July 2009
51 posts
Top Pot.
I was thinking again about yesterday’s post on the consumer decision process, and one thing that’s particularly struck me about the McKinsey study I referenced is the concept of loyalty.
Many of us (student/professional/regular consumers) have heard of the term brand loyalty, and many of us believed that it existed prominently among the masses. The study brought some interesting and valuable nuance to the equation.
Quite simply, brand monogamy is sooooo 1900s.
On one hand, we have the active loyalist, and this person fits the prototypcal brand loyal description. For certain categories, this person is certain to go for their brand of choice. The active loyalist is committed to a lasting relationship.
It turns out, though, that people are much more likely to be passively loyal. They are somewhat likely to choose a brand they feel loyal to, but they are MORE likely to choose something different. Intrinsically, this makes sense. For most categories, I fit this description. There are so many options, and nowadays so many good deals, that it just make sense to be passively loyal.
Since most of us are passively loyal to most categories, the new consumer paradigm is one of being a loyal switcher. Even for products and services where the company does all the right things… Good amount of brand awareness… Ample positive information on the web… Timely and caring customer service… you can never quite guarantee a continues string of sales to this person (i.e. us).
This is a tremendous challenge. How can you engage this consumer time and time again if they’re just “dating” your product? I would argue that (besides doing all the right things above) since many purchase decisions are made at retail, this speaks to the importance of impactful packaging, engaging displays, prominent location placement, and, everyone’s favorite, price promotion. One difficult challenge of emerging from this recession will be the process of weaning consumers off of price deals (which often accompany promotional placement at retail).
Another important lever will be new product innovation. Since we consumers are so capricious, we’ll be looking to try out the next new thing. But, then comes another dilemma… Is there a point at which you are just innovating for innovation sake? Are you making your product more complicated and expensive, possibly opening the door for a disruptive innovation?
I’ve got to give some much due respect to my good friend David Hegarty. David has recently quit his strategy job at a top technology company and moved to the start-up hotbed of the Bay Area.
What would drive a sane man to do such a thing during this obviously capital constrained environment? It’s simple - a great idea.
One word; two syllables; one vowel: Hollrr.
Besides presenting a well designed and overall fun site to visit, Hollrr is a completely new type of media company that is poised to redefine consumer advocacy. I know that’s a bit vague, so let me break it down to a few more concrete descriptions.
1 - Hollrr lets consumers initiate “tribes” whereby they can spot a cool new product, advocate for it, and be financially rewarded for it. Hollrr’s tibes tend to cater to a person whom you can categorize as a maven. Someone who is always ahead of trends, trying new things, and spreading the gospel of a great product/service.
2 - Hollrr also lets new companies, eager to launch new products, another advertising vehicle in order to engage potential consumers. The world is crowded, we’re over messaged, and it’s difficult for new companies to break through. Hollrr is geared to be the type of notoriety accelerant that until now could only happen organically.
3 - They’ve got a truly fun and well designed site. If you’re like me and love to learn about new products and services, there’s always a great new tidbit on Hollrr.
Marketers who are ahead of the curve should be able to spot the obvious value of a media company like Hollrr. Per yesterday’s post, the consumer decision process is much more complicated than a simple funnel. Technology and changing generational mindsets (i.e. younger people more apt to advocate) have catalyzed an important pre-decision informational search process. This is Hollrr’s sweet spot.
Links
Another great post by Alex, and on a subject I’m also very fascinated with - animal psychology.
A week ago, I posted a couple times about my new fascination with animal psychology.
In looking for more info on the topic, I came across this fantastic three year old piece by Malcolm Gladwell. I initially assumed he’d simply found a way to shoehorn his liberal agenda into an otherwise interesting topic, but it was actually, refreshingly apolitical.
It’s commonly said that dogs can “sense fear.” This piece does a great job of breaking down exactly what that means, without getting into mysticism. The primary subject is Cesar Millan, television’s Dog Whisperer.
The contrast I particularly enjoy in the article is Millan, a man who’s surprisingly physical with animals, telling owners that he doesn’t believe their claim that they love their pets.
This piece is a bit of an investment (it prints to 11 pages), so if you don’t have one already, you should get an Instapaper account and chip away at it on your iPhone, Kindle, or computer when you have the time.
Glad to see my good friend Novita joining the Tumbl-sphere. She’s always in the know about the latest game changing news in retail and marketing, and has a keen eye for business trends.
