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Branding = Change Management and Operational Excellence

Over the past couple of years I have been involved in the development processes of SME’s and some major companies with hundreds of millions or billions in turnover. These processes are about change:

  • The emphasis is moving from advertising and external media to own touchpoints and communications with own customers
  • The marketing as such is becoming more and more targeted and measurable. Marketing has a business case and acts more and more like a business unit
  • The view is moving from products and services to customers and customer centric insight driven development
  • The development requires companies to change the way they operate and how they are organized
  • Big data about customers, their behavior and their needs is required in order to enable the change
  • The change requires companies to re-consider their KPI’s and what data do they use in order to increase transparency and enhance and empower internal innovation and cross-silo collaboration
  • This change must be managed and management must change in order to enable the change for better

I recently published my view on the new and re-designed 7P’s for marketing. In this article I already underlined the fact that marketing has changed profoundly. Brands are no longer created – they are earned. Brands live in customers’ minds and they grow from experiences.. own and peer experiences. In my opinion CMO’s are at the very core of corporate Must Win Battles like:

CMO and corporate must win battles

This is why I would say rather confidently that the path from good to great brand includes these stages:

branding, marketing, operational excellence

First: You need to have goals and vision. They act as a unifying master plan that everyone in the company can understand and accept. What kind of brand are we trying to create? What kind of customer experience and and relationship are we trying to deliver and earn? What kind of impacts are we trying to get?

Second: When you analyse the customer journey accross all touchpoints and channels, you get to see how are you currently performing, what and where do you need to improve. This is where the magic happens between your brand and customers

Third: You need to take a look at how does your company actually operate and how is it managed. Does your current ways support and enable the customer interface operations that you are trying to achieve. Are you organized right, do you have right kind of KPI’s, are different diciplines and silos working together or do you lose insights between gaps and inevitably cause corporate autism?

Fourth: Does your corporate infrastructure enable everything mentioned and planned above? Do you have legacy systems and technology, disconnected data etc. In case the technology and infrastructure doesn’t enable the change, how do you take action? What kind of roadmap and investments are required? What can be done fast, what takes more time and effort? What can be piloted and can you start the learning curve growth with some manual work that enable more effective technology implementation?

This same approach to change management can also be seen as work that moves from practical customer interfaces insights and understanding to top – not top-down. This is how it works:

upside down strategy workWhen I have been running these cases I have learned that this approach works very, very well. The reason is that everyone is involved and the process in it self actually enhances the learning and feeling of unity, shared goals and willingness to change. This is because the process inspires, makes difficult theory work feel practical and easy to adopt. Very often the process generates several small victories and improvements that can be implemented immediately. The good experiences start building up and people get the feeling that these things are really happening and we are really doing something meaningful. Once the plan is ready, the organisation has already moved several steps to the right direction and has become excited about the development. For the management this is extremely valuable situation, because they can just enable what the organisation is asking for instead of trying to order and manage changes top-down.

The reality is that the use of data and data driven operations are requiring new approach to technology and companies need to adopt it some how. Here’s an example about the use of external data ecosystem along with own data

Internal and external data use in marketing

The role of internal and external data:

the role of internal and external data in marketing and customer services

This is how I see the brand development in this day and age. Do you agree/disagree? Would you have any cases, experiences or hints how I could develop this approach further?

See also:

SEE ALSO:

About Author

WARC Webinar Path to purchase Insight Keynote presentation

Here’s my WARC webinar presentation from 30th July 2014. Enjoy 🙂

Also check out:

  1. Managing brand – the most profound KPI’s and measures
  2. Customer Journey FLOW
  3. How to map and study Customer Journey
  4. Customer Journey stage 1: Brand as a platform
  5. Customer Journey stage 2: Initiation
  6. Customer Journey stag 3: Choosing and buying – cross-channel influence
  7. Marketing’s new and re-designed 7P’s

Future CMO Commercial Community Introduction

The goal for Future CMO Commercial Community is to create a network of highly capable individuals who can act as supertemps or highly advanced specialists who can act as catalysts for customer centric, marketing and organic growth driven strategic and operational transformation for their clients. Below,  there are directions and requirements for those who would like to join this community and offer their services in Futurecmo.org. Future CMO is a platform for Symbiosis Strategy and I welcome you to join. Futurecmo.com will also be published later in 2014. Join now and we’ll get better service up and running soon. There will also be new and improved FutureCMO.org.

Here’s initial offering description:

Toni Keskinen, Founder and Cheaf Editor of Future CMO
+358 50 5522276
toni.keskinen(at)futurecmo.org
http://www.linkedin.com/in/tonikeskinen
Located in Helsinki, Finland
Available for speaking engagements and consulting globally

Jarmo Lipiäinen, Co-Founder, Business Director and Consultant
+358 40 525 7289
jarmo.lipiainen(at)asiakkaanmatkassa.fi
http://www.linkedin.com/in/jarmolipiainen
Located in Helsinki, Finland
Available for speaking engagements and consulting engagements

About Future CMO Commercial Community: Anyone can contact Toni Keskinen and request membership in the Future CMO Commercial Community. The only requirement for enlisting is that you have original, fresh, insightful and important insights to share with the members. The best source for such insights and content is your daily client work which is why the most ideal members are people who actually get their hands dirty and do what is required to be done. Experiments and practical work generate the most interesting content. I don’t really think that this community is suitable for academics. The minimum requirement for membership is that you write at least one article in a month. The goal is that Futurecmo.org becomes a service with very high quality content and subsequently serves all members as a marketing & learning platform. Joint effort will increase reach and impact more than anything a single person could do. In case you are accepted as a Commercial Community member, you will get publishing rights to this service. There will be two types of FCMO Commercial Community members a) Supertemps b) Specialists.

Specialists:You should have practical, unique and original thoughts, ideas, insights or cases to share. Specialists should also be capable of connecting their specialist area in to general marketing and management realities.

Some questions that might help you recognize the supertemp inside yourself:

  1. Do you have both breadth and depth in your skillset at practical and strategic levels? Are you the one who recognize what, why and how should be done in order to drive much stronger performance, growth and profits?
  2. Do you have experience from multiple business areas with different business logics and aplications to value creation and competitive advantage?
  3. Do you have difficulties leveraging your full capacity in you current work?
  4. Do you want to practice your skills and learn much faster and more holistically and pragmatically than is possible in a regular specialist role?
  5. Are you happy moving from one company to next without a fixed team and do you feel comfortable facing challenges by your self together with a client’s own internal team changing in each engagement?
  6. Do you have a network of specialists around you, who can fulfill your shortcomings reliably and rapidly so that you can solve any given challenge you come across?
  7. Are you capable of driving co-creation development, designing customer centric operational change, business modeling and -cases and managing projects across corporate silos, levels and specialist ownerships like sales, CRM, online, analytics, BI, customer service, marketing, research or ICT?
  8. Do you impress clients with you skills, accelerate development, drive results and generate strong recommendations for your work?

Typical Must Win Battles that give us direction for relevant content creation:

  1. Best customer experience (Goals: loyalty, LTV, cross & upsell, high NPS)
  2. Innovative solutions: Creation of competitive advantage, distinctive and special offering capable of delivering substantial value, high quality at highly competitive price
  3. Continuous and cost-efficient new business (Goals: new customers, demand generation and stronger conversion)
  4. Lean and effective operations and processes – strong bottomline (Goals: highly productive organisation capable of delivering superb customer experience at comparatively low expences by using new technologies, online environments and automation
  5. Creation of inspired and winning corporate culture: Inspirational and very satisfying workplace capable of understanding and driving development and change. Corporate recognition as very prominent employer for hungry and innovative new talent, Topline growth energize the company’s employees and focus their minds on opportunities, innovation and growth. Growth is a lot more inspiring tool for profitability than trying to save the company to mental death

Admap Best Practice: Mapping the Customer Journey

This is the original non-edited version of the article I wrote for Admap January 2014 issue:

Best Practice in How to Map Customer Journey

by Toni Keskinen

Customer Purchase Journey by definition is the customer’s journey from existing life experiences to initiation, cross-channel consideration and purchase. Customer Journey then continues to using the product or experiencing the service, re-purchases and loyalty or attrition. This article concentrate on Customer decision-making journey to purchase.

Marketing research often looks into the future perspective and ask about awareness, top-of-mind, preference and shortlist of potential brands. The challenge about researching future is that people are quite bad at acting according to their own intentions. Habits, convenience and instincts drive behaviour to unexpected directions that are difficult to predict by research. These studies also often miss a major point. They ask customers which brand they prefer and make them choose one, and consequently fail to recognize the fact that people might have only brand options, not a specific preferred brand.

Example: In a Telco case we learned that 76% of the customers had a pool of options but they didn’t have a specific preferred brand. This result means that most of the market is floating. People only have options and consider brands as equally good. When the time comes the best/ first/nearest/most conveniently available deal will win regardless the brand as long as the brand is within the pool of options.

