March 8, 2018
By Carla Johnson
Just because two customers are close in age, live in big cities and earn similar incomes doesn’t mean they spend the same way. Despite what they have in common, they could be very different customers once we dig into the details.
Once we understand what influences how people make decisions, we can look at how they rationalize the decisions they end up making. By understanding the interconnected and constantly shifting decision-making framework buyer’s use, it makes it easier to get our heads around how 21st-century customers make choices with their money.
KPMG’s Global Customer Insights report, Me, My Life, My Wallet, gets into the nitty gritty of why this is the case.
One of the areas that I found particularly helpful was the Five Mys, a framework that helps marketers navigate the complexity of how customers make decisions. This is a powerful tool that gives structure to the outside-in look that we need to be taking when looking at customers, and then aligning what we do with what they need.
The five dimensions include:
1. My Motivation
Trust, authenticity and social values are critical. But they also have an intangible effect on the choices buyers make. It’s people’s best past experiences that define the bar of what they expect in the future.
To get better at understanding customer motivations, ask yourself these questions:
– Where, in the customer journey, are the biggest friction points and expectations?
– How do I get insights so I can better understand the keys that drive the behavior of my most profitable customers?
– How does the data that I already have create, or even improve, a customer experience?
– How can I get data about how customers behave so I can better understand their whys?
– Where does environmental behavior fit into the picture?
2. My Attention
The fight for customer attention has never been more intense. And, it’s getting worse because of the incredible amount of data at our fingertips. In fact, four in 10 customers say they’re so overwhelmed that they’re tempted to turn off completely.
Breaking through the extraneous noise is the only way to keep customers loyal and attract new ones.
To get better at understanding customer attention, ask yourself these questions:
– How do I get my customers’ attention in a way that won’t add to their information overload?
– What moments matter most to customers, and how do I build value around these?
– How do I keep delivering value once I’ve captured their attention?
– How will advancements in machine learning and artificial intelligence help my customer?
3. My Connection
Today’s technology connects humans to information and each other every minute of every day. This has created a shift in how we behave and interact socially.
Think about this: The mobile phone took 13 years to get into the hands of 25% of Americans. The iPhone took only 2.5 years.
People who are used to always being connected has made them more sophisticated in their digital interactions. We have to understand this before we’ll be able to create better relationships with them.
To get better at connecting with customers, ask yourself these questions:
– How do I help customers get smarter about how they engage with my brand?
– How do I get smarter about them through their connections?
– How can we help them deal with connection and disconnection anxiety?
– What experiences could I create to connect them to each other?
– How do I apply the same thinking to my organization and then take advantage of technology?
4. My Watch
The companies that understand the how people are pressed for time, and then anticipate how that changes throughout a customer’s life, are in the best spot to connect with them in the most crucial moments. Smart brands get the time-money trade-offs, and they’re better at anticipating what people will need in the future. This creates a “stickiness” with their customers that lasts for years.
To get better at understanding customer motivations, ask yourself these questions:
– How can I reduce the time and effort it takes for my customers to interact with or buy from me?
– How do I find out the pockets before a pivotal life event happens?
– How do I start to build in these pockets as part of my segmentation strategy?
– For the customer who values time the most, what opportunities do I have to deliver an experience that’s different?
– How can I deliver value early in my customer’s experience and keep it up throughout their journey?
– How do I apply the same thinking across my organization and make it easier for my teams to connect with them?
– How can I help buyers prepare for life events?
5. My Wallet
How customers adjust what they spend at different times in their life is changing. And that has a ripple effect across all the areas in which they spend money. Just how and when it does depends, to some extent, on the generation. For example, millennials have put off starting families and buying homes a full longer than their baby boomer counterparts.
To get better at understanding how customers spend money, ask yourself these questions:
– How can I help customers manage their spending and their budget?
– How do I identify how they are spending and sharing their money?
– How can we get to people who will earn more in the future?
– For customer who care more quality, what opportunities do we have to deliver a differentiated experience?
– What are the ways to build trust early in the customer journey so we have an opportunity to earn more of their spending?
Photo credit: Pixaby
