Monthly Archives: July 2009

6 Predicting consumer behavior… Brand loyalty vs. the whacky, random ways people often buy things.

Corporations spend billions every year trying to predict consumer behavior. Market research firms have sophisticated modeling protocols, ivy league PHDs and multivariate analysis to help them make sense of what is, inherently, nonsensical behavior.

Take, for example, the time my dad decided to replace his rusting Ford pick-up. He drove two hours to the Big City so he’d have plenty of truck dealers to choose from. He spent the weekend kicking tires, braving the onslaught of old-fashioned salesmen and test driving every make and model.

Then he came home in a Toyota Matrix.

Not exactly built for an over-70 demo.

Not exactly built for an over-70 demo.

He was 70 at the time! God only knows what possessed him to switch from a pick-up truck to an urban pocket-rocket. The Matrix is more suited to base-thumping car stereo blast-a-thons than my dad’s easy-listening coastal lifestyle.

No one could have predicted it.

In hindsight, I suppose you could say it was consistent with his car-buying history, which is even more erratic than his golf game. I challenge anyone to find a pattern in this list:

1968 Fiat 124 Sport Coupe

1970 Chevy Caprice Station Wagon

1973 AMC Hornet

1974 Chevy Vega

1976 Ford LTD 4-door sedan.

1984 Mazada 626

1991 Ford Taurus

1994 Ford F-150 Pickup

2002 Ford Taurus

2007 Toyota Matrix

Obviously, he has no brand loyalty. The only constant is a sedan of some kind for my mom. (I’ve decided he buys cars the same way he buys fruit… Whatever looks good, smells sweet and is on sale at that particular moment.)

You might think that’s a little weird, but research published by University of Iowa neurologist Antonio Damasio shows that most purchase decisions are almost as random as my dad’s car buying.

Damasio says marketing messages are processed outside the conscious mind. Emotions push us toward decisions we think are best for us, and we often bypass reason because experience endows us with what he calls “somatic markers in the brain.”

Somatic markers are the most likely biological basis for intuition. These pre-recorded behavior guides are based on inherited behavioral traits and formed by experience. When making decisions, somatic markers are triggered, often making reason irrelevant.

So it’s intuition and emotion that drives real life purchasing decisions. Not logic.

As Dr. Dean Shibata put it, “If you eliminate the emotional guiding factors, it’s impossible for people to make decisions in everyday life.”

On the other hand, when people are asked hypothetical questions about purchases, as in a focus group, the brain works on a much different, analytical level.

“Instead of the real reason for buying, researchers get a rationalization based on the respondent’s idealized self-image. If they don’t account for this bias, researchers are left with a model based on how people think they ought to be motivated, rather than their actual motivations.”

So beware of market research that demands a rational explanation for irrational behavior.

And here’s another thing that makes consumer behavior hard to predict… Many times we aren’t “qualitatively conscious” of our motivation. “Consumers have limited knowledge of their own values, needs and motivations that affect purchase decisions,” says Neurologist Richard Restack.

So my Dad probably doesn’t even know why he made that decision to drive home in a Matrix.

The point is, all purchases are emotional purchases.

So the next time you’re throwing together a sales presentation, you might want to spend more time trying evoke an emotional response, and less time building charts and graphs.

Reason certainly does play a vital role in the early stages of many buying decisions. But in the end, the actual purchase is entirely emotional.

Here’s an example from my own, personal experience.

I recently bought a new golf club. I’ve read a lot about the new hybrids, and I decided it was time to replace my 5-wood that was never quite right.

So I did some on-line research, studied the reviews in Golf Digest and formulated a short list of clubs to try.

All very thorough and rational.

Then I went to a demo event at a local golf course to see, feel and try them for myself. I ruled out a few right away on a purely subjective basis… what they looked like or how they sounded.

After an hour or so I had it narrowed down to three top contenders. There was very little difference between the three, that I could see. All things being equal, the brand was the tipping point.

After I went through the whole meticulous process, the somatic markers in my brain kicked in, and said “go for it. Get the Nickent. This is the right fit and a good, safe purchase.”

I didn’t choose the biggest selling brand, but one I perceived as being the more specialized upstart. The underdog with an impressive presence on tour. And the company I most admired from a business perspective.

Not exactly a rational decision, when all was said and done. It had nothing to do with the features they tout.

The point is, people are unpredictable. As marketers, the minute you start thinking you really know your audience’s hot buttons and can predict their behavior, forget about it. They throw you a curveball and go for the Matrix.

