We humans like to think of ourselves as the crowning glory of creation. The species whose evolutionary advantage was intelligence of the highest order. We forget thereby that we are still primates at our core, unconsciously controlled by our emotions – and this also applies to your customers. Fortunately, you can foresee their irrationality.
„I’ve learned that people will forget what you said, people will forget what you did, but people will never forget how you made them feel.“(Maya Angelou – American author and civil rights activist)
For a long time, economic theory was based on several absurd assumptions. People have all the information they need for all their decisions, they can process this information in lightning speed in any quantity and they have no impulse problems whatsoever. The underlying idea of human nature was dubbed homo oeconomicus. This was done out of sheer necessity, because the mathematical models of the time could only handle so many factors.
Since the turn of the millennium this assumption is systematically being broken with. The pure rationality of the homo oeconomicus has been replaced by findings from behavioural psychology. As a result, decision-making behaviour that was previously regarded as unpredictable can now be explained in retrospect and it is even possible to make predictions about future behaviour.
In Customer Experience (CX) optimization this is applied in two ways. First, behavioural economics methods are used to measure customer satisfaction and loyalty. Time and time again, empirical studies cast doubt on the validity of customer statements about their future behavioral intentions. If we understand that people would like to be rational but are emotional, then the discrepancies between statements and behavior become evident.
An example of this is the Customer Effort Score (CES), which measures the perceived customer effort. It is shown that this simple parameter alone has a stronger connection to customer loyalty than most traditional measurement methods such as the NPS. Why? Because low customer effort generates positive emotions and knowledge about the emotional level of a customer is worth more than his rational declaration of intent.
It opens up the possibility of generating loyal customers from satisfied customers. While the former only claim to recommend products to others, the latter actually do so. They advertise in areas that companies cannot penetrate themselves. Interested parties often form opinions based on the experiences of other customers before companies even have a chance to make contact.
But how do you get access to such an influential marketing tool? How do you increase the loyalty of your customers? The answer is: through emotions. The most reliable predictor of customer loyalty is emotional attachment. It is emotions that create longterm value.
To help you create these emotions, we have expanded our existing consulting and analysis repertoire to include behavioural economic insights and methods.
If you are interested in learning how these methods work and how we can help your company specifically, feel free to contact us. We are looking forward to an exchange of ideas.