How to prepare for Customer Journey mapping:

Before you start designing the research or make any assumptions, establish the foundation. You can establish the foundation with two key factors:

a)    Is the category or brand in high intensity position: high involvement, -investment or –interest product or service? Heinz ketchup would be in the low-end, buying a car would be in the high-end. The purchase intensity stands for the depth of consideration and willingness to make an effort to make a considered choice. If the product or service has low intensity, there will be no actual journey but rather spontaneous and habit driven behaviour. High intensity decision-making on the other hand could last a long time and have a lot of touch points in variety of surroundings.

b)    What is the brand’s status in customer’s mind compared to competitors? In case the brand is well-known and preferred brand, the customer journey will have completely different dynamics compared to less known challenger. The key question is; “is the brand being sold or bought”? In case the brand is bought, you can approach the mapping in order to find ways of optimizing conversion rate. For such case tactical marketing will also generate much stronger impact than in case of a brand with less demand. In case the brand is sold, you should find ways how to break into customer’s consideration and prove your brand better than competitors. In case the brand is sold, the burden of proof is on the brand’s shoulders and you need to find ways how to guide customers away from the path leading to market leader purchase.

You can find data for creation of foundation from the company’s brand tracking research, market share report, online analytics and Google Adwords tool or Google Trends tool. When looking for foundation intelligence, consider how the category behaviour reflect the two foundation factors, how the brand in question and it’s competitors position against each others. Draw a map with all competing brands on it (X-axis: Activity share seller vs. buyer, Y-axis: Intensity level. Eg. Heinz = bottom right corner = no or very little advertising, strong sales & market share, low intensity) Do the preparation phase well and you will have a rather good idea about what is happening in the customer behaviour dynamics. Analytics can give very good answers to “what” –questions. However, you need to make in-depth-interviews in order to find answers to “why” –questions.

Discovery phase:

Once you have a high level view on the market place and a lot of “what” ideas to guide you, prepare to make in-depth-interviews with customers and get “why”-answers from them. Choose customers who have made their choice recently. In case of high intensity purchases, people can remember their experiences for a couple of months, in case of low intensity purchases – interview them instantly at the point of purchase or walk them thru the store with the customer again using the customer as a guid for a tour and let the customer tell you what he experienced, noticed or thought along the way (the same approach can be used in online buying by recording customer’s actual journey thru website). This is different from mystery shopping, because the emphasis is on the customer, not on the store personnel.

The point of in-depth-interview is to analyse the customer’s lived experiences with out others’ interference. This information is only available from customers, because you need the full view across all brands, information and shopping touch points in the category – not just the brand you are doing the mapping for. Ask your customer to tell the whole story from what ever got him interested in buying to purchase. Here’s the process:

  • Who is the customer? Get to know his lifestyle and connection to category/brands
  • What made the customer interested (initiation)?
  • What and where did something happened that gave the impulse to initiate consideration: commercial act by the brand or it’s competitors or an event that made customer interest (eg. Moved to new apartment, new need etc.)?
  • Did the customer have a preferred brand in the beginning or not? Were there other options the customer considered?
  • How long was customer’s consideration and learning time before purchase?
  • Go thru all phases: initiation, browsing, configuration, decision, purchase
  • In which channels the customer interacted with your and competing brands in each phase?
  • Did the customer do all phases and what was the main driver and meaning of each of them? Did the customer skip stages? (In case you want to quantify results later, always define stage and ask if the customer did it before asking about it’s content and channels. Skipping stages is quite common)
  • What was the customer’s experience in each engagement like? Which brands performed well? Why?
  • Something led to decision, what was it and in which touch point did it occur?
  • What did the customer eventually buy?
  • What was the reason for choosing the specific brand over others?
  • What was the second best option or was there one? Why did it lose?
  • In case the customer chose competing brand, why did he not buy the one in focus?
  • Would customers buy again if they had a choice? What is different brands’ Net Promoter Score Index? What were they satisfied for? Was there dissatisfaction?

I would recommend making at least ten in-depth-interviews/category in order to learn about customers’ behaviour and motives. You should interview both won and lost customers and totally concentrate on their experience and point of view. In case you can study customers who left the brand you are making the customer journey mapping for, you will also find out where the brand failed and how the competitors caught the brand’s customers’ attention. In some markets for example outbound sales is an important influencer which has major impact on behavioral dynamics. While interviewing, keep your mind open. Don’t narrow your consideration, but consider all experiences and thoughts the customers have had. From customer’s point of view marketing, pricing, product design, convenience etc. are all relevant issues. As an outcome you will come across things you can influence and those you can’t. However, you need to understand customer’s behaviour and consideration holistically.

Analysis

This approach to interviews, discovery and analysis goes by the name “interpretative phenomenological analysis” (IPA) in psychology. Once you have the interviews, you can create an analysis about their journey and visualize it. The best way to do this is by visualizing each journey separately. Concentrate especially on chain of events, customer’s journey from one touch point to next, motives and contents steering the customer. Conscious cross-channel purchase journey is most likely in case of high intensity purchase. The behaviour dynamics differ between products, service ranges and between same brands in same category. In your analysis you can divide customer behavior in three major types:

Journey Driven people: These people take pleasure in getting to know their options, their qualities and comparing. They are also more likely to share their experiences in social media as they consider themselves as experts. People who are prepared to make detours and a longer journey require a different approach than destination driven ones and they don’t react on offers as easily, unless they have already got to know their options well in advance.

Journey Driven People are often early adopters. They are especially important in case you are launching new product. They are interested in the products and their qualities. You need to support their needs and change or influence their attitude in order to break in to their awareness. As they search and compare, you need to be able to justify to them why your solution would suit them and guide them to decide and purchase your product/service. These people really consider their user experience and share recommendations in case your performance is beyond expectations. Supporting their needs helps you perform better with other people representing different behaviour type.

Destination driven people: These people don’t really care to learn about products by themselves. They make rapid decisions based on their priorities (e.g. always the best, always the cheapest) or rely on 3rd party recommendations such as test results. An offer for test winner product is an effective proposition for them and generate rapid sales.

Destination driven people also need to be influenced at “need and attitude” -level in order to create better awareness of your offering and it’s qualities. However, this is more about leveraging past reviews and feedback from journey driven people. Destination driven people are more likely to be influenced by e.g. Magazine or social media reviews on your product or other independent sources of information. With such support you can just concentrate on tactical advertising in order to encourage decision and purchase making. Destination driven people are interested in the user experience and reviewing their own experience to others.

Slow movers, public opinion driven people: (also habitual or insignificant purchases). These people don’t take risks. Only after most of the others have already accepted and favoured a certain product or service will they follow. Same behaviour also describes the purchase process of less significant products, like toilet paper or other habitually purchased products. People don’t really pay attention to what they buy; they just buy it like they’ve done before.

Public opinion driven people accept your offering when it’s widely used and they are completely certain that choosing your offering has no risk what so ever. It’s all about tactical advertising, retail promotions and encouraging purchase. They are not likely to share their opinion to others or recommend your products or services actively.

In different product and service categories differences are dramatic. It’s easy to think in terms of travelling. A motorcyclist takes longer and slower routes because the journey is the major part of the travelling experience in itself. On a family holiday the same person takes a direct flight to an all-inclusive hotel. Although this is the same person, different context and different motives lead into completely different behaviour. The point of this analysis is to really understand how people behave in your category towards different brands and find out what is required from you in order to perform better.

Along with behaviour type, analyse:

  • What kind of commonalities and shared phenomena, motives, contexts, choice criteria and channels can be found from customer’s behaviour and what was there that you need to quantify or find more information about. Pay attention to the chain of events.
  • Which of the touch points the brand can control, which you just need to influence
  • What was the customer experience like in competitors different touch points along own ones. Can you learn something from them?
  • Pull all your findings together and have a workshop to discuss about these findings and find out how the internal organization experience these findings and what knowledge do they have about them. Get people who work in direct customer interfaces involved.
  • Also discuss, which ERP, CRM, online analytics or other systems are currently capturing data about the customers? This information can help you further and let you make a decision whether you continue by doing data analysis and workshop or do you need to quantify the results with larger research. I would recommend research every one or every two years in order to map out how the market place works from customer’s point of view and what you can learn from competitors’ practices or whether you can find opportunities for growing market share

Why this approach to mapping and analysing customer journey is imperative

In many cases your own campaign could actually sell competitors’ products. Also, in many cases the customer journey is full of conflicting interests. In case you only analyse the one brand’s journey you will completely lose sight on category dynamics. Here’s an example about my Garmin buying:

There was a home electronics store advertisement promoting TomTom navigator for 75€ with European maps.  I went to buy it, but the store salesman told me there was an error in the ad and that price only included Western European maps. He showed me the product with Full European maps with 105€ price. Next to it was Garmin Nüvi, which had exactly same price. I asked if there was any differences between the two and the salesman told Garmin had better battery life. I bought Garmin. Let’s look at the interests of different players:

Me, the customer:

I was very happy, although I paid 40% more than intended but 105€ wasn’t a problem eventually. I was highly price-oriented customer who was looking for ”good enough” solution and was not interested in more advanced solution or bigger screen. Because of the basic functionality needs I had I was also not interested enough to look in to product specifications online, product reviews or discussion forums. This product will get the job done anyway. I was a perfect example of destination driven buyer. At home, the product exceeded expectations. It had much more functionalities than I was expecting. They had minor meaning compared to the basic functionality, none of them was more important than the battery life, but it was a positive surprise.

