience, to see what people are doing. As you might recall, there’s a significant difference between what customers say and what customers do. The great thing in the digital environment is you can see what they do. You can also make (and test) one of these digital nudges and see the effect.

Amazon uses Customer Science because they have a great deal of data. Moreover, they know a great deal about me. I buy virtually everything on Amazon, from food to books and everything else. They know what I read on my Kindle and when I wake up because I use the Amazon Echo. They even know who’s come to my front door. Some people think it’s Big Brother-ish, and it is, but I think how they use it is ingenious, which leads me to the next rule…

Rule #3: Design your experience to anticipate your customers’ needs.

Given all that data you acquire for rule #2, here, in working with rule #3, you can use it to anticipate what customers will do next. Then, you can design your experience to play into that behavior. You are, in effect, beating customers to the punch and offering them an easier way to do what you want in your experience while at the same time improving the process for them.

For example, time is a significant resource for all of us. To conserve it, we want things to be easy, so we spend the least amount of time (and cognitive resources) on something that we can. If you can make things easier on your customer by understanding how they navigate a website and what needs they have that accompany a purchase, you are more likely to get customers to behave the way you want.

Don’t make your customer anticipate. Figure out what they would want and give it to them. Whatever you do, please don’t make them burn up their precious attention, trying to find the necessary information to make a decision. Make it easy for them to see what they need.

Moreover, you can use that information from Rule #2 to segment customers by behavior, which allows you to get even more specific about what they need for the experience to be easy. If you know that this type of customer usually behaves in a particular way, you can provide the information they need to improve the experience and get them to do what you want. Everyone wins in this scenario.

Rule #4: Plan to evoke emotions and measure them.

Around 18 months ago, I had a podcast about analyzing customers’ facial expressions during experiences. To summarize how the technology works, there is a camera positioned to record customers’ facial expressions during experiences, which you can later analyze to understand how customers feel at the moment. The types of signals that reveal the customer’s emotional state include micro-expressions, like eyebrows raising, lip pursing, or pupil dilation. The advantage is that you get a real-time report on how your experience makes people feel. So, for example, if glasses direct had been recording my face when I read the email about putting the credit card between my eyes, they would have known by my microexpression that I was surprised they asked (by my raised eyebrow) and doubtful that this would work (by my pursed lips).

In a digital experience, however, you usually can’t see anyone. You can hear somebody yelling at you in a store or see them stamping their feet, but online, not so much. The best way you can determine if someone is unhappy is if they leave the page just before check out or something. Or, maybe they get on the chatbot next, so you have that data to consider. In other words, it isn’t easy with digital experiences to know at the moment how customers feel.

However, that is even more why I think it is vital to get on board with Rule #4. If you make a deliberate plan to evoke a specific emotion—which can be feeling cared for or prepared or surprised and delighted—in your digital experience, then you have a better chance that those moments will have positive feelings rather than negative, even if you can’t record the microexpressions as they occur…yet.

Rule #5: Humanize technology.

The best way to introduce this rule is to give you an example. So, as I mentioned, I buy everything on Amazon, including a chef’s knife recently. Unfortunately, we dropped it on the floor, and the blade broke. I went online and saw there was a manufacturer’s warranty, so I began a chat. It was clear that I was dealing with an automated chatbot, which isn’t bad in itself, but it was noticeable. Then, when I reached a real human, the human asked me the same questions in the chat, which annoyed me.

My advice here is two-fold. First, mind the experience enough that you don’t ask people the same bloody questions twice. Second, it would be best to make that interaction with technology feel more “human” if possible.

We know from a former guest on our podcast, Shiri Melumad, assistant professor of marketing at the Wharton School, University of Pennsylvania that she has data that shows people respond differently on mobile phones than they do on their computers, albeit subtle differences. For example, people are more emotional on their phones because mobiles are more difficult to type into, so people get to the point rather quickly. However, these subtle differences might also be present in how people react when they think they’re talking to another human being versus thinking that they’re talking to a robot. Those differences and reactions would be essential to anticipate and manage in your digital experience.

We are not saying that you should use a bot or that people don’t like communicating with a bot. However, it is different, and it would be wise to determine if it’s the right kind of difference for the interaction. In other words, you should ask yourself at various points in the digital experience, would this interaction have a better emotional outcome for the customer if a human handled it?

Humanizing technology also means that you should not make customers feel that you are trying to avoid the human touch. I had that lousy type of avoidance experience with my cable company last week. (What a surprise!) I couldn’t get a human to talk to me. It felt like a nightmare, which is not the digital experience anyone is trying to design for customers.

These five rules will help you build an excellent digital experience. Try putting a digital nudge in the design to take advantage of all the concepts we have discussed in the behavioral sciences, and then see what your customers do. Moreover, use this data about customer behavior to understand what customers want or what they are trying to get and test to see what happens if you change it. Once you know these needs, try and design a digital experience that anticipates customers’ needs to make it easier for them to get what they want when they want it. Doing so will help your plan evoke the emotions you want customers to feel during your digital experience to tie to results that you measure. Finally, consider how your digital interaction comes across to customers and whether the human touch is in all the right places. All of these rules can help govern your digital experience, which, as we all know in 2020, is one of the only places your customers can have an experience at all.

To hear more about this idea in more detail, listen to the complete podcast here.

Colin Shaw is the founder and CEO of Beyond Philosophy, one of the world’s leading Customer experience consultancy & training organizations. Colin is an international author of six bestselling books and an engaging keynote speaker.

