Author: Emily Louise Spencer

Emily Louise Spencer is an in-house content writer at Revuze. She is a graduate of the University of York with a master's degree in Chemistry. A published scientific author, she now works as a content writer and copy editor.

How Brand Equity Can Positively Impact Your Business and Drive Growth

Posted on by Emily Louise Spencer

Brand equity is the ability to be recognized and acknowledged as more than simply another face in the crowd. Some brands have it, and even fewer know how to build it. With time and effort, you can learn how to become a master of brand equity, similar to giants like Apple & Microsoft. Your Journey Starts Here.

Brand equity is a great tool to have in today’s ever-changing competitive markets. 

The main benefit of having strong brand equity is that consumers will continue considering your products even when the cost is high. 

Consumers perceive them as having innate value or quality solely because they associate it with your brand.

Being the top brand whenever consumers think of your market sector is the ideal position, but it’s not quite that straightforward. 

I’m sure you’ve heard of the Pepsi vs. Coca-Cola, Apple vs. Microsoft feuds, etc. No one side can claim to truly be at the top of the market, despite all having strong brand equity.

Still, it’s a great position to be in. 

In this guide, we’ll take you through the steps of creating strong brand equity, allowing you to dominate the conversation. 

Let’s begin with the basics.

What is brand equity?

The definition of brand equity is a brand’s perceived value according to consumers. It can also be defined as the level of positive feelings that consumers have about a brand when compared to others in the same market space.

For example, if you order a rum and coke at a bar, you might be asked if Pepsi is okay. Some would answer yes, some no — that’s brand equity. If you buy a new gaming console and are dead set on having a PlayStation? You guessed it, that’s brand equity once again.

Some brands even dominate the market to the point where their name becomes the commonly used word for the item they produce. 

Coca-Cola and Sellotape, for example, have become synonymous with their markets, despite being only one among dozens of brands. That’s strong brand equity at work.

If you have strong brand equity, you have a dedicated customer base and the option to charge premium prices. 

When launching a new product, you’re guaranteed to get customers’ interest no matter what it is. 

That said, you can’t coast by on brand equity alone. You must ensure your products are still top-quality and are within the market’s expectations. Microsoft learned that the hard way with Windows Vista and even Sony with the $600 PlayStation 3.

Keller’s brand equity model (aka brand equity pyramid model)

It’s worth mentioning the Keller Brand Equity model here. We won’t cover it in too much detail as that would be an article in and of itself, but let’s go over it to give you a general idea.

Keller’s brand equity pyramid model states that to gain strong brand equity, you need to shape the way your customers think and feel about you. 

This starts at the base level with establishing your brand identity, then works its way up the pyramid by asking questions about what your brand might want to achieve.

It’s a step-by-step process that makes thinking about how you plan to position yourself and what feelings you want to evoke in your customers. 

Each stage contains crucial components that evoke brand loyalty, so be sure to give it a look if you want to build your brand up to the next level.

The impact of brand equity on customer interactions

Now that you know what brand equity is, you might be asking yourself – “is it worth it?”

It’s true that building brand equity is a long and difficult process, but the results are well worth it. 

Let’s take a look at some of the most tangible benefits, ones that you can point to when an investor asks why you’re putting so much effort into building your brand’s equity.

Customer spending

Brand equity impacts customer spending in two main ways. 

First of all, if you have a high brand equity you can charge more for a product than you otherwise might. In fact, it’s often expected of you to do that. So much so consumers will become suspicious of a product line if you don’t. 

When was the last time you saw a new iPhone going for less than $1,000? It would seem suspicious if it did, right? That’s Apple’s brand equity at work.

The second way in which customer spending is impacted is in making decisions about what to buy, especially in cases where a customer has little knowledge of the products in that market sector.

When a not technologically aligned parent decides to buy their child a simple phone for calls and texts, they’re left to rely on what little they know about a brand’s reputation.

What do they pick? An obscure and niche phone with specific uses? Or a well-known brand such as Apple or Samsung that they’ve probably heard of in passing? Probably the latter, right?

That’s brand equity in action. 

Customer loyalty & advocacy

I’m sure you’ve come across a friend or acquaintance who buys only from a specific brand and won’t accept replacements. I mean, what other laptop could replace my trusty Macbook?

I’ve grown to love it and how it functions so much, that buying another Macbook when it’s time to replace it is a no-brainer. And there are millions like me.

That’s the epitome of customer loyalty, which is different from customer retention (coming up in a few paragraphs).

Customer advocacy is when that loyalty is taken one step further. 

In essence, the customer becomes someone who will promote your brand to their friends and acquaintances, sometimes to the point of convincing them to switch brands.

Brand equity is of great help here. Not only do customers have a much easier time advocating for a brand that is well known, but the actual process of loyalty can be sped up tremendously.

Customer loyalty relies on great experiences, that’s true, but the opinions of others also matter. A HubSpot study on the topic found that 81% of consumers would rely on referrals from friends and family to choose & try a brand over an advertisement. This means that you’ll likely need a recommendation simply to get on the customer loyalty ladder in the first place!

Having strong brand equity means that people are more open to trusting you from the get-go, which makes climbing that ladder from customer to loyal customer to brand advocate that much quicker.

Customer retention

Your customer retention rates are one of the key metrics that help your business keep going. After all, if your customers leave unsatisfied and don’t return it’ll hurt your performance in the long run. A mere 5% increase in your retention rates can bring up to a 25% increase in profits!

Your churn rate, or the rate at which you lose customers over time, is another measure that’s similar to customer retention, just in the opposite direction.

It’s calculated by taking the number of customers who stopped interacting with you over a set period of time and dividing it by the number of customers you had at the start of the time period, then converting it into a percentage.

If your churn rate is high, your customer retention rate is low. Churn is often a more useful metric to look at than retention since it’s more directly comparable over different periods of time.

So, what does brand equity have to do with customer retention? After all, retention rates are solely about customer experience, right? Well, not entirely.

Research has shown that customers care about more than simply their experiences with you, with 80% being willing to change brands based on “a company’s social responsibility, inclusiveness, and/or environmental impact.” How does news on these topics spread? Via brand equity of course.

An apt metaphor to describe this would be meeting someone for the first time. Consider what would happen in the following circumstances.

You meet someone who is clearly in a bad mood, is rude to you, and snaps over minor things. You’d feel insulted, maybe even a little scared. You mark this person in your brain as bad news, and won’t want to deal with them again.

You then tell people that you know about this encounter, and how you felt. They have met this person before and reassure you that they aren’t normally like this, that it must have been a bad day or something similar. 

From this, you decide to revise your opinion, and the next interaction you have with them is great! Clearly, it was just an off day and they’re not normally like this. 

Having strong brand equity keeps customers coming back to you, even when they’ve had one bad experience. 

It’s a sense of trust that the consumer population as a whole has with you, which means that individuals are willing to give you another shot even when they didn’t like what you had to offer the first time around. 

Brand equity’s impact on your internal workings

Brand equity doesn’t just impact your dealings with customers, rather it shapes the very way your business will operate. 

There are plenty of strategies and tactics that big brands with strong brand equity can use that smaller, less well-known ones cannot. 

One example that springs to mind is the TV show Rick and Morty, which premiered its third season completely unannounced back in 2017. 

Any other television show would spend time hyping up a new release, using advertisements, press releases, and other means to keep the buzz going. 

Rick and Morty’s strong brand equity meant that it didn’t need to do that in order to keep viewers engaged.

There are more internal benefits to having strong brand equity than pickles and portals. Here are a few.

Stock prices

Stock prices are a great indicator of how your business is doing. Of course, this is only applicable if you actually have them up for sale, but let’s go over them briefly anyway. If this isn’t relevant to you, feel free to skip to the next section.

Strong brand equity will increase your stock prices, as it brings with it the expectation that the brand will continue to perform well. This in turn can also increase your brand equity in a feedback loop, though there is a limit to it.

So, why are stock prices important? Well, they’re an indicator of how well your brand is doing in its market, as well as a status symbol that can open doors to you that would otherwise be closed.

Higher stock prices are also attractive to investors who will continue to put funding into your brand if they think it’s going to give them a good return on investment.

Easy expansion of product lines

Creating new product lines is never easy, however with brand equity you can make the process a bit smoother.

Imagine a completely unknown business releasing a new line of soda drinks. They’re unusual flavors that haven’t really been tried before, and overall the public seems uncertain. Would you buy that drink, or would you avoid it for your regular soda?

Now, let’s flip the circumstances. Let’s say that Coca-Cola releases lots of new and unusual flavors. You know the brand, and know what they usually make is considered good quality, so you’re more likely than not to try it out at least once.

There is actually a great real-world example of this with Walkers, the UK-based potato chip company that regularly comes out with absurd flavors such as Breakfast, Fish & Chips, and even Squirrel! That’s not a joke, they actually did this.

Thanks to their strong brand equity, Walkers have been able to turn their experimental product lines into a game of sorts, with the most popular limited-time flavor being kept and turned into a regular product. 

Not only did the public do their research for them, but they actively engaged with their product testing and expansion. 

Imagine a no-name brand releasing these flavors, they’d likely be considered a joke. That’s what brand equity is truly capable of doing! 

Greater influence on the market as a whole

Strong brand names bring with them a sense of dominance. 

With strong brand equity, you’ll be able to negotiate with others from a position of power rather than equal footing or from a position of weakness.

With this position at the negotiating table comes opportunity. Partnerships, sponsorship deals, and collaborations, all these are possible only if you have a strong bargaining position. 

You also open yourself up to greater investment potential and maybe even get better deals from your suppliers once you’ve made a name for yourself.

Five ways of measuring brand equity

Alas, measuring brand equity isn’t straightforward. There are many factors to consider, and which one you put weight on will depend on your business model, industry, etc. 

Further, brand equity isn’t something you can measure in cold numbers. Still, there are a few tried and tested brand equity analytics you can use. We’ve laid out five of them below for your consideration.

Competitive analysis

Competitive metrics set you up against your competitors and see how you’re doing compared to them. 

It’s a more aggressive form of analysis that takes their marketing campaigns and yours, sees their results, and tells you how well you’re doing in comparison. If your competitors are lagging, that means you’re leading, and vice-versa.

Other factors you can look at to compare brands include relative customer sentiment, acquisition rates, social media engagement, etc. 

Remember though, just because your competitors are below now doesn’t mean you can relax. They’ll be looking for ways to improve just as you are, and if you stop to watch, you’ll be left behind!

Financial data

Another metric you can use to measure brand equity is financial data. 

Market share, profits, revenues, prices – these all tie into how well your brand is doing, since more brand equity correlates with more customers. Compare these to those of previous years or quarters, and you’ll be able to measure brand equity data over time.

Customer lifetime value is another strong indicator. 

Essentially it’s the value that a customer brings to you during the entirety of their total interactions with you. 

