Tuesday, July 7, 2009

Rethinking brand relationships -- Part 1

Rethinking Brand Relationships
Now is the time to cast a critical eye on the essential building blocks of your business to gain a
new understanding of where connections between consumers and brands really begin
By Wendy Lurrie
As White House Chief of Staff Rahm Emanuel famously said to the New York Times last fall, "Never
waste a crisis." Inside every crisis is the seed of opportunity — the chance to think in new and different
ways, the chance to return to basics and especially to re-think the basics. The challenges we're facing
today give us both reason and opportunity to reconsider how we think and how we work as marketers,
how we act and how we engage with consumers.
While nearly everything can and perhaps should be rethought, I believe there are certain key
components that are most critical to success and in greatest need of reconsideration in marketing -- two
of which are relationships and experience — both of which are deeply, inextricably linked.
Relationships: Are Brand Relationships Really Like Human Ones?
Traditional relationship marketing (whether known as RM, CRM, direct marketing, customer-centrist marketing or some other descriptor)
holds that emotional and highly engaged connections between brand and consumer are the optimal end state. In any economy, but
particularly in this one, that premise deserves reconsideration. The question is, do brand relationships really adhere to the human pattern, in
which the best relationships are the most intimate, emotional, and engaged ones? Even if they do, does it really make sense to try to recreate
human-to-human relationships with brands?
Despite the best efforts of marketers, only a few brands currently enjoy a clear emotional connection with their consumers, with Apple
perhaps the most frequently cited example. The reasons why Apple enjoys its privileged status — from the exquisite design of its products to
the personal charisma of Steve Jobs — are complex and difficult for most brands to replicate. Far more attainable and potentially as
rewarding for consumer and brand are relationships based not on emotions but on satisfying transactions.
The truth is that for most brands — and, in certain circumstances, for all brands — the essence of the brand-consumer relationship is
transactional. Success is based on utility and performance and the meeting of expectations. What do people really want from their bank or
their breakfast cereal or their cable company? Are they truly seeking an emotional connection, or are they looking for a well-thought-through
and expertly managed transactional relationship where the brand consistently behaves and delivers in a way that is satisfying? Do
consumers change credit cards or cancel cable subscriptions or insurance providers or choose not to buy their next car from their old car
company because of what they see and hear in marketing communications? Or is it because of actions and issues at the transactional and
performance levels?
Just think about the difference between the transactional experience offered online by Netflix and the physical store experience provided by
companies that pioneered the movie rental category. Netflix is a business predicated on making life easier for customers. With its home
delivery and now streaming of videos, its no-late-fees policy, and a hassle-free online experience where even service cancellation is
streamlined, Netflix quickly overcame its late start and took control of a category once owned by less customer-focused competitors.
This is not to say that emotions are unimportant. We all know that establishing trust is absolutely critical in categories from food to finance —
particularly now. Brands like Zappos and Google demonstrate the loyalty-building power of the emotional delight consumers experience
when a brand delivers more than expected. We also know that badge brands succeed by making consumers feel more confident in
themselves and more connected to their tribe.
So the issue up for discussion is not whether emotions matter, but which comes first: Do emotional connections lead consumers to buy
brands, or do successful transactional experiences help create an emotional bond?
In these challenging, anxiety-ridden times, when people are returning to basics and challenging whether they need all the products and
services in their lives, transactional relationships based on brands delivering what they promise and giving the consumer no reason to look
elsewhere make intuitive sense. But the fact is, in any economy, the degree to which the consumer's expectation is matched by the product
or service experience either builds trust or damages it, either begins to create a reservoir of good will or triggers an attitude of skepticism.
The advantages of optimizing the transactional experience for both consumers and marketers are obvious:
 To the consumer, a successful transaction is a promise kept. Successful transactions are concrete, not ethereal or hypothetical. They
are proof that the marketer understands what consumers want and need. And they operate in the very emotional and important
dimension of delivering the value consumers expect for their money.
 For marketers, optimized transactional relationships help melt away the anxiety that surrounds a purchase. In addition, when a
company consistently keeps its promises, the consumer rewards it with loyalty, referral, and even advocacy, effectively creating a
consumer-brand partnership.
 When a brand unfailingly delivers on consumer expectations, it positions itself to generate word-of-mouth recommendations —
creating the spontaneous peer-to-peer connections that increase intimacy, relevance, and credibility. This is particularly important at
a time when top-down marketing approaches are increasingly irrelevant and, even worse, regarded with suspicion by consumers.