1 Garbage In, Garbage Out — How to get effective advertising from your agency.

Took a load to the local dump the other day. As I hucked yard debris and unwanted consumer goods out the back of the truck, I got to thinking about waste in advertising.

There are mountains of it, even in this age of informed metrics and marketing ROI.

As an agency copywriter I spent months — years even — working on poorly defined assignments and campaigns that went nowhere. More often than not, we simply didn’t have anything insightful to go on. It wasn’t a lack of creative juice… we always had lots of good ideas. The problem was lack of direction.

After a few rounds of constructive criticism and outright rejection, we either had to come up with a strategic nugget of our own, or continue throwing conceptual darts, hoping something would stick. Not a good arrangement, for either party.

So here’s some insider’s advice on how to work efficiently with your ad agency. It’s not rocket science. If you want the creative product to be effectively memorable, you’ll need to do your part. Most importantly, you should provide concise strategic input and stay actively involved in the planning phase of the advertising process.

Because it really is a case of garbage in, garbage out. And there’s already too much garbage out there.

yorba_linda_landfillAvoid the landfill with a good Creative Brief.

Every agency has its own version of the Creative Brief. Creative teams rely almost entirely on this document, so the only way you can be sure your ads will be on target is to agree on the strategy mapped out in the brief.

Jon Steele, Account Planner, account planner on “Got Milk,” says a good creative brief should accomplish three things:

“First, it should give the creative team a realistic view of what their advertising needs to, and is likely to, achieve.

Second, it should provide a clear understanding of the people who the advertising must address.

And finally, it needs to give clear direction on the message to which the target audience seems most likely to be susceptible.”

In a nutshell, he says the creative brief “is the bridge between smart strategic thinking and great advertising.”

Unfortunately, smart strategic thinking is often lacking in the small-agency environment. Agencies pay lip service to it, just like they pay lip service to doing “breakthrough creative.” In reality, most small agencies simply don’t think things through very well before the creative teams begin working.

Perfectly natural considering the creative product is their only deliverable. Everyone wants to get to the good stuff, ASAP.

Sergio Zyman, former CMO with Coke-a-Cola, says “ strategies provide the gravitational pull that keeps you from popping off in all different directions.” Likewise, the creative brief is the strategic roadmap that keeps all your agency people — the researchers, creatives, media planners, programmers and AEs — heading in the same direction.

Drafting a truly insightful brief is both a creative and a strategic exercise. Andrew Cracknell, Former Executive Creative Director at Bates UK, says “planners take the first leap in imagination.”

Steele says the brief should not only inform the creative team, but inspire them. Instead of just listing the problems that the creative team will face, a great brief offers solutions. In the case of “Got Milk”, the brief said ditch the “good for you” strategy and focus instead on deprivation… what happens when you’re out of milk. The creative team took it from there.

So if you’re a client, insist on staying involved until the creative brief is absolutely nailed down. Then sign off on it, and set the creative team free, in the right direction.

Then, when they present the creative product, you can judge not on subjective terms, but on one simple objective question: Does it follow the brief in a memorable way?

Don’t overwhelm them with data.

Advertising people don’t look at business like MBAs do. And as a general rule, they hate forms. So don’t expect your creative team to glean much inspiration from sales reports and spread sheets. And don’t assume they understand the fundamental metrics of your industry.

You need to have your elevator pitch and your essential marketing challenges nailed down in layman’s terms. Before you go to an agency or a freelance creative team. As Zyman said, “If you want to establish a clear image in the mind of the consumer, you first have to have a clear image in your own mind.”

Do a presentation for the agency… present your version of the facts, and then engage them in dialog. It’ll force you to focus on strategic thinking and it can generate tremendous team energy. But don’t be surprised if they question your most fundamental assumptions. That’s what they do.

Remember, advertising people are specialists.

Don’t expect your agency team to grasp all the nuances of your business. Even though agencies often claim to immerse themselves in your business, all they really care about are creative forms of communication. “What are we going to say, and how are we going to say it.”

If you want someone who understands balance sheets and stock option restructuring, hire a consulting firm.

It’s unfortunate that so many ads are nothing but garbage. But if you have your act together from a strategic branding standpoint, and stick to the process, a good agency can be a tremendous asset. It’s a classic win-win arrangement: They can win awards, and you can win business.

Subscribe to my RSS feed and get updated every time there’s a new post. Just click on the RSS logo at the top left of the page. Or follow “brandsight” on Twitter.