Idea 25 addressed the potential for developing an ethical business or brand and the critical role that alignment plays in creating such an enterprise. It discussed research findings highlighting the importance of aligning the values of the business or brand with those of people within the target audiences. In Idea 25, I note that aligning […]

Idea 25 addressed the potential for developing an ethical business or brand and the critical role that alignment plays in creating such an enterprise. It discussed research findings highlighting the importance of aligning the values of the business or brand with those of people within the target audiences. In Idea 25, I note that aligning the values of a business with those of its target audiences requires a deep understanding of the values of the target audience.

Developing a deep understanding of the target audience involves getting close to that target audience. Idea 26 further addresses the importance of getting close to target audiences, the benefits of doing so and strategies for doing so. Moreover, it addresses the importance of businesses developing an empathetic relationship with their target audiences, with the core proposition being:

• Marketing is entering an age in which ‘marketing with empathy’ will become a hallmark of successful marketers.

Marketing with empathy has an essential role to play in maximizing the lifetime value of each customer and minimizing the cost of marketing to those customers.

EMPATHY-BASED MARKETING

The logical starting point for this discussion is to define empathy, marketing-based empathy and the stages in developing and applying empathy-based marketing.

1. Walk a mile in their shoes – empathy can be the key.

Research suggests that as many as 85% of human beings suffer from low self-esteem at one time or another. Understanding this, Dove (the soap brand) ran a campaign in 2013 called – ‘Real Beauty Sketches.’ Using a video campaign, Dove considers how women and men tend to struggle with low self-esteem.

A woman describes her facial features to a sketch artist who is behind the screen. Immediately after this, a second person is asked to describe the same woman while the artist sketches another portrait. When presented with both the results, the portrait based on how the second person saw the woman made her look much younger, more beautiful. And more likeable than the one sketched using the self-description.

The campaign had the tagline ‘You’re more beautiful than you think’ evoked quite an emotional response from the viewers, without even once mentioning or showing any of its products. The response to the campaign was extraordinary. Online view exceeded 8 million, and sales spiked.

This is widely considered a successful example of empathy-based marketing. It tapped into the tendency for the target audience members to suffer from low self-esteem and gave them hope that they may look younger and more beautiful than they thought they did. It also sold Dove soap without ever mentioning the brand.

Tap into the emotional beliefs of your target audience.

2. Incorporate authenticity and honesty with empathy.

The importance of authenticity and honesty to effective branding is addressed in IDEA 24. Research suggests that 90% of millennials believe authenticity is important when deciding to support a brand, compared to 85% of Gen X and 80% of Baby Boomers. Another study found that 59% of shoppers prefer to buy from the brands they trust, honestly being a key driver of trust.

Research has also highlighted the importance of empathy in marketing and branding while reporting that only 30% of marketers were proficient in experiencing the world from someone else’s. One study found that ‘18% of consumers had stopped using a brand in the last 12 months because of the gap between marketing and experience, with 32% believe the gap is widening. Overall, this gap represents a fundamental empathy deficit among brands out of touch with what it feels like to use the brand.’

Empathy is important in marketing and in life – but what is it?

Academic Brene’ Brown defines empathy as – ‘communicating that incredibly healing message of – you are not alone.’ Offering a more practical definition, the Oxford Dictionary defines empathy as – ‘the ability to understand and share the feelings of another.’ In essence, empathy is ‘feeling what others are feeling’. It involves much more than understanding what others are feeling, and unlike sympathy, it does not involve feeling sorry for someone.

Empathy brings a business much closer to its customer than understanding ever will. It is all about getting closer to your customer.

Move beyond understanding and develop empathy for your target audiences.

3. Establish a partnership with your target audience?

Put simply, ’empathy-based marketing’ involves ‘walking in your customer’s shoe.’ It involves going beyond understanding your target audience to actually feeling what they feel.

Empathy based marketing is ‘state of the art’ thinking when it comes to connecting with the target audience. It involves:

• Embracing the customer’s experiences.
• Thinking like the target audience.
• Looking for ways to make customers lives better.
• Understanding what motivates the audience.
• Helping audiences solve problems.

Empathy based marketing is often manifested in:

• The content published and provided to audiences.
• The customisation of marketing messages.
• The nature of the customer experience.
• Empowering employees to directly touch customers.

Empathy-based marketing involves truly connecting with customers and potential customers – on an emotional level. Its ultimate form involves entering into a partnership with the target audience – whereby the parties work together to exchange maximum value. It is a genuine recognition that marketing is or should be all about the customer.

Get close enough to your customers that you can establish a mutually beneficial partnership.

4. Move through the stages of empathy.

It has been suggested that there are three stages of empathy-based marketing – Cognitive, emotional, and compassionate.