Aside from the smart business-woman exterior, she’s also personally committed to advocating for some very important global health issues. Check out the post below on HIV /AIDS in Africa. Thanks for posting, Novita!
South Africa Is Seen to Lag in H.I.V. Fight
Circumcision has been proven to reduce a man’s risk of contracting H.I.V. by more than half. Yet two years after the World Health Organization recommended the surgery, the government here still does not provide it to help fight the disease or educate the public about its benefits.Link to full article:
http://www.nytimes.com/2009/07/20/world/africa/20circumcision.html?_r=2&ref=health
This article really resonated with me, based on my experience in South Africa. In 2006, I had the very fortunate experience of traveling to Southern Africa (South Africa, Botswana, and Zambia). Our group studied the challenges to increase HIV/AIDS treatment adoption and adherence.
We sought to better understand the supply/demand dynamic in this market. Are low treatment rates primarily caused by weak demand for services or limited supply? Through the study of existing literature on this topic and interviews with practitioners in the field, we identified what we believed were the four most critical barriers limiting treatment uptake: stigma, misinformation, healthcare professional capacity, and lack of access to financial resources.
One thing that really stood out to our group, and was reiterated in this article, was South Africa’s lack of government support, despite its relative “wealth” and education levels. (Compared to other surrounding nations)
In fact, this was one of the first quotes we came across when we began our research 3 years ago….”In 2004, South African Health Minister Manto Tshabalala-Msimang announced that a program to supply ARV drugs to thousands of patients would be delayed because the health system was “in shambles.” Instead, she advised, “I think garlic is absolutely critical… Lemon is absolutely critical. Olive oil is absolutely critical … just one teaspoon, it will last the whole month.’”
That is just plain disturbing.
On a lighter note, the only ‘humor’ in the article….”Men waited nervously one recent chilly morning for their turn. Most were hoping the procedure would help them stay healthy here in the nation with more H.I.V.-positive people than any other. But some said they were also drawn by a surprising, if powerful, motivation: They had heard from recently circumcised friends that it makes for better sex. You last longer, they said. Your lovers think you’re cleaner and more exciting in bed. ‘My girlfriend was nagging me about this,” said Shane Koapeng, 24. “So I was like, ‘O.K., let me do it.’ ”
As a Marketer, I’m thinking that might be the way to go…. !
McKinsey just published what I believe to be a very important study into the consumer decision making process. (Cool interactive version available too.) I’ll summarize the main points below.
1.) The “decision funnel” concept is bunk. People’s actual purchasing process doesn’t behave with a linear path, and doesn’t begin with a large consideration set.
2.) What researchers have found is that the purchase process is a loop. Initiated by some trigger, people start with a (1) small consideration set in their heads. They then (2) actively evaluate their options through info gathering and shopping. Finally, there’s the (3) moment of purchase, followed by the (4) post-purchase experience.
3.) It actually doesn’t end there… There’s the whole “loyalty loop.” McKinsey found that there are two types of loyalists. The traditional concept - the active loyalist - is someone who tends to be brand loyal through and through. The newer concept is the passive loyalist - and there are many more of her than of the actives. These people will consider being loyal to what they’ve bought and like, but are more likely to be open to change. They are very likely to make the decision at the store, and not before it.
So what? Well, the big takeaway for me is that depending on your marketing strategy, you’ll need to prioritize your messaging by purchase process stage. I think a lot of money is spent on getting the brand into the intial consideration set (awareness building), which is critical, but I also agree that some of the later stages are oft neglected.
Shared by Greg
Reblog: Radarchive.
fuen:
Cobra propaganda poster | Alessandro von Victor
via Super Punch
Shared by Greg
Via Paul Kedrosky
A guest post by Pablo Triana:
The punditry and the world at large have been hard at work trying to find ex-ante predictors for the malaise that has engulfed…
Listening to Bill Simmons’ BS Report podcast yesterday, I realized I didn’t have a good answer for this question. We’re in the last year of the decade, but there’s been surprisingly little talk of the end of the decade. Somehow, saying that it’s the end of the 80s had more of a ring than saying we’re at the end of the, um, whatever we call this decade.
So, as Bill asked, what is the best movie? It must be creatively unique, acclaimed, and re-watchable. Bill and guest Chris Connely (former MTV movies reporter) submitted Almost Famous, the Dark Night, and Oh Brother, Where Art Thou, Gladiator, and Lord of the Rings.
Chris brought up a very good point that I hadn’t thought about -
Jarring photos of where our used goods go when they’re obsolete.