Follow Colin Shaw on Twitter @ColinShaw_CX

The post The 5 Rules for Designing a Great Digital Experience appeared first on Beyond Philosophy.

Target Corporation has had a number of challenges over the past few years, from abruptly closing all of their Canadian stores to a 2016 earnings shortfall, plummeting stock price, and a rather negative sales outlook for 2017 (first quarter EPS was 6% lower than first quarter 2016). The company is forecasting a single digit sales decline for the full year.

So, how does Target intend to bring about a performance turnaround? The company is taking aim at a revised store experience for customers. Target has invested $220 million to remodel and renovate 28 stores in North Texas. According to Target spokespeople, the remodels will emphasize “inspiration, discovery, style, and ease”. Among the changes:

– Top-to-bottom overhauls, with new design/style elements and product presentations (based on what customers said they liked about Target’s new stores)

– Two entrances, one that promotes exclusive and seasonal items, the second for Online Order Pickup and quick purchases, such as for groceries (see below)

– More attractive merchandise presentations, including “updated mannequins and fixtures in apparel, home and beauty”.

– Easier in-store shopping flow, with aisle modification designed to encourage customers to browse through apparel, accessories, and other products.

– Updated, more engaging grocery department, with “grab-and-go food and beverage options”, with fresher products, more choice, and greater convenience

– Target’s Online Order Pickup located at front of store, for faster, more efficient, check-out

– Wine and beers shops inside the store

In all, Target plans to fully redesign 110 (out of their 1,800) stores in 2017 and 500 in the next three years. This is a significant corporate initiative, with cash investment running into the billions of dollars.

Apart from design, product, and other store elements, Target is also investing in technology which will enable store employees to more efficiently search inventory and also take payment from mobile point-of-sale devices.

While all of this reads well, the planned modifications are the kind of inside-the-dots, rather conservative approaches most would expect from a mass discount retailer in search of customer experience enhancements. Here’s my question, and my key issue. Beyond these “inspiration, discovery, style and ease” changes, how is Target, in parallel, evolving its store culture to generate more interaction with, and commitment by, employees?

I’m an active grocery and discount department store customer. Among stores I frequent are Target, Wegmans, Trader Joe’s, and Costco. Where employees, and their commitment to customers, are concerned, the Target store experience will (likely) never equal Wegmans, Trader Joe’s, or Costco, but, Target could certainly take some lessons from the store cultures of these successful retailers.

Because Target will now be looking to place increased focus on groceries, I’ll use Wegmans,Trader Joe’s, and Costco as my reference points. Rochester, New York-based Wegmans, has succeeded in creating an almost cult-like bond with its customers. The company, which is well-known for its food selection and quality (you can even custom blend your own trail mix), and for its empowered, well-trained and proactive employees, has been named the best supermarket chain in America by Consumer Reports; and, yes, it certainly might be the best retailer on the planet.

1. Wegmans. Wegmans has constructed and sustained a stakeholder-centric culture where the customer truly comes first, and customer experience is the barometer by which it measures success. For example, the retail grocery industry (and the discount department store industry) is normally associated with fairly passive and reactive customer service; but, like Whole Foods Market and Trader Joe’s, Wegmans’ employees readily make themselves available to help customers (who Wegmans refers to as “guests”) find what they want, and often make recommendations for what they think the customers would like. Do Target’s store employees do anything like that? If so, I’ve never heard of anyone experiencing it, nor have I.

Speaking on a personal level, at Wegmans shopping is not a chore and is often pleasurable. Stores are attractively laid out, almost like an old-world open-air market. There are tea bars, multiple eat-in options, and chef-prepared breads and meals to take home. When shopping there, rather than rush through, the inviting atmosphere makes it enjoyable to take my time, relax and experience what the store has to offer. Better for me, and better for Wegmans. Will the reimagined Target store experience do that?

Wegmans also does other things to set itself apart, and in positive ways. From a merchandising and reputation perspective, they are seen as active members of the communities in which they operate. They were one of the first chains to purchase from local vendors. Does Target do that? Don’t think so.

The chain supports local causes and events. Wegmans represents conscious capitalism, in the truest sense of the term, further building the bond between the enterprise and the customers, many of whom consider Wegmans ‘their store’

They also offer new technologies, such as the interactive recipe and shopping list feature on their web site, and an iPhone app that helps shoppers organize their purchase list on an aisle-by-aisle basis in the store – all to enhance the shopping experience. Is Target including that in their technological upgrades? Don’t think so.

2. Trader Joe’s. Shopping at Trader Joe’s is truly a branded customer experience. Each store has a light-hearted South Seas island theme throughout, including the Hawaiian shirt garb of store staff. Employees at their Monrovia, CA headquarters often served as a ‘tasting panel’, and they help determine which new products will be stocked in the stores; and, with tasting locations at each store, customers get to give the final stamp of approval, or rejection, by ‘voting with their taste buds.’ This is also a device for bonding with customers at the store level. Even though Trader Joe’s stocks about 3,000 items, compared to the average supermarket’s 30,000 items, sales per square foot are typically two to three times that of chain supermarkets.

What has made Trader Joe’s so successful — apart from wage and benefits packages, and opportunities for advancement, well above most companies in the supermarket industry – is the sense that employees are the brand, its communication style and fun, upbeat culture. Employees are selected and trained to multitask, and everyone seems to enjoy what they do. They deliver a great branded customer experience, and they stay (voluntary turnover is only 4 percent) because they enjoy working there and because the organization is thriving.