 Another benefit: The peer-to-peer process, in turn, gives the marketer valuable feedback about what qualities and actions actually
matter to their consumers.
Wendy Lurrie,
G2 Digital & Direct
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For all of these reasons, we should honor and pursue the transactional bond, rather than denigrating or shying away it.
So we come to the second part of this equation — the brand experience.
Experience: Focus on the Experience and Deliver
In virtually every comparison of online shoe retailers, one name comes out on top: Zappos. As a reviewer for About.com wrote, "Hands down,
my favorite online shoe store. Great selection, lightning-fast shipping, and fabulous customer service. I don't know what I did before
Zappos, along with a handful of other smart marketers including Netflix, Apple, and, to some extent, Google, illustrate a core principle: The
degree to which the consumer's experience with a brand matches or exceeds their expectation determines customer loyalty and profitability.
This suggests a related principle: In a world where experience defines potential customer value, then the real play and opportunity exist in the
intersection of experience and expectation.
However, for marketers who believe that loyalty lives and dies less because of the power of marketing and marketing communications and
more because of the actual experience a customer has with a brand, the current corporate environment is frustrating. Within most companies
today, marketing communications has little influence over the actual product or service offering. Processes from the way new products are
developed to decisions about pricing and distribution to the consumer's experience at retail and in dealings with customer service are usually
outside marketers' purview or control. In many cases, they are managed through corporate operations, finance, and other departments that
do not even face the customer.
The result is, while advertising and other communications can promise whatever they want, they lack the power to deliver on their promises.
If you think about a cable company, you know that people base their satisfaction and loyalty on factors such as the ease or difficulty of
scheduling an appointment, whether the installation person is on time and responsive, and whether the service actually works well.
Advertising can get customers to call, but it cannot make them loyal and it cannot overcome negative comments from a customer's peers.
Hidden inside every problem is its solution, or at least the path to a solution. And that's true in this case. Today's crisis, which has only
heightened the ongoing marginalization of marketing, presents an opportunity to reevaluate marketers' relationships with consumers and also
their roles within their own organizations. It's time to rethink marketing, to recast it as the capability best suited to understanding and
managing the totality of touch points, intersections, and connections that constitute the complete consumer experience.
In a truly consumer-focused organization, marketing would have the power to help align the service experience to respond to customers' key
demands. Marketers and agency partners should have access to all the business processes, tools, and performance data that make it
possible to audit experience, identify the ruptures, and address the needs.
We particularly need new tools help us see, understand, and maximize the critical intersection where customers' expectations and
experiences meet. We need to hear consumer expectations clearly and to see with crystal clarity the experience we're actually delivering.
New tools for studying and benchmarking consumer expectations are also needed. We need to be able to measure not only what consumers
expect in functional benefits, but also what they demand of the experience. We need to separate what is important to consumers from what is
not. Urgently we need to know exactly how much tolerance they have for errors. It's worth noting that Zappos, Netflix, Google, and others in
the pantheon of today's most successful brands rely on the power of data and technology to continuously improve their process and
Once a marketer knows what the consumer's most important expectations are, and once all the best and worst aspects of the transactional
experience are exposed, the matter of what promises to make and, above all, which ones to keep become glaringly evident. This information
becomes a blueprint for improvement and optimization, ensuring that we make meaningful promises -- and don't create false expectations
with promises that cannot or will not be kept. It can help entire organizations learn to perform in ways that encourage consumer loyalty.
When marketers gain influence in the creation and management of the total experience several important changes will occur:
 The role of experience will be acknowledged and elevated within the corporation.
 People who are by definition customer-facing will be in charge of the customer experience.
 As new tools are developed and marketing takes on a more central role, marketers will finally be in a position to recalibrate and
reorient their organizations toward their primary goal — creating profitable customer engagements.
These anxious times present an ideal occasion for a thoughtful re-examination of conventional wisdom. This is the moment to cast a critical
eye on the essential building blocks of our business, challenge the fundamentals, and gain a new understanding of where connections
between consumers and brands really begin, what constitutes experience and how decisions are made in corporations. If we do that this
"crisis" will indeed not be wasted.
Wendy Lurrie is president of G2 Digital & Direct, a global marketing services agency network dedicated to brand-building beyond advertising.
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