CLV = Average purchase price Average purchase rate Average customer lifetime

Strong brand equity correlates to higher CLV since loyal customers will bring in more revenue for you overall. Conversely, if you need to keep re-attracting customers, it might end up lowering their overall value to you since acquiring a customer is more costly than keeping a current one.

Also worth mentioning is the cost of acquiring new customers, which is a huge indicator of brand equity.

If said cost is high, it means that it takes a lot of incentive for a consumer to switch from a competing brand to yours, meaning your brand equity is low, and you need to work on your image.

Brand awareness

Brand awareness is another abstract quality that’s hard to measure, but nevertheless, it’s very valuable when you’re looking at your brand equity. 

To put it simply, if consumers don’t know about you, then they won’t buy from you. Further, if they know of you only vaguely, you won’t be their first thought when looking for a product.

Having high brand awareness means that you’re synonymous with the market you’re in – like the examples of Coca-Cola and Sellotape mentioned earlier. 

Being so well known comes with certain risks to your brand, as you lose copyright on any name that becomes the commonly used term for an item, but it’s a definite sign that you’re well up there in people’s minds. 

Coca-Cola managed to retain its trademark since the commonly used term is the nickname Coke. Sellotape, However, lost theirs when the term was deemed genericized enough.

Ways you can measure brand awareness include:

  • Surveys.
  • Store traffic.
  • Search volume.
  • Google search rankings.

These aren’t the end all be all, but they’re a good start. You can also look to social media for hints, but this information will be highly polarized due to the nature of such spaces. 

After all, when would you be more likely to post on social media? After a routine, bog-standard experience, or one that was absolutely awful? 

Customer sentiment

Customer sentiment is about feelings, specifically customers’ feelings towards a particular product or brand, depending how you measure it. 

Customer sentiment is a measure of how strong the emotions associated with your brand are, and how positive or negative they are. 

It’s especially important in today’s markets, as 86% of customers are willing to spend more after a positive experience with a brand.

Generally, customer sentiment is generated by surveys or similar methods, asking customers to rank their experiences based on how they felt about their interactions with you. 

However, it can also be found by scraping review data with sentiment analysis or analyzing social media chatter. 

It’s not straightforward at all to measure customer sentiment, and you may need to use specialized platform like Sentimate to analyze the data for you.

Brand audits

Something to consider when you’re analyzing your brand’s equity is what’s the total value of the brand itself, or what it contributes to the business simply by existing. 

There are a myriad of factors you can measure when doing this, but depending on who you are and what you do some will be more important than others.

In general, things to consider when auditing your brand are:

  • The cost to build the brand. How much money did you pump into advertising, trademarks, etc.?
  • The market value of the brand, or how much value it brings to stamp it on a product. Can you charge more for a branded product compared to a generic equivalent?
  • The income value of the brand, or how much money it brings in by making customers aware of your products. Can you launch a new product and expect high sales, or would you need to put funds into advertisement?

How to build & develop brand equity (with examples)

Brand equity develops in two distinct ways. 

Firstly, there’s the way in which awareness about a particular brand can spread over time from person to person naturally. This is often overlooked as a method of building brand equity as it is a slow process but nevertheless is important.

The second way is to build it yourself, taking action to increase your brand’s visibility, reputation, and relationships with consumers. 

We’ve outlined below the processes by which these two methods take place, as well as how you might go about beginning the latter.

How brand equity develops organically

Brand equity is something you’d ideally want to craft, however, it’s also something that can develop naturally over time. 

Back in the 1950s, for example, they didn’t have the knowledge we do on how brands can build equity for themselves, yet Ford was still considered a top-tier manufacturer of cars. 

This happened because information can spread organically from person to person by word of mouth, which increases brand equity without any input from the brand itself. 

Let’s take a look at the process by which this happens.

Awareness

In the first stage, a consumer becomes aware of your brand’s existence. This can be via spotting products on shelves, seeing advertisements, or simply by word of mouth.

They will have no immediate opinion on them beyond what others might have told them and their immediate gut response to anything of your brand’s image they’ve seen.

At this stage, it’s not likely that a person will buy from you, but a small number of them might do so. If they do, they skip the next step and go straight to the third one.

Recognition

Next, the person in question will come across your brand again. This time they’ll recognize it, and it won’t be completely unknown to them. 

Their prior experience with your brand will add to the current one, forming an opinion. 

This is where good advertisement comes into play, as many potential customers simply gloss over a brand at this stage if it doesn’t catch their eye, forget about it, and do not progress further along in the process.

Trial

In the third step of the process, a consumer will feel comfortable enough with your brand to test one of your products. This might come after coming into contact with your brand just a few times, or it may take longer.

The important part of this step is that the person takes the leap from consumer to customer. They’ve invested money into you, and their opinions will be highly polarized by their experiences with your product or service. 

If the customer likes what you have to offer, it’s likely that they’ll come back. If they don’t, they won’t, and might even badmouth you. This fact is why businesses will often advertise their generic products more, leaving the more niche ones aside as fewer customers would prefer those as their first experience with the brand.

Preference

Next, a customer who has had good experiences with your brand will begin to prefer you to others in the market. This step absolutely requires that you get the previous one right, with most potential advocates straying from the track at this point. 

It’s not enough to simply be good, you see, you have to be better than their previous brand in order to convince them to prefer you. It’s been shown time and again that humans are creatures of habit, and won’t change their habits unless given an incentive to.

In this case, that incentive is a better experience than your competitors provide.

Loyalty

When a customer has had repeated good experiences with a brand, they will not only prefer it but begin to recommend it to others. 

After all, wouldn’t you want your friends to have a good time just like you did?

It’s at this stage that a customer can be considered an advocate for your brand. They will spread information on you to another person, who will then begin this whole process all over again as they’ve just become aware of it.

Advocates don’t just help spread awareness either, their efforts can be seen at every step of the brand equity process. 

  • If you’re aware of a brand but haven’t yet tried it out, someone recommending them to you might convince you to give them a go.
  • If you’ve tried out a brand, but haven’t committed to them, the opinions of others might help sway you.
  • If you’ve tried out a brand, and had a single bad experience, hearing about the good experiences of others might convince you to give them another try.
  • If you have a preference for a brand but aren’t comfortable talking about them to others, seeing another person do so might put you at ease.

Keep in mind, however, that not everybody finishes these steps. Some may simply prefer not to air their opinions so openly, others might simply be stubbornly stuck to their current brands. That’s okay though, not everyone needs to be an advocate in order to spread brand equity!

Building brand equity yourself

Brand equity spreads organically, though this is a slow process. In order to speed things up, there are several things that you can do in order to increase your brand equity artificially.

These factors really dive into the why and how of your brand. Consumers want brands that stand for something, that have a purpose and a meaning behind them. 

You need to have more tangible business goals than simply “be successful and make money”, and they need to be ones that consumers can relate to in order to truly create brand equity.

The sections below aren’t steps per say, but rather overarching guidelines that you should always keep in mind when attempting to build your brand equity. There’s no point at which you can say you’re finished, you should instead be constantly analyzing your brand and the world around it.

Understanding your brand’s drive

The purpose of your brand needs to be clear in order to build strong brand equity. If you take a look at the most prominent brands today, you’ll find that they put their purpose and drive at the forefront of their communications.

That’s not to say that they all have the same messages or goals. Each brand has its own unique approach, meaning you can’t simply copy someone else’s drive if you want to set yourself up as unique.

So, what kind of messages are there? Let’s take a look at two prominent examples in the tech industry – Apple and Microsoft.

Apple

Apple’s stated purpose is to stretch the limits of technology, to create things that no one else can. To that end, they portray themselves as providers of future technology.

Apple’s advertising tends to focus on the brand itself, more than the products, which has allowed them to break away from their initial focus on computers and into phones, tablets, and even TVs.

Overall, Apple’s strategy has been to present itself via dazzling and simplified displays that cling to people’s minds. It’s certainly worked, with their advertisements being some of the most memorable and creative in recent years.

Microsoft

In contrast to Apple, Microsoft portrays itself as reliable, down-to-earth, and hard-working. In other words, similar to your average working Joe. Instead of being a futuristic, out-of-this-world brand that dazzles you, they stick to the practical aspects.

Microsoft positions itself as the good old reliable company that will never let you down, one that keeps working people in mind. 

While certainly less exciting than Apple’s dazzling displays there’s no denying that the straightforward, practical-centered message resonates with a lot of consumers worldwide, resulting in Microsoft’s systems being the most used by far.

Of course, a brand’s drive can change over time.  Markets change, technology evolves, and the needs and desires of consumers change too. A business that aims to provide dial-up internet service would find it extremely difficult to attract customers today, for instance, despite it being a fairly attractive, low-cost option just 20 years ago.

Developing your brand’s message

When you’re creating messages that consumers will encounter, it’s important to make sure that they’ll find them appealing and interesting in order to further engage with you.

In other words, it’s not just what you say, but how you say it too.

The key element of your brand’s message is taking your drive and translating it into real-world problems that consumers face. Specifics and details are extremely important, as consumers are put off by vague wording and ill-defined tones.

So, how do you find out what consumers would relate to? In one word, data.

  • Consumer opinion surveys can tell you directly what worries them.
  • Search traffic is a great indicator of what topics are growing in importance.
  • Social media is a goldmine of opinion data and is searchable and segmentable.
  • Reviews and ratings of similar products or services to yours can give insight into consumer desires.

One thing to keep in mind is that deciding your message isn’t something that you do once and then stick to. As times change, you need to change too, and altering your message in order ot appeal to consumers more is standard practise for most brands.

Driving awareness of your brand

Being aware of a band means more than acknowledging its existence. You want customers to understand both what you stand for and how you plan to uphold your values.

Awareness comes with long-term strategies, and taking actions that align with your values. It’s a trust factor, one which will only come after you’ve demonstrated your commitment to upholding the values you’ve stated.

The most important thing you can do with your awareness strategies is to be consistent. Consumers connect the most with brands that they can form emotional bonds with, which onloy happens if that brand is consistent in its ways. You’ll get more out of long-term, loyal customers than you ever would by simply partaking in one-and-done sales.

In short, focus on the broader future of your brand instead of simply the next transaction. While you might profit in the short term, you’ll lose out in the long run.

Maintaining consistency & transparency

Once you’ve established your brand, don’t change it unless you have to.

This might seem completely opposed to everything we’ve spoken about in the previous few sections but bear with us here.

When we say keep your brand the same, what we mean is the personality and tone behind your brand needs to remain consistent in order for customers to continue to relate to you.

While there have been a few instances of brands radically altering their image in order to refresh themselves – see Savage Wendys – it’s generally better to maintain your image.

If you do pivot, make sure to stay consistent. Wendy’s has been roasting ordinary people and antagonizing their competition on Twitter for over half a decade now, and has become something of a sensation.

The customers that you retain tend to do so because they relate to you and your brand. If you wipe the slate clean, you’ll have to re-acquire loyalty from them all over again.