3. Costco. Going to Costco is not an especially exotic experience, and yet shoppers often describe their visits as “fun.” Costco pays their employees a lot more on average than most retailers, enabling the company to keep turnover much lower than other retailers. Employee behavior, often identified as smiling, friendly and helpful, actively contributes to positive in-store customer experience; and this helps enable Costco to maintain focus on their original strategy – low margins, low overhead, big profits.

So, in Target’s revamped store customer experience experiment, which will soon be rolled out as a major test and downstream strategy, is the store culture, and linkage between customer experience and employee experience as Wegmans, Costco and Trader Joe’s do so well, also being included? Is this strategy on-target or off-target?

The post Target’s Revamped Store Customer Experience Experiments: Culturally, Are They On-Target or Off-Target? appeared first on Beyond Philosophy.

Today, it shouldn’t be news to anyone that things have changed and malls in general are struggling. Discount retailers are partly to blame, but the real culprit is the internet. Why would you change out of your pajamas and scout for a parking place when you could buy the same stuff online, from the comfort of your couch?

As the Tampa Bay Times reports, malls are responding by seeking tenants who are “internet-proof”, providing something that you can’t just order up from Amazon. You don’t have to leave the couch to buy a new pair of pants, but you’ve got to come to the mall if you want to eat at California Pizza Kitchen. By attracting destination tenants, mall developers hope to keep occupancy levels up and bring in people who will also buy from other stores. Increasingly, malls include destinations like grocery stores and gyms.

That’s why, for example, a Saint Petersburg, Florida mall’s tenants include several spa/hair salon type businesses, an H&R Block, two eyeglasses stores, a shoe repair shop, a carpet and flooring store, a dentist and a tattoo parlor. Imagine getting your teeth cleaned, your taxes filed and a new tattoo, all in one trip!

Individual stores are also realizing that they have to offer a different experience to get shoppers into their brick and mortar locations. I’ve written about Apple’s decision to stop calling their retail shops a “store” and instead focus on giving customers a fresh experience – more like a gathering place than a store..

By altering the mix of tenants in shopping malls, mall developers are protecting themselves from retail tenants who might abandon their leases in the face of online competition. But they are also changing the mall experience for customers. If they don’t do it right, this can cause problems.

It’s all about expectations. People who go to a shopping mall expect to shop. They anticipate a broad assortment of the usual mall retailers. If a mall has too many other kinds of tenants – hair salons and day spas and watch repair shops – then the customer’s expectations of a mall with lots of stores isn’t met. Even if the mall is fully occupied, the customer’s perception might be “wow, there’s hardly anything in this mall.”

When customers don’t get what they expect, they form a negative memory that can keep them from coming back. I discuss customer expectations in depth in my new book,The Intuitive Customer: 7 Imperatives for moving your Customer Experience to the next level, which I co-authored with Professor Ryan Hamilton of Emory University.

How can malls avoid the expectations trap? A first step is to fully understand the experience from the customer’s point of view. Why are they coming to the mall, and how do they feel while they’re there?  In our customer experience consultancy, we do this by conducting customer mirrors where we stand in the customer’s shoes at each point along the buying journey.

Changing customer expectations by promoting experiences that go beyond shopping is probably a step in the right direction. That’s what Apple says it plans to do, and what Lululemon is doing with in-store yoga classes. it’s what grocery stores are doing when they host cooking classes and wine tastings and offer in-store dining.

The key is to manage customers’ expectations and then exceed them. But if malls don’t pay attention to their customers’ emotional and subconscious experiences, those internet-proof tenants aren’t going to save them.

As a customer, what do you think about a mall with nontraditional tenants? Good idea or bad? Share your thoughts in the comments box below.

To learn more about managing and exceeding your customer’s expectations register for our 3 part Training Course based on our latest book:The Intuitive Customer: 7 Imperatives for moving your Customer Experience to the next level(Palgrave Macmillan, 2016) for only $59!

If you were interested in this article, you might also like:

Retail’s Worst Nightmare – Virtual Reality!

The Apple Store Will Be No More!

Artificial Intelligence: It’s Coming to a Mall Near You!

Colin Shaw is the founder and CEO of Beyond Philosophy, one of the world’s leading Customer experience consultancy & training organizations. Colin is an international author of five bestselling books and an engaging keynote speaker.

Follow Colin Shaw on Twitter @ColinShaw_CX

The post Revealed: Shopping Malls Fight Back! appeared first on Beyond Philosophy.

Before the announcement, many experts and industry commentators had little idea what it would be. They knew, however, that while the delay of the big announcement for a couple of days is unusual for such a high-profile, public company, it wouldn’t likely cause any loss of confidence by their long-time fans.

Tesla Breaks Top 20 for Customer Experience

It’s safe to say at this point that Tesla has a loyal following. Tesla was the only carmaker that made the top 20 for Best Customer Experience. In the research mounted by Group XP, Tesla came in number 20. For Customer Experience ranking, the research team used four criteria, which included:

1. Impression: Do they have a unique reputation?
2. Interaction: Does the company deliver on your needs?
3. Responsiveness: What is their online presence and quality of their content?
4. Resilience: Do they have a higher brand purpose, meaning a desire to make customers’ lives better?

