How Watches Can Explain Loyalty: Deploying Alternative Methodologies to Understand Behaviour
Photo-by-Marek-Szturc-on-Unsplash
A few years back, I collected Tesco Club card points. I did this because I did most of my online shopping with Tesco and because I had an Avios credit card and Tesco linked directly to it.
I also had a Tesco shop near(ish) to my home, but I seldom went there. There was a Co-Op inbetween home and the station so when I needed something small it was far easier and quicker to go there, despite the fact that I wasn’t ‘rewarded’ for doing so.
I never thought about any of this when I logged in to Tesco or stopped in at the Co-Op. But now that I’m forcing myself to think about, I guess I’d say I was loyal to Tesco. Rationally, shopping at Co-Op didn’t make me less loyal to Tesco, although it may appear so – it’s simply that Co-Op won on availability. All the same, if someone had come along with a better online offer to Tesco, I’d probably have switched.
Loyalty schemes aren’t sufficient
From all the work we’ve done in the loyalty and retail space, I know I’m not the only person who thinks and behaves like this. The challenge is that loyalty schemes, designed to encourage loyalty, aren’t sufficient…
…Because loyalty comes from so many different places and not only financial reward. In fact, I’d argue financial reward simply encourages a transactional relationship and not an ongoing form of loyalty.
Take Lidl. For a long time they didn’t have a loyalty scheme and yet they cultivated an almost cult-like loyalty among their customers, thanks to the shopping experience and the perceived quality-price ratio.
On the other end of the spectrum, John Lewis is the gold standard for customer service – an investment that is repeatedly rewarded with repeat visits and praise.
So how does a brand garner brand loyalty?
It goes without saying that they have to ‘get it right’ with their product and service. It’s a competitive jungle out there and consumers are more demanding and fickle than ever before.
So, let’s redefine customer loyalty as a step further than financial reward: it’s a complex web of a brand delivering something to customers that enhances their experiences of the category and maybe even their life, it’s about an emotional connection[1].
Admittedly, that’s quite a lofty notion. Even more so when you consider that consumers are unlikely or unwilling to admit that.
How do we establish what would genuinely reward loyalty?
We can’t ask consumers directly what they want in return for their loyalty as loyalty has now become synonymous with loyalty programmes that reward on spend alone that all we’d hear is a regurgitated version of what they already have.
And, as we’ve established, loyalty is irrational.
Therefore, we need to understand consumers’ values, needstates, and interactions with the category and brand in order to understand what sorts of rewards might resonate.
At Embark Insight, we use behavioural biases as a lens to reveal what consumers find hard to articulate, which in turn influences how we approach the research.
For example, fundamental attribution bias tells us that the context in which a person is has a greater influence on their behaviour and decisions than their personality, motivation, expectations or even instruction given to them[2]. Thus, if we wish to understand how a person behaves, in relation to the category and in their life as a whole, to identify real consumer needs and motivations, research needs to get as close to the natural context as possible.
A case study
An example of how we’ve responded to this bias is through prompted video diaries. Participants were given pre-programmed watches set with multiple alarms to go off at key moments during the day. When the alarm went, participants recorded a video about their day. At the end of the period, we conducted video interviews in which we summarised participants’ lives based on the videos and the responses were astounding.
“I can’t believe how accurately that describes my life.”
“I’ve never thought about it like that, but that’s so true.”
“I would never have thought I did that so often.”
“This has really changed my life and forced me to reappraise how I spend my time.”
This in-depth mirror of their lives enabled a deeper discussion around who they are as people. This was facilitated by two key things:
Having spent time sending videos to our moderators, participants felt much closer to them, almost on a friendship level and felt comfortable sharing inane and irrational details of their behaviour that they wouldn’t have done without this level of closeness
We used what they had already shared with us about themselves to discuss their behaviour and peculiarities, thus avoiding putting words in their mouths and inadvertently passing our assumptions onto them
“The real me isn't the person I describe, no, the real me is the me revealed by my actions.”
Malcolm Gladwell, Blink: The power of thinking without thinking (Penguin, 2005)
This incredibly indepth reflection of the people we were interviewing provided a true insight into their values, motivations, and interactions with the category which elevated the discussions we could have with the client about their consumers.
As with the example I gave of my own experiences with Tesco and Co-Op, it’s far easier for me to explain why I didn’t do bigger shops at Co-Op when you’ve already observed that I only ever did small shops there and bigger ones at Tesco. Otherwise, I may well have shared some inconsequential observations about the shopping experience at Co-Op that completely miss the point.
Ultimately, this deeper understanding of consumers grounded in their own behaviours enabled a more robust strategy for our client that truly put consumers front and centre.
[1]Extensive research in the category by Forrester has proven that emotion is the key driver of customer loyalty. Using data from more than 45,000 US consumers Forrester found that emotion contributed most to customer loyalty in 17 of the 18 industries that were studied, so building an emotional connection seems the best place to start.
[2]Anyone who’s been shopping with a hungry, tired child can attest to that.
