When you last bought something, do you know why you bought it?

Why did you choose one brand in preference to another? Why did you plump for an iPhone instead of a Samsung? Why do you get your coffee from Starbucks rather than somewhere else?

We all like to think our decisions are based on rational thinking. But there’s much more to it. Harvard professor Gerald Zaltman tells us that at least 95% of all cognition occurs subconsciously. The subconscious mind is where our emotions brood, and where much of our day-to-day behaviour is shaped.

As a business owner you won’t be surprised that emotions are involved in purchasing decisions. So are you really engaging with your customers on that level? And do your customers actually want the things you think they want?

Why we need to emotionally engage with our customers

There are two reasons for this. The first is that happy customers are more likely to be repeat customers. A report from Capgemini last year found that, when ready to make a purchase, 86% of consumers with high emotional engagement first consider their favourite brands (ie, those they’re loyal to); while 82% always buy those brands. For those with low emotional engagement the figures were 56% and 38% respectively.

The second reason is more mercenary. Even if nurturing emotional engagement doesn’t appeal to your business ambitions, the dangers of negative action from customers should scare you into action. One group of researchers recently found that four or more negative reviews on Google could cost you 70% of your potential customers.

Even if nurturing emotional engagement doesn’t appeal to your business ambitions, the dangers of negative action from customers should scare you into action.

But which emotions?

So emotions matter – because happy customers come back, while angry ones will berate us in public. But it’s not just that. Researchers are finding big disconnects between what customers actually want and what we think they want. A surprising example is loyalty programmes. According to Capgemini’s study, 90% of consumers view them negatively. It seems you can’t actually buy loyalty: it needs a different approach.

Beyond Philosophy founder and CEO Colin Shaw suggests we need to ‘realise the only way to build customer loyalty is through customer memories’. It’s worth the effort to do this, because loyal customers buy more, pay more, and are more likely to forgive failures and to promote your business to others.

There’s solid research to back up this theory. Capgemini split drivers of consumer loyalty into three areas: emotions, rational elements, and the company’s own brand values. Emotional drivers include things like honesty, integrity, trust and belonging. Rational elements include competitiveness, customer service, delivery and ease of use. While brand values captures things like environmental impact, business practices and fairness. Among the three sets of drivers, the connection between emotions and loyalty came out on top by a wide margin.

Why aren’t we getting it right?

So if the research is telling us how much emotions matter, how come we’re not making the most of it? In that same Capgemini report, the majority of executives surveyed (80%) thought their brand understood its customers’ emotional needs and desires. But when the customers themselves were asked whether those brands do a good job of emotionally bonding with them, the figure was just 15%.

That’s a sobering gap.

According to Beyond Philosophy, the reasons for this mismatch fall into two categories. First, many companies simply don’t have a theoretical or practical understanding about the need for emotional engagement with their customers. Second, even if they wanted to achieve that understanding, it’s not immediately clear how to measure and quantify emotions, compared with more concrete things like customer behaviour or revenue. As they point out, this tends to lead us to measures such as Net Promoter Score (NPS) and the Customer Satisfaction measure, CSAT, which take the place of a more meaningful understanding of what customers really want.

What can we do about it?

We can start by taking a good look at ourselves. The term ‘customer-centric’ is now so ubiquitous that it’s almost a buzzword. But saying and doing are not the same. In 2015, Amazon CEO Jeff Bezos argued that companies often lean towards obsessing over competitors instead of obsessing over customers: ‘Many companies describe themselves as customer-focused, but few walk the walk. Most big technology companies are competitor-focused. They see what others are doing, and then work to fast follow.’

It’s a key lesson. Of course you should think about your bottom line and what your competitors might be doing to eat into it. But think about it alongside your customer experience, not to the detriment of it. There’s nothing wrong with loving what you do, but if you’re failing to engage with your customers or, worse, actively driving them away, you’ll be sawing off the branch you’re sitting on.

Are you product-centric or customer-centric?

This is one of the most useful exercises you can do. Forget about the platitudes that belong in annual report introductions. Sit down and work out, honestly and self-critically, whether you’re a product-first or customer-first outfit.

Sit down and work out, honestly and self-critically, whether you’re a product-first or customer-first outfit.

Product-first companies focus on cutting-edge products, new features and their price to market. They put their resources into development; and they measure success by market share while extracting as much value from each product as possible.

