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The Continuum and the Marketplace

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In consumer business strategy – from branding to product development – addressing the emotional human needs continuum is crucial to success. Businesses that seek to create superior product/service experiences need to learn how to empathize with consumers’ needs.

Years ago, our firm conducted research at Universal Studios Florida and Walt Disney World, Orlando. At the time, Universal was searching for ways to distinguish itself from its giant competitor. Consumer deep-dive research with 14 families provided a participant mix representing the park visitor population. We followed these families observing their moods and behaviors, and discussed their impressions as they experienced the parks to determine what was really at play during a family vacation.

We take vacations to escape daily life and to provide children new experiences. Vacations satisfy our need for pleasure in an ever accelerating culture. So what happens when we escape and the work piles in our inbox? In the context of emotional needs, a theme park can mean more to its patrons than they can articulate. It’s not simply about the fun, but rather the function of the fun for the family’s growth.

One might think that the two parks are locked in a win-lose competition for Sunshine State vacationers, but that’s not necessarily true. Many families visit both parks. At one time the parks offered discernibly different atmospheres. One interview subject put it: “Disney is like sitting by a stream. Universal is like going rock climbing. Both are enjoyable, both are nature, but with one you’ve got more of that nervous adrenaline rush.”

Our researchers spent days observing how this participant’s analogy was on the money. The polarity of experiences is perhaps why some vacationers visit both parks. At the time, Universal and Disney mirrored the needs continuum. However, this has changed. They aren’t merely high-end amusement resorts that offer different thrills for families. They help families satisfy psychological needs for their children.

[wcm_restrict]Security versus Independence

From toddlers to teens, children have conflicting sentiments, a desire for the security of connectedness pulling them in one direction and a desire for the adventure of independence pulling in another. At the time of our research, the Walt Disney World experience appealed to desires for security, safety, and closeness. It always offered a fantastic experience that feeds children’s imaginations. But generally speaking, its essence nurtures a younger child’s connection in a safe and fantastic world. Disney is the quintessential ‘mother’ archetype.

Universal Studios, on the other hand, appealed to older children and their families’ desire to interact with the world, through which they gain a sense of accomplishment. By developing autonomy, children boost self-esteem. Universal Studios was perceived as edgier and adventurous — stimulating and intellectually challenging. No longer was Universal just the more exciting cousin of Disney. It was an amusement park that satisfied visitors’ needs for individuality and independence.

Recognizing this fundamental difference, Universal changed its marketing from promoting what it wanted consumers to experience to a testimonial to what the experience was already providing. No longer focusing on their marketing platform – “ride the movies”– they built a new strategy – “Experience an extraordinary escape at Universal.” Steadily, Universal made gains in gate entries.

Of course, this dynamic has changed in recent years. The Disney of decades past is not the Disney of today. Their parks are now more “Universal” in feel, entertainment and attractions. That said, the dynamic illustrates the opportunities that arise when a needs-based approach is applied to business models.

The Value of Human Needs

The process is not simply one of a business matching its product to a customer’s psychological needs. To harness the value of human needs, one must understand where people are in their life cycle. Some emotional needs are more relevant at different ages, for different genders and personality types.

We see the push and pull between connectedness and individuality at each point along the continuum. No one need is owned entirely by the individuality or the connectedness side of the continuum. For instance, consider the need for belonging, essentially connectedness within a community. So much of our daily routine consists of participating in groups. We join groups for closeness and sometimes to ‘fit in.’ To a great extent the need for belonging is not wholly consumed by the connectedness space. What we belong to is a stamp on our identity.

Consider how we categorize informal acquaintances. It’s not Dave, the guy with a unique perspective on financial markets, but rather it’s Dave, the guy from Rutgers, the big Mets fan, the one who volunteers with Habitat for Humanity. Certainly, we are not the church, synagogue, or mosque to which we belong. We are not the political party we vote for. We are not the company we work for. Or the brand of shoes we wear or the grocery store we frequent. Each group we ‘belong’ to is a distinct piece of our identity.