The team then came up with a point system to rack and stack over 43,000 brands across 36 markets.  To give you an idea of the range of brands included in this list, the number one brand for Customer Experience was Pampers. Pampers had 149.9 points vs. Tesla’s 116.79—which, we can all agree shows Pampers was loads (ahem…) better.

Tesla Wears Their Halo Well

While BMW (114.19) and Mercedes (111.98) were right behind them at spot 23 and 28, respectively, the fact remains Tesla came out on top for carmakers. Why? They have a sparkling halo-effect that attracts and retains a loyal fan base.

A halo-effect is a lot like your brand reputation.  It is a high level of perception of your brand. It is not a shining circle of light to indicate your divinity—although, in some ways, the halo I’m talking about does just that. The halo-effect represents how people interpret your experience based on their previous experiences with you and your brand. The Halo-effect exists even if a customer has never bought one of your products. It influences people’s perception of your actions, products or services. However, unlike the halos that angels wear, it can be good or bad.

To give you an idea what I mean, let’s consider other car brands.  I have never owned a Ferrari (which came in at position 30). But when I hear they have a new car, I know it will be beautiful, fast, and WAY out of my price range. I will be right about all three. However, if I hear that Volkswagen has a new fuel-efficient and low emissions model, I know it will be adequate, affordable, and have a much larger carbon footprint than it says it will. I will be right about all three.

It can also affect people’s interpretation of their experience as negative even when they love your brand, and they have an entirely sufficient experience. For example, let’s say you have always wanted to drive a Tesla Model X because you have heard so much about how exhilarating and life-changing it will be. You finally get your chance. You drive the car, and it is great, but not exhilarating or life-changing. It was okay, just not exceptional. Unfortunately, this experience can translate into a feeling that the brand lets you down, which then reflects poorly on your experience, even if only at a subconscious level.

A Loyal Fan Base Is Forgiving

In recent years, Tesla increased their research and development spend. Their budget in2015 reached just under $718 million, with no signs of slowing down. Unfortunately, their losses are almost equal to that each quarter, which you can see from this graphic:

Numbers like this would be the death knell of most companies. And yet, Tesla retains a halo-effect of being a company to watch, the future of…well, something BIG!

It also seems that not being able to get the product you want from Tesla would also create a negative halo effect. However, with car buyers, the fact that the Tesla Model 3debuted this Spring with delivery not scheduled until the end of 2017—over a year later isn’t a problem. In fact, the orders they already have means that if you reserve the car today, you will get it in mid-2018—over two years later!

Tesla announced that the self-driving car is here. Moreover, Elon Musk and Tesla solidify their reputation for thinking big and backing their claims for being the cars of the future. Apparently, it’s working. They came out on top of all the carmakers in the Customer Experience Index. Despite their heavy losses in R & D, they continue to maintain a reputation for being innovative. Moreover, you can’t even get one of their cars until a little under two years from now. It also shows that their strategy for brand engagement and the halo-effect it creates is anything but on auto pilot.

To learn more about these fascinating and compelling concepts for yourself and business, please register for our 3 part Training Course based on our latest book:The Intuitive Customer: 7 Imperatives for moving your Customer Experience to the next level (Palgrave Macmillan, 2016) for only $59!

If you enjoyed this post, you might be interested in the following blogs:

Revolutionary Thinking on Customer Loyalty

Astonishing Big Gains from Little Changes!

Fascinating Insight! How You Make Decisions

Colin Shaw is the founder and CEO of Beyond Philosophy, one of the world’s leading Customer experience consultancy & training organizations. Colin is an international author of five bestselling books and an engaging keynote speaker.

Follow Colin Shaw on Twitter @ColinShaw_CX

The post Tesla: Intriguing Insight To Success appeared first on Beyond Philosophy.

As Customer Experience Consultants, we see our clients presume that customer evaluations of an experience occur at the product level. This presumption is only partway true. People do evaluate at the product level, meaning how much it costs or how it tastes, and it is important. However, people also reference their other expectations, as in how much they think your product should cost or how delicious they predict it will taste.

Sometimes, even with clear expectations and the ability of the product to meet those expectations, there are other influences on the customer’s evaluation of his or her experience. These influences can be surprising.

My latest book, co-authored by Emory University’s Professor Ryan Hamilton discusses how these unimportant aspects can be quite important to your Customers. The book is called  The Intuitive Customer: 7 Imperatives For Moving Your Customer Experience To The Next Level, and includes:

Imperative 6: Accept that apparently irrelevant aspects of your Customer Experience are sometimes the most important aspects 


We assume customers enter the experience with an expectation of how good it will be. They then compare the expectation with the reality to create their evaluation. When the experience exceeds their expectations, they evaluate it positively. When it doesn’t, they don’t. This assumption is accurate in straightforward cases, meaning the experience was clearly excellent on all fronts—or clearly wasn’t!

But what if the experience falls short, but only by a little bit? For example, let’s say you went to a hotel where the experience was fine. The room was fine, the service was fine, and so on. However, you thought this particular hotel would wow you. While they didn’t do anything wrong, you didn’t feel wowed either. Now, even if the experience was objectively good (i.e., nothing was technically wrong with it), your disappointment regarding feeling wowed translates into a negative evaluation.

When things get ambiguous or difficult to evaluate, customers may use their high-level impressions of the brand, the retailer, or the service provider to guide their evaluations or what we call a “halo effect.” Your feelings toward a brand create a positive or negative halo influencing your evaluation of their Customer Experience.

