One of the main trends most companies are investing in within today’s competitive landscape, which has been widely affected by the advent and development of the digital era, is customer experience, a proven most profitable, better results yielder, and effective strategic asset. As commonly referred to, customer experience focuses on the experiences and attitudes your customers develop when interacting with your business, and it is demonstrated that building and relying on positive experiences deliver an overall improved performance compared to traditional and outdated strategies, such as conventional communication campaigns and programs.
Intuitively, building an outstanding experience for your customers mainly deals with evoking and orienting positive emotions, arising from every interaction they have with your company. As a consequence, your customers’ emotions play a major role and are the forefront in customer experience, neglecting them or taking them out of the equation in building all your customer experience efforts would be risky and detrimental. Most companies focus their strategic goals on improvements of the functionalities of customer experience, such as responding to their customers in a timely manner, while disregarding the power emotions hold in providing unique and inaccessible differentiators. From this perspective, adopting a customer experience strategy backed up with your customers’ emotional roots acknowledgement would grant an inimitable competitive advantage. Emotions convey the potential for your company to differentiate and it will definitely inspire your customers, undeniably impacting on retention, acquisition, generating customer advocacy and most importantly on their loyalty.
Given the considerable opportunity to create new value through this virtuous cycle, where a positive customer experience is nourished by emotions and would end up increasing customer loyalty, your business cannot neglect to include emotions and emotional connections within its strategy.
Why emotions and emotional connection matters?
Customer loyalty can be defined as your customers’ attitudes and behaviours in favouring your business and brand over your competitors because they perceive that your company is satisfying their needs and requirements better than other alternatives on the marketplace. Customer loyalty is particularly relevant, especially if you consider Pareto’s law: it is demonstrated that 20% of your existing customers generate 80% of your revenues. The reason is that a customer who has already been satisfied by your offering and the collateral activities stemming from his or her purchase, such as an impressive customer service, is most likely to reiterate the purchasing behaviour, preferring your brand over your competitors’, and maybe recommending it, ultimately entering brand advocacy.
Furthermore, when it comes to customer loyalty, three main components can be identified: behavioral loyalty, which relies on customers’ likelihood to repurchase a brand; rational loyalty, which concern customers’ tendency to weight up the value of the product or service to make calculated decisions concerning the purchase; emotional loyalty, which is based on psychological preferences rooted on affective attachments. One out of the three components has a wider influence on customer behaviour, and it is the only one that would secure your company over the competitive landscape fluctuation, since it is the most powerful and would grant your customers to remain loyal to your business regardless of price, convenience or other circumstances, because your customers would develop a personal connection with your company. Emotionally loyal customers have an effective and purely instinctive connection with your company, whether the behaviorally loyal customer may be led by a lack of alternatives, and the rationally loyal customer is led by seeking the best value over the market.
Emotionally loyal customers are most likely to repeat their purchases even if alternatives are presented, try out your new products or services, trust your company, forgive your company eventual mistakes, and most importantly to advocate your company to their peers. Moreover, it is demonstrated that emotional loyalty has greater longevity and that there is a certain degree of legacy in emotional loyal customers, which would end up transmitting their purchasing preferences to their relatives. Therefore, align your strategy and nurturing your customers’ emotions across channels within your customer experience efforts, would ultimately drive your customers’ most profitable behaviours, impacting on your revenues and market shares both in the short and in the long run, forging a powerful, inimitable, and long-lasting relationship with your consumers.
Which emotions should be evoked and which ones avoided to impact on loyalty?
It appears clearly that how customers feel and perceive the interactions and experiences they are having when dealing with your company has an impact on their loyalty towards your business. Customers can be considered as emotionally loyal and connected to your company when it aligns with their needs, expectations, and motivations, supporting them in fulfilling their desires. Hence, customer emotional loyalty necessarily comes from the emotional response the customer develops from a business transaction with your firm. Namely, there are five main positive emotions, meaning driving loyalty, and five main negative ones, as weakening loyalty.
Customers feeling valued, appreciated, confident, respected, and understood, perceive that the company has outperformed their expectations, responded to their needs, and solved their eventual pain points, offering a unique solution. Therefore, they are more inclined to repeat the interaction in the future, because of their positive experience with your company, and they are most likely to recommend your business to their network. These emotions are good indicators of loyalty since it is demonstrated that they drive repeated purchases and advocacy, while also impacting on trust and on the availability of forgiving your company’s eventual mistakes.
On the other hand, customers who feel angered, annoyed, disappointed, frustrated, and neglected, develop such negative experience that they would tend to avoid future interactions, considering twice about doing business with your company again, if not staying simply indifferent to your brand and offerings. As a consequence their customer loyalty would remain unvaried, or jeopardized for good, implying they will not reiterate their purchasing behaviours and that they would rather not recommend your company, unless they would opt for generating a bad word-of-mouth, discouraging their peers in interacting with your company.
Adopting and embracing an emotional-connection strategy when investing in customer experience is a managerial imperative. However, this strategy should be undertaken across all organization. It requires extensive consumer insights, analytical capabilities, and a considerable commitment to align your company with your customers’ emotional contexts.
Your company should first start measuring and identifying emotions in customer experience, through statistical analysis and key metrics that define critical influential emotions, which has the highest impact on your customer relationships and experiences. In order to conduct such an analysis, your company could start tracking sentiments in Voice of Customer Data, mining customers’ feedbacks, questions, and words used when interacting with your business. These techniques would secure your company with profound understandings of your customers’ emotional context. Secondly, your customers’ emotional connections should be scored and classified, according to the most likely to generate profitable behaviours, opting for the ones yielding the highest potential gains. By proceeding through a system of trials and errors, your company could constantly experiments with these emotional connections, investing in repeated improvements. Finally, to maximize emotions’ potential and opportunities, your organization has to be fully committed across functions and focused on delivering the positive emotions throughout the customer journey, from stores to omnichannel experiences, merchandising, and message targeting.
The latter is particularly important, and would be scrutinized in the next issue, since personalization is the most profitable way to address and embrace customers’ emotional connections, and it could be scaled up to reach an outstanding overall customer experience, positively impacting on your overall performance, and ultimately granting your company a long-lasting competitive advantage.