Emerging Trends in Retailing: Emotionally Connecting with Shoppers
Wednesday, 8 October 2014 - Arkansas
Kevin Roberts’ keynote on ‘The Power of Emotion’ at the fourteenth annual Emerging Trends in Retailing Conference. Held at the University of Arkansas by the Center for Retailing Excellence within the Sam M. Walton College of Business, the conference theme was ‘Emotionally Connecting With Shoppers’ and focused on the importance of emotionally connecting with shoppers to drive sales and deliver outstanding business results for brands and retailers.
I’ve been asked to talk about how to win in a high-speed connected world – and about how unleashing emotion accelerates the likelihood winning.
We live in a VUCA world.
Volatile, Uncertain, Complex, Ambiguous.
The primary challenge is to reframe VUCA, whether you’re a brand, a retailer, a communicator, an educator.
The no.1 job of everyone here is to transform VUCA into SuperVUCA, to create a SuperVUCA zone, build a feeling in people that is Vibrant, Unreal, Crazy and Astounding.
Quite a challenge.
The question ‘how to win in business?’ has fundamentally changed over the decade; even over the week!
As differences in product, price and performance have gotten smaller to the point of parity, the question that matters to consumers – to people – has gotten bigger.
The old answer was framed in the ER words: Are you cheaper, newer, brighter, whiter?
Today, ER words are tablestakes. You must offer superior performance at a value price… but that isn’t enough in today’s SUPERVUCA world.
We are in a real-time, on-demand, see-thru Age of Now, a thriving eco-system of connectivity, community, conversation.
Winning the Now is not only about price, benefit, range, convenience, speed (but of course you’ll never survive without them).
It’s about how you bring them together as an emotional package, about bundling a feeling, creating something bigger than a transaction, bigger than satisfaction, because:
- Emotion answers today’s key question “How will you improve my life?”
- Emotion cannot be commodified, counterfeited or perfected. Its very imperfection generates unlimited power.
Improving people’s lives in the Now starts with what American critic and commentator Alexander Woollcott said. “There is no such thing in anyone’s life as an unimportant day.”
The wins are in making every day count, every moment special. It’s less about sweeping emotion, more about concentrated feeling – an alchemy of place / space / time.
People fall into the trap of thinking emotion is soft. Sunsets and violins. ‘Hard emotion’ is hugely powerful – being helpful and empathetically practical. In other words, user interface design is everything, or I’m out of here!
- Netflix’s rolling monthly contract, one click to cancel (vs. a hell journey), your user preferences kept for a year.
- Disney’s brand purpose: ‘Creating the best 30 minutes of a child’s day.’
- Burger King: Whopper Face (Brazil) – snaps you as you order a Whopper, prints your face on front of the packaging. Reactions captured and spread globally.
Products demos are not always the enemy – as long as they are supercharged emotionally.
Here are SIX SHIFTS FOR BRANDS TO MAKE IN THIS SUPERVUCA WORLD AND HELP THEM GET TO THE FUTURE FIRST:
#1 SHIFT: Architecture to Dream
(MLK RAP) Marketing is dead. Brand equity pyramids, onions whatever, are the start point, not the end point. Building a brand is not enough. Marketing’s role is to create a movement… and movements are built on Dreams.
The Walmart brand is built on Save money. Live better., but its Dream has always been to create a movement people can’t wait to join. A movement based on providing Americans with what they never dreamed possible.
A movement that makes America proud as it creates more American jobs by supporting more American manufacturing, and by hiring more than 100,000 veterans.
#2 SHIFT: Function to Experience
Satisfaction equals Performance minus Expectations.
Expectations of brands are rising. People insist on knowing what you stand for. Personalization is craved by Millennials. Six things we know about them:
- They are not into limitations
- Value means much more than price
- They demand to be recognized as individuals
- They yearn for belonging
- They are very impatient
- They’ll see right through you
The more embedded that quality, service, distribution and performance become, the more emotional experience is the difference.
This can be delivered in small increments, little lifts.
You don’t have to be Hollywood or Apple to create experience. For example, blockbuster game Minecraft, with massive appeal, is about building not destroying.
Experience can be framed as revolution. Revolution starts with language. Walmart is known for its everyday low prices, but emotionally this could be reframed as Walmart being incredibly useful.
… bringing back the original feeling of Sam Walton’s pioneering to meet the needs of small town America with never-been-seen-before choices that helped people live better lives.
The future retail question? Is a price leadership claim a killer apptoday – or must we offer a deeper emotional experience?
Examples of emotional experience:
- Uber turning ‘this taxi sucks’ into ‘this taxi inspires.’
- Airports like Heathrow T5 and T2 turning waiting areas into dining and shopping fields of dreams.
- Selfridges (experiencing record growth) treats retail as a playground of inspiration, not a bunch of departments.
However plain you are, little emotional connections can change everything.
#3 SHIFT: Consumption to Participation
This is the great shift from pumping markets to creating movements, from storytelling to story sharing, from promoters to influencers, from verbal to visual.
The consumer cycle is: See it, Search it, Shop it, Share it.
Starbucks is promoting what happens in its stores and not just highlighting coffee, to show how its stores “help facilitate human connections.”
Sharing is emotional not rational, and ‘omnichannel’ – the seamless challenge – just means emotionally-connected.
The challenge is to be live, move at the speed of culture, inspire people to participate in a conversation of real-time relevance, pulsing and connecting and growing each moment into a SUPERVUCA story. Ask 3 questions of an idea:
- Will people want to see it again?
- Will people want to share it?
- Will people want to recreate it?