Sometimes, newer isn’t always better. Then again, that’s up to you to decide.

Customer experience

Customers are at the heart of brand equity. News can travel faster than ever in the age of the internet, and bad news always seems to spread the fastest.

The solution? Simply providing a good customer experience.

Brands aren’t defined just by what they do anymore, they’re also known for how they do it. Unless being rude to your customers is part of your appeal, and yes, there are actually businesses that do this, you need to put great customer experience at the heart of your brand.

Social media is a great place to let customers air their praises and grievances to you. By taking note of the former you can continue to provide great experiences in the future, and by responding to the latter you’ll be potentially turning a negative into a positive. Almost all brands, even smaller, local ones, have some kind of social media presence.

An often overlooked way to gain insight into what kind of experience your customers want with you is simply to ask them. While it’s not always possible to get real-time feedback, asking your customers how you did at the end of each interaction can get you detailed information on how your strategies are working.

At the end of the day, the customer is king – at least when it comes to brand equity, anyway.

Real-life examples of building brand equity

All this talk of brand equity sounds very impressive, but you might be wondering – if it’s all hypothetical, nothing guaranteed, what’s the point of it? 

Well, we’ve gathered below some real-life examples of how brand equity was built, as well as the lessons you can learn from them.

Maggi

You might know Maggi as a provider of cheap, filling instant noodle snacks. What you might not know is that they were banned in India in 2015, after regulators determined that their products weren’t as free of MSG as they claimed, and even contained lead!

The validity of these tests was later called into question, but you’d expect there to be some damage to their reputation … right?

Despite the fact that these noodles were banned in the entire country of India for almost six months, and that production had been halted during this time, there was still an enormous demand from the Indian population for their one-pot snacks.

So, why is this?

Well, Maggi’s success was in adapting to the culture present in India. In quite a few nations, offering noodles as an alternative to rice would be seen as sensible, however in India, the idea of “rice for dinner” is so ingrained (no pun intended) that they needed to try a different strategy.

Instead, they advertised their noodles as an afternoon snack, something that could be made and eaten quickly by those in a rush – for instance, parents who needed to feed their children quickly after school.

In essence, Maggi offered itself as an “in-between” option and did so with great success. The convenience of their products meant that even after a scandal that halted sales for six months, many households still returned to consuming them almost immediately.

The lesson here? Adapt yourself to the demands of the market you find yourself in.

Netflix

Netflix is a huge success story when it comes to brand equity. Once they were nothing but another video rental company, now they’re synonymous with online streaming services. 

They’ve even entered our casual vocabulary as a verb … to Netflix and chill. 😉

Netflix was able to build its brand equity by being one of the first organizations out there to expand into what it’s now known for – streaming services.

In fact, I’d bet that a few of you reading this don’t even know that it did anything else before streaming.

Netflix was in the right place at the right time to begin the streaming revolution, launching its platform in 2008. It may not have been the first streaming service, but it was definitely the first major one.

Why was this the case? Well, they were already established as a video rental company at the time. 

With the rise of the internet, Netflix saw that they had an opportunity to expand their services. Eventually, as their streaming service gained momentum, they turned it into their primary source of revenue.

Today, Netflix no longer offers video & DVD rentals.

The lesson here? Adapt your brand’s strategy and identity to changing times.

Conclusion

Hopefully, after reading this guide you’ll know a little more about brand equity – what it is, how it’s grown, and how it’s maintained.

Brand equity requires knowing your brand, and knowing what your brand’s greater purpose in the world is. That’s a big question to ask, and a lot of brands can’t even boast of having one.

By having a purpose, a message, and the means to spread awareness of these, you can propel your brand to great heights. People naturally seek purpose in life and align themselves with those brands that hold values they can understand and empathize with. 

It’s not entirely out there to say that these purposes sometimes matter more to them than the products & services that these brands provide. 

Take a deep breath, and ask yourself – what is our brand’s purpose? What can we do to make sure this purpose is fulfilled? Do that, and you’re on the right track to having brand equity for yourself.

How Competitive Intelligence Lets You Stay Ahead of Your Rivals

Posted on by Emily Louise Spencer

Businesses don’t exist in a bubble. Competitors always try new tactics to gain market share, leaving you behind. That’s why performing competitive intelligence isn’t optional these days but a must. This guide will walk you through the details of competitive intelligence, from basic definitions to actionable strategies explaining how to perform it and gain the upper hand.

 

Imagine, if you will, that you’re a baseball player who’s up to bat.

You’ve no idea what pitch the pitcher is going to throw.

You’ve got no clue where the catchers are planning to move to.

All you can do is make your best guess, right?

Well, not exactly. Each pitcher has their preferred throws, and there’s a good chance they’ll use one that they think you’re weak to. If you prepare for such a pitch, you’re more likely to score a home run ????. 

In a way, the world of business is just like the game of baseball. Being able to predict what’s going to happen next will give you a huge advantage. You’ll be able to see your competitors’ latest moves to try and squeeze you out of the market and counteract them.

That, quite simply, is competitive intelligence. 

What is competitive intelligence?

Competitive intelligence is data collection and analysis by your organization on its competitors. This is done using openly-available sources, such as:

  • Press releases.
  • Patent filings.
  • Whitepapers. 
  • And more, which we’ll cover later on.

Public companies are much easier to gather data on, as they are lawfully required to publish their quarterly earnings. Private companies are a little bit more difficult to examine, but there are methods you can use. Legal ones, that is.

Competitive intelligence vs. industrial spying

When we say competitive intelligence, you might think that you’ll be aiming right for the target and getting ahold of your competitors’ strategies directly. 

This is not actually the case.

You see, competitive intelligence is done legally. 

Every business has a right to keep its inner workings a secret, especially concerning its information. Stealing that information is highly illegal as it would involve either breach of contract or hacking into their servers.

Information gathered illegally can, of course, be used to make decisions, but that’s not competitive intelligence – it’s industrial espionage, which we strongly discourage.

How do you get competitive intelligence?

Competitive intelligence has many sources.

Which ones you turn to will largely depend on your intentions when performing your research. Nevertheless, all of them can provide valuable data if analyzed correctly.

Blog content

The content that your competitors write about on their blogs is a gold mine of information. Not only does it tell you what type of consumer they’re hoping to attract, but how they’re hoping to attract them.

Just like our blog, you’ll find a variety of topics based around the general market that your rivals are in being written and posted. Some of them might seem to have little relevance, but when you analyze them fully, you’ll find ways in which they link back to your competitors’ game plans.

We wouldn’t be writing about competitive intelligence here at Revuze if our software couldn’t help in that regard, now would we? Our AI can help you obtain competitive intelligence in real-time, so feel free to book a demo if you’d like to learn more.

Social media

Social media often has a news component for businesses, whereby they keep their stakeholders updated with their new and ongoing dealings.

Thanks to this, they’re prime information sources. New product launches, new deals, and customer responses, you can find a lot of data on these platforms.

You might think that a lot of social media information can only be used in reactive responses rather than proactively, and in a sense, you’re both right and wrong. 

You can only respond to each individual piece of information, however, they may reveal a trend that shows your competition’s ongoing strategies.

Take, for instance, the example below from Nestle.

Taken individually, each advertisement gives off a different message. The first one showcases the benefits of plant-based food, the second promotes involving children in your cooking.

When looked at together, they tell a different story. Nestle is promoting healthy eating, presumably because they want to boost sales of their healthy eating product lines. This is a bold new direction for a company known mostly for its chocolate and confectionary sales.

Reviews & feedback

Whenever your rivals launch new products or services, the first thing you should look at is their reviews. 

Not only will they give you insight into what your competition is trying to achieve, but they’ll tell you the audience’s response to it.

There’s no use creating the perfect egg scrambler if your customers want their eggs fried, after all.

Reviews are useful for existing products too, with any changes reflected in the feedback they receive. 

Job boards

While not the most intuitive of places to look, job boards can nevertheless be a valuable source of information.

Imagine for a second that your main rival has suddenly posted a lot of job openings in their R&D department. This is pretty unusual since they typically have a low personnel turnover rate.

So what’s going on? Well, there are several options:

  • They’re looking to expand their R&D department permanently.
  • They’re starting an experimental project which they aren’t sure will succeed.
  • They’re feeling behind on their research and want to hire more staff to catch up.

In the case of the first option, the job listings would be permanent posts. In the case of the other two, they’d likely be temporary. 

The second option might also be listed as “temporary with a possibility of becoming permanent.”

Just like that, simply by keeping an eye on the job boards, you’ve gained valuable information on what your rival is up to.

Financial statements

As mentioned previously, public companies have to release their financial statements quarterly. With this data in hand, you can see:

  • Where they’re earning the most money, in essence, what areas they rely on.
  • Where they’re earning more money than last quarter, therefore growing their operations.
  • Where they’re investing their money, what they’re buying, and what they’re not.
  • Which strategies of theirs are working, and which aren’t.

Press releases

Business news is absolutely full of valuable information. There will be announcements about new products, new hires, expansion moves, and more.

Some businesses even have a News section on their websites or apps, which coalesces all this information in one place.

Local information

If you’re part of an industry that has brick-and-mortar stores, you can look at the local information surrounding said stores in order to gather information.

What times do your competitors open and close? What area of the town or city are they located in? Do they have a decent amount of floor space dedicated to customers? Do they keep their stock on hand in a back room or a nearby warehouse?

All these little details can tell you what might and might not work in your own stores. Of course, copying your rivals exactly isn’t ideal as they might be constrained by circumstances and not able to operate as they would ideally, but it’s a start.

Legal papers

You can look at legal papers filed by your competitors as they are typically publicly viewable. 

For instance, a planning permission request for a large industrial building would indicate that your competitor plans to build a new manufacturing plant or similar establishment.

This tells you that your competitor is trying to expand their manufacturing processes, and if it’s in a new location, you can assume that they’re trying to expand into a new market.

Another great source of information is patent filings. These will tell you not only what your competition is doing but what they plan to make legally exclusive. 

It’s sometimes said that there’s not an original thought under the sun that someone hasn’t already had at one point. That’s true in R&D as well. 

You might have to end up abandoning your projects or adjusting them not to break copyright law if your competitors patent what you’ve been working on.

Industry conferences

Conferences are similar to news reports, except more detailed. They’re designed to showcase all of the best aspects of a business to others within their industry, whether that’s to attract new customers or collect new talent.

Conferences are often the most detailed sources of information on this list, and that’s for one simple reason. You can actually talk to participants and get their opinions and perspectives.

All news, legal papers, and social network content are heavily moderated by those who release the information. When talking to someone face to face, you can often get far more information.

The downside is the unorganized nature of gathering data at conferences. You also have to factor in the ability to get to the conference, accommodation, etc. 

So are conferences worth it to attend? It’s up to you, but we’d say definitely. The rise of virtual conferences is also making attendance easier, so keep an eye out for these opportunities.

