The Customer Loyalty Loop Page 6
In Stage One, the real secret is about learning how to tell your story in a way that implants a positive movie into the potential customer’s head and makes them want to maintain their interest in you and ultimately do business with your company.
There are some ways we can accomplish this proactively, and we’ll discuss a few of them. Also, I’ll discuss the science behind why this works and provide action steps so you can look at your efforts at this stage and make immediate improvements.
One of the ways we can accomplish this is through a concept called preemptive marketing.
Preemptive Marketing
One of the greatest marketing breakthroughs of our time came from a strategist by the name of Claude Hopkins.3 Here are two crazy things you might not know about this: One, this sales and marketing breakthrough occurred back in 1919, and two, it’s hardly ever used today, even though it’s more relevant than ever with the rise of social media and new tools for digital storytelling. It’s one of the most powerful marketing techniques you could ever employ. Further to that, it’s crucial in the first stage of the loyalty loop. Here’s the story.
The Schlitz beer company needed help. In the late 1800s, Schlitz became known as the beer that put Milwaukee on the map, but after the turn of the century, the sales for Schlitz began to drop. They were getting crushed and losing market share in an increasingly competitive marketplace. They felt that they had a fantastic product, but it was becoming harder and harder to compete because everyone was selling the same product. The product became commoditized, or so they assumed, but they knew they needed help, so they took the plunge and hired a fantastic consultant by the name of Claude Hopkins. A quick note of shameless self-promotion here: it’s important to hire great consultants. (Like me!)
Hopkins was the Don Draper of his time. He traveled to the Schlitz factory to meet the executives and toured the facilities. As the executives took him on what was probably a pretty standard tour of the brewing facility, Hopkins was amazed at everything he saw. For example, he noted that the factory sat on the edge of one of the Great Lakes, where water flowed into four large basins, feeding the plant with an endless supply of clean water. As the tour continued, he was shocked at the love and care that went into producing what had seemingly become an undifferentiated commodity. Schlitz, for example, showed Hopkins its research center where the company was performing thousands of experiments on yeasts to perfect the quality and purity of the final product. He saw the bottle-cleaning area, where bottles were washed a minimum of 12 times to remove all the impurities from the bottle, resulting in the best-quality beer they could produce. He noted that many of the scientific testing areas were encased in glass with air purification filters and workers adorned with lab coats. All of this was done to protect the product from impurities getting into the beer. When Hopkins finished the tour, he was stunned and asked the executives, “Why aren’t you telling your customers about this?” And they responded, “Because all beer is made this way.” Hopkins thought for a moment and said, “You’re right, but nobody is telling the public about this.”
Almost every product and service is a commodity to an extent. There’s very little differentiation between most products and services. In fact, most companies sell products that are very close in quality, at similar prices, to a similar audience, using similar advertising. In a nutshell, companies do struggle to differentiate themselves.
Hopkins recognized the power of telling your story before anyone else could in a way that stoked a fire inside your prospect’s mind. Jay Abraham, one of the greatest marketing experts of our time, has called this the concept of preemptive marketing.4 Preemptive marketing is about everything that happens before the sale—the ability to implant a story in the customer’s mind, before persuading them to buy. While most companies are waiting for prospects who are ready to buy, preemptive marketing is about building the trust, the relationship, and story long before your competitors have even had a chance to influence the potential customer. This creates an unfair competitive advantage, and it’s available for you to use right now. Hopkins went on to create messaging for Schlitz around the concept of purity. Every beer manufacturer was calling their beer pure. But what Hopkins did was different. What he did was explain why and how the beer was pure. For example, one ad explained that the Schlitz’s brown bottle provided an extra level of security against sunlight, which would spoil beer in lighter bottles. Were others using brown bottles? Sure, but nobody else was explaining why. Another ad urged consumers to ask their doctor about the purity of Schlitz beer—because “He knows the importance of purity.”5
What does science tell us about preemptive marketing, and why does it work? Is there any research to back up why preemptive marketing has an impact? For this, we look to the work of one of my favorite social psychologists and his work on happiness. A Harvard social psychologist and author of the book Stumbling on Happiness,6 Dan Gilbert provides us with an interesting insight as to why this works, the way it does, and how we can further take advantage of preemptive marketing. Gilbert says that “people believe everything they read or hear—whether truth, fiction, or outright lie—when they first read it or hear it. It is only afterward they may come to disbelieve it.” In a nutshell, people believe everything at least for a second. Preemptive marketing allows you to be first to plant a story in the customer’s mind, and it’s a powerful concept we can all use. That’s not to say we’re planting truth, fiction, or outright lies, but we can be in charge of telling our story and ensuring it’s the one that differentiates us from our competitors. More so, the repeated use of those stories makes everything even more believable.