The Needs Continuum can only be put into action when matched with a psychological perspective that helps businesses identify consumers’ unmet needs. With the right focus, meeting unmet emotional needs can be much more than a token statement issued in press releases.[/wcm_restrict][wcm_nonmember]

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About the Author

Mark Ingwer is a business psychologist and the founding partner of Insight Consulting Group, a global marketing and strategy consultancy specializing in consumer and business insights. He has over 25 years experience applying his unique blend of psychology, marketing, and business acumen to helping companies optimize their brand and marketing strategy based on an in-depth understanding of their customers. He has worked with a diverse range of companies across numerous industries, with a special focus on consumer packaged goods, healthcare, and advertising. Mark is a frequent speaker and media source, and has been featured in publications such as Business Week, New York Times, Crain’s New York, Brandweek, Chicago Tribune, Chicago Sun-Times, Admap, Bloomberg Markets, Marketing News, and Advertising Age.

Personal Needs vs. Customer Relationships

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Many companies talk about the need to establish strong ‘relationships’ with their customers. Some compile complex Customer Relationship Management algorithms to develop and maintain these relationships. And, these companies rightly recognize that the transactional interactions of the past are ineffective in creating loyal customers.

The concept of customer relationships makes sense in the context of meeting personal needs. As in all interpersonal relationships, from friendships, to marriage, to company and client, trust and the promise of mutual benefits are the foundation for growth and development. When we put others’ needs first in relationships, we’re more likely to make those relationships work.

Emotional Needs Not Yet a Business Priority

After decades of formally documenting the stages of business-customer relationships, we’ve learned that many companies become complacent in their endeavor to understand, satisfy, and embrace the emotional needs of consumers. Companies understand the meaning of ‘relationships,’ but rarely consider what it takes to make their audiences’ needs a priority. They seemingly cross their fingers hoping that what brought customers to their company will cause them to be loyal. Just as in most human romantic relationships, business-to-consumer relationships fall apart when one party (the business) fails to track the evolving needs of the partner (the consumer). The challenge of sustaining long-term value pushes businesses toward considering short-term relationships as the easiest route to profits.

[wcm_restrict]Indeed, if a department attracts new customers, it wins the lion’s share of the marketing budget, but it is well documented that it costs some companies five to ten times more to attract new customers than to retain an existing one. On the other hand, if companies sustain relationships with existing customers, a mere five percent decrease in annual defections can lead to a 25 percent to 125 percent rise in profits. Another way of crystallizing these figures lies in a social reality of the Internet era. When we are satisfied with a product or service, we may tell three friends, but when we are dissatisfied, we’re inclined to tell (or Tweet) it to three thousand.

Even when brands claim to desire lifetime relationships with customers, many tactically distance themselves from the humanity of their interactions. The systemic nature of marketing strategy depersonalizes their audience by using language that groups customers into segments and tar¬gets. People are commonly referred to as ‘buyers,’ ‘shoppers,’ ‘payers,’ ‘non-responders,’ ‘early adopters,’ and ‘eyeballs.’ What is too often lost is the nuance – human.

The routine marketing logic follows a self-sustaining strategy: measure category and purchasing behaviors, shoot a creative mix of emotionally salient messages and rational pleas at the targets, place all bets on marketing science, and presume the targets can’t help but consume. But if we truly view consumers through the lens of relationship dynamics, we’ll learn that, whether we are working, shopping, or engaging with friends and family, our psychological needs are a constant driving force. Understanding and putting this into practice strategically will eliminate the artificial two-way mirror between daily life experiences and the ways businesses communicate.

The Powerful Role of Trust

Customer relationships, like interpersonal relationships, are built on trust. And if trust is lost, the relationship is lost as well. Marketing scholars Jennifer Aaker and Susan Fournier reveal how closely business relationships and interpersonal relationships mirrored each other in an Internet-based psychology test. Over a two-month period, the researchers measured the evolving strength of their relationship with customers as they were introduced to an online film processing and digital library business. The participants were told they had been selected for a pilot program before the business was to be opened to the public. They were told to take pictures and use the website’s services at their pleasure, evaluating the experience along the way. Some participants interacted with a version of the website that used exciting, amped-up marketing language. Other participants engaged with a company that was more down to earth, personalized, and directed at forging a sincere dialogue.