What are the goals of competitive intelligence?

So, you might be thinking, why use competitive intelligence? 

If it’s all indirect information, is it really going to give me an accurate picture of what my competition is up to?

Competitive intelligence is akin to following footprints in the sand. You might not be there to see the person walk it, but you can see which direction they’re going in, and when they shift or double back on themselves.

You can infer a great deal from indirect information. If you want an example from history, look no further than when Kodak accidentally discovered the Manhattan Project, simply by noticing that they were getting reports of radioactively-contaminated film in the area around the test site.

Anticipating your competitor’s moves

“Know thy enemy, and know thyself,” said Sun Tzu in the Art of War.

While not quite a battle between armies, business is no less competitive. If you know your rivals’ moves before they begin, you will be able to counter them with great effect.

Let’s say that both you and your competitor are in the e-commerce business. 

You know from experience that your competitor has put on a Black Friday sale every year, thus you can anticipate that they’ll do the same this year and develop a strategy that accounts for this.

There’s also the option to take a look at their past sales, as well as current hot items, which will give you a clue as to which products they might put on sale this year. If you know which categories they plan to target, you can sidestep or counteract them.

All in all, the best way to counter an opponent’s strategy is to never let it get off the ground in the first place.

Driving your innovation

You always need innovation in order to keep your business fresh and on top of things. This goes doubly so for those dealing with the ecommerce market, where trends and habits change faster than anywhere else.

Competitive intelligence can uncover what it is that your competition has, but more importantly, it can also reveal what they lack and what consumers are after. No one can cover all bases, after all, and by keeping an eye on new opportunities, you can really get ahead in the game.

Keeping track of market conditions

Markets change, and you need to change with them in order to survive.

One of the greatest examples of decision-making in business is Netflix, which in 2007 launched a streaming service alongside its video rental one. This proved a huge hit and allowed Netflix to become the giant that it is today.

Netflix saw which way the wind was blowing as music consumers turned more and more to digital media and decided to follow it. It allowed them to survive a major upheaval in the industry, which many, including Blockbuster, did not. 

Netflix’s changes showcase a great example of strategic intelligence in action. Video rental was still popular back in 2007, after all, and they could simply have stuck to it. 

Instead, they took account of trends that showed a shift towards online streaming and were able to adapt and weather the storm. 

Blockbuster, on the other hand, continued to have faith in their traditional methods and failed to take into account the long-term implications. There’s only one Blockbuster left in the US now, and for a good reason.

Growing your brand to customer expectations

Times change, and so do people. Nobody would say that applying the same business tactics that worked in the 1950s is appropriate in today’s world, but few realize just how fast expectations can change in the age of the internet.

This is something that e-commerce-based businesses especially need to be aware of, what with the internet being an ever-evolving pace. 

Payment options, fonts and colors, images – especially if you try to use internet humor to sell your brand – links and plugins, all these can have a massive effect on your ability to sell. 

If you use unusual plugins, for instance, you’ll turn off most customers who won’t want to install one to use your store. 

If you’re given the option between two sites, one of which requires you to download extra features to use while the other is free of such inconveniences, which would you choose to use?

Links can also break or be archived over time, meaning what worked perfectly one day won’t the next. Relying on other websites to grant information is a tricky business.

If a certain brand that you’re displaying prominently has bad press, you may want to decrease its visibility on your store lest you get a bad reputation by association. Conversely, you can increase the visibility of other brands that have a surge in popularity.

Competitive intelligence will help here, telling you what customers expect from you and what you need to do in order to meet those expectations. 

A good example of growth meeting customer expectations is Amazon’s adoption of Venmo as a payment option, allowing those who don’t want to use their bank accounts directly a more secure way to pay.

Credit and debit card fraud has been on the rise over the past few years, making more and more consumers wary of using their cards online. 

When using Venmo, your bank information is never directly given to the vendor, meaning that phishing attacks or breaches in Amazon’s security are unlikely to put consumer data at risk.

The COVID-19 pandemic showed just how fast brands needed to be able to change to survive, with plenty of businesses not making it through 2020 intact. 

While not exactly a typical event where markets are concerned, it does nevertheless highlight how much circumstances can change in short periods of time.

Knowing your position within the market

Another great example of where competitive intelligence can help you is in finding your market position. 

You see, it isn’t always obvious from sales figures and other such indirect data exactly where you stand nor how you are perceived by the consumer base.

Data sources such as reviews, ratings, etc., can give you an insight into the consumers’ minds and how they perceive your brand, letting you assess your standing. 

Are you seen as a first-pick, top-rate seller? Are you just a reliable alternative when the usual options aren’t available? Or are you seen as someone niche who fulfills specific demands that only a few consumers would have?

By using this information and comparing it to your strategies, you can see if you’ve achieved your targeted market position. If you have, great! If not, you’ll gain insight into why this is the case and how you might resolve that in the future. 

Remember, Spotify was able to alter its position from merely a simple music player to a content creation platform in just a few years, proving that anything is possible if you have the right intelligence.

Staying ahead of your rivals

Let’s go back to the baseball metaphor. Your biggest rival has started upping their game by purchasing new players specifically to beat you. 

You can’t stop them from doing this as the people selling the players aren’t going to stop just because you ask nicely. So, what can you do?

Well, there are several ways in which you can undermine them, all above board.

For starters, you can either coach your team in strategies that counteract theirs, or you can hire new players yourself to counteract their changes. 

If one pitcher they obtain is known for their difficult-to-hit fastballs, you can hire a hitter who’s known for being able to knock them out of the park.

Secondly, you can put in bids yourself. 

Not only can you stop your rival from obtaining certain players that way, but by entering into bidding wars with them, you can potentially limit the number of players they can buy. 

An organization only has so much money to throw around, after all.

Following on from that, if you take a look at their team and the players they’re placing bids on, you might be able to see dazzling combinations that would work very well together and disrupt them. 

For instance, if you split up a pitcher-catcher combination that is known for doing great together, you can disrupt their seamless play by having their players have to adjust to each other.

In short, just because your competition plans for something to happen doesn’t mean that they will be able to pull it off.

Helping decision making

Finally, we get to the main point that underlies most use of competitive intelligence, that it helps you decide what to do next.

All of the previous examples we’ve mentioned today allow you to make better choices, ultimately helping you make data-driven decisions that will elevate you in the market. 

The more information you have, the better a decision you will be able to make.

If the British had known that Washington planned to cross the Delaware, they wouldn’t have simply let him slip through their fingers. 

Knowledge is power and some would say knowing your competitors is a superpower.

Types of competitive intelligence

Now that we’ve mentioned why you want to use competitive intelligence, it’s time to take a look at what it is in more depth. 

We’ll start by defining the two types, strategic and tactical.

Strategic intelligence

Strategic intelligence is all about long-term thinking. It’s information that could affect the business’ direction over long periods of time. 

This type of intelligence isn’t something that you need to worry about right away. However, you shouldn’t let yourself be lulled into a false sense of security.

Some examples of strategic intelligence include how consumers use the internet, for instance, which social media sites they use, which plugins are considered essential, and which browsers are in favor. 

Tactical intelligence

Tactical intelligence deals with things that alter your plans in the short term.

This type of intelligence demands an immediate response if you’re going to act on it, and in some cases, you may have to act without having the complete picture. 

That said, you shouldn’t let that stop you from making a decision. 

In business, it’s often best to make a decision with the information that you currently have rather than miss the opportunity.

Examples of tactical intelligence include new product launches by competitors, new government regulations being introduced, new stores being opened in your area, and disrupted supply chains due to road accidents.

How do you perform competitive intelligence analysis?

If you’ve read this far, you’re probably convinced that competitive intelligence is the right type of analysis for you. 

So, how do you go about performing it? We’ve laid out the seven crucial steps below that will assist you in undertaking your analysis.

Decide what you want to achieve

The first step, as with many a project, is to determine what exactly it is that you want to achieve with this analysis.

Do you want to know your position within the market? Perhaps you’d like more information on what your rivals are up to? Or maybe you’d like to scour the market for a gap that you can fill?

Your aims will determine everything, from your information sources to your analysis methods. If you don’t make a firm decision here, you’ll be floundering about during the entire process.

Remember, your business will likely have several different markets that it stretches into. By segmenting your analysis into different sections for each market, you’ll be able to collect data that’s relevant to each without muddying the waters.

The narrower your field, the more precise your information will be.

Identify your competitors

Once you know what you aim to achieve, you can then identify your competitors. These are those businesses who are:

  • Within your market.
  • Selling similar products.
  • Aiming to appeal to the same audience.
  • Able to take away your customers.

This is a fairly straightforward step in most cases since you can simply look at who is selling similar products or services to you. The more similar these are, the more they are a direct competitor.

Determine the data you need to collect

Now that you know what information you want to find, and who you want to find it on, it’s time to determine what data will showcase that information.

Are you looking for information on new products that your rivals are launching? Look to reviews, your rivals’ websites, and unboxing videos.

Do you want to know what your competition is up to with their advertising? You need to look at their campaigns and observe the trends.

You can be more specific too, splitting advertisement into online and offline, email and social media, etc. Remember, the more segmented the data, the more precisely you can guess your opponents’ moves.

Find your data sources

Once you’ve determined the data you want to collect, you can pick your data sources. 

Products? Find their reviews, look at their product showcases, and check out the product’s sentiment via sentiment analysis. 

You can even go so far as to buy one of their products for more direct comparison and testing, and maybe find a way to get an edge that way.

Pricing strategies? Take a look at price trends offered by Amazon, at past offers and pamphlets, and compare them to your own.

SEO tools such as Semrush and Ahrefs will give you detailed information on a variety of topics, as they’ll easily be able to show you which keywords your competitors are aiming to rank strongly in. 

If you know where they’re trying to appear in Google searches, you’ll know what kind of customers they’re aiming to attract.

Analyze your data

Next up is data analysis. There are plenty of methods to choose from, some involving software and some involving doing the number crunching yourself. 

Some examples include but aren’t limited to:

  • Porter’s Five Forces.
  • Driving Forces Analysis.
  • Product Life Cycles.
  • Porters Four Corners.
  • SWOT Analysis.

Remember, while computers might be all the rage, they’re a little lacking when it comes to the emotional side of things. 

Sometimes you can simply look at the information you’re presented with and come to a better conclusion than a computer could ever reach.

Convert your analysis into plans of action

Now that you’ve gained your information, it’s time to convert it into plans of action. Or rather, factor it into your existing plans to make them better.

To take the previous baseball metaphor, you need to adjust your stance once you’ve deduced what pitch you’re about to face. In the case of business, however, the pitch is anything that can alter the ideal outcome of your plans.

The direction that you take is extremely dependent on your situation, so for the most part it’s up to you. Your intuition and experience can be excellent tools here, allowing you to see solutions that wouldn’t ordinarily be obvious.