Consider experiences eating at McDonald’s, a brand that prides itself on its consistency anywhere in the world. However, when you go to a McDonald’s in the UK, you don’t have the same experience you do in Des Moines or Toronto.  It’s similar, but not the same. Also, McDonald’s has a huge brand reputation (whether good or bad) that affects your evaluation. Plus, there is another local influence at work in these experiences, with different tastes unique to the area, such as:

It’s possible just seeing these local items on the menu affects your evaluation of your McDonald’s experience in these countries, even if you don’t order them.

However, if you removed the McDonald’s logo and branding from the equation, your evaluations of your dining experience would change. You see, your brain associates your expectations with the McDonald’s brand. Without that reference point, your brain doesn’t know what to expect, and as a result has fewer expectations influencing the evaluation. If you think you would still know the taste of McDonald’s without the packaging, you are likely wrong.

Several studies have shown this to be the case. But rather than a dry study, here’s a great example from Lifehunters on YouTube:

McDonald’s is one example of a brand with a reputation. But there is also Zappos and Starbucks, Bank of America or Goldman Sachs or Amazon and Volkswagen. Each of these brands creates an expectation in your mind, either good or bad, depending on their halo effect with you.

Organizations must understand how these halos affect their customer’s impression of the experience, and manage them better. Some try and succeed; others fail. Why? Too many organizations are letting their halos slip by focusing their efforts on things that won’t change customers’ evaluations.

For example, say you have a retail location where you want to improve the Customer Experience. You could change the organization of product in the store. You could begin a loyalty and rewards program to keep people coming back. But, after doing all the work, you notice they’re not moving the needle forward on your results. In fact, it seems like your customers didn’t notice the changes.

However, one day you notice that your car park outside the store has issues. The flow is confusing, the spaces too small, and the sidewalk is uneven. Your customers have learned to get around, but it was an effort that makes a poor impression that reflects on your experience. You might try fixing the sidewalk and improving the size of the spaces in your lot to enhance their impression upon arrival. It will likely have more influence on your Customer Experience than a frequent buyer program will.

Another example could be updating the bathrooms and keeping them spotless. These little impressions—a better car park, clean and modern bathrooms— add up in the mind of customers, and they create a better impression about the retail experience.

There are many influences on how a customer evaluates your experience, not just the ones about which you have always heard. While they do assess your experience at a product level, they also do it at an expectation level. Also, your brand reputation affects their assessment. Furthermore, other little impressions affect their overall impression of your brand. When you understand and address all of these elements, you are taking the steps needed to move your experience to the next level.

Join our free book launch webinar on October 18th to find out more about how you can make little changes that have a BIG impact: The Intuitive Customer: 7 Imperatives For Moving Your Customer Experience To The Next Level or join one of our new training courses from $59.

What brands create high expectations in your mind? I’d be interested to hear the brands and why in the comments below?

If you enjoyed this post, you might be interested in the following blogs:

It’s the Little Things: Adding Value Without Lowering Prices

Training Employees on Nonverbal Clues

‘Top 50 Marketing Thought Leader’ Reveals Latest Trend

Colin Shaw is the founder and CEO of Beyond Philosophy, one of the world’s leading Customer experience consultancy & training organizations. Colin is an international author of five bestselling books and an engaging keynote speaker.

Follow Colin Shaw on Twitter @ColinShaw_CX

The post Astonishing BIG gains from little changes! appeared first on Beyond Philosophy.

When Customer Retention, my first book on customer behavior was published, now over 20 years ago, one of the strongest reactions voiced was my contention, and the proof offered, that customer satisfaction and customer retention were fundamentally different concepts, and that they required different measurement protocols. Many felt that customer satisfaction and retention were the same. In reality, they are very, very different, conceptually and measurement-wise. Retention is about behavior, the motivation to remain a customer, whether at lower, equal, or higher purchase levels. Customer satisfaction is not about any of that.

Customer satisfaction has always been largely about attitudes about a product or service experience. Attitudes are superficial and tactical, essentially dealing with transactions and interactions rather than longer-term experiences and relationships. It is, as well, sometimes about behavioral intent, not behavior itself. Customer satisfaction is also about the tangible, functional, and rational components of value (time/timeliness, accuracy, completeness, suitability, price, functionality, etc.) of value delivery. For decades, satisfaction has been a cornerstone of what we understand to be total quality in products and services, as perceived by the customer. Unfortunately, customer satisfaction has been proven to have very little impact on, or connection to, actual customer behavior. I’d submit that the hourglass sand on satisfaction meaning and actionability have finally run out.

Even total quality icon W. Edwards Deming believed that customer satisfaction was not an ineffective metric for understanding the impact of satisfaction on customer actions. In his book, Out of the Crisis (MIT Press, Cambridge, MA, 1982, p. 141), Deming said: “It will not suffice to have customers that are merely satisfied. An unhappy customer will switch. Unfortunately, a satisfied customer may also switch, on the theory that he could not lose much, and might gain. Profit in business comes from repeat customers, customers that boast about your product and service, and that bring friends with them. Fully allocated costs may well show that the profit in a transaction with a customer that comes back voluntarily may be 10 times the profit realized from a customer that responds to advertising and other persuasion.” This quote appeared in Customer Retention (ASQ Press, Milwaukee, WI, 1995, p. 9).

When. 35 years ago, Deming said “Profit in business comes from repeat customers, customers that boast about your product and service, and that bring friends with them”, he was talking about what, for the past decade, we have understood, and effectively measured and applied, as customer advocacy behavior.