Gigantti store:

Closed 40% more sales than I had intended to spend. The experience about the store was positive and the sales person’s advice was good, which means that the store will get more money from me later on. Was their error in the ad intentional? Probably not but they should still analyse how the error influenced their GPS navigator sales in general. What did customers come to buy and what did they actually walk out with?

TomTom:

Complete failure. The brand might have made a special deal for the campaign resulting change in price image. After reading that leaflet customers think, that you can get TomTom with European maps at the price of 75€. It easily becomes the market standard because of nationwide advertising campaign. You are making a bad deal if you pay more for it. Price/value ratio sounds perfect but actually it wasn’t real because of the error in the ad. That’s ok if you go to Gigantti and they tell you about the error. If you don’t you just expect that TomTom’s are now cheap. It’s most likely that TomTom does some kind of post campaign analysis and comes to completely wrong conclusions unless they understand how the purchase dynamics in the low price category GPS really works and how their campaign influenced customer behaviour in general.

Garmin:

Great success. Garmin did nothing but made a deal anyway.  Well, I had positive image about Garmin in advance and the sales person just gave me the last defining fact that led to decision to buy Garmin. Now that Garmin closed a deal with me and got me registered, I am quite likely to buy other stuff on top later on.  Was Garmin’s success intentional? In reality the sales person’s advice could have been founded on her own perception or Garmin had analysed the differences between brands and intentionally launched training for retail sellers which states that their battery life is better than TomTom’s. How much longer? No idea.  It never came up.

Conflicting interests are very important to understand. In another case a laptop brand sold 50% more than their preference rate would suggest. That also was because the sales people preferred that specific brand.

Here’s how Audi did in case of B2B car leasing deals:

  • Preference 14%
  • Alternative to 26 %. Altogether Audi was considered by 40% of all buyers
  • Audi sold 11,2% that is 2,8% below preference which means 80% conversion

Audi was the most sold brand but was also most often the 2nd best and had lowest conversion rate  in the market. Wolkswagen sold 119%, Volvo 117% and Ford 196% compared to preference. Even if you would be number one in sales, you could still be the one losing most.

There is one more thing to consider: Specialist & aggregator influence. In B2B especially customers are using professional consults and agents to compare and make recommendations. The customer journey behaviour and needs of an agent are very different from individual buyer’s needs. In B2C businesses comparison services and aggregators like Hotels.com and eBookers have similar significant influence. In case there are such actors in your category, analyse their journey separately.

Business Dynamics Score (BDS)

In case you quantify your results with larger sample you can calculate Business Dynamics Score.

Those who preferred you originally > How many did you keep?
Those who preferred your competitor > How many did you win?
Those who had no preference > How many did you win?

When you compare won-kept-lost results between brands you can really see how different brands are performing. I would recommend calculating BDS from all market players in order to learn about differences in channel efficiency. This figure will give you very good understanding on how behaviour from one brand to another differs and what you need to do in order to perform better. Such insight has great impact on media- and communications strategy.

Constructing Market Flow

In case you have the larger sample, you can construct entire market flow across stages, channels, motives and behaviour types from spontaneous purchases to considered ones on one page view. This single page view will help tremendously in understanding what kind of factors influence market success most and how for example strong retail strategy performs against strong online emphasis. In one case we found that spontaneous buying was quite strong and outbound calls represented 15% of total market sales. However, we were surprised to learn that more than half of customers buying in the category initiated because of outbound call, didn’t do one stop shopping, but instead started cross-channel consideration journey ending up in a purchase from some other channel.

Check out these articles too:
Marketing’s new and re-designed 7P’s
Managing Brand – The most profound KPI’s and measures /
From marketing automation to service automation

About Author

Toni Keskinen ,Chief Editor for Future CMO Movement (http://futurecmo.org)

Toni.keskinen(at)futurecmo.org

http://www.linkedin.com/in/tonikeskinen

How to map Customer Journey – The key questions

When a customer initiates conscious consideration and buying, he’s often  the one who’s active. He’s making searches online, reading ads, discussing about his interest with friends and family, reading product reviews, asking questions from professionals and stores, visiting several websites and outlets, asking opinions and advice. Majority of this behaviour can be analyzed online or with research.

When the customer initiate this journey he’s in charge. At least that’s how he feels. That needs to be taken for granted. He makes decisions. While he’s in charge, he’s being influenced by media, marketing, brands, professionals, sales people,… There is an exception though, in case it is possible for you to earn a position as a trustworthy and respected specialist, then you can sell with specialist recommendations. This approach to sales works much better than hard selling. In the end the customer is quite likely to buy something he could not have imagined before actually entering the journey. He does the decision eventually and your role is to influence the choices he makes if you know how to do it.

Check out a collection of Customer Journey Map visualisations in Pinterest “Customer Journeys and touchpoints”

The things that are often neglected, which I find very important are:

  1. Chain of events > you need to know and understand the people flow across channels and touchpoints
  2. Competing & neutral touchpoints > You need recognize and understand also the impact of your competitors touchpoints. Your channel capasity to convert customers is the key and you must understand that the customer is not visiting your touchpoints only, but your competitors too. Increasing your conversion and business dynamics score is the ultimate goal of the entire Customer Journey work

The mapping of the customer journey is composed of he following parts:

0. Customers: Who are they? How do they live? What kind of life style and life stage are they in their own lives? What is their socioeconomic status like? How can you reach them? What kind of behavioural conventions their everyday life has in the context of your offering? What do they value? What kind of solution would they appreciate? Who are your most valuable customers? How do customer profiles differ from one product category to another? What kind of potential can be found from your existing customers from cross-selling point of view? What kind of people keeps your company in business now and where can you find growth potential?

1. Touch points: mediums, services, personnel, re-sellers, physical spaces, online. 

Do you have control of the touch point or does a partner manage it? At what point of a customer journey is the customer getting involved with a certain touch point? What can you do in that moment and what are your goals and KPI’s? Can that specific touch point result in to an acquisition or do you need to direct the customer further? What kind of roles a single touch point has and how can you make certain all roles are played out right along the customer journey?

2. Service moments and context

What are the most likely contexts in which the customer engages with the touch point? What is he trying to do? How can you help him achieve that? How is that done? How could it make your product or service look more appealing or at best, a most likely option?

3. Motivation and drivers

Are the customers reaching out for you or is it the other way around? In what kind of mindset does a customer engage with your brand? What could drive him further instead of abandoning your brand? What are the conventions and customs in your business and how could you exceed customer’s expectations by breaking them? Are there other companies that have a similar logic to yours and could you implement their approaches, which already have a proven logic?

4. Decision making process

What is the customer’s decision-making process like? Is he doing it himself or using a consultant or services for comparison? Are there predictable qualities in customer’s selection process that would enhance your capability to adapt your organisation to the customer’s behaviour with right content, value proposition or services? How does the customer move from one stage to the next?

5. Triggers and Moments of truth (initiate/choose/drop/buy/attrition)

Where and at what point are the most important moments of truth defining the majority of your business success? What triggers them to decide or act according to your will? Can you trigger customer behaviour? How can you do that most effectively and which kind of approach result in best outcomes? Why do you win and what do your competitors do better if you lose business to them? How can you outperform your competitors’ actions?

6. Post-purchase satisfaction and recommendations

Would customers buy again if they had a choice? What is your Net Promoter Score Index? What were they satisfied about? Was there dissatisfaction? How can you improve your customer experience in order to earn higher opinion? Do your customers discuss about your product online or face to face? What are they saying? Are they endorsing your brand? Could you use their endorsement for others who are still considering it?

7. Business systems, research and analytics

What kind of information your systems currently store from your customers’ behaviour? How could this data help you serve your customers better and create systematic methods for continuous development of your company? Consider ERP, CRM, Online analytics, Contact Center systems, email communications, customer satisfaction and voice of customer studies, reclamations, customer feedback and ideas for improvement etc. How does the infrastructure  combine different data sources and make it available for people working in customer interfaces? Do you have marketing automation software in use that could adapt your operation and communications to individual customer’s behavior and store customer’s online engagements and interests that enable realtime action and individual customer care models?

Here are a couple of visualisations I find particularly informative and inspiring:

One by Desonance

Another by Hear of the Customer: Customer Journey Experience Map – Top 10 requirements

Here is a great presentation about how the job gets done and what is the impact on business performance:

Beyond HBR’s “truth about customer experience”

Harward Business Review just published a great article about Customer Experience and Journey. See here. The main point of the article is, that managing single touchpoint engagements doesn’t provide sufficient customer experience.

HBR - Truth about customer experience

My advice is: Don’t design just touchpoints – Design chain of events, proactive and reactive. Development and measurement is often done engagement by engagement. The service design approach also highlight such emphasis. I’ve done Customer Journey mapping and methodology development since 2004 and agree with the article, only it’s lacking tools and methods how you should approach the challenge. I can help with that.

I’ve written an article series about customer journey management and you can choose and pick, which areas you are interested in or read them as a series of articles:

  1. Customer Journey FLOW
  2. How to map and study Customer Journey
  3. Customer Journey stage 1: Brand as a platform
  4. Customer Journey stage 2: Initiation
  5. Customer Journey stag 3: Choosing and buying – cross-channel influence

In order to really do Service and CX design for the entire customer relationship, you need to understand that there are very different journeys to begin with.