Repeat, repeat, repeat

Competitive intelligence isn’t just a one-and-done type of deal. Your strategies change, so why shouldn’t your competitors do the same? 

Competitive intelligence should be a regular habit that you indulge in, not a one-off project. 

After all, markets are volatile, consumer expectations change, and you need to be aware of all of this if you want to get ahead in the game.

When should you perform competitive intelligence analysis?

As we’ve previously mentioned, competitive intelligence analysis is something that’s ideally done whenever possible. 

However, there are a few specific times in your business’s life cycle that you definitely need to be performing it.

Let’s take a look at some of the best points in time when you can be undertaking this.

When you’re starting out

Analyzing your competition should be one of the first things you do when you’re planning to start a business. Knowing who you’re up against, what they do, and how they do it is crucial to staying competitive.

Understanding the industry you’re in will tell you a great deal about how you should operate. 

Is the market saturated with brands that seem indistinguishable? You’ll need to stand out by having a feature that’s unique. 

Shopify, for instance, saw the world of ecommerce and decided to create a platform for small businesses to create their own customized online stores easily, rather than having to rely on pre-existing platforms that would limit their design abilities.

Your investors will want to know about the surrounding market too since it gives them an insight into how well you’re likely to perform and how risky an investment you are. 

Very few businesses can get off the ground without funding, so this is a top priority.

When you’re developing & launching a new product

William Henry Perkin isn’t likely a name that you know, since he lived in the 1800s. In short, he’s best known for creating the first cheap purple dye, which until those times had been limited to the extremely rich due to the cost of its production.

He also created a red dye in 1869. However, another company beat him to the punch in patenting it by just a single day! 

This showcases why you need to perform competitive intelligence both when developing and launching a new product – your rivals might be thinking along similar lines and get their product out before yours, at which point you may have to abandon the entire project due to patenting.

When you’re considering a change in market strategy

Change comes to us all, whether we like it or not. A crucial part of planning for change is analyzing the current market in order to assess whether or not your planned changes will be effective.

One of the most important parts of this is analyzing your competitors in order to make sure they’re not planning the same as you. 

After all, it’s no good to plan a pivot that makes you stand out only for your competition to take the same direction. 

When you’re seeing a drop in physical business activity

When business stagnates, there isn’t always an obvious reason why meaning you need to look deeper to find the source of your problems.

Of course, foot traffic and physical sales can decrease for reasons other than your competition, but by analyzing them, you can see whether they are stealing your customers or if there’s a bigger problem that you all are facing.

Are you all seeing a drop in foot traffic, but only within a specific area of your city? It’s probably a transportation issue that prevents customers from being able to reach you easily.

Maybe some of your competitors are seeing a boom, whereas others are seeing a bust also. There will be some correlating reasons as to why specific businesses are more attractive right now compared to others, and you will be able to find them.

Maybe everyone sees a drop in business activity. This points to a drop in consumer confidence, indicating that you should be prepared for them to spend less and spend only on products they really desire.

All this information adds up to an edge that lets you see where consumers are engaging with businesses and, more importantly, why. This enables you to adjust your approach and meet their expectations.

When you’re seeing a drop in online traffic

Getting hits on your website is crucial to ecommerce, and a big part of this is search engine optimization to account for organic searches, which are making up a larger and larger share of online traffic. 

In essence, hitting the right keywords within your website and meta information makes sure that you’re at the top of the list when it comes to Google searches in your particular field.

The problem with this is two-fold. 

First, the inner workings of search engine rankings are secret and will naturally change over time. 

Secondly, the searches that consumers perform will change over time as their needs and wants evolve.

Both of these factors add up to one single outcome – you need to keep on top of your optimization to stand out. 

If you see a drop in traffic, you likely need to redo your metadata to upstage your competition.

Hitting a home run with competitive intelligence

With this complete guide on competitive intelligence, you should be able to get the edge your need over competitors.

You’ll understand what competitors are after, their plans, and indirectly – what customers want.

The journey doesn’t end here, though. Once you have customers’ attention, you need to provide them with a show they won’t forget. Check out our ecommerce customer experience guide to get up to speed on the topic.

How Convergence Marketing Empowers Your Brand and Customers

Posted on by Emily Louise Spencer

Today’s world is all about data, and bringing your data together is the heart of convergence marketing. When every department can access it, your customers stand to win through personalized and improved experiences. Let’s dive in to understand how convergence marketing benefits everyone and how to apply it successfully.

 

Traditionally, a business’s marketing, communications, and IT divisions are kept separate. These sections run independently of one another, interacting only when necessary. 

This allows businesses to operate smoothly without having the burden of double and triple-check everything.

Customer reviews

It’s a good approach, born from times when most management strategies were being developed. Times when keeping everyone up to speed meant sending paperwork back and forth between departments. It’s a lot of hassle, and efficiency dictated people should know only what’s needed for them to perform their jobs.

But we live in different times.

In today’s world, with technology allowing for instant communication and data sharing, this approach might seem outdated. Siloing your departments might be what’s always been done, but that doesn’t mean it’s the only way to go. That’s where a new approach comes in, called convergence marketing.

Keep reading to discover what potential it holds for your customers and company.

What does convergence marketing mean?

Convergence marketing is more of a philosophy than a strict step-by-step approach. In essence, it’s the art of merging your marketing, information, and design divisions in order to allow a unified message across all forms of marketing media you use.

The main idea of this approach is to place the customer at the center of all forms of communication, seeking to ensure that all messages they receive present a single, unified front. 

This reduces the number of mixed messages the customer receives, allowing for greater brand recognition and trust to flourish.

Convergence marketing generally applies the most to digital or digital-supported forms of marketing. That’s because digital information can flow freely and seamlessly, as it’s retrieved from a database within milliseconds. 

As such, attempting to converge marketing strategies that are mostly offline will be very difficult.

Convergence marketing vs. integrated marketing

A similar yet different term is integrated marketing. 

Integrated marketing is all about coordinating marketing messages across different communication channels to increase brand awareness.

While this might seem identical to convergence marketing, this approach only considers the marketing department, ignoring all other aspects of the brand that might serve as touchpoints for customer communication. 

It shares the same idea as convergence marketing but applies it on a smaller, more isolated scale. That being said, integrated marketing often happens naturally when you do convergence marketing, as you’ll likely factor in all communication channels.

Convergence marketing vs integrated marketing

What are the advantages of convergence marketing?

Now you may be thinking, this sounds like a lot of work, and that’s because it is. 

Bringing separate departments of a business together is never easy, doubly so if you want them to be able to communicate in real-time. 

If it’s that difficult to employ convergence marketing (which means it’s likely to cost a decent sum of money), why do it? 

The benefits of convergence marketing tend to outweigh the costs if done correctly, as presenting a unified message on all fronts has numerous benefits. Let’s go over the most immediate ones.

Customer empowerment

By putting the customer at the center of your marketing strategy, you’ll be empowering them to act and provide feedback, giving them a voice in future decisions.

Any customer-centric marketing strategy takes in feedback, but where convergence marketing empowers customers is the linking of marketing and communications channels. Each piece of information collected by the communications team will be passed on to the marketing team and vice-versa.

Two way communication

This has the effect of not only increasing the customers’ voice within the organization as a whole, which allows you to tailor your marketing campaigns appropriately but increasing brand recognition overall.

While it might seem as though useful customer data is difficult to get, it’s been proven that two-thirds of consumers will willingly share their data with you if they think it will improve their overall experience. 

They’re also willing to let you use first-party tracking cookies and other means of observing their online behavior if they think they’ll get something out of it.

In other words, convergence marketing is like symbiosis. Each party gives and takes, and both benefit overall.

Improved customer experience

Convergence marketing necessitates a shared database of information to which all sections of the business have access. 

By creating this cross-transfer of information, various departments of your business will have access to all data collected on customers, enabling them to see previously documented interactions, and provide a better overall customer experience.

A Google report showed that up to 85% of digital customer journeys use more than one form of interaction with you. That’s a lot of data that you might miss if you’re relying only on information from one IP address.

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With all available information on a particular customer, you will be able to learn what experiences they’ve had with you in the past, what approaches they respond best to, and even what might cause them to walk away satisfied. 

Remember, engaging your customers is the best way to make sure they walk away happy! 

Integrated communication between departments

Convergence marketing requires departments to collaborate, which means you need to have a robust communications system between them. Integrated communication isn’t so much an unintended benefit as a necessary part of convergence marketing. 

Once the channels of communication are open, they can be used for more than they were designed for. Departments can share ideas and get feedback on them, ask for help from one another, etc. 

Another factor is post-purchase customer service. Almost 60% of consumers would use social media to get this, but without information from the sales team on what’s been purchased, whoever is running the social media won’t be able to do their job.

Collaborations are also an option. With the traditional siloed form of organization, the different departments wouldn’t know about each other’s plans and, therefore, wouldn’t be able to offer assistance or request adjustments.

One of the greatest examples of inter-departmental collaboration in modern times can be found in Apple’s Transparency Report, designed to keep track of both government and private party data requests to Apple.

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Apple’s aim here was to keep their customers reassured that their data was safe and wouldn’t be sold to third parties. 

In order to achieve this massive task, Apple had to keep a record of any and all requests for data, the reason for such, and whether or not the request was granted. 

This quite obviously involved their communications department. The collaboration also involved their legal team, who determined whether or not to release data in the face of law enforcement requests, and their information security team, who decided how to release the data.

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They pulled all information together and released it in the form of their Transparency Report, released annually. In the above table, taken from their 2021 report, you can see that over 70% of private-party data requests were rejected. Apple is practicing what they preach, being open and honest about its responses to data requests when needed.

Apple scored a major PR win with customers who want to keep track of their data and be reassured that Apple would only release it as a last resort. It’s arguably their greatest collaboration and one that perfectly exemplifies convergence marketing.

Instant access to information

Converging your departments necessitates placing information within a shared database. It also means that your data will take a standardized form and that anyone within your organization who has access can use it.

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Imagine you’re a member of the marketing team who’s had an idea about using some of the latest designs in your new marketing campaigns. Without a unified database, you’d have to:

  • Request the designs from the design team.
  • Wait for a member of the design team to read your message.
  • Wait for the design manager to okay sending the designs over.
  • Wait for the design team to actually send the designs over.

Each of the above steps takes time, whereas with a unified database, you can simply hop into the relevant folder and pull the designs out for use. 

Where and how can you apply convergence marketing in your business?

Convergence marketing isn’t something that you can apply overnight. It’s a slow and steady process that brings different sections of your business together, requiring careful preparation. 

The simplest, and altogether the most sensible approach, is to alter each of your departments’ approaches little by little until they’re aligned with each other. 

Once the processes and guidelines that each part of your business uses are similar, you can begin the sync, allowing them to work in harmony.

Let’s go over what each department needs to do to get the convergence ball rolling.