The satisfaction (and delight, NPS®, and CES) metric does not take consumer brand favorability and volume/type of positive and negative online/offline word-of-mouth into consideration. And, as many consulting organizations have determined, today these factors are critical for both understanding leveraging downstream customer behavior. Advocacy and bonding, principally based on the kind of positive/negative customer word-of-mouth and impression of the brand or vendor that Deming identified, has tremendous power and potential to create desired high-end customer behavior. Word-of-mouth, however, is a double-edged sword; and customers’ negative communication, as much as praise, can have a damaging effect on other customers and non-customers, as well as the communicating customer.

As a core performance metric, customer advocacy is very much alive and well in both B2B and B2C products and services. Scores of studies, in many verticals around the globe, have demonstrated that informal word-of-mouth and brand reputation are essential decision-making levers. If anything, due to the more critical nature of touch points, performance, brand perception, and relationships in B2B, bonding may well be more important in this arena than in the business-to-consumer world. Critically, in both B2B and B2C performance measurement, there is little evidence of metric flatlining or reaching an actionability plateau.

So, all of that said, is there a role for tangible quality, as measured by customer satisfaction, on customer behavior? And, what is the most actionable way to measure it? Based on extensive consulting, training, and research experience, in b2b and b2c verticals around the world, I’d suggest that much of tangibility is about the emotional and memorable underpinnings of trust and confidence these elements represent. As noted in many of my blog posts and white papers, there is an emotional subtext to all components of value delivery, whether tangible or intangible, whether transactional or experiential over time. Especially with regard to rational value elements, these basic “table stakes”, when delivered to spec or as expected, will help drive trust, confidence and future consideration. When the basics are not attained, tangible element under delivery will undermine trust, and influence negative downstream behavior.

Some experiences are pleasurable in the subconscious, some are painful, some are superficial, some go deep. They can create sensations and feelings that can be a challenge to articulate, but which cause people to take action. Translating these subconscious emotions and feelings is the ‘holy grail’ of customer journey design.

Seemingly forever, marketers and researchers have been trying to identify stable and predictable links between what consumers say about product and service experiences, what they mean, i.e. the emotional and unconscious underpinnings about what they really think and believe, and what they do in terms of actual decision-making and actions in the marketplace.

There is an intersection between customer experience with a product or service, internal reaction to that experience, informal peer-to-peer communication about the experience, and downstream customer decision-making. It occurs in the personal emotional and subconscious distillation of that experience in creating memories forming the customer’s behavior. This may sound a little technical and psychological for some, but reckoning with the meaning of emotional and subconscious response to experiences has important ramifications in the marketing world. It can mean knowing what customers really want, whether they will stay or leave a vendor, and whether they will be loyal brand advocates or not. We’ve come a long way from customer satisfaction.

Republished with permission from CustomerThink.com

The post Customer Satisfaction. Why, Oh Why, Is ANYBODY Still Measuring? appeared first on Beyond Philosophy.

I have recently been included in Brand Quarterly’s ‘Top 50 Marketing Thought Leaders over 50’ and they asked me an interesting question: “What do I think the next industry trends would be for the year?” I thought I would expand on my thoughts here and give a better explanation.

For those of you that do not know about this,  behavioral economics embraces the fact that often Customers make irrational decisions and as a consequence this affects what they buy. In short, you need to embrace the fact that Customers are irrational.

In our bland world everything is the same to many marketers who still only focus on the 4P’s (Price, Place, Product and Promotion)  and use this as a crutch. Marketers need to recognize that human decision making is far more complex than this. They need to elevate their thinking to a new level of  understanding and embrace behavioral economics to break through the glass ceiling that is engaging them.

Let us start with three simple questions:

1. What emotions are you trying to evoke in your Customers?
2. Do they drive value for your organization ($)?
3. Have you designed these emotions to be evoked in your marketing?

Not sure? Well you should be. To do your job effectively you should understand how emotions are evoked and design this into your Customer Experience or campaign. You therefore need to understand behavioral economics  and how to make the most of Customer’s irrationality. When you have mastered this I then suggest  you look into the whole area of predictive analytics and define how you can predict customer’s true behavior.

The last piece of the jigsaw is making this ‘live’ in an experience. Imagine that you have just designed a campaign that drives the customer into a store and they then have an interaction with  store personnel. How are you going to ensure that the emotion you want to be evoked is actually evoked during the ‘in store experience’? The answer is that the store personnel need to be trained on recognizing how the Customer is feeling when entering the experience. This is achieved through advanced soft skills training. This covers  recognizing Customer’s verbal and non-verbal cues (facial expression, body language, tone of voice ,etc.) in order to identify how the Customer is feeling. Then the store personnel can  implement their training to convert how that Customer feels,  maybe from ‘confused’ to one of the specific emotions that drive value for their organization.

Sounds far fetched? It’s not. This is what our more advanced clients are doing today with great success. One client moved their Customers from:

• ‘Feeling out of control’ to ‘in control’ by 25%.
• ‘Feeling Anxious’ to ‘feeling at ease’ by 10%.
• When Customers were asked, “Would you hire this person?” , a reply of ‘yes’ increased by 25%.

So, understanding that Customers are irrational, embracing behavioral economics, using this to predict their behavior and finally designing your experience and training people on how to convert customers emotions is the new world. Welcome to the new world of practical behavioral economics!

Colin Shaw is the founder and CEO of Beyond Philosophy, one of the world’s leading Customer experience consultancy & training organizations. Colin is an international author of five bestselling books and an engaging keynote speaker.