  • Purchase journey (From awareness to consideration and transaction, Acquisition)
  • Service journeys post purchasing (Using the product or service, value-in-use)
  •  Planned (e.g. Address change, regular maintenance etc.)
  •  Unpredictable (e.g. Product failure, reclamation, insurance coverage, etc.)
  • Delivering a service as a customer journey (taking a cruise or flight, restaurant, using media, etc.)
  • Retail customer journeys (e.g. IKEA store experience)

Once you have both Insight and Topsight level understanding about customer journey in full, you need to take a look inside the company. What organisation bodies are involved with customers, what kind of technical environment direct their operation and what kind of data steers their actions. The reality is, that management reporting practices represent management understanding and decisions. The systems and technical infra on the other hand define how the corporate body acts. In case you need to change the way how the corporate body in total behave, you need to define required technical changes, change management and manage change. In my experience, creating Service Blueprints has been quite effective tool for both challenge recognition at current status mapping and Customer Experience planning.

The potential is absolutely amazing. The customer’s expectations are constantly growing harder to fulfill and companies that are agile enough to cure “Corporate Autism” and take the steps required to move from “inconsideration marketing” and mass mailings to service automation, Customer Experience and Journey design at total relationship level, can win marketshare and increase profits considerably. The business-as-usual approach is no longer sufficient, you need to free the full potential an organisation can offer and tear down silos in order to take advantage of synergies available.

In the big picture, your company must act professionally and fulfill minimum requirement perfectly. Failing these requirements cause criticism and decrease your NPS results. Acting human, being considerate, thoughtful and proactive on the other hand increase the number of people willing to recommend you and increase you NPS score. Succeeding in both cumulate earned trust, which is the foundation for long-lasting and profitable customer relationships and strong brand.

creating customer loyalty and trust_improving NPS

In case you do well, the process will enable you to design lean processes and define the best possible value your business processes can possibly deliver. In my opinion this is the Future for CMO’s position inside the company. It’s not the job for CMO’s to define business process management, but it’s the CMO’s responsibility to make certain that everything the company does, delivers maximum customer value and experience across all customer interfaces

Customer interface reach & effectiveness

In case you can capture customer contacts, you can start servicing and inspiring customers individually and simultaneously your capacity to influence increases. The bigger share of the customers buying in a certain category you have in your database, the more effective means you have to influence their behavior and market dynamics. The ultimate goal is to synchronize customer portfolio with product and service portfolio across all touchpoints and marketing interfaces.

customer portfolio_customer touchpoint & marketing portfolio_product and service portfolio

In my experience the only way to do successful customer journey and experience design and create sustainable management model for it is to do the work upside-down. You start from the actual interfaces, motives, contexts and people. From there you continue inside the company culture, practices and technology and design the strategy level after you understand everything else. Like this:

Bottom-up strategy and data analysis

The Holy Grail of customer value is Symbiosis. Check Symbiosis Strategy – creating the ultimate value  -article here.

This is a video by on Sep 12, 2013, It’s All About the Customer Journey

Author: Toni Keskinen, Marketing Architect & Customer Journey Designer, Toinen PHD

http://www.linkedin.com/in/tonikeskinen

Join The Future CMO Movement LinkedIn Group here

Choosing and Buying – Cross-channel influence

We first started the development of cross-channel customer behavior analytics methodology – One Experience in 2004. The original insight about channel development was about clear conflict between companies channel development practice and customers actual behaviour. Companies used to develop each channel individually. Very often each channel has still own channel responsible management that is developing that individual channel to the max. Also the benchmarking was done against competitors channel and the goal was to be better than the competitor. There’s nothing wrong with anything described above unless it generate blind spots and steer companies to invest in development that doesn’t actually support customers and create value for them. The rule of thump is that you should constantly consider effort vs. gain from customer perspective whenever you are developing or changing something.  When doing Cross-channel customer behaviour studies we learned that in some cases companies channel strategy and customer’s needs and expectations were not aligned and the channel strategy actually hindered sales.

Many brands have a long and successful history of servicing their customers thoroughly in a single channel.  Kirsti Lehmusto (former CMO of Finnish retail company Stockmann and colleague from Taivas, now CMO for Helsinki University) recognize the retail store management, contact centre services and distant sales services with catalogues as methodologies that have created great financial success by concentrating in excelling in the customer experience in a single channel from beginning to the end.

Channel management 1_single channel optimizationIn the current 24/7 economy and world of digital influence it is even more important to understand that in current world customer’s move accross channels and create service strings that fluently move customers from one channel to another according to their preferences, drivers and motives. It is important to look at these service moments in each channel and optimize them to help the customer further to his preferred next step.

Channel management 2_cross-channel behaviour

Service and product ranges don’t have the same meaning for customers and people are not quite as interested in everything. In the article ”Customer Decision Making FLOW” there’s more about how the decision-making about a certain FMCG goods and brands like Coca Cola differ from buying a magazine subscription, taking a mortgage or buying a motorcycle. The following gives an outlook on general learning’s about stages in various businesses.

Let’s dig deeper in to stages: Browsing, Configuring, Deciding, Buying and Post-Purchase.

The two stages before these are: Brand-as-a-platform that you can read from here and Initiation, you can read here.  (I would recommend reading them, before going further to choosing and buying journey below). Also check out how to run customer driven business design development here.

Browsing

Browsing is most often about learning, simultaneous process of exploring your own intentions and interests, and actively considering what kind of solution would be perfect for the customer. Customer has mental goals while doing this. He’s interested in certain facts, has drivers guiding him further while exploring. Not all factors are created equal. These things define customer’s mindset & motivation. (We must not forget, that people are emotional by nature and we need to understand what people are feeling while they are browsing and learning and help them feel good about the brand we are promoting). While doing this, customers use information sources that are both interactive & instructional. On-line services, product reviews, friends, catalogues, retail stores, contact centres, agents & brokers. Some of these touch points can be led by the brand, some can’t. Some of the touch points have more meaning than others. The important thing is to understand what the customer is trying to do, which touch points the customers use and how did the touch point fulfil customer’s expectations.

Customers who have no prior experience about buying products and services in certain service or product category are more likely to browse more thoroughly and consciously. Also, people who are more price sensitive tend to do more work in browsing and all other stages in general. There are two underlying reasons for the Journey driven emphasis and strong browsing

  1. Customers are curious and actually want to know what options are most interesting and
  2. Customers are worried about making bad decision and try to learn more in order to avoid mistakes.

In many cases both reasons are meaningful.

Some businesses are naturally interesting for customers, like travelling and cars. In these businesses learning about products, services and prices can be considered as entertainment. Coffee table discussions and other people’s experiences are also an important part of the decision making process. In this kind of categories visits to the stores and actually seeing the products are also considered entertaining and fun. If people are busy and don’t just go out and see products for fun they are more likely to actually go and see what they are considering in configuring or even in purchase stage after making the mental decision to buy. The trend though is that companies have less and less face time with customers enabling persuasion. Cross channel marketing is more about steering customer forward and selling by supporting their choices than actual selling. Pulling instead of pushing.

In business-to-business customer journeys browsing is about looking for potential service providers for further negotiations. Managers and entrepreneurs looking for service providers ask other people’s opinions, look online for potential companies and potentially even use a professional consultant to find best possible potential service providers.

When defining sub channels for Browsing stage our experience is that it’s better to use broad descriptions of the touch points and ask about customers experience and what kind of information had most meaning for them. In browsing it is impossible not to talk about search engines in the current digital environment. Customers often have pre-decided brands and options they are mostly looking at. However, they also look for other people’s experiences and use search engines while looking for information. Even if the brand or product would not be known and on customer’s shortlist, search engine advertising enable capturing some of the customers. The more entertaining and positive context the buying is about, the more likely people are to click and learn about options they didn’t know existed. Travel is a great example of such business. In travel people are happy to give their email and contacts to travel agencies, cruising companies and airliners just to get more entertaining ideas and travelling inspiration from them. In less entertaining businesses too, it’s possible to capture customer’s contacts and call back later. When I built a house and was looking for materials, contractors etc, it was obvious that the browsing was often done in the middle of the night and an opportunity to leave contacts and get a call next day was considered as good service.

In less interesting businesses people often skip browsing or do it in-store at a shelf. FMCG businesses represent such business in which people don’t search information or find out about options outside store. Browsing is likely to be done at the shelf comparing contents and prices. If customer does this once, he’s not likely to stop and think next time. Once decided, customers easily create habit and non-considered re-purchases. This doesn’t mean that you couldn’t do anything though. Some companies have created wildly popular recipe clubs and services that offer inspiration in a format of recipes instead of individual products. One of the best examples is Valio’s Cream Club which cost 18€ as annual subscription price. This program is nothing but marketing and branded content. Still, people consider these recipes so inspiring that they are prepared to pay for a membership which makes this marketing program practically free for Valio even without product sales. If your product is not interesting as such, people could still be interested in the context your products are used in enabling branded engagement.