Where and how can you apply convergence marketing in your business

Marketing department

Convergence marketing, as the name suggests, is focused on marketing. It should come as no surprise in that case that the marketing department will be at the center of your efforts to converge.

When implementing convergence marketing, the first step in the process is to begin documenting and recording your marketing efforts within a database. That is, if you have not already done so.

Marketing department

The next step is to take a look at the way you store information, including but not limited to:

  • Acronyms.
  • Filetypes.
  • Naming conventions.
  • Database layouts.
  • Access protocols.

These all need to be standardized into a form that the other departments involved in your efforts will be able to read and understand. 

Once information is standardized it can be read by anyone who knows the syntax used, which should be provided to all other teams involved. Other teams may not necessarily use the same software as the marketing team, so you’ll need to take this into account.

You might be asking yourself, why is data standardization important? Surely anyone who needs to use the data can simply convert it into a form they can read.

The answer is two-fold. 

Firstly, errors can crop up in translation. The data you end up with might not match the data you started out with, and it’s not feasible to manually check every piece that comes your way.

Secondly, your staff is only human. It’s inevitable that someone will forget to convert data, use the wrong conversion methods, etc. 

If you think this is overstating the matter, please remember that NASA lost an entire Mars probe in 1999 thanks to someone forgetting to convert from inches to centimeters. Hopefully, any mistakes that crop up in your departments won’t cost $125 million and involve crashing objects into planets.

While standardized information is vital for all departments involved in the convergence efforts, it’s especially important for the marketing department. 

And since marketing plays an integral part in your efforts, you should consider convergence within the department.

Internal convergence

Converging your marketing efforts can mean many things. Perhaps the most important aspect you should look at is converging your online and offline forms of marketing.

Due to their different philosophies, it’s common for businesses, especially larger ones, to silo these two forms of marketing into different teams so their operations flow smoothly.

Online marketing is a far more advanced approach, crunching big data from each particular consumer and personalizing ads and offerings based on behavior, interests, and more.

Offline marketing, on the other hand, needs to be far more general. It’s not that you can’t make offline forms of marketing more personalized; it’s that the amount of effort that it takes means it’s not always worth it.

In today’s world, attention spans are shorter than ever. It’s estimated that the average human’s attention span is just over 8 seconds, a drop of nearly 5 seconds from the year 2000. This puts the average human’s attention span at less than that of a goldfish!

This drop doesn’t come as a surprise, given how technology has sped up in the past 20+ years. With this information in mind, it’s more important than ever to grab consumers’ attention early on in your interactions. 

That doesn’t mean you should ditch offline marketing efforts. Some can work brilliantly. Take the billboard below as an example.

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It was created as part of a Minnesota anti-smoking campaign. 

It’s a simple design, with only the website link on the billboard itself, but the pole beneath dressed up as a cigarette makes sure that we know the purpose of the advert. 

The green color often associated with hospitals is the final nail in the board, subconsciously reminding the reader why they should consider getting in touch.

In short, the billboard has conveyed:

  • What service is offered.
  • How to best contact them.
  • Why you should do so.

Online marketing can learn a lot from offline forms. Digital designers may be tempted to make elaborate and attention-grabbing content, but paradoxically it’s best to keep things simple even when you have a theoretically unlimited amount of space.

No one wants to keep scrolling forever, after all. It’s estimated that the average website user stays on a webpage for only 50 seconds, and that’s with an engaged audience, so you want them to take in as much information as possible in that time.

This is where the convergence of online and offline marketing comes into play, with the two learning from one another and leaning on each other. In all forms of media, you have to present information in a very efficient way. It’s not enough to simply make a consumer aware of your product. You need to tell them what it is and why it’s the best option for them to purchase. 

The below images taken from IKEA’s website showcase how simple designs can convey a lot of information. 

This image displays a sense of aesthetics that would make the viewer see IKEA positively while not being too complex or distracting from the point.

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The second section, shown below, uses extremely simple outline images to get the point across, displaying all of IKEA’s services in a readable form.

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Simple, easy-to-read marketing.

Communications

Communications refer to the part of your business responsible for communicating with outside parties. That’s anything from customer service helplines to writing emails to your shareholders. 

In small businesses, this department might be merged with another or simply have its responsibilities spread across several other teams. Still, the principle behind convergence marketing extends whether you have a dedicated team or not.

Your communications department greatly benefits from convergence marketing, with the most obvious advantage being access to the other departments’ data.

With access to all the data your marketing department has collected on a particular customer, you’re better able to tailor your approach to them. This can extend to:

  • The channel of communications.
  • The tone used in communications.
  • The complexity of the language used.

You might think that that’s all there is to it, but there are other benefits as well. Not only can the information you get improve your communications department’s operations, but collaboration with your other departments can provide benefits that neither could produce alone.

Take this creative approach from Capital One as an example.

The company was on the ball with their Capital One Cafes, a re-imagined form of banking where their branches doubled as cafes with co-working spaces and workshops.

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Despite the fact that most banking is done online, there is still demand for in-person interaction when dealing with problems. Capital One saw this and decided to use its spaces as a means of connecting with the community better. 

This strategy was the brainchild of combined marketing and communications thinking. Not only is the cafe a great marketing stunt, but it’s also a relaxed setting that consumers can use to communicate with the business without fear.

Going up to a teller screen can be intimidating after all, and many consumers are put off by the formality of the whole process. By removing the physical barrier between the bank workers and the customers, a more welcoming environment is created.

It’s doubtful that either department would have been given the go-ahead without collaboration. Altering your entire business strategy is extremely costly and risky, but with multiple departments backing it, the alterations went ahead.

Management

Finally, let’s talk about the management side of things, specifically the upper management. While there isn’t much to say regarding implementation, it’s easy to see the benefits, especially in terms of decision-making and cohesiveness.

It’s often said that the upper management doesn’t know nearly as much about the goings-on below them as they should. This is mostly due to how difficult it is to pass information and manage it in a centralized and standardized manner. 

CEOs and COOs make the decisions, but how can they make them reliably when they aren’t getting the complete picture?

In the traditional approach, department directors report to their superiors, passing along different strategies, suggestions, and requests at once. Keeping track of all of that can prove difficult even for the most qualified managers.

By converging your marketing, there is a single, unified goal that the business wants to achieve. This means that anyone who makes these decisions can always fall back on that, rather than having to keep track of all the different strategies your business might be going after.

Convergence marketing is all about passing on information in a clear manner. Better information means better decisions, which make for better business strategies, and a more unified organization.

What tools can help enhance convergence marketing?

If you’ve read this far, you’re probably looking to apply convergence marketing to your organization. There are many ways and tools to go about it. So many that you may get overwhelmed at first.

To help make sense of all of this, we’ve prepared a list of the most useful tools and why they’re useful in tackling convergence marketing. 

This isn’t an exhaustive list. It has to be on the general side of things, as each industry and context requires a different approach. So, if you think you have a better option, we encourage you to go for it.

Social media

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Social media is a powerhouse of the current digital marketing age. It’s a tool that can create a lot of data for you to utilize, while also allowing for better interaction between your communications department and your customer base.

Social media communications is a tricky business, with even the most innocuous of comments being able to spark outrage or dissent among your viewers. By looping back real-time information into your marketing department, you will be able to mitigate any crises.

This is where social media monitoring comes in. Social media monitoring software can assist you in keeping track of your online statistics, flagging any urgent or suspicious data, and allowing you to give feedback and responses to questions rapidly.

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The software is fairly new but has already made great strides. Some countries have even used it to monitor the accuracy of news shared on social media sites, with the aim of keeping their population informed when electing their new leaders.

In short, social media can be used as both a form of marketing and a form of communication, sometimes simultaneously. 

The platform you use will depend on your market, target demographics, etc., but all share the advantage of global reach. Their downsides are also similar, with rapid responses and careful monitoring being crucial.

Mailshots

Mailshots, also called direct mail marketing, is the art of using mass production of a single advert to market to large numbers of consumers at once. Typically, the term has been used to refer to letters or leaflets you send through the post, but it is also applicable to email marketing.

The advantage of convergence marketing when using email mailshots is immense. 

You can combine clicks and conversion statistics, along with other forms of data you’ve collected on customers to further personalize communications. Something you wouldn’t see in a siloed system.

And it’s a big deal, as segmentation and personalization are by far the most effective email strategies.

Consider the following scenario – a customer is after a specific brand of eyeliner, so they send an email to a store, asking if they have it in stock.

If your departments are siloed, the marketing department won’t know about this instance, and future newsletters and promotions will be less relevant for that person.

With your marketing and communications departments converged, this information will be communicated between them, allowing for it to be used in future personalized marketing efforts. The customer gets more relevant content, and you get a happier customer. Everybody wins.

To sum it up, mailshots are all about information. The more relevant you can be, the greater their chance of paying off. Keeping the flow of information open between departments means everything can be considered, not just what the marketing department has immediate access to.

Apps

When you create an engaging app for your brand, customers are more likely to use it for browsing, purchasing, and interacting with your company. 

This gives you heaps of data about your customers in a simple and efficient manner. It’s especially true with apps as they’re usually linked to an individual account, leaving less margin for errors.

Another great thing about apps is they can be heavily personalized according to the data you just collected. Whether that’s to do with how the content in your app is laid out or specific times you’d like to use push notifications. There are even capabilities to change the design with AI-generated art, though these processes are still in the early stages.

All in all, apps are a sandbox for you to create your perfect customer contact point.

Cloud software databases

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Market Report

To move information between the different sections of your organization, you will need a database of some kind. In essence, each division needs to know what the others are doing and why they’re doing it. This prevents your sections from conflicting or producing mixed messages.

Cloud software is a particularly efficient method to use, with many tools to choose from. The main players are SalesForce, PipeDrive, and Zoho. Your choice will mainly depend on your organization’s:

  • Size.
  • Goals.
  • And ability to implement technology.

Let’s go through a list of the benefits that cloud software can provide and discuss why they’re superior to other options.

Scalability

If you’ve ever used a flash drive or similar device to store your files, you know that they can very quickly become full. Data takes up space, and the amount of data you collect won’t always fit into the storage space you’ve allocated.

If you’re using traditional data storage means, you’ll need to physically go out and obtain more storage space, install it, link it to your data collection software, etc.

All that takes time, time in which valuable data will be lost. Cloud-based services offer expansion as your organization’s data storage needs grow. Perhaps more importantly, you can also decrease the capacity when you see a drop in your needs.

Cost-effectiveness

Cloud software is a far more cost-effective solution than traditional forms of information storage. 

For one, you don’t have to store the data yourself in a physical location which would come with maintenance costs. You also don’t have to maintain and replace the storage drives every few years when the technology moves on, which is quite costly.

Another factor that bears mentioning is the time cost of duplicating files, emailing them to relevant people, and of those people downloading them. This might not seem like much, especially with smaller files, but when this process happens thousands of times a day, it starts to add up.

