The New Consumer Decision Journey

Check out this presentation by David Court, McKinsey´s managing director. He lays out and explains fundamental changes in consumerism (from product research to purchase) which dismantled the old model of the purchase funnel. Not only the new media vehicles, with the internet being the most important, but also the increasingly consumer empowerment have propelled these changes. The new consumer decision journey starts by actively reaching out to family and friends, instead of passively sitting at home being bombarded by advertising.

The traditional purchase funnel is a linear process. It starts with awareness (consumers become aware of brands), than familiarity (consumers research and learn about a product or brand), consideration, purchase, and finally loyalty.

Why does this model no longer works? First it begins with a broad opening with many options (brands) than narrows down to one or few brands. The other reason is that today´s consumer behavior is rather a more circular process. This old model implies that consumers follow certain consecutive steps, in a straight line. According to McKinsey, the new Consumer Decision Journey looks more like this:

This whole process starts with exposure as people see and hear about brands. Then comes a trigger, which could be a first impulse to want something. These are the pre-stages of the consumer decision journey.

The first step is initial consideration. Here the consumer has a narrow list of brands (the contrary of the purchase funnel, where consumers has many options in the awareness stage). In this stage it´s very difficult to get through the clutter of ads and media bombardment.

Next, they move on to active evaluation. In this stage the number of brands and possibilities increase. Consumers reach out to family and friends and are actively researching brands on the internet and paying attention to ads.

Finally comes closure or purchase. Consumers are decided to buy, but have not yet decided on the brand, so in-store presence is really important here and packaging could decisive for a brand win the race.

The last stage is what David calls the loyalty loop in the postpurchase experience. Here consumers develop two different types of loyalty, which could be decisive in future purchases. Consumers are either active loyals, which is the traditional way in which people don´t really consider other brands. But there is also the passive loyals. Here consumers are open to buying that brand again, but are also open to other brands.

Which marketing actions can we develop based on this model?

David explains that marketing activities should be aligned with this research and buying behavior. There are 5 areas where you can consider your marketing actions:

1. Set priorities by stages: Which actions can you undertake in the different stages of the consumer decision journey? For instance, you could decide to spend less on the initial consideration stage, but substantially more on the active evaluation by stimulating third party sites to write about your brand, having testimonials published and spreading word-of-mouth. Which strategy fits best with your target´s decision journey?

2. Messaging. Align your marketing communications to allow and stimulate consumers to reach out for your brand.

3. Fundamental investments on consumers-driven markets. Make it easier for people to learn how to use your product and spread the word.

4. Win in the store.

5. Develop a seamless brand experience: consistent and integrated marketing communications.

Understanding consumer-driven versus company-driven touch points

Today brands no longer control what´s said and talked about theim. They no longer are the only source of stimuli and information about their products. With consumer-driven touch points, people actively search the internet, talk to friends and spread word-of-mouth. Brands must then align their strategies to consumers-driven touch points by being present (advertising and provide information feeding consumers channels) when consumers are actively researching for products.

Barcelona Campaigns for Bikes

This morning as I was biking to work, I was pitched by a gang of bike enthusiasts near sagrada familia. They belonged to the Bicycle Association of Catalunya (BACC) and were handing out leaflets and gifts to other enthusiasts and bicycle amigos like me. They were there to rally for more bikes in the city!

Their gift, a black handbag with a big white bike on it contained a bell, a biking guide to the city and a BACC newsletter with interesting information about the organization and the projects it’s currently undertaking. With this campaign, BACC aims at raising awareness about this old, yet so timeless and sophisticated mode of transportation.

It’s a pity though that BACC´s communiqués are in Catalan. Given that Barcelona is a multilingual city, the organization misses out on a huge piece of potential target audience by choosing to target only Catalan speakers. From a communication stand point that’s a flaw.

Altogether the city of Barcelona is doing a great job in pursuing people to use bikes instead of conventional, energy consuming and environment unfriendly modes of transportation like cars, buses and motorcycles.

In March 2007 the city of Barcelona introduced Bicing, a service which allows subscribers to take out bikes from stations throughout the city for only 30 bucks a year using a chip card.

Bicing has some weaknesses though. For instance, you can only take out a bike for 30 minutes each time and stations are often found empty. Nevertheless, Bicing is working really hard to make improvements as the number of users keeps growing. Also, the city council is broadening its biking infra-structure by building more bike ways and improving traffic signals.

This is a great development for a city that, like other big urban conglomerates, struggles with serious problems caused by an overload of automobiles. My guess is that from now on the priority lies in educating people about using and respecting bicycles. This remains a challenge as many motorists and pedestrians just ignore bikers and don’t acknowledge them as a serious mode of transportation.