Configuring

Configuring can be exactly that, e.g. using a car configuration online in order to learn which kind of combination would be most suitable for me. The name of the stage comes from mass-customisation vocabulary (Jarmo Suominen, professor for Masscustomization (MIT/UIAH) had strong impact on the original theory development). In configuring stage customer has most often chosen the brands he wants to learn more about. Often it is about negotiating with potential suppliers about the price or contents and terms of the offer. The difference compared to browsing is that in browsing customer often is learning and more open to possibilities. In browsing, he’s also often anonymous visitor online or in store. At configuring customer is engaging actively and has more defined decision making criteria. He’s looking for the best deal. Configuring is also about letting some options go in order to concentrate on the best potential choices. It’s equally important to know how people define which brands they want to continue with and understand what kind of tools and information sources people use in order to rule out some brands. The car configuration tools are a great example of that.

Case: We studied 500 professionals who had chosen a leasing car as their car benefit provided by their employer spring 2010. The study proved that 18% of all buyers used car configuration tools to decline brands before going to test-drive or asking an offer for the car. It’s actually rather logical. When customers start building their dream car they easily come up with a solution that is too expensive for them. Also, the car configuration tools give a price before any discounts. As a result customers start dropping out options they had chosen in the first place and suddenly the whole experience is about giving up on things the customer would have liked. Eventually the brand loses the appeal it had originally. It is absolutely certain that every car brand’s research prove that customers require openness in pricing and giving as much information as possible online. However, optimisation of sales and driving people further in their journey is sometimes different from what customers demand. Direct marketing has proved this decades ago. Customer should not get a figure online that he could consider as an offer unless you are selling cars online and actually give a real offer for the customer. In majority of car selling the customer should only get an offer from car seller and enable the car seller to show the qualities of the car in person. Emotional and rational influences are often a mixture creating desire to own the car. This desire requires certain level of engagement, which improves the probability of closing a deal. Car configuration tools’s role is to enable dreaming and bring the customers to the store.

In business-to-business and major consumer purchase decisions the configuring stage is often about a meeting with the salesman or other representative in order to define request for an offer. Online e-commerce and opportunity to buy abroad is just another way of servicing the same need. The buyer wants to know and learn about the service providers or products capabilities, background, cases and discuss about the qualities of potential solution. Very often the first engagement with the service provider also allow buyer to evaluate what kind of feeling the service provider left in the first engagement. Word of advice from previous cases is, that it’s more important to ask than present at this stage. In people businesses customers want the company to concentrate on their needs and solve them. It is important to show interest in customers needs and show how much you care about their problem. Human behaviour is about trust. The seller’s first priority as a contact person and representative of his company is to understand the brief and create trusting and caring connection to the buyer.

Decision

Was there a specific event or incentive that led to decision? If yes, what was that? Whether or not there is an offer, the people still evaluate offer or stimulus against their perception of the brand, the company and the product. Customer has certain motivation, drivers and resources that guide him. From which retailers did the customer ask for an offer. What prompted the decision?

In some cases customer know that they should buy a new product in order to replace the old one but they just don’t recall doing so or lack motivation or ability to do it. In these cases we talk about ”pending purchase decisions”.  Offer in store or discount advertisement could act as a trigger. In smaller purchases just seeing the product is the trigger. In other cases there could have been long-lasting interest and consideration but no action. In cases like this the customers have been interested and wanted to buy for a long time but were not able to do so or lacked justification. Discount advertising is very effective trigger in these cases. People could wait for a long time for the products price to come to the acceptable level. The discount has two-fold triggering effect

  1. The price can be considerably lower than normal
  2. The offer is there for a limited time or there is only limited number of products at that specific store resulting feeling of hurry and justification. It’s now or never!  Limited number of products is a message that increases sales never mind how many products the store would actually have in storage.

In TV-shop commercials sales increased when customers were told: ”If you call, Prepare for holding online or use SMS for ordering”. Just saying some other people would also buy the product was justification enough for more people to act.

In technology businesses like wrist-top-computers measuring pulse and other training factors, mobile phones and entertainment gadgets the prices come down after some time due to rapid product circulation. If the products become ”most wanted” like iPod and iPhone did, declining pricing eventually reach tippin’ point driving products to move from most wanted to market dominating products. Following the own brand’s and competing brand’s customer journeys and preference, enable recognising and preparing for such events.

Another very important thing is to track competing brand’s actions in this space. Competing brands could send offers by mail; use out-bound telemarketing to help (read: push) customers make decisions right away. Proactive decision supporting and triggering could result a lot of lost business unless it’s detected and acted on.

In business-to-business cases and major consumer purchase decisions the decision stage has to do with comparing offers. It is smart to take the time and present the offer face to face. Face time often increase trust and represent dedication. At best the presenting of the offer means evaluating and considering it aloud. Customer has a change to ask questions and make certain that they understand what exactly the offer means. The first meeting with a salesman was about first impression and the next about how well does the contact person meet expectations and is he trust worthy? How well has the contact person taken customers wishes in account and what kind of pro-active propositions there are in order to better meet customer’s goals. It all comes down to trust eventually. Price is a subjective issue in most cases, not an absolute measure. Higher price just require more trust and better justification than lower price.

Purchase

Where did the customer purchase? Purchase channel and location give new information for analysis when looking back at the customer journey. Customers could have purchased from certain store brand, specialist store, online retailer, catalogue sales company, by phone, by calling to contact centre. It’s important to track which player was the active contacting party a) customer b) competitor.

Purchase channel send a message about customers decision-making dynamics too. In several cases the customers behaviour has been very online centric in every other stage but purchasing. Online channels are very effective in offering information about the products and services but often customer rather purchase from store, individual contact person or contact centre rather than online. Why is that?

Our learning has been that it’s most likely an expression of insecurity and pure need for human contact confirming the decision. People want to call, possibly bargain a little, but most importantly they want to feel secure that they are doing a good deal and they will not feel sorry for it after. In retail products customers could go to buy in retail store in order to confirm their decision by touching the product and experiencing it live or they want to get it with them right away. Visit in the store could be inevitable in many cases but there are risks.

When we were developing One Experience methodology we did some multi-client researches in order to develop the methodology. We found out that while Fujitsu-Siemens had 22% preference rate, they sold 35%. Their sale was roughly 50% higher than their brand preference would let expect. In the further analysis we found out that majority of sales people working in stores preferred Fujitsu-Siemens laptops and often owned one too. Of course the same apply in case of trade promotion offering sales people extra for selling more Fujitsu-Siemens. However, in this case there was no promotion but it was natural for sales people to recommend Fujitsu-Siemens.

The reality is that when people have been looking for a solution, product or service they would like to buy, they are actually still rather open for influence at the very last stage. When people get to know offering they often come to conclusion that certain product is both possible for them and they feel comfortable about choosing it. Once the customer comes to a store and the premium product is in discount, the customer is likely to change his mind in that instant and buy the premium product even if it was still slightly more expensive than the one the customer came to pick-up. The same phenomena apply when customer engage with store personnel. The professionals in store can raise insecurity in customer’s mind or recommend something other than the customer was going to buy. Often the customer’s goal for the discussion in store is meant to confirm customer’s own thinking. Still, often it results alternative outcome depending on the advisors training, experience, opinions and incentives. Brands have very different variation in the level of determination in their buying. Strong brands, which have a “love” relationship with buyers, are much harder to persuade to some other way.

In the same Laptop study we found another interesting phenomenon. There were dramatic differences between store brands in which customers went to see the products and where they actually purchased them. The conversion rate from visitor to buyer was at best 66% and at worst less than 30%. The two biggest retail brand conversions were a) 29% visiting and 9% of sales and b) 23% visiting and 6% of sales. These two brands dominated people’s visits but they didn’t dominate sales. Retail conversion rate optimisation would have dramatically increased these retailers market share and it shouldn’t be too hard when they already have people coming to them.  41% of customers told that the sales person influenced their decision and in 23% of cases they reported sales persons opinion had important role. 39% of customers only went to visit in one store. Still, many of those people purchased online.  Currently many customers consider stores as showrooms and look for the best deal online.

RECENT DEVELOPMENT AND TRENDS

The rise of online channels and social media’s role in customer journey has increased information available for customers. Social media has enabled and encouraged communities and discussion forums in which people share experiences of different products and services. This change has diminished the role for sales people in many businesses and created disruption in former Customer Journeys. In the world of 3i, that is high interest, high involvement and high investment product and services, people’s know-how about the products and services often exceed the level that sales people have in store. The customers are increasingly becoming specialist in what they are buying. They are also actively using this knowledge as social capital. People enjoy their position in their own community and sharing increase their role as a valuable member. Peer-group’s respect is often very effective motivator that activates discussion and participation.

The customers are also increasingly interested in companies’ practices and values. Several brands have suffered major image setbacks due to child labour in their production, environmentally indifferent attitude and any ethically questionable actions. People become more and more conscious about their consuming,  effects of their choices and the products and services are no longer enough. People also need to feel good about their choices.

The trend that is shaking the corporate mindset is transparency. Brand, products and services, pricing, quality and experiences are all available online. Customers trust each other more than the brands specialists even if they don’t know each other. Transparency means that companies need to be just as good as they say they are or better than they have promised. Search engines are the best enablers of transparency democracy.