I’m not saying that as a business you shouldn’t be doing those things, but here’s another set of priorities to consider. Customer-centric organisations focus on the best solution for their customers – their source of profit is loyalty, their most important process is relationship management and they measure their success by satisfaction, retention and customer longevity. Even their HR and reward structures, right through from recruitment to compensation, are designed to ensure the customer is put first.

It is likely most companies aren’t wholly one or the other, and in practice fit somewhere between the two descriptions. But if you find yourself leaning towards the first, it may be time to reassess your approach to customer experience.

Looks like we’re product-driven: what do we do?

Last year Colin Shaw published a white paper, 10 Critical Steps to Move Your Customer Experience to the Next Level, which aimed to help businesses reshape their approach along more customer-centric, emotionally focused lines.

The process starts with research – customer feedback sessions – but the key step is to start taking an ‘outside-in’ approach. In other words, start living out your customer experience as they do. Shaw also advocates bringing in a consultant from outside your company to help you see the things you can’t or don’t want to see. An experienced third-party consultant can evaluate both the successes and flaws of your customer experience with complete impartiality.

You also need to understand where you stand with your customers today. As Shaw points out, data gathering reveals which moments in your experience evoke which emotions, and how these emotions drive customers’ current behaviour. Once you understand your current customer experience, you can set about planning and building a new approach. Think about how each step of the customer journey can bring about positive emotions for your customers. Then make it an integral part of your company’s culture to connect with these emotions – and constantly reinforce that culture.

Don’t falter at the implementation stage

Putting together the theory but forgetting about implementation won’t move you forward. Shaw suggests drawing a pyramid with the elements you want to achieve, such as trust, at the top; then further down set measurable targets and initiatives to help align your customer experience strategy; then set the concrete goals and specific actions you need from your team to deliver that strategy.

These actions are for you to determine. The message is that to move to a truly customer-centric experience you must stop conjecture and turn instead to measurable actions.

Again we can look to Amazon as the example: every business decision they make – even technical decisions like procuring IT systems – is based on the effect it will have on the customer. If it doesn’t benefit the customer they don’t do it.

Again we can look to Amazon as the example: every business decision they make – even technical decisions like procuring IT systems – is based on the effect it will have on the customer.

Emotional engagement can make your business stronger

It can be hard sometimes to see beyond product and profit – ultimately we’re in business to succeed and that means beating the competition. But even if you’re not sold on making happy memories, an emotionally engaged customer base isn’t just something that’s nice to have. Treat them well and these customers will be both loyal and valuable to you. Harvard Business Review separated ‘highly satisfied’ customers from their ‘emotionally connected’ counterparts. While ‘highly satisfied’ sounds like a decent enough customer experience, HBR found the latter category to be worth 52% more to a business on average.

Engaging with your customers builds trust, positive associations and the desire to return. Your customers will remember how you made them feel – and they’ll tell others about it too.

But it’s not just about nurturing a warm fuzzy feeling. There are hard business benefits here. When Louis Gerstner took over at IBM, he moved towards a customer-centric approach, leaving behind a model of aggressively marketing new products, and focusing instead on consulting with businesses first. Steve Jobs did something similar – Apple stayed innovative, but it innovated around need, not for innovation’s own sake.

Companies that connect with their customers’ emotions enjoy loyalty and positive reviews, but they can also weather the changing fortunes of business. As your customers’ needs evolve, you evolve with them.

Freshstone Consulting works with clients to set strategic direction, drive business performance and solve problems. The team’s focused and disciplined approach allows Freshstone to reliably influence corporate strategies, increasing the sustainable growth and profits of a company. To meet the team and find out more, please call +971 4 248 5165 or email info@freshstoneconsulting.com.

About the author: Tanvir Haque, Founder of Freshstone Consulting. 
Tanvir is currently the Chief Commercial Officer at Lifecare International, and he is the Founder and Non-Executive Director of Freshstone Consulting. He thrives on developing customer-centric business relationships, and as such he is currently focused on revolutionising Lifecare’s customer experience and driving the company’s digital transformation plans – all with the aim of unlocking Lifecare’s full technology potential. With a career spanning back more than 20 years, Tanvir’s experience has been gathered in professional services, banking, and telecommunications, having worked with PwC in Sydney, Andersen in Sydney and London, and Standard Chartered Bank in London. He relocated to Dubai in 2008 and spent a number of years advising and consulting international businesses on how to drive growth before joining Lifecare in 2015. Tanvir graduated with a Bachelor of Commerce degree from the Australian National University in his home town of Canberra and is a qualified Chartered Accountant and a member of Chartered Accountants Australia and New Zealand.