Colin is proud to be recognized by Brand Quarterly’s as one of the ‘Top 50 Marketing Thought Leaders over 50’.

The post ‘Top 50 Marketing Thought Leader’ Reveals Latest Trend appeared first on Beyond Philosophy.

Consumers for the luxury brand can look forward to a change in their experience. According to Business Insider, the new experience is called a “guest journey” and the sales associate is now their “muse.”

However, the names are just the start of the changes. The associates (muses) are tasked with not just “making the sale,” but first and foremost to engage with the Customer. In other words, the muses must determine how the Customer wants the experience to go that day, and then deliver that version of it. Muses will now also greet the guest only, but they won’t show product unless asked specifically to do so.

I’ll be honest, today we are exploring the experience of an industry I know NOTHING about, women’s fashion. But I do know enough to see that there is a great benefit to making the Customer feel like they are on a journey—particularly when they are spending the kind of money they are at one of these shops.

Setting the Expectations As High As Possible

Luxury brands, more than most, have set an expectation in the minds of their Customers, and it’s as high as the prices on the merchandise. By revamping the Customer Experience to reflect the brand value of luxury, Kate Spade is joining the ranks of Apple and Lululemon.

One key for a luxury brand is called “aspiration.” When retailers of luxury brands talk about aspiration, they refer to the value the brand name implies in the mind of the consumer. Aspiration is what drives a woman that sees a Kate Spade bag in the window of the shop to figure out if she can stand to eat noodles for the next month to pay for it. Aspiration means that consumers pay a premium to be a part of the brand, and are thrilled about it.

However, to remain aspirational, a brand can’t be too popular—or too accessible. Michael Kors, an equivalent brand for women’s fashion (or so I’m told…) is suffering from too much of both, and it shows in their sales numbers. To maintain their aspirational status, Kate Spade is pulling back from discounting and flash sales this year, a gutsy move in an economy that is still in recovery mode for many.

They also want a younger vibe. Their millennial-focused Kate Spade Saturday Stores closed last winter, but the line will continue in the Kate Spade New York Stores. They have a great new campaign with actress Anna Kendrick, called #missadventure:

The Warm Glow of Meeting Expectations

All of these measures, from calling sales associates muses to hiring a spokeswoman that personifies their target Customer, Kate Spade New York is sending a subconscious signal to consumers. Eventually these manifest into a brand message that sets an expectation for the quality of the experience. And this brand promise will convince a young twenty-something woman to spend her rent money on a great bag. Buying it from her muse, who delivers the experience, I mean “guest journey” she went to the store to have will give her a warm glow—which is great, because she’ll need it when she has to sleep in the park next month!

All joking aside, the idea that your retail experience should reflect your brand values is a tenet essential to creating a great Customer Experience for a Luxury brand. And that’s something that Kate Spade New York is designing their experience to do—in spades.

What other luxury retail experiences deliver their brand promise in spades? I’d love to hear your opinions in the comments below.

If you enjoyed this post, you might be interested in the following blogs:

Discounting a Luxury Brand: The Power of the Attention Cluster of Emotions

Bergdorf and the Subconscious

Apple: Imitation is the Highest Form of Flattery

Colin is proud to be recognized by Brand Quarterly’s as one of the ‘Top 50 Marketing Thought Leaders over 50’.

Follow Colin Shaw on Twitter & Periscope @ColinShaw_CX

The post Kate Spade Revamps Retail Experiences to Deliver Brand Values appeared first on Beyond Philosophy.

September 1st, the high-end yoga-wear maker introduced their new Pant Wall. The new fits are arranged according to how they feel when worn, rather than the silhouette as it was in the past. The new pants range from Tight fit to Relaxed and include other fits such as Held in, Hugged or Naked.

I realize of course that I am not the target of Lululemon, since I would never wear yoga pants (you’re welcome!). They certainly wouldn’t have my size. And if they did, the sight of me wearing this is enough to put everyone off their food for a week! However, the last fit description sounds interesting, to say the least!

The new fit descriptions are designed to help Customers know which fit is appropriate for what activity. The new wall is in response to Customer Feedback that they were confused about how the pants should fit and sometimes bought them too big. The Pant Wall was designed to help Customers feel less confused in the store more satisfied with their purchase after they leave.

The Customer response to the change seems to be positive, according to analysts. They are upgrading the stock and forecasting a positive turning point the brand by the 4th quarter. Morgan Stanley upgraded LULU, predicting that the stock will continue its success in earnings for 2016.

The VOC is the Key

So what does this story show us? It shows us two things. First, that listening to the Voice of the Customer (VOC) is an important part of your brand strategy. Second, that incorporating what you hear in the VOC to your Customer Experience pays off for your bottom line, a.k.a. stock price value rising.

An important part of your success (a.k.a. stock price value rising), is having a few ways to keep in touch with the VOC. Lululemon has a few channels in place to listen to the VOC:

• There is the Ambassador program, designed to give local athletes and brand ambassadors a way to weigh in on the product lines.
• Then there is the heylululemon.com site (also called their feedback page) where they invite their Customers to make suggestions and submit ideas.
• There is the Guest Education Centre, where they answer all questions and concerns via email, live chat, or call center.