COGNITIVE EMPATHY

Cognitive empathy involves understanding the emotional state of the target audience. This most often involves listening and market research. This equates to UNDERSTANDING – an issue discussed in more detail later in this article.

EMOTIONAL EMPATHY

Emotional empathy involves connecting with the target audience emotionally – engaging with the target audience and sharing emotions. This equates to ENGAGEMENT – an issue discussed in more detail later in this article.

COMPASSIONATE EMPATHY

Compassionate empathy involves taking action to address the emotional state of members of the target audience. It involves encouraging action from the audience. This equates to MANAGEMENT– an issue discussed in more detail later in this article.

The critical point here is that empathy starts with understanding, requires engagement and, when fully formed – facilitates action. Once marketers feel what the audience feels, managing the behaviour of the audience becomes simpler and cheaper.

Move yourself through the three stages of empathy.

5. Develop the mindset for empathy-based marketing.

Empathy-based marketing can deliver significant benefits to a business or brand. Some of these benefits are discussed in the next section of this article. Empathy-based marketing is not, however, a simple marketing tool. It is a complex approach to marketing, and the benefits will only follow if it is implemented over an extended period. Moreover, empathy-based marketing involves more than new skills. It requires a specific and sustained mindset.

Empathy-based marketing involves the long-term implementation of strategies (some of which are discussed in the last section of this article) that can deliver and maintain a connection between the business and its target audiences. It involves a long-term commitment to understanding, engaging with and managing the behaviour of the target audience. It most certainly requires a commitment to this cause by all customer-facing staff.

The mindset required to establish an empathy-based approach to marketing involves:

• An absolute orientation to putting the customer first and the benefits this offers.
• A total commitment to understanding consumer behaviour.
• An absolute commitment to engaging with the target audience and genuinely listening.
• An absolute commitment to customising and personalising all marketing.

Mark Cuban, the venture capitalist, once suggested that before he invests in a business, he has to feel assured that the business owners and managers know that ‘the customer owns their ass’.

Understand that ‘your customer owns your ass.’

THE BENEFITS OF EMPATHY BASED MARKETING

Empathy based marketing is growing in popularity, and it is doing so for an excellent reason. It delivers a range of benefits – from improved sales and margins to lower marketing costs.

6. Walk a mile in their shoes – then you might understand them.

According to the National Autistic Society, 99% of people in the UK have heard of autism, but only 16% understand the condition in a meaningful way. I suspect it is no different in Australia.

To increase the understanding of autism among the broader population, The National Autism Society developed a VR-driven campaign. The campaign and resulting VR experience enabled users to experience what it is like for a child with autism to navigate a busy shopping centre. Showing flickering lights and overwhelming sound – the video effectively highlights the sensory overload in busy and stressful environments.

Unlike other charity strategies that raise sympathy or compassion, this approach puts the viewer in someone else’s shoes – shocking them with the disarming reality of dealing with autism. It enables the consumer to gain a greater insight into how the autistic child feels in a shopping centre. This, in turn, creates a more profound sense of connection. Even watching somebody else have the VR experience provides enough insight to evoke genuine empathy and emotion.

Empathy is all about connection, getting closer to an audience, feeling what it feels and enabling a more informed reaction. While this example is different from that facing most businesses, the point is clear. If businesspeople can better understand their customers and walk a mile in their shoes – they will be better able and more inclined to develop products they engage with.

Walk a mile in the shoes of your customers and try to feel what they feel.

7. Establish the empathy required to build the trust that builds loyalty.

Research suggests that 81% of consumers need to trust a brand before buying it. Other research suggests that the factors driving trust in a brand include:

• The customer experience.
• Social media commentary.
• Brand authenticity.
• Brand transparency.
• Social responsibility.
• Brand consistency.

This same research suggests that central to addressing these factors and being in a position to build trust, there is a requirement for businesses to:

• Understand customer sentiment.
• Understand customer behaviour.

Understanding customer sentiment and behaviour is enhanced by getting as close as possible to the customer. The capacity to build trust in a brand is facilitated by having the empathy for customers and potential customers that delivers an understanding of their sentiment and behaviour – and this, in turn, can facilitate building trust in the brand and, therefore, sales and loyalty.

Get close to your customers and develop the empathy required to facilitate trust. 

8. Establish the empathy required to define the quality that delivers brand loyalty. 

Research suggests that the three most important considerations for consumers buying a brand for the first time are:

• Quality – 85%
• Convenience – 84%
• Value – 84%

There would be no surprises here for many readers, although many would want to add price to the list. My concern about this list relates not so much to the absence of price as a factor nominated in the top 3, but rather the three big questions begged by this list. They are:

• What constitutes quality?
• What delivers convenience?
• What delivers value?