Post-Purchase

Once a customers have made a purchase and started using the product or service they are often likely to talk about their experiences. Word-of-mouth is a major influencer in many businesses and sharing experiences spontaneously online has multiplied the word-of-mouth influence. Another important thing to consider is that web does not forget easily. When customers start looking for information about the product or service online, they use search engines. The highest scoring links are the ones that have been clicked most often, have external links directed to that specific content and so on. This means that the highest scoring content could be several years old. It is very important for brands to stay in touch with customer’s satisfaction and recommendations.

Analysing the outcome

As customer journey designer I was very interested in learning about the customers decision-making dynamics from beginning to the end. In order to optimize that you first need to understand what is happening. We came to conclusion that the best way to effectively show what happened was to break the conversion analysis in three: Won, Kept and Lost business. To make it more meaningful we broke further to three dimensions: before buying, what happened in the original groups and what was the outcome. Here is an illustration of one case. This measure is called Business Dynamics Score (BDS)

 Business Dynamics Score

Of those 42% who originally preferred the brand 95% were kept and only 5% lost. Of those 28% who originally preferred competitor 70% were converted and only 30% were lost to competitor. Of those who had no preference 88% were converted and won. Only 14% were lost. The outcome is that from this company’s target group they won 46% of sales from competitors, 40% of their sales came from those who originally preferred them and they lost 14% of their reference group’s sales to competitors. In this case the sample the data was collected from customer buying this service at certain frequency and in this case some of the customers had purchased competing brand after the most recent purchase from the brand that was studied. This finding helped further in recognizing how much business is leaking from the brand to the competitors and why.

This way of looking at the customer data also reveal where the brand is making it’s sales. Of people who originally prefer the brand, how many actually buy it in the end. Of customers who prefer competitors, how many the brand is capable of winning. From customers who have no preference but only rather equal options, how many of them actually buy the brand in question. While capturing data, this same comparison also work very efficiently in analysing how competitors win from the brand in question and what can be done about it.

In order to finalize the big picture, it’s also very educating to see which brand the customers consider was second best after the purchased brand if any. Being second best means that the brands success was good but something still turned the customers head and led to lost business. If your brand is very often the second best, it means that it is not too hard to make major improvement in sales.

Of the full Customer Journey – this article was about the third slot – Choose and buy, Check out the first two stages:

Customer Journey stage 1: Brand as a platform

Customer Journey stage 2: Initiation

Also see Business design with customer centricity

Managing customer interfaces – marketing do-or-die

and How to Map and Study Customer Journey

Customer Journey

Author: Toni Keskinen, Marketing Architect & Customer Journey Designer

http://www.linkedin.com/in/tonikeskinen

Join FutureCMO Movement LinkedIn Group here

The beginning of customer journey – Initiation

Image

The customer comes to a crossing and stops because the brand successfully engages with him or something changes in the customer’s situation. In most customer journeys there is a defining moment when a person gets actively interested in buying, initiated. That moment can be identified rather reliably. Something makes a person actively start considering about buying something. Active purchasing consideration does create memories because it’s done.. well, actively in your conscious consideration. Active consideration could take years in some cases or it can spark purchase spontaneously. Depending on the category, differences are huge but also within a single product group customers’ behaviour have vast differences. In many smaller decisions the consideration is less profound but still, when ever you are breaking a habit or really considering about doing something, you can recall doing so when specifically asked about it. In fact the customer is the specialist in his own experience and we can learn from him. Best way of getting to know the dynamics and learning about the reasons for people to get interested is by doing one-to-one interviews. Interviews are actually for discovery, expedition trip to customer behaviour and drivers, differences and variety. Group discussions easily make people indicate rational behaviour although it was not. We would suggest one-on-one in-depth interviews or questionnaire before a group discussion asking person’s own thinking. In the group discussion some of the key findings could be thoroughly opened. This kind of approach enables capturing human behaviour more reliably.

There is a methodology in Psychology called Interpretative Phenomenological Analysis (The Psychologist, vol 18, No1, January 2005) It has been developed for analysing people’s lived experiences. The methodology avoid making assumptions and does not test hypothesis. The person’s experience should be recorded as authentic as possible. They are done in one-on-one meeting. Interpretative means that the researcher looks for things that are distinct (i.e. idiographic studies), but will also attempt to balance this against an account of what is shared (i.e. commonalities across a group of participants). Researcher reduces the complexity of experiential data through rigorous and systematic analysis. Analysis relies on the process of people making sense of the world and their experiences. I use this methodology in Insight interviews and then create quantitative study based on these findings in order to quantify which phenomena has most meaning and can these phenomena related to specific business and brand be segmented in some way or result difference between segments and brands.

The best way we could come up when working on One Experience cross-channel buying behaviour mapping tool, was to start with one-on-one interviews and learning about the people’s reasons to get initiated in the first place and continue to map out the cross-channel purchase behaviour.

The initiation of the active consideration is often a result of certain drivers and motives in certain context being prompted to active consideration by certain touch point in certain channel. These reasons, channels, motives, contexts and drivers should be recognized and quantified in different target groups. They are the very foundation of profitable marketing operation.

You can roughly divide reasons to initiate in commercial and non-commercial reasons. Commercial reasons have to do with advertising, direct marketing, outbound telemarketing, retail, point-of-sale promotions, sales people and so on. Non-commercial reasons have to do with magazine reviews, word-of-mouth, actual need because of losing or breaking the old product, tradition based behaviour (e.g. in travelling every year at the same time), change in a living situation (e.g. moving) and so on.

Further, initiation can be divided in initiation in general and initiation to the brand. Initiation in general is about how the customer became interested in acquiring certain product or service in general and these reasons are often non-commercial when asked from the customers directly. This is not completely true because something has created the need in the first place. That’s why it’s also important to ask about their initiation to a purchased brand. Becoming initiated to certain brand is more likely to be commercial. In most cases you can narrow these reasons to a few major ones per segment. This information will help you decide where and what to do in marketing. How to effectively reach people and how to choose the message and content in most appealing way.

The Apple iPod is a great example of a product, which had  ”a long activation” period. The iPods were originally too expensive for many people who would have loved to get one. After some time, the price of the iPod reached tippin’ point, level which enabled most people to get one. At that point iPod rose from most wanted niche product to dominant brand. The MP3 format, iTunes and making CD digitization easy were the enablers of MP3 revolution. ITunes and buying music online were Apple’s strengths. However, the product design and user experience made it the most wanted brand and later on dominant market driver leading the way. Currently it has been predicted that when eye surgery costs come down to the level of 1500€, people choose surgery over new classes. Markets could change profoundly and rapidly.

We have learned from several cases that the brands often don’t know why and from who’s initiative customers got activated. In one case our client, advertiser, was wondering why their demand had suddenly increased dramatically and they made record sales without doing anything specifically. This company had very effective sales process delivering superb customer experience and consequently very high sales conversion. After running customer journey study for them we found out these people were originally activated by a competing company, which had launched a major direct mail campaign. The product was expensive and people wanted to take another offer just to be certain. This incident delivered record sales for the competitor. It’s likely that the active brand also sold more than in average but it’s absolutely certain that they also lost major part of their potential sales.

When you are concentrating on customer perspective you are simultaneously doing very effective competitor benchmarking and learning from their success too. In best case the competitor becomes your best salesman without knowing about it. You can also learn from competitor’s success.

In retail store you can roughly share products in two categories: must have and nice to have products. These products life cycle could vary greatly. In one CPG case that we analyzed we found three most common patterns in getting initiated. The first one was planned. People wrote on their shopping list that they will buy this product. The second was buying in stock when the product was in discount. The third was the biggest one… People who had made a mental note they should buy the product. However, this product was not in the priority list, which resulted ”pending activation”. These people were activated to purchase by just seeing the product in store or seeing an offer about it. The major sales increase for promotion was due to the fact that they had promotional spots that prompted people’s attention and activation by just being there. The sales would have increased even if there were no discounts because people just forgot to act on their decision. In many cases there is latent behaviour that must be recognized in order to optimize profits. There’s no need to offer major discounts if just being there does the job or offer smaller discount or on-top offer in order to justify the extra visibility in store and also activate stock buyers. It also has major indication in the media strategy. If the brand’s awareness and other KPI’s are in order, the most important goal is to have continuous activation going on generating faster re-purchases and increase in the market value. Depending on the product’s role in customer’s life there would also be possibility of creating CRM or social relationship management (SRM) approach that would keep customers active and engaged with them in product and service development.

Testing in the real environment is the only way to get a true business case

Making people move is a fundamental marketing goal. In order to optimize marketing effect, you must study, test and learn what kind of trigger and content create most response. You should also learn in which context or medium people would be most likely to act on the advertising and which interaction channels deliver best results. Consider, what is the role of your own mediums like website, retail or CRM. How can you leverage earned media like discussions online and press or other PR. Are there ways of collaboration with partners that would result synergy and low-cost leads? Where and how much should you invest in paid media like TV, print, radio, outdoor and online. You can manage what you measure and optimizing the mix takes a lot of learning, trial and error to make it right.

The second equally important issue is to learn where you should steer people post activation: online, mobile, customer service, retail or create a first action which help you support customer thru out the journey and purchase. Again, there are good learning’s available but each business is unique.