Easier collaboration

As mentioned before, the instant transfer of information between different people greatly benefits cloud software. However, the ability to collaborate goes further than that.

In traditional collaboration, one person might send a draft to a second, who suggests edits and sends it back. Then, if the first person doesn’t like some of those edits, they would suggest something else.

This takes time, causes great delays in projects, and is very inefficient overall. The key issue here is that each person cannot see what the other is doing until the edit is complete, and if they disapprove of it, that’s time and energy (and money) wasted!

With cloud software, the projects can be hosted online in a place that both participants in this hypothetical example can see. Each edit can be reacted to live as it is being done, saving time and effort in both parties’ cases. 

Enhanced data security

Physical means of data storage aren’t the most secure. Once a connection is made, it’s very easy for a hacker to steal data and very difficult for you to stop them without physically severing the link to your server.

Cloud computing offers a unique opportunity in the data security world. Since your providers will necessarily have great data security measures in place (that’s their entire point), your customers can rest safe and easy knowing that their data won’t be stolen.

Cloud software is necessarily shared over multiple parties, which needs to be transmitted in real-time. This makes it an ideal candidate for blockchain security measures, which are considered almost unbreakable. 

While data can be extracted from an external source, doing so requires the consent of all parties involved, so hackers would have to go the extra mile. Furthermore, a complete block in the chain cannot be altered, making most run-of-the-mill hacking methods ineffective.

Wrapping up

It’s not always easy to switch to new methods of thinking, but converged strategies are the future as customers are expecting a more personalized approach.

Convergence marketing ensures your customers will get it, as each department will be able to fetch, understand, and send data from across the company.

The next step would be to measure how customers feel about your new approach. Luckily, it’s something you can measure via advanced tools that provide sentiment analysis, providing valuable insights for your business. Read more about it here. 

 

Customer Perception: Making Consumers See Your Brand Positively

Posted on by Emily Louise Spencer

The concept of customer perception might seem like a simple thing, but in reality, there’s far more nuance involved than you might think. At its core, customer perception is your customers’ opinions of you and is a key factor in a consumer’s choices.

Being seen positively by consumers is a must to generate new leads while also retaining your current ones. Almost 70% of consumers say they’re more inclined to spend more money with a company they trust to treat them well, rather than go for a cheaper alternative.

And trust plays a big part in how customers perceive your brand.

But where should you start? Customer perception is a big topic, and countless factors influence it. 

This guide is a good start. It will help you understand what’s behind customer perception and, most importantly, how to measure and improve to thrive in today’s market.

Let’s get started!

What is customer perception?

Customer perception refers to your customers’ awareness, opinions, and general feelings about the brand and its products or services. 

It’s shaped not only by direct experience with your brand but by all surrounding interactions like news reports, advertisements, word of mouth, etc.

It’s important to remember customer perception isn’t the same across sectors. It can differ based on location and demographics.

For instance, Home Depot is very well regarded in the US, but when they tried to expand into China they didn’t consider Chinese culture’s adversity to DIY. By the end of their six-year expansion attempt, they had to shut their stores and deal with a $160 million loss.

Customer perception can be tricky to quantify. It isn’t necessarily directly connected to the overall quality of the products or services you provide but how they see you.

You must remember your customers are human, and emotions and logic mix together. It’s not enough to look at the value proposition.

That’s why you need to dig deeper to measure how customers feel about you. Good places to start are:

  • Analyzing customer reviews.
  • Looking at social media platforms.
  • Conducting surveys.

This NEPA global survey on food habits is a great example of how perception affects our purchasing behavior. When asked about sustainable meat alternatives, only 25% of UK consumers said they would like to see lab-grown meat on their local supermarket shelves.

What is the customer perception process?

The customer perception process is exactly what it says on the tin. It is the process by which customers sense, organize, interpret and respond to anything related to your brand – be it a particular product, the brand as a whole, or somewhere in between.

Let’s break down this process by looking at an advertisement.

  • First, the ad is seen by the customer.
  • Then, they organize the information, taking it in and understanding its meaning and the message it conveys.
  • The customer can then interpret the information based on the current situation and history with the brand.
  • Finally, the customer responds to the advertisement, forming an opinion and associating emotion with it. 

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This all happens within a second or so, leaving little to no room for conscious thought to be involved.

But just because this process happens quickly and automatically, it doesn’t mean we can’t predict quite well what will happen. 

When running an ad campaign, you don’t just whip up a graphic and run along with it. You try and understand what your target audience will take from it and how it will affect their perception of your brand.

Later, you can collect customer perception data via the previously suggested methods. This will help you better understand your ideal customer and the effects of your latest campaign.

You can find a great example of this if you look to KFC’s 2018 ad, which issued as an apology rather than a simple advertisement. 

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In early 2018, KFC in the UK ran out of chicken. That’s right, a business that mainly sells chicken ran out of chicken. 

Since this naturally grabbed the attention of the local press, KFC responded in a manner that resonated with the British public – posting a full-page ad in the Metro with their initials rearranged to almost form an explicit word. It’s almost as if they were going “FCK, this is embarrassing”, a phrase that struck the bullseye with the British public.

Underneath, the company apologised for it’s failure, promising to do better in the future. KFC’s ability to laugh at itself took classic British humor, owning up to their mistake, and an appropriate form of advertisement to create one of the best responses to a PR crisis in the last decade.

Why is customer perception important?

While a positive customer perception is bound to net you new customers, it can help also drive growth via repeating customers. 

By forming long-term, lasting relationships with your customers, you increase loyalty and customer retention rates.

Focusing on metrics such as these is key in ecommerce, as it’s considered much cheaper to retain existing customers than attract new ones.  

Customers who have already purchased from you, and have built a positive relationship with you, are far easier to convince to purchase again than those who haven’t. To attract new customers, you need to:

  • Convince them that their existing brands aren’t working for them.
  • Show them that your brand can fulfill something their current one cannot.
  • Overcome the human resistance to change with enough incentives.
  • Convince them to buy from you.

You skip the first three steps with existing customers, making it a much more efficient and cheaper affair. 

The key to customer retention is to align with their values and beliefs. This will depend on your market, who your customers are, and what demographics your customers belong to.

Older generations emphasize different things than younger ones, men on different factors than women. These are all generalizations, of course, and won’t hold for every customer of that particular demographic, but it’s important to keep them in mind.

Customer perception has two particular factors which promote strong loyalty and even advocacy:

Value alignment

A customer who perceives your brand as having the same values as them will intrinsically align themselves with you. Conversely, a brand with lacking or conflicting values will see customers migrate away to greener pastures.

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The same Ipsos Global Trends Report 2021 also found that consumers’ three most common expectations of brands are:

  • Committing to fighting climate change.
  • Standing up for social issues, and 
  • Paying their taxes. 

This is true worldwide, with the report looking at all six continents.

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Businesses that are perceived to have outdated or harmful business practices will be met with rejection and even protest, while those who keep an eye on the values their customers hold will be embraced.

But it’s not enough to talk the talk. You also have to walk the walk, with actions speaking much louder than words. Shallow and meaningless gestures will be seen through, yet genuine commitment will be held in high esteem.

Microsoft is an interesting example of a company that shifted its value to keep up with the times. Historically, it was known as a combative and aggressive company. But with the appointment of Satya Nadella as CEO in 2014, it shifted towards more collaborative tactics.

The software giant now provides support for open-source software, PaaS, and IaaS solutions and, in general, is far more open to working with other developers. 

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Trust

Good customer perception signals to the consumer base that you are a trustworthy brand that will not lie, misdirect or cheat customers. 

To build and maintain trust, the best practice is simply to be trustworthy, to say what you mean, and to be honest and open about your business practices. 

Costa Brazil, for instance, laid out their Roadmap For Change earlier this year, stating their sustainability targets and their pledge to plant new trees to replace those their products required. 

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Unlike similar press releases and statements from similar companies which only showed the positive, they were open and honest about the difficulties of building a sustainable brand and admitted that they weren’t experts in the field. Many other businesses switching to eco-friendly means of production haven’t been willing to admit difficulties, leaving Costa Brazil as one of the few who will publically acknowledge setbacks.

At the end of the day, customer perception is about developing positive relationships with customers, which leads to increased sales and success. 

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Past experiences

It’s no wonder that past experiences can determine loyalty and retention.

As we’re all conditioned by our past, our reactions and knowledge are entirely dependent upon our previous experiences. In this way, good customer perception relies on having consistent good experiences. 

A well-known phenomenon is hyper focus on particularly good or bad parts of an experience with a brand, with one bad experience tainting a person’s perception of that brand as a whole. 

Thus, consistency is key in building good customer perception.

How to determine & measure customer perception

We briefly talked about the ways you can measure the elusive customer perception. Now’s the time to dive deeper.

It isn’t easy to keep track of all the factors that affect customer perception, but with a little investigation, you can usually find out what customers expect of you. 

Using one method of information gathering alone will usually get you part of the story, but not all of it. For example, reviews, by their nature, are only left by those who have purchased from you. Thanks to the human tendency to only leave reviews in the case of particularly strong experiences, whether positive or negative, you’ll tend to get a skewed view of things.

You need to use multiple methods of data collection if you want to get the complete picture. That means complementing review data with other methods such as surveys and social media monitoring.

Collecting feedback via surveys

Surveys are great, as they can tell you the little details that you specifically need to know. You can ask the specific questions you want answered, and those who complete your survey will give you the answers. Sounds simple enough, right?

In reality, things aren’t so simple. Consumers tend to only answer surveys when they’re particularly motivated to do so.

A popular motivational tool is a monetary incentive. While it will get people to answer your questions, some may simply tick boxes randomly to obtain the reward. 

That being said, you can somewhat overcome this by placing reverse-scale questions, helping you to weed out such responders. 

For example, if marking 5 means an excellent experience in most of your questions, create an item where marking 5 means a terrible one. In surveys where all items are marked with 5, you’ll know people didn’t bother reading the question, and you can disregard their answers.

Another issue with surveys is they’re usually limited to your clients. Would you look at an email from a company you have never interacted with directly and think, “I’m going to complete this survey!”?

Finally, only people interested in answering questions will complete your survey. The issue is that your sample is limited to a specific subset of people that don’t necessarily depict your entire audience.

That said, surveys are still a great tool to gauge customer perception. You just need to keep their limitations in mind.

Once you’ve opted for one, it’s important to know how to read them and what you can get out of them.

Net Promoter Score (NPS)

The net promoter score is a value that’s based on a specific survey question:

“On a scale of 1 (very unlikely) to 10 (very likely), how likely is it that you would recommend us to someone else?”

Those who answered 9 or 10 are considered “promoters” of your brand, whereas 0-6 denotes a “detractor,” those who will decry you. 

The relative ratios of these will give you an idea of how well your product or service is received and help quantify your overall customer perception.