While many readers might think they know the answers to these questions, my research over 30 years suggests that most don’t. Indeed, my research suggests that few consumers can articulate a definition of quality. Quality, convenience, and value are emotive, subjective and very hard to define. They are rarely defined well-using intuition or market research. The only way to reliably answer these questions is to get very close to customers and develop the empathy required to determine precisely how customers feel and what they want.

It is essential to truly understand the customer and how they feel to define quality, convenience, and value. This, in turn, requires empathy, an empathy that can only be achieved by getting close to customers utilising gathering insights and engaging in co-creation.

Get close enough to customers and potential customers to maximise brand loyalty.

9. Stop focusing on sales and start focusing on customers.

Convert a prospect, and you will achieve a sale. Convert a human being and deliver as promised (or perhaps even exceed expectations), and you will almost certainly achieve multiple sales. Stop looking at sales and start looking at the lifetime value of each customer. Consider:

• Repeat customers spend67% more in months 31-36 of their relationship than they do in months 0-6.
• Repeat customers spend 300 timesmore than first-time customers.
• Referred customers are four timesmore likely to purchase.
• Referred customers have a 37%higher retention rate.

Central to maximising the lifetime value of a customer is establishing a solid relationship with each customer. According to recent articles in Forbes, developing long-term solid relationships requires:

• Being a credible resource and source of information.
• Being seen to be open, honest and transparent.
• Delivering as promised at every touchpoint.
• Eliminating surprises and delivering certainty.

This article goes on to highlight the importance of:

• Treating clients as ‘more than clients.’
• Rewarding loyalty.
• Delivering the vision of a partnership.

The last three factors are all about empathy. Getting close enough to the customer to deliver these three factors will go a long way towards delivering the other antecedents of a long-term relationship. Developing a long-term relationship with each customer is central to maximising the lifetime value of each customer.

Develop the empathy required to establish the relationship required to maximise the lifetime value of each customer.

10. Use empathy as a low-cost tool for reducing marketing costs.

Recent research found that it costs five times more to acquire a new customer. Another study found that while the profitability of a new customer is 5 – 20% on average, the profitability of an existing customer is 60 – 70% – and a big part of the additional profitability is related to a lower cost of sales. Returning customers require less effort and a smaller investment.

This highlights the link between customer loyalty and marketing costs. In contrast, the previous missive in this series has highlighted the link between customer loyalty and relationships inspired by empath- based marketing. The greater the level of empathy, the better the relationship and as a result, the better the relationship and the higher the customer’s lifetime value.

Empathy can reduce the cost of marketing.

Empathy can also reduce the cost of research and development, and production. A powerful approach to empathy-based marketing involves a co-creation approach to product development and the development of the optimal customer experience. Co-creation involves – business insiders (staff and consultants) working together with business outsiders (customers and stakeholders) to develop the optimum product and or customer experience.

Co-creation is a form of collaboration and innovation that can effectively develop products and customer experiences that will minimise failures and the cost of production and marketing – while maximising conversion rates, margins, and the average sales per customer.

Use co-creation to develop an empathy that reduces the cost of production and marketing. 

An empathy-based approach to marketing can deliver significant benefits. The best strategies for establishing empathy are addressed in the remainder of this article.

UNDERSTANDING THE CUSTOMER AND POTENTIAL CUSTOMER

Empathy can and should impact marketing at three levels – understanding, engagement and behaviour management. It is essential to start by embracing empathy as an avenue to understand customers and potential customers better. Ideally, this will involve developing an appreciation of how customers and potential customers think and feel – and what they will respond to.

11. Learn from watching your customer use your product in their context. 

A business developing a new home improvement product talked to 35 participants to find out what they were struggling with within their yards. Each participant narrated a video tour of their yards using their smartphone. They specifically discussed what they liked and disliked about various products – in the content of their own back yard and their requirements.

The research team then reviewed the transcripts focusing on what consumers thought of products while seeing them active in their yards. The process enabled the research team and, ultimately, the business more broadly, to gain critical insights into how participants were thinking and identify opportunities.

A video analysis tool (Digsite) facilitated the process, making the analysis relatively straight forward. With instant transcriptions, teams were able to create video clips and share them with colleagues enabling everyone to begin the process of developing empathy for their target audience.

This example highlights the value of observing your customer interacting with and or using your product in the customer’s context – providing insights that market research might not be able to identify.

Watch your customer using your product in their context.

12. Use market research – but take care not to understand the answers too quickly. 

Henry Ford is reported to have said – ‘If I’d ask customers what they wanted, they would have told me a faster horse.’ He said this in an attempt to question the value of market research. More recently, Steve Jobs is reported to have derided market research – ‘…because customers don’t know what they want until we’ve shown them.’