Think of the concept of preemptive marketing as your opportunity to plant the seed of imagination and a memory inside your prospective customer’s head before your competitors even have a chance at getting their attention. Too many branding, advertising, and marketing companies are obsessed with trying to get some moment of awareness through all that noise. They talk about eyeballs! We need more eyeballs—more eyeballs! A far more effective route is to carefully consider the memory you want to implant and work toward doing that. To do this, you need a story and that story needs to be compelling enough for the prospect to pay attention.
Consider the following thought experiment. Put yourself back in London in the early 1900s and you’re reading the newspaper. You’re flipping through while sipping your morning tea. The sound of your favorite British police sirens (eee arr, eee arr, eee arr!) can be heard in the distance. There’s a cool breeze coming through the window. As you quickly flip through the classifieds only glancing at the page, something catches your eye. You spot the Shackleton ad we discussed at the start of this chapter. An ad that’s only 26 words long, just slightly too long for Twitter, with no fancy graphics, just plain text, but one that stops you in your tracks. This advertisement accomplished what many of the ads in that newspaper were likely unable to achieve. It got your attention by planting a story in your head—a story of adventure, the unknown, the ability to become a hero and a legend. We can get our prospect’s attention in a lot of ways, and that’s why attention is an inadequate label that comes from the traditional lifecycle—because attention is in short supply. You can whack a hammer on a desk to get someone’s attention. You can say something provocative and edgy, and that might do it. But there is a far more effective way, and that’s to get the attention that matters.
We have a window of opportunity to plant the seed of memory and to tell a story. Stories are emotional, and they create a reaction. That’s what Shackleton did with this ad, and that’s what Hopkins did with Schlitz beer.
Why does this work?
Think about how you would have reacted if you had seen the ad. You would have created images in your mind about what an expedition like this would be like. It would have likely encouraged you to have images of adventure, danger, challenge, heroism, and achievement. Note that the ad threw out a few ideas like danger and honor and let you, the reader, do the rest
. In other words, the ad made you make up your story by giving you a few keywords. Moreover, not only did it spell out what the job was—a dangerous expedition—it spelled out the “why” of the job—honor and accomplishment, with a little heroism thrown in for good measure.
The ad also plays on several cognitive biases. One of these is the fear of loss. The ad specified “men wanted” but it didn’t mention how many. Clearly this wasn’t intended for everyone, and there would surely be competition for places, despite, or perhaps because of, the difficult conditions and low pay. In fact, the ad implies that only a special sort of man could make the cut—those who didn’t mind the danger, difficult conditions, and were more interested in adventure and honor rather than money. In a subtle way, it defined an in-group, and which self-respecting man wouldn’t want to be part of it?
Moreover, the fact that the pay is low can be seen as an advantage. This job is about adventure and honor, and no amount of money can buy that. If it were a standard position, the low pay would be a disadvantage, but here it just highlights the special qualities and real appeal of the opportunity.
Also, this is likely to be the first time you have seen a job like this advertised and as such “anchors” all your future exposure to similar ads. So, let’s suppose the next day you saw an ad for an expedition to another part of the world; you would automatically recall this original ad, which would influence your thinking and your decision about the new one.
As you can see, there are some important factors that impact the power of preemptive marketing. But what if there was another powerful tool that we could use, one that could dramatically impact the customer experience before it even happens? Well, it turns out there is, and that’s the concept of anticipated memories.
A Simple Thought Experiment
Do the following thought experiment with me: I want you to think about your last vacation. I don’t mean your last business trip, but a real, relaxing vacation.
Perhaps you traveled to the Caribbean, where you spent your days lounging on the white sandy beaches of Aruba. Maybe you set sail on an Alaskan cruise, where your time was spent enjoying the sights of the Alaskan snow-capped mountains, or enjoying hot coffee on the ship’s balcony while watching moose and grizzly bear wandering the riverbed or the occasional bald eagle sighting. Perhaps the days passed by as you toured the vineyards of the Bordeaux region of France, sipping some of the finest wines your lips have ever tasted. I want you to close your eyes for a moment and take it all in.
Take as long as you need.
Try to remember the sights, the smells, and the feeling of the breeze on your skin. Remember the tastes of foods you tried for the first time, or the sand between your toes. Come back when you’re done. Don’t worry; I’ll still be here.
In the few short moments it took you to complete that exercise, something fascinating happened inside your mind. It was something so profound, so powerful, and yet highly applicable to your business. What just happened, within seconds, inside that blob of jelly in your head, can drastically change how business is conducted and how organizations operate. What just happened has significant ramifications on your ability to market your business effectively, maximize customer value, and build intense customer loyalty.
Now here’s something even more interesting! If you didn’t close your eyes and do the exercise that I told you to do, you still, technically, completed the task.