Consumers want to have control

Today’s consumer want to control the process of choosing and avoid being sold at. Pushing is irritating and considered as a bad customer experience. When customer has a medium in which there is a lot of choice he has the control. Customers choose what to concentrate on, and how much time they are willing to use in learning about product. Customers can choose to continue shopping online, in retail, mail order or to go and see the product live or choose not to do anything.

Advertisers have an opportunity to increase communications to own customers and creating own mediums in print and online. Previously marketing focus was mostly about finding new customers, although majority of the sales came from existing customers. Customer magazines and catalogues are part of customer loyalty, mobilisation marketing. The respondents consider the magazine or catalogue as respect of customers own space, time and consideration.

Buying is not easy

Marketers often assume that selling is hard and buying easy. For customers it is not easy to really understand the scale of offering and relevancy of it. At personal level they have ways of learning in their own time. Often the retail experience is too hectic and nervous for learning at own speed. Online services and catalogues allow people to have their own time and space. In one case outbound represented majority of initiation, but fraction of the transactions.  Banner ads are often judged wrongly due to this – people initiate but make transactions elsewhere.

Consumers consider concrete pricing, product pictures and good presentation of products as valuable service that makes buying easier. It’s easy to see for example how much catalogues and online travel advice decrease the need of personal advice from travel agencies and enable online buying.

The difference between emotional brand advertising with very little information and buying information sources is obvious.

Conclusions about Initiation

Initiation and getting activated is about prompting attention and making the person move. No matter how long there has been a latent interest, there’s always something that changes in offering, customers situation or the market that gets people activated. What is that, what is the motivation behind, what is the customer’s mindset at that point, which brands customer considers as options, which does he prefer if he does? Understanding this has a major influence in the overall marketing strategy.

In order to understand how customers are best reached it’s also important to understand the need of advertising and shopping consideration. For many brands there would be possibilities in helping customers learn about their value proposition by really making great product descriptions and photos for shopping medium use. Although the customers would not buy from these sources, they still learn from them. That’s free media that really hit the target. Brand’s own online service should be the source of ultimate information that really answer customer’s questions and engage with the customer resulting action.

When we were studying the different mediums capability to influence customers and how brands currently work, we came to conclusion that when brands are rapidly learning new, they are simultaneously forgetting old. Customer’s behaviour does change but when competing retail brands e.g. drop catalogue and go purely online, the other brand might gain advantage.

When measuring success brands should concentrate on how much did the advertising change customers perception of the brand positively, did the advertising justify higher price or increase the interest in wider audience with current price or did the advertising just activate people with discounts, which is good in the short run but could damage the brand in the long run. Which mediums performed best compared to the investment? If some mediums under performed was it due to the medium or advertising content? If you can answer all these questions post campaign, your capability to improve further is much better and you can actually predict outcome much better than previously which justify the spending.

What do you think? I’d love to get some comments :)

If you liked this one, check out how to manage customer interfaces and pre-initiation stage along the customer journey Brand-as-a-roadsign.

An article about the next stage in Customer Journey here: Choosing and buying – cross-channel influence

More advice about how to map and stury customer journey is available at https://futurecmo.org/2012/12/01/how-to-map-and-study-customer-journey/

Author: Toni Keskinen, Marketing Architect & Customer Journey Designer

http://www.linkedin.com/in/tonikeskinen

Join FutureCMO Movement LinkedIn Group here

How to map and study Customer Journey?

Customer Journey Mapping

http://www.servicedesigntools.org/tools/8

Generating and visualising the map is one thing, capturing data and understanding to generate it is another thing. I’ve done Customer Journey mapping and analysis since 2004 and learned a lot about the differences in methodology and their value. I’d like to share some of my experiences here.

The first thing to start with is to consider how you approach this task. I’ve learned that when the designer him self engage in customer journey mapping and research, the time spend in studying is actually effective planning time. Outsourcing this work to a researcher makes everything much harder. When you as a designer and planner are responsible for planning, you have a completely different idea about what to study and pay attention to instead of researcher.

I’ve learned that starting the work with qualitative interview really help in understanding what it is you need to pay attention to. In the qualitative interviews I have used methodology that has a name in Psychology: “Interpretative phenomenological Analysis”. See more from Psychology – magazine This approach thoroughly study customer’s lived experiences from their perspective. The point in this is, that you need to understand the whole big picture with different touch points, different brands and their content, value proposition and services. You need to see from the customers eyes and experience the market in full. Once you have studied 6-8 people like this, you will be ready to write quantitative study for those customers who have recently done the process or are currently in it. Here’s one sample story about buying a GPS navigator and about conflicting interests along the Customer Journey

How to divide the study in phases?

Customer Journey

Majority of the potential innovation driving information is easy to access in case you have a customer register. Considering other journeys apart from buying customer journey, each journey should be separately studied and measured post delivery. I normally study acquisition journey as one study from brand-as-a-platform to Choosing and buying and also ask about post-purchase satisfaction. Using is another study or it can be combined with re-consideration phase, whether people leave or re-buy. Loyalty as such is very much tied to using phase or experiencing the service, which is why combining the latter two would also be a good idea. Always study both won and lost customers. Especially the customers who were lost have a lot to give. By combining different customer groups you will have a better understanding how the market actually works.

If you don’t have a database in use, you can recruit respondents from a panel source with this brief. Depending on the business and brand, the company’s reach in the market place differ very much. If it is possible to find out the number of new deals customers are doing annually, it’s easy to calculate how many did ask for a proposal from you. Closed deals are calculated as conversion from proposals. There’s also hidden movement in companies data they are not aware of. For example customers that are members of your loyalty program also buy from your competitors. Every now and then it’s healthy to ask from current members what they have recently purchased in order to find out how to best approach them and minimize loss of sales and risk of losing members to your competitors. Recently lost customers got initiated for some reason too. How did that happen and why did they not continue their relationship with your brand.

Along with studying customers afterwards, it is very eye-opening to follow what they are doing and to interview them right after they have made their choice. This is different from mystery shopping, because the emphasis is on the customer, not on the store personnel.

The third important source of information apart from customers is your internal organisation working in customer interfaces like helpdesk, customer service, maintenance and sales. They know what questions are frequently asked, what challenges (product failure, need for advice, compatibility issues etc.) are causing most of the costs for the organisation. They are also excellent advisors when considering options how to solve these challenges.

Marketing research often looks into the future perspective and ask about awareness, top-of-mind, preference and shortlist of potential brands. These are all good measures and valuable, but intentional – and could easily lead you to a wrong direction unless you have other KPI’s (key performance indicators) and tools to complement them. The challenge about researching future is that people are quite bad at acting according to their own intentions. Habits, convenience and instincts drive behaviour to unexpected directions that are difficult to predict by research. These studies also often miss a major point. They ask customers which brand they prefer and make them choose one, and consequently fail to recognize the fact that people might have only brand options and not a specific preferred brand.

Example: In case 76% of the customers have a pool of options but they don’t have a specific preferred brand, it means that most of the market is floating. People only have options and consider brands as equally good. When the time comes the best or first/nearest/most conveniently available deal will win regardless the brand as long as the brand is within the pool of options.

When a customer initiates conscious consideration and buying, he’s often active. He’s making searches online, reading ads, discussing about his interest with friends and family, reading product reviews, asking questions from professionals and stores, visiting several websites and outlets, asking opinions and advice. Majority of this behaviour can be analyzed online or with research.

When the customer initiates this journey he’s in charge. At least that’s how he feels. That needs to be taken for granted. He makes decisions. While he’s in charge, he’s being influenced by media, marketing, brands, professionals, sales people,… Eventually the customer is quite likely to buy something he could not have imagined before actually entering the journey. He does the decision eventually but you can influence the choices he makes if you know how to do it. The mapping of the customer journey is composed of he following parts:

1. Touch points: mediums, services, personnel, re-sellers, physical spaces, online. 

Do you have control of the touch point or does a partner manage it? At what point of a customer journey is the customer getting involved with a certain touch point? What can you do in that moment and what are your goals and KPI’s? Can that specific touch point result in to an acquisition or do you need to direct the customer further? What kind of roles a single touch point has and how can you make certain all roles are played out right along the customer journey?

2. Service moments and context

What are the most likely contexts in which the customer engages with the touch point? What is he trying to do? How can you help him achieve that? How is that done? How could it make your product or service look more appealing or at best, a most likely option?

3. Motivation and drivers

Are the customers reaching out for you or is it the other way around? In what kind of mindset does a customer engage with your brand? What could drive him further instead of abandoning your brand? What are the conventions and customs in your business and how could you exceed customer’s expectations by breaking them? Are there other companies that have a similar logic to yours and could you implement their approaches, which already have a proven logic?

4. Decision making process

What is the customer’s decision-making process like? Is he doing it himself or using a consultant or services for comparison? Are there predictable qualities in customer’s selection process that would enhance your capability to adapt your organisation to the customer’s behaviour with right content, value proposition or services? How does the customer move from one stage to the next?

5. Triggers and Moments of truth (initiate/choose/drop/buy/attrition)

Where and at what point are the most important moments of truth defining the majority of your business success? What triggers them to decide or act according to your will? Can you trigger customer behaviour? How can you do that most effectively and which kind of approach result in best outcomes? Why do you win and what do your competitors do better if you lose business to them? How can you outperform your competitors’ actions?