They also do roundtable research at the store level. One of my work associates emailed me recently regarding a recent experience she had with Lululemon. When she was invited to an event at the store, she thought it was a party with drinks and snacks and would feature an exclusive preview for new products. However, it turned out to be something much more rewarding. Here’s what she described:

“…Don’t get me wrong, there were drinks and snacks. However, I, along with about 10 other people, had the opportunity to not only network a bit, but also sit at a round table where we were asked about our lives and what inspires us, as well as our thoughts, likes, and reasons for shopping with Lulu.  Then, they offered us a chance to give feedback on our concerns and what they could change and improve (whilst notes were taken by the store and Regional managers of the brand). They also had new products we were given the opportunity to try on and give feedback as well. At the end of the evening, it was also a nice surprise to be given a gift card to shop with them again.”

All of these listening channels are paying off—and according to stock pundits, by next year or even the fourth quarter this year, quite literally.

It’s nice to see a brand remember what makes Customer Loyalty and Retention work. Lululemon had begun to lose their balance with their Customers coming out of their pose as the top Yoga-wear brand.  But by realigning their strategy with a Customer focus and listening to the VOC, they are once again finding their Customer Center, and positioned to take the top spot once more.

How are you listening to the VOC with your brand?

If you enjoyed this post, you might be interested in the following blogs:

5 Ways to Make a Great Impression on Your New Customer

When It Comes to Customer Experience, You Have to Keep Rolling the Dice

The Good, The Bad, and The Ugly in Customer Experience Lately

Colin Shaw is the founder and CEO of Beyond Philosophy, one of the world’s leading Customer experience consultancy & training organizations. Colin is an international author of five bestselling books and an engaging keynote speaker.

Follow Colin Shaw on Twitter & Periscope @ColinShaw_CX

The post Yoga Pants Can Realign Customer Experience appeared first on Beyond Philosophy.

Frost and Sullivan, the growth consulting firm, predicted that by the year 2025, global traffic would be measured in 100 Zettabytes. After I had googled what a Zettabyte was (1,000,000,000,000,000,000,000), I realized that ignoring the big impact of not having all the big data is a big problem for organizations—Zettabyte big!

I have written before about the big hole in big data, which is the lack of emotional data collected in all these bytes of information. We are getting a picture, but it isn’t complete. Because unlike the computers that collect this data, the people are humans. Therefore, they are irrationally driven to make a decision based on emotions. So yes, the data might show a pattern, but it doesn’t show the emotional state that created the pattern. In other words, it shows what they did, but not why they did it.

It is important to consider this information from a Behavioral Economics viewpoint. For those of you who have heard this phrase but do not really understand what this means, the Oxford Dictionary defines Behavioral Economics as:

A method of economic analysis that applies psychological insights into human behaviour to explain economic decision-making.

In my view this is fundamental. Despite this fact, Big Data continues to gain steam as the “next Internet-sized” evolution of business. In their Big Data roundup this past June, Cloud Tech’s blog showed the results of a study. In it, 89% of business leaders believe big data is the new Internet, meaning it will revolutionize business they way the Internet did. And they also believe it will revolutionize their operations (85% said), and the biggest way it would revolutionize them (37% said) is in Customer Relationships.

Blimey!

Don’t get me wrong; I think big data is helpful to Customer Relationships.  However, as it is now the data you get is like watching a bunch of people from a distance. You can see what they are doing, but you can’t hear what they are saying. Actions, I suppose, speak louder than words (or at least that’s what my mum told me), but frankly, hearing the words and experiencing the action is a faster route to understanding. Their words and actions can give you the insight that Big Data currently lacks.

For example, why do people bounce off a website? Big data will tell you that at some point, your Customer visited your website and then left x.x seconds later.  The reasons why this occurred are not addressed in the “data.” Instead, you have to guess. Was the page uninviting? Was the link they came in from misleading? Was the Call to Action on the page unclear? You don’t know. You just know they came and then they left x.x seconds later. Without the why, you can redesign the website, clean up who you link with, or fix the call to action, but you have no idea if what you fixed will work to fix the bounce rate.

Big Data is helpful. Before this “data,” you might not have known that your bounce rate was a problem. However, as my example explains, it doesn’t answer why this happens or provide a clear path for fixing the issue.

What organizations need to do is to track the emotional key moments in their experience and compare them with the Big Data they get back. We do this type of research all the time. We take an outside-in approach, walking the experience as if we were a Customer, noting how we felt in the experience at each moment based on the activities that take place then. These moments tell us what an actual Customer is likely to feel. Then we use this information to change that moment to evoke a different emotional response, one that we want the Customer to have. We call it an Emotional Signature, but you might also call it “The Why That Big Data Misses.”

So if you want to reap the benefits of Big Data’s Big Impact to revolutionize your Customer relationships, as the study we reference above indicates, then you need to do your emotional research, too. This research will explain what you see in the Big Data Charts, allowing you to understand what it means. Most importantly, this understanding will lead to better design to get different (and more pleasing) big data results in the future. No guesswork required.

Will you miss the big impact of big data?

If you enjoyed this post, you might be interested in the following blogs:

• The Big Hole in Big Data

• 4 Ways to Gain Customer’s Trust in Data Security

• The Moral Dilemma: Collecting Data on Customer Behavior

Colin Shaw is the founder and CEO of Beyond Philosophy, one of the world’s leading Customer experience consultancy & training organizations. Colin is an international author of five bestselling books and an engaging keynote speaker.

Follow Colin Shaw on Twitter & Periscope @ColinShaw_CX

The post Big Data’s Big Problem appeared first on Beyond Philosophy.