Keep the Ring, Get Me an iPad: Emotional Vs Rational Marketing
The holidays that just passed weren’t the only thing to celebrate, according to historical trends. As we moved from December into 2015, how many of you were seeing a lot more engagement announcements on Facebook, or even became engaged yourself?
December is the most popular month to get engaged (according to wedding website TheKnot.com), so it’s likely many of us gearing up for the typical spring/summer calendar full of weekend weddings.
While December is not known as a big month for weddings, it is a big time for jewelers, including the months leading up to it. Diamonds, gold, and other fine jewelry become very popular purchases at this time.
Fine jewelry is an emotional buying decision, which you can see from the jewelry store commercials that evoke sentiment for our loved ones.
But that emotional pull to purchase diamonds, gold and precious stones could be changing significantly.
Diamond sales are down this year – but what is up? Technology-related gifts, including smart phones, tablets, and other functional devices. To understand why, all you have to do is think about the ages of people getting engaged: 18-34 year-olds.
People in that age range who are getting engaged right now just aren’t drawn in by the emotional purchase of fine jewelry anymore, if they ever were. They value technology purchases.
But it’s not just function over form. The emotional motivation behind a purchase (whether technology or fine jewelry or any high-dollar item) is always there.
“Status for this generation isn’t about money — it’s about attention,” said psychology professor Kit Yarrow in a recent Pacific Standard magazine article. Therefore, a smart phone is considered a better gift (and better use for the money) than fine jewelry, since it allows you to share your life and stay connected much more than a gold and diamond ring can do.
As the article notes, using technology to create “an everlasting Facebook album from that scuba diving trip in Bali says so much more than one lone photo of a pave diamond necklace.”
WHAT FUELS YOUR BUSINESS DECISIONS?
The average decision process for a consumer making a purchase is estimated at 80% emotional and 20% rational, according to an annual customer loyalty report from Brand Keys.
It’s interesting to think that the car in your garage, or the shoes on your feet, could have ultimately been something you felt you wanted (80%), and then justified the need for later (20%). Brands, especially in the luxury market, depend on this ratio.
This realization brings us to your business planning as we begin 2015. What guides your business decisions as a data-fueled marketer: emotions, or rationale?
How do brands make decisions about how to operate, what customers to market to, where to locate stores, what marketing campaigns to do, and many more strategic plans? It needs to be much more in the “rational” category – but how do you do that as a data-fueled marketer?
As consumers, we are emotional creatures without even realizing it. That can be a habit we bring to other things in our lives as well, including decisions at work.
Since your customers still have emotional reasons for making a purchase or using a service, the only thing that should be emotional is your messaging to your customers; not your planning. Creating customer profiles and making decisions from them should never be solely a ‘gut feeling’ or only based on your professional instincts.
At the same time, we all know that in our work, over time we develop good instincts about what we do. We learn to trust our sense of what will work or won’t work in the market, or in the supply chain, or within product development – whatever it is you do. You can never ignore that, because no one can completely predict the future with total accuracy. You have to trust your experience and knowledge to lead you.
Turn the 80/20 ratio on its head, and instead focus 20% on emotional thinking and 80% on rational thinking. Make your brand’s business decisions and planning based on good data.
Who are your customers? Where do they live? What do they do and what are their preferences? Basing the answers to these questions only on what has worked in the past, or what you think your customers should want, will only lead to bad business decisions.
The first step, however, is to know that your customer data is valid and complete. Gartner estimates that 40% of failed business initiatives are due to bad data. Validate, correct, and enrich your customer data before you use it. Then as a truly data-fueled marketer, you can use the 20/80 ratio properly and steer your brand to a great 2015.