6. Post-purchase satisfaction and recommendations

Would customers buy again if they had a choice? What is your Net Promoter Score Index? What were they satisfied about? Was there dissatisfaction? How can you improve your customer experience in order to earn higher opinion? Do your customers discuss about your product online or face to face? What are they saying? Are they endorsing your brand? Could you use their endorsement for others who are still considering it?

Customer Typologies by behavior

You can easily argue this is not the whole truth. Not all purchases are done like this, consciously working thru a cross-channel decision-making process and eventually buying something. That’s right. And that’s why we needed to create a model for defining critical customer journey models for different kind of purchases. Conscious cross-channel purchase journey is most likely in case of ”3i” purchase. That is High interest, -involvement and/or -investment product or services. However, the buying models and patterns are more complicated than that. Also the behaviour dynamics differ between products, service ranges and between same category brands. You can divide customer behaviour in three major types: Adventurers, Flyers and All-inclusive cruisers

Adventurers: Journey driven people are interested in the products and their qualities. You need to support their needs and change or influence their attitude in order to break in to their awareness. As they search and compare, you need to be able to justify to them why your solution would suit them and guide them to decide and purchase your product/service. These people really consider their user experience and share recommendations in case your performance is beyond expectations. Supporting their needs helps you to perform better with other people representing different behaviour type.

Flyers: Destination driven people also need to be influenced at “need and attitude” -level in order to create better awareness of your offering and it’s qualities. However, this is more about leveraging past reviews and feedback from journey driven people. Destination driven people are more likely to be influenced by e.g. Magazine reviews of your product or other independent sources of information. With such support you can just concentrate on tactical advertising in order to encourage decision and purchase making. Destination driven people are interested in the user experience and reviewing their own experience to others.

All inclusive cruisers: Public opinion driven people accept your offering when it’s widely used and they are completely certain that choosing your offering has no risk what so ever. It’s all about tactical advertising and encouraging purchase. They are not likely to share their opinion to others or recommend your products or services.

The share of each of the previous groups vary by product category and brand. The rules of engagement apply and they must be considered in the mapping too. These laws apply like gravity and this means  that same tools and methods in marketing certainly don’t apply to every case in the same way. Here is the rules of engagement map: a) Level of 3i and b) who’s the active party.

Customer journey rules of engagement

I know doing this kind of mapping sounds like awful lot of work, but I can guarantee that doing it is one of those things you celebrate most later on. Trying to compile data from different sources or doing this with qualitative interviews will deliver 70% right answers and generate innovation too, but doing it this way will give you more insight than you have ever got about your competitors success and failure, understanding the role of different channels and information sources and about market dynamics in general. This approach is a gold mine.

Well, there are a number of ways how to maps and document customer journey. They are all ok, but built for different purposes and they offer different kind of value. One great source of information for visualisation and internal/qualitative process is http://www.servicedesigntools.org/tools/8

What do you think? I’d love to get some comments 🙂

SEE NEXT:

Key questions when stydying Customer Journey

Customer Journey stage 1: Brand as a platform

Customer Journey stage 2: Initiation

Customer Journey stage 3: Choosing and buying – cross-channel influence

also check out how to manage customer interfaces

Author: Toni Keskinen, Marketing Architect & Customer Journey Designer

http://www.linkedin.com/in/tonikeskinen

Join FutureCMO Movement LinkedIn Group here

Customer decision making journey and market FLOW

McKinsey just published an article about customer decision making journey. It’s an approach based on a single research and 20000 respondents. I find it great that Customer Journey work and methodologies get real attention and McKinsey’s article proved that customer journey understanding, analytics and design are maturing and becoming real business management tools. We have taken it further with Jarmo Lipiäinen and created Customer Journey Management methodology for sustainable management model. We are also trying to have Customer Journey Management – the book – published, but in the mean while here are some thoughts about how to apply customer journey mapping and understanding to your  business.

To start with:

You need to understand that there are very different journeys to begin with.

  • Purchase journey (From awareness to consideration and transaction, Acquisition)
  • Service journeys post purchasing (Using the product or service, value-in-use)
  •  Planned (e.g. Address change, regular maintenance etc.)
  •  Unpredictable (e.g. Product failure, reclamation, insurance coverage, etc.)
  • Delivering a service as a customer journey (taking a cruise or flight, restaurant, using media, etc.)
  • Retail customer journeys (e.g. IKEA store experience)

Media company’s customer journey would be about daily use contexts in multi-channel environment reaching the customers with online, print, tablets, email with variety of media types. The thing is, if you simplify customer journeys too much, you will not benefit from the analysis either.

1st: Concentrate on what they did 

When you are diving in to customer behavior along their decision-making journey, you need to understand that only customers who have recently done the purchase can tell you how they did it. People are very bad at behaving according to their preferences – so you need to learn from what they did – not from what they think they would do. When people enter the decision-making journey – they can not know how they come out of it. Here’s an example of car purchases

it is a maze

When customers enter the maze they have certain brands in mind. When they are inside the maze they will consult professionals, read reviews, visit discussion forums and discuss with friends. When they are in the zone they will pay attention to advertising they normally ignore and they are likely to learn a lot. Eventually, when they buy something, it could be something they wouldn’t have thought in the beginning.

2nd There are dynamics – rules of engagement so to say – but each category and brand journey is different

If you consider decision-making journeys from buying a nuclear power plant to buying a bottle of coke – here’s how you can analyze the rules of engagement

The customer journey for a well-known, liked and preferred brand is extremely different from a journey for unknown new brand. Read more from article: Brand as a roadsign. It is also good to understand that if you have several product categories, each of them is likely to follow different dynamics.

3rd Look at the whole market – not just your own touch points and understand the market flow!

Here is an example of market flow for a telecom operator. The Dynamic market flow is interesting concept that medical companies are using. They don’t look at the overall market shares but dynamic market, which is about new prescriptions and changing prescriptions. Similarly, looking at the market change is where you can best see how your work is influencing. The market share will follow. Here is some idea about how the idea works from a telco case I made a year ago. I can’t give any actual data out because it is proprietary but I can explain the methodology. First of all, what is the size of dynamic market and how does it flow:

This data tells you how many actually bought, how many of them bought spontaneously and how many did considered purchases. Earlier I did a customer journey decision-making mapping for 3G bundles in Finland, Denmark and France. I can tell you that the differences in national behavior also vary very much. When French people make considered purchases, Finns buy 3G bundles like sausages. These two markets have very different dynamics. Ok. Let’s dig deeper. Here is how you can break down each product category:

This graph has very important information presented in a single page. I know it is not beautiful but it is highly practical. First of all you need to know whether people are newbies and making their first purchase or experience buyers. Then, what is it that makes people tick and initiate conscious consideration? When they do get activated, do they really look for more information or just rely on their brand related heuristics or do they just buy spontaneously? There is great different between customer journeys that are spontaneous and those that are considered. There is even more important figure to understand, that is outbound tele sales share of dynamic market. When you have all this information about your brand and your competitors, I can guarantee you will find insights and surely learn what to do differently. Between brands there will be major differences in conversion rates from preference to purchases and differences in sales via different channels: outbound, retail, online, inbound…

4th Different types of relationships

You buy milk several times a week, you use video rental service occasionally, but very rarely rent the same movie. In average you buy a house once in a lifetime. The relationships are different, very different. This difference has a major impact on how you can create customer relationships and apply customer journey methodology to them. Here are the variables:

These variable form a quadrant with typologies:

It is obvious that every brand should work their way up and to the right. Even if a customer only buys the product or service once in a lifetime, you could still create relationship that feels like continuous relationship.

5th Leverage all your information assets

Understanding the whole customer journey makes it possible for an organisation to re-define relevance and information sources. I’ve published an article about how to cure corporate autism earlier and you can find more from there. Check out 

However, you need to understand how the market works and how does your products and services flow with the market. The Customer Journey  as a full help in defining what to pay attention to.

Along the Customer Journey you can analyze customer behavior with online analytics, CRM, marketing automation tools, CSAT, VOC-studies, look at market data, research marketing and brand outcomes, analyze social media.. Ok, the list is endless. This is why you need to re-define relevance and build your KPI’s accordingly.

Business Dynamics Score is one of the most fundamental decision journey metrics. It tells you how many customer that preferred you originally, did you keep and how many did you lose. Of those who had no preference or preferred competitor, how many did you win or lose.

LAST but not least

If you really step in to your customer’s shoes, you understand that for a customer a brand is a single entity. If you really analyze customer journey you will find out what to change in order to perform better, but it could be anything. The challenge I have faced most often when I have done customer journey mapping and analysis for my clients is, that it is difficult to tear down silos and act on customer behavior needs. Instead of print campaign it might be better to spend the money on new online webstore, or investing in marketing automation software enabling event based servicing. In my opinion customer journey work is an extraordinary innovation  methodology for corporate transformation, change management, and amazing performance.

SEE NEXT:

Customer Journey stage 1: Brand as a platform

Customer Journey stage 2: Initiation

Customer Journey stag 3: Choosing and buying – cross-channel influence

How to map and study Customer Journey

Author: Toni Keskinen, Marketing Architect & Customer Journey Designer

http://www.linkedin.com/in/tonikeskinen

Join FutureCMO Movement LinkedIn Group here

 

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