Here’s what I mean.
What happened with an almost incalculable speed is that your brain just processed through billions of tiny bits of information in an attempt to piece together a memory of your last vacation. Scientists or neurologists call this the process of recall or retrieval. Your brain used bits, pieces, and fragments of your entire vacation—whatever pieces it could pull together quickly—to create a few mental images of your last trip, snapshots if you will.
If you did complete the exercise, then you undoubtedly remembered a few very distinct and memorable things about your trip, and you could probably see certain moments replayed in your head. Your journey might have been last week—and the memories are still really fresh, or it might have been three years ago (if so, you need to take more time off!). It really doesn’t matter; the same thing happened.
Now you might be wondering, “How can my recent trip to the beach exponentially change the way my organization operates?” Or perhaps you’re curious how your memory can help you create a more profitable company. Then again, maybe you’re just thinking, “Noah, what on earth does my last vacation have to do with customer experience, customer service, and customer loyalty?” I want to show you how with a simple understanding of anticipated memories, you can create an almost unfair advantage when it comes to maximizing your company’s potential. But before we do that, we need to look at one of the most fascinating medical studies ever conducted and its implications to our discussion.
Dr. Martin Seligman, in his classic book Authentic Happiness, writes about an experiment involving colonoscopies:
682 patients were randomly assigned to either the usual colonoscopy or to a procedure in which one extra minute was added on at the end, but with the colonoscope not moving. A stationary colonoscope provides a less uncomfortable final minute than what went before, but it does add one extra minute of discomfort. The added minute means, of course, that this group gets more total pain than the routine group. Because their experience ends relatively well, however, their memory of the episode is much rosier and, astonishingly, they are more willing to undergo the procedure again than the routine group. In your own life, you should take particular care with endings, for their color will forever tinge your memory of the entire relationship and your willingness to re-enter it.
Before I tell you why this study is important, listen to this: Nobel Prize winner Daniel Kahneman, the author of the New York Times bestseller Thinking, Fast and Slow, who we’ve already talked about, coincidentally shared the same study in his own book and when he took the stage at the renowned TED Conference. I have no doubt Seligman’s work influenced Kahneman and vice versa, but it’s more fun to call it a coincidence.
Here we have two psychologists who were attempting to teach us about the inner workings of the human mind. One was studying the brain and happiness, and the other was studying how humans think and make decisions.
Now I already told you this, but I’m not a psychologist, and I don’t play one on the Internet (or in the books I write), but here’s why this matters: both of these psychologists had inadvertently stumbled upon one of the most profound business lessons ever.
Let me explain: These studies show us why customers choose to do business with one company over another. The study also shows us why they continue to do business with a business over time and why they may choose to end the relationship early, or even come back to a business after a length of time.
In a nutshell, they had discovered the secret to not only getting a new customer but how to keep them—two major issues and challenges for any business on the planet.
I’ve shared this fascinating medical study before. But on those occasions, I discussed how we could ensure customer and client relationships ended as positively as possible with our greatest percentage chance of being able to bring a lost customer back through customer reactivation efforts. It wasn’t until I made the connection between Kahneman’s and Seligman’s different takes on the study that I recognized the greater implications of this research.
What this study teaches us is that contrary to the belief of marketing experts, authors, college professors, and consultants everywhere, it is not the customer’s experiences that create a customer for life, or even a repeat customer, but rather it’s the customer’s memory of the experience. Think back to the cognitive biases we discussed earlier where we showed research that suggests that the memory is the experience. It’s not what happened that is critical; it’s the points that we remember that are essential. And those points will be heavily influenced by the strongest emotions we recall. So
if the last part of a colonoscopy allows you to experience relief, you will have an overly positive memory of the event because it has been colored by the sense of the relief and the reduction in discomfort. And further to that, it’s not your sales or marketing that gets you a customer in the first place; it’s the imagination of the expected experience your customer has in relation to doing business with you. This relates back to the preemptive marketing we just discussed in the previous section.
Now you might be thinking to yourself, “wait a minute, Noah—what’s the difference between the customer’s experience, and the memory of the experience?” There’s a huge difference. Customer loyalty becomes a function of memory, and as you’ll see, even a great experience can be jaded by the reminder of the wrong memory. We don’t recall a perfect memory; in fact, as one author wrote, “not only are memories capable of being retrieved, they are also capable of being reconstructed.”7
So here’s what I’m suggesting: Contrary to industry norms, the most important thing your organization is selling is not a product or service, it’s not the benefit derived, and it’s not even a great customer experience. But rather, it’s the memories created that resonate and stick in your customer’s mind—the ones that remain to be recalled and retrieved at a moment’s whim—before, during, and after the sale! There’s a fascinating distinction between the experience and the memory of the experience.