The Sincere Company

Aaker and Fournier found that relationships with the ‘exciting’ company had the trajectory of a short-term fling, while those involved with the ‘sincere’ company developed a relationship that deepened over time. The sincere, relationship-oriented business had raised consumer expectations of the service quality and built loyalty to the website. If the company delivers as promised, there is no question that the personal touch will keep cus¬tomers invested in the experience for a long period of time

Yet there is one caveat to the research that speaks to the irony and complexity of consumer decision-making. When the researchers imposed an unexpected service failure within the experiment—e.g., “Sorry, but we lost all your film!” — relationships with the users interacting with the sincere business were harmed the most. Why? Because when a business promotes itself as an earnest entity that truly cares about its customers, and then fails to deliver on those expectations, it does more harm than simply not delivering. “Trust is much heralded in marketing, but it has a downside,” said Aaker in an interview for Stanford Graduate School of Business (GSB) News. “What needs to be understood and managed are the contracts, norms and rules that underlie the relationship between a consumer and brand, and how a brand’s actions fit or violate those norms.”

Businesses must reestablish the emotional trust that is destroyed when they transgress, be committed to following through on promises, and be prepared to stand by that attitude when crisis strikes. In the days following the British Petroleum (BP) oil spill, how many times did we hear executives tell the public not to worry? While Chief Executive Officer Tony Hayward haplessly expressed how much he’d “like his life back,” BP was writing a 187-page legal report that pointed fingers at third-party contractors, tacking an asterisk to every apology. Perhaps they should have known that what won’t work with a friend or loved one won’t work for an angry public either.

The Deceit of Satisfaction

On the surface, one might think that meeting needs is purely about satisfying the consumer. It’s hard to deny that sentiment but what needs to be done is a realigning of the definition of satisfaction with what makes us deeply satisfied. Of course, companies are trying to interpret and meet emotional needs but it is questionable whether traditional consumer research methodology is capable of measuring true need satisfaction. Consider these two points:

  • Roughly 80 percent to 90 percent of new products and services fail or drastically fall short of sales expectations in their first year.
  • Customer satisfaction is used by 90 percent of companies as a benchmark for success. Overwhelmingly, most companies report that their customers like their products just fine.

What’s at play with this apparent contradiction? One reading of the product failure data is that there are too many products in the marketplace. And, in most cases of failure, advertising and marketing efforts aren’t successfully connecting emotionally with consumers. But the customer satisfaction benchmark is confounding. If everyone says they are satisfied, why do most new products fail?

Surveys Fail to Predict Repurchase

As it turns out, positive consumer satisfaction surveys are neither a predictor of repurchase nor an indicator of whether emotional needs are met. Most companies go only so far as to ask whether their clientele is satisfied with their ‘experience’ – most customers say “yes.” The marketers congratulate themselves, only to find later that the same ‘satisfied customers’ went elsewhere the next go-round.

Again, the mental process that occurs during a customer satisfaction survey is typically a rationalization of past experience. The brain quickly evaluates the individual’s expectations of the product, and if they were in the ballpark, the product is checked “satisfactory.” A one-time purchaser of an electronics brand may never tell a researcher, “It worked well enough. I was satisfied. But the design and overall feel just didn’t enhance my deep-seated feelings of identity and autonomy.” The consumer may have appreciated the product, but if his or her unarticulated emotional needs went unmet, the appreciation means virtually nothing for a business trying to form a base of loyal buyers.

This is a problem for businesses using a logical, traditional process to study the emotional issue of satisfaction. If a business is going to learn about an emotional issue, it needs to study the issue with a method sensitive to emotion. At the end of the day, businesses must see their customers as individuals who are always striving for a healthy sense of self-identity.[/wcm_restrict][wcm_nonmember]

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About the Author

Mark Ingwer PhD is a consumer psychologist and the managing partner of Insight Consulting Group, a global marketing and strategy consultancy specializing in market research and consumer insights. He has over 25 years of experience applying his unique blend of psychology, marketing, and business acumen to helping companies optimize their brand and marketing strategy based on an in-depth understanding of their customers. He is the author of the book, Empathetic Marketing published by Palgrave.