It might take some time, but for sure Barcelona is biking in the right direction.

Dude, Dig my Dog-Fish!

This is what I mean…

A couple of weeks ago I posted a presentation about Social Media Strategy & Goals. I´ve had some pretty good response. Besides having the busiest traffic days,  my presentation has been linked to and commented on, especially on Twitter. Quite some people “twitted” about my blog and another few decided to follow me on Twitter.

(…or just search lucas adventures in twitter and find out for yourself.)

This good response exemplifies some of the principles I laid out on my presentation. By offering people something useful, the presentation, I added some value to those who read it in my blog (social media). They in turn engaged with me and spread the word. Instead of money, I got something much more valuable than that: exposure and word-of-mouth. Much better in the long run.

That´s great! Thanks twitters!

WWF Ad Campaign

Love to the World and to Your Customers

Love your customers and treat them with respect. Show your appreciation with an impectable product and an honest, trustworthy and fair service. Walk a mile on their shoes and earn their permission to market. The best part is, it won´t cost you much more.

Richard Branson, Virgin´s CEO, become a pop star in the UK because he rescued consumers from despair and negligence. He gave them respect and provided them above-the-average value for their money. Above all, he inspired people by having the conviction to fight for their rights.

My bank manager in Holland is a very nice guy (he works for the Rabobank). He first considers I might have “just forgotten” to deposit money when I am in red before blocking my account. He reminds me kindly I should deposit some cash, and never raises his “tone-of-voice”. I then feel embarrassed and cover the account right away.

As a consumer when you are treated like that, you have no choice but to respect and love back. You drop your guard, give permission to market and embrace the brand. All of that for no extra costs.

Social Media Goals & Strategy

Enjoy the presentation I put together about Social Media Strategy and feel free to leave your comments.

Seth Godin Speaking on Tribes We Lead

The Energized Differentiation

Following up on my previous post about John Gerzema and Ed Lebar´s The Brand Bubble, I would like to add a note about a topic I left untouched: The Energized Differentiation.

In The Brand Bubble the authors draw an in-depth context of today´s market place. According to them there is a huge clutter of products that very much offer the same thing, and where the only way out for brands to differentiate is by lowering prices. They argue that this is due to media fragmentation and technological innovation. Nowadays, a nobody-heard-of brand can grab the market share and reach more consumers than a blue chip company. On the competitive level, minor brands with less capacity can manufacture and distribute high quality goods too, but for much lower prices. Think of home appliance gadgets for instance.

On the other hand, consumers are becoming less and less impressed and knowledgeable of brands. They just don´t care and don´t trust brands anymore. Brands have made way too many false promises and now they can´t be trusted. In these Postmodern times, consumers have grown aware of the world around them, are in general more sure of themselves and above all, know that fulfillment doesn´t only come through material possession.

For brands this is real trouble. If your brand´s USP is price, anyone who´s willing to go lower will beat you. So what can you?

The Energized Differentiation is way to snap out of the clutter, making your brand truly desired, allowing you even to higher prices as demand for your brand grows. Nicely said, but what does it really mean? To make a brand glow with energy and attract consumer´s desire and appreciation, marketers must rely on true creativity, keep a clear vision and be flexible enough to adapt to market changes.

Brands that are heavily energized have a strong creative essence or foundation. At the same time as they impress consumers, they somehow “lend” or let their features transcend to consumers, making them feel more creative and energetic themselves.

Personally, my favorite brands are: Apple, American Apparel and New Balance. Other brands than those I would probably not even bother to mention, but these in particular add a kind of magic to my day-to-day inspiring me by their insights of the world.

The life lesson for me is that the energized differentiation also applies to persons. In the human market place, similarly to consumer markets, there is a lot of competition. With more people having more access to information and education,  the supply of qualified professionals tends to increase. As with brands, those willing to get the job will do it for less money. So here too, in order to differentiate yourself from the crowd, build positive energy and let that shine on those around you.

The Brand Bubble

I´ve just got started reading John Gerzema and Ed Lebar´s Brand Bubble. In their book they lay-out and explain a twenty-year trend that reveals scarry concerns in Brand markets. Over the years CEO´s, investors and venture capitalists have placed way too much value in intangible assets of Brands. According to them, organizations underestimate and overlook this trend, ignoring the huge gap between brand value in Wall Street and consumer value in real life. Brand value these days are out of proportion with actual earnings. While brand value in Wall Street grows, consumer perception about them tumbles. The answer: The Energized Differentiation.

So far, so good.