And consumers want to participate in store and online…
- Shoppers want more than a transactional experience around price and utility, they want to feel special and recognized in what they buy. “One size fits all” is less salient to the shoppers of tomorrow. Stores within stores are ways to personalize.
- The connection between instore and online needs to be seamless and as compelling as other website experiences. Shoppers are savvy and they have little tolerance for miscues and dead ends; they expect Best-in-Class navigation whether it’s in the aisle or on the page.
- The authoritative voice of the retailer or the brand is only one among many today. Shoppers place disproportionate emphasis on the voice of their peers. The authority can just as easily be the ratings and reviews on the websites. Today’s Word of Mouth influencer is the blogger community. You do not control the conversation.
#4 SHIFT Relevance to Resonance
The future of automation, robots and Big Data – from Artificial Intelligence to the Walmart Exchange (WMX) – is a fantastic thing, shifting supply side mechanics and raising relevance demand side.
However it is emotion, not relevance, that converts and creates loyalty in minds and hearts. Reason leads to conclusions; emotion leads to action.
Technology and data can’t feel or dream the magic that builds loved billion-dollar brands. People like technology but people mostly really like people; being understood, touched and involved.
Apple’s U2 fiasco was a reminder that people want pull not push, resonance not just relevance, magnets not just mirrors.
Success lies at the intersection of Big Data and Big Emotion.
#5 SHIFT Like to Love
Being liked, trusted or admired is no longer enough…
LOVE / RESPECT AXIS RAP
Being bigger than a brand is about being irresistible. There are three secrets:
Mystery – the alluring, surprising, the unexpected…. a force that turns the functional into the emotional.
- How did Puma in Mexico promote Faas running shoes, the ‘fastest in the world?’ Your level of discount depends on how fast you make it to check out!!
- How did we create an entirely new buying/drinking occasion, out selling existing sales on St. Patricks Day.
Sensuality – the five senses are portals to the emotions.
Screens ‘must try harder’ to be sensorial, while the physical store has huge potential for tactile and immersive activations, from store within a store…
Example: Cabela’s (Canada) – a destination shopping experience – in-store aquariums to archery practice ranges.
Intimacy –Most organizations do intimacy badly or wrong, or badly wrong.
Intimacy is empathy, commitment and passion, the stuff that matters to people, like “work is a beautiful thing,” like emotionally connecting people with real workers as we have in the integrated American jobs campaign.
Intimacy can touch deep in such ways, or it can be light as a feather – as in the official diaper of experienced moms.
#6 SHIFT: Price to Priceless
The past was centered in price. The future is about what you do with price, how you build on price, a feeling beyond price.
Priceless brings the dream, the experience, the sharing, the magnetism and the love of it together in unique ways.
“ONE NIGHT, I’M SITTING PLAYING WITH THEIRS VERSUS SOME OTHERS. AND ALL OF A SUDDEN, IT DAWNS ON ME THAT WHEN I LISTENED TO THEIRS FOR A WHILE, I FEEL COMPLETELY DIFFERENT. AND THE REASON IS THAT THEY RECOGNIZED THAT HUMAN CURATION WAS IMPORTANT IN THE SUBSCRIPTION SERVICE, THAT THE SEQUENCING OF SONGS THAT YOU LISTEN TO AFFECTS HOW YOU FEEL.”
Priceless is the ‘specialness’ in every moment, from instant checkout to money-back to self-design to VIP shopping.
HOW TO GET TO PRICELESS? THERE ARE THREE KEYS:
1. DO WHAT’S RIGHT, EVERY TIME
Millennials expect big things from big businesses. A new MSL Group global study of Millennials indicates that:
- Millennials have given up on government, and see big companies as our only hope
- 78 % recommend a company to their peers based on the company’s involvement with society
- 83% expect businesses to do more than they are already doing to help the world; 82% do believe they are capable of it
- 51% want to get personally involved in making the world a better place
- 69% want businesses to make it easier for them to get involved.
The philosopher Daniel Dennett said it was an occupational hazard to be asked the meaning of life, so his soundbite is that the definition of happiness is to find something bigger than yourself and dedicate the rest of your life to it. Before it’s too late.
2. BE A CREATIVE LEADER
Ideas have magical power. It is the unreasonable power of creativity that drives growth today.
Some people say it is content, but content is just wallpaper, it’s background noise. For content to be engaging it has to have an idea at the center. Ideas are the currency of today.
And the cultures with the most ideas are the best placed to win. Ideas deliver exponential growth.
Creative Leaders have lots of small ideas, continuously. Quickly. 5 seconds at a time.
And Creative Leaders Surprise with the Obvious:
- Netflix using piracy (popularity on illegal services) to pick its programming.
- Barclays is Paying Some Bankers Based On How Well They Behave.
3. FAIL FAST, LEARN FAST, FIX FAST
THE DALAI LAMA: “KNOW THE RULES WELL, SO YOU CAN BREAK THEM EFFECTIVELY.”
A winning supplier/retailer relationship pushes boundaries, so that both brands and retailer are moving at the speed of culture.
It’s about loosening control, exiting comfort zones, breaking rules, taking risks, testing and trialing to win together.
It’s about: IQ+EQ+TQ+BQ.
There is no magic formula, no guaranteed outcome of today’s social media phenomenon. No one could have ever expected the Ice Bucket Challenge to be the success it was.
The key is to try continuously, to be constantly experimenting.
Fail Fast, Learn Fast, Fix fast
Vince Lombardi said “winning isn’t everything, but wanting to win is.”
AND WINNING IS FUN.