I am far convinced that either man uttered either statement. However, both innovators question the value of market research – at least so far as it might be used to identify consumer needs. I agree with them and along these lines would argue that:

• Market research is not an effective way of identifying what consumers want because they generally do not know or cannot articulate what they want.
• However, market research is a potentially effective tool for identifying the problems that consumers are having or have had.

It is the role of marketers and innovators to understand consumer problems identified in market research and identify a commercially viable solution.

On the last pint, it is reported that Steve Jobs commented – ‘Give customers what they want. But that’s not my approach. Our job is to figure out what they’re going to want before they do.’ Research might then help determine the likely response to our solution.

Market research has many limitations. Response rates to quantitative research are now so low and so skewed that many are questioning its value. Consider recent political polling. The effects of groupthink and ego cast considerable doubt on the value of focus groups. That said, market research remains a useful tool for understanding customers – given that you have appropriate expectations, use the right method, and ask the right questions.

I am a fan of market research and view it as a valuable tool for developing an understanding of customers that can build empathy, especially where it:

• It examines the past and the present.
• Involves one to one in-depth interviews.
• Tests tangible propositions.

While recognising its limitations, use market research to understand customers and potential customers better. 

13. Take the time to watch consumer and study their behaviours.

An increasingly popular tool for understanding customers and developing empathy is observational research. Observational research is – a qualitative method of collecting and analysing information obtained through directly or indirectly watching and observing others in natural or planned environments.’ Zoho describes observational research as the first essential step in developing a marketing strategy.

Observational research techniques include:

• Covert – where the researchers do not identify themselves – and stand back and watch.
• Overt – where the researchers identify themselves and explain the purpose of their work.

Both approaches are used to:

• Observe shopping behaviour in-store.
• Study the customer journey and identify touchpoints.
• Identify the purchase options considered by consumers.
• See how consumers use or apply products.
• Uncover new product opportunities.
• Test and validate ideas.

Many suggest that observational research needs to involve experts with considerable training. I disagree. While it is important to know how to observe objectively, independently, and comprehensively, most informed businesspeople can use observational research. Indeed, all staff should be encouraged to and given the avenues for reporting on customer behaviours.

Use observational research to understand customers and potential customers better.

14. Embrace marketing automation – to develop and reflect empathy. 

Here are some statistics worth pondering:

• 75% of marketers report using at least one marketing automation tool.
• 9% of marketers use automation tools to improve the customer experience.
• 77% of marketing automation users report increased conversion rates.

These findings point to the growing popularity of marketing automation, its value as a research tool and the capacity of the data collected to facilitate higher sales. Businesses have the capacity to collect and may collect huge amounts of data about customers and potential customers that can be used to develop a more comprehensive understanding of:

• The customer.
• The customer journey and touchpoints.
• Customer needs and expectations.

Data of value might include:

• Instore traffic flows.
• Website traffic and dwell times.
• Email opening rates and click-throughs.
• Purchase, repeat purchase, and referral behaviour.

There is real merit in bringing this data together into a central database and then using it to:

• Fine-tune marketing strategies.
• Fine-tune media and messaging.
• Customise all aspects of marketing.

All three facilitate empathy and while the third is a powerful demonstration of the power of marketing automation. Marketing automation can reduce marketing costs and increase results for a relatively modest outlay on software and hardware.

There is virtually no business in 2021 that should not use marketing automation to gather and collate customer data and then use that data to customise strategies and implementation. 

15. Where you cannot experiment – learn from the experiments of others.

Research undertaken at Columbia University found that when presented with a choice of 24 jam flavours, 3% of subjects made a purchase. By contrast, when presented with just six flavours, 30% made a purchase.

While intuition might tell us that the more choice we offer, the better – this is just one of the hundreds of research and empirical studies that demonstrates that purchases are higher when the number of options is fewer. Research suggests that most products’ optimal number of choices is between three and seven, depending on the product category.

This research suggests two critical points:

• The power of experimentation.
• The power of consumer insights.

There are now volumes of research demonstrating the weaknesses associated with intuition and the fact that intuition is almost the anathema of empathy.

Businesses, including relatively small businesses, can readily carry out experiments of this nature. Where such research is not possible, for whatever reason, there is now a growing catalogue of experiments from Universities around the world, which can provide the data without the need for another experiment.

There is also a growing catalogue of neuro-psychology research. Consumer responses do not rely on observation or consumer reports but rather on brain activity, making it more reliable. Such research is beyond the capability of most businesses but can be readily accessed through journals and books. Neuroscience is the new frontier for experimental research in marketing.

Use consumer insights and experimentation to understand customers and potential customers. 

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