Customer Effort Score (CES)

Similarly, the customer effort score is based on the question:

“On a scale of 1 (extremely low effort) to 5 (extremely high effort), how difficult was it for you to find a solution to your problem with us?”

The CES measures the effort that customers feel like they have to go to in order to get what they want from you, which is a crucial component in a customer having a good experience with you and therefore having a good perception of you.

Analyzing review data

Review data is solid. It’s information on your products or services provided by those who purchased from you and therefore is a reliable data source, right?

Well, not exactly. 

First, you have to consider that you’ll get a skewed perspective from reviews thanks to people’s tendency to only leave them after standout experiences. 

I’m sure you’ve come across review STAR ratings online and seen a lot of 5-star and 1-star reviews, but not very many in between.

Customer reviews

Secondly, reviews can be faked. Whether that’s by competitors, the platform you’re using to sell on, or by people who have nothing better to do than make everyone else’s life difficult, you can’t necessarily rely on review data that isn’t directly linked to a purchase. 

The problem then comes that, by only taking into account verified reviews, you might leave out plenty of genuine reviews that simply didn’t bother going through the verification process. 

With Revuze’s data collection engines, you can take information in brands, product lines and even individual products, analysing them from every angle in order to pull as much information as you can from that data. 

We use sentiment analysis, SWOT analysis, and more to give you a full 360 degree view of your brand, market standing, and competitors.

Social media listening

With the advent of the internet, the things people talk about daily suddenly became recorded and publicly available to analyze. 

Using software, you can collect millions of text pieces relevant to your brand and analyze them with sentiment analysis in order to get a clearer picture of how customers feel about you.

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Like previous strategies, social media listening is not without faults.

Social media is volatile, and one negative opinion can turn into thousands when passed on, then die out. If you’re not segmenting your data by time, this can give you a much lower figure than you’d otherwise expect. 

Furthermore, not everything that people post on the internet is their actual opinion. Influencers get paid to say certain things; some people look to fit in by posting opinions others might hold, and others look to stir up outrage for amusement.

The lesson here? Take everything you get from social media monitoring with a grain of salt. It’s a good indicator, but it might not be reliable.

As you can understand, all data-gathering tactics present challenges. That doesn’t mean you shouldn’t use any. Quite the opposite. By acknowledging these challenges and employing more than one tool, you’re bound to get as close as possible to the real picture.

And once you have that, you can start working on improving your image.

What factors influence customer perception, and how do you improve them?

Factors that influence customer perception

Many factors affect customer perception. In fact, almost every facet of interaction between customer and brand that you can name will have an impact of some kind. These can be tangible, measurable things or more abstract ideas.

The key to positively influencing customer perception is to do these things regularly, as it not only will tell you how your actions have been perceived but can tell you if customer expectations have shifted in the time between surveys. 

This might seem far-fetched, but large scandals and world-shaking events can shake up the market and shift customer priorities over just a few months.

The top factors influencing customer perception will depend on your market, target demographics, location, etc. 

In the previous section of this article, we talked about value alignment, trust, and past experiences as factors that affect customer perception and loyalty. Now, let’s take a look at other common ones.

Pricing/Quality 

Pricing and quality often go hand in hand, so let’s discuss them as a pair.

A product’s overall quality strongly impacts customer perception, with certain prices bringing expectations of quality standards. When the quality of your product or service meets or exceeds expectations, customer perception rises.

Prices that are too high will put customers off, and ironically, so too will prices that are too low as they give the impression that your products have some hidden defect.

Setting a price for your products when launching them is never easy, but you can look to the other similar quality products on the market and what they are charging as an indicator of what might be a reasonable price to charge.

This doesn’t mean you should blindly follow your competitors’ pricing strategies. You should always monitor the sentiment around these prices, ensuring that customers are happy to pay these prices.

For an established product, the key is to keep an eye on the sentiment around your products’ pricing, quality, and how they combine. 

You can do this with the help of sentiment analysis, text mining, and other forms of social monitoring, which tell you more about the overall picture than a simple survey would.

There is also the factor of brand value: a well-established brand can charge more for its products than an unknown one, owing to the trust consumers have in you. 

You should also keep in mind that prices are dynamic. What customers were willing to pay upon initial release won’t be the same as what they’re willing to pay six months afterward, for example.

Customer service

When customers have an issue with your products or services, your ability to make them feel heard, listened to, and have their feelings respected greatly impacts your customer perception.

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Good customer service relies on knowing your audience, what they desire and what they expect from you. In general, you should be able to learn a few things about your customer base and what they expect by monitoring reviews, social chatter, and surveys that you put out. 

You can go further by segmenting these into demographics, allowing for personalization of customer service to a particular demographic or even individual if enough data has been collected.

The processing power required to personalize customer service isn’t something a human brain can output. However, advanced AI can assist you by analyzing the data and providing recommendations for how to approach the particular customer, problem, etc., based on previous customer service interactions that were successful.

You can take this process even further with hyper-personalization, which takes the philosophy to the individual level, using data and information collected on a specific individual.

Take, for example, the following interaction:

  • You phone a company helpline, asking for assistance setting up your software.
  • The person taking your call asks you for information on your software, then redirects you to another person who is more able to help.
  • You then must explain everything you’ve already explained to the second person, wasting your time and theirs.

You’d feel quite annoyed at the repetition, wouldn’t you? Well, if the company had a database of information on their customers and their problems, the interaction would go more like this.

  • You phone a company helpline, asking for assistance setting up your software.
  • The person taking your call asks you for information on your software, enters it into a database, then redirects you to another person who is more able to help.
  • The second person now has all the information that the first person entered into the database and can take over without wasting time.

In that case, you’d feel like somebody listened to you. The company took your words, kept a record of them, and used them further down the line to help you.

Businesses can also take things a step further by noting down common issues, keeping a record of their solutions, and making them accessible to users. Why bother calling a helpline if you can find the answers on the website? 

At the end of the day, speed is key in customer service. Providing a personalized customer service experience can help solve problems quickly and efficiently. 

Branding

Your branding sends a clear message to customers. 

Your logos, artwork, packaging, and all other visible, tangible factors specific to your brand affect customer perception.

You can think of your branding as an extension of value alignment. You need to position yourself in a way that attracts your audience and aligns with their beliefs.

Brightly colored, shiny plastic packaging will catch customers’ eyes. 

However, plain, more recyclable packaging may boost your customer perception with certain audiences. 

Usability

The customer’s ability to use your product significantly impacts customer perception.

Placing step-by-step instructions on your products will make use easier, including easier-to-read instructions on boxes or packaging. You can even delve further into the design process by editing the shape of your products so that their use is intuitive even to someone unfamiliar with them.

Usability

A highly specialized brand of computer parts aimed at consumers who can construct their own devices doesn’t have to be as simplistic as a brand that focuses on the general public, who aren’t expected to have the computer know-how of the aforementioned specialized customer base.

Further additions you can make include so-called “poka-yoke” or “mistake-proofing,” where your products are made so that misuse is made difficult to achieve to prevent customers from damaging your product while attempting to use it.

A good example of poka-yoke is USB cables, which can only be connected in the correct direction and will refuse to slide into ports the wrong way, preventing any potential damage that could arise to both the device and the person operating it from a backward connection.

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Advertisement

How you deliver your advertisements, as well as the contents of them, have a massive impact on customer perception. This is especially true of the former, with different target audiences having different preferred modes of communication.

Choosing the wrong mode of communication for your target demographics will have a net zero impact at best, as customers simply either ignore or do not see your advertisements, and a negative one and worst, as they see you as out of touch.

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Gen Z, for instance, rarely pick up the phone if they don’t recognize the number calling them, nor do they answer the door if they’re not expecting someone, so cold calling and door-to-door sales will misfire as communication channels.

Instead, you’ll need to utilize digital and social media to reach this demographic in an effective manner.

Don’t forget the context, though. Knowing when and where to place your advertisements so that they grab attention but don’t distract from the current situation the customer finds themselves in is the key.

You’ve probably come across pop-up ads on smartphone apps or websites, those that cover the entire screen and completely derail any process or train of thought that was taking place beforehand. It’s extremely distracting and annoying.

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This is an example of bad advertising, which will hurt your reputation if you allow yourself to be placed in those positions. Picking and choosing where you want your adverts to go is crucial to maintaining a good perception.

Passive advertisement, on the other hand, doesn’t affect the usage of the website or app in question. It’s a term that covers top banners, side adverts, and any other form of online advertisement that goes out of its way to avoid disrupting the user experience.

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As you can see in the example above, the Forbes website uses banner adverts across the top of its page. While these adverts catch the eye, they can simply be scrolled or looked past to access the website’s content without interacting with the ad in any way. This makes the advert less intrusive, less annoying, and less likely to be met with a negative reaction.

Furthermore, the quantity of advertisements matters also. While it might seem intuitive that more advertisement equals more customers obtained, there comes the point where this is inverted. Too many advertisements can cause irritation, which is then associated with your brand and puts potential customers off interacting with you.

Customer reviews

Almost all customers who purchase online will take the time to read product reviews before purchasing. 

The reviews that have been left, their content, quality, and even their number have a big impact on purchasing decisions. It’s been shown that consumers are weary of purchasing products with few reviews, even if the product in question is newly released.

While having good reviews is important, addressing negative reviews will have a positive impact overall on your customers’ views of you. It shows you are willing to listen and consider your customers’ problems.

Social media listening tools, dedicated CX teams, and sentiment analysis all play a part in keeping up to scratch with your customer reviews. 

The key here is speed, with computers doing most of the work identifying and flagging especially positive or negative reviews in order for a human to see and respond in a short amount of time.

Recommendations and advocacy

People listen to the opinions of those they hold in high regard, whether that’s influencers, well-known names in a certain sphere, or friends and family. Your ability to improve customer perception in those people’s eyes can also have a knock-on effect that leads to improved customer perception overall.

By using influencers, promotional discounts for those who recommend your products to their friends & family, and making other forms of advocacy easier, you allow your customer base to do the hard work for you. 

Unfortunately, besides paying influencers to advertise your products, the mechanics of recommendation isn’t exactly straightforward to influence, as they rely on nuances and factors beyond your control. 

Ultimately, the best way to get customers to recommend your products or services is simply to give them a great experience – from the moment they search for you and buy your product, up until they need your help with it.

Location & shipping services

Convenience is a big factor in choosing a brand, with a location close to your target market’s preferred area of purchase being important. Your location will depend on your target audience, with younger, more tech-savvy customers being far more likely to purchase online, for example.

If you’re already an established business, it’ll be very expensive to move to another place to perform commerce there. 

Luckily, shipping networks these days can stretch all across the globe. With the right setup, you’ll be able to reach those distant markets with ease. 

So, what is the right setup?

Firstly, you need a good distribution system. By this, we mean that you need to have pre-existing plans for getting goods from one place to another across all options you plan to ship to. 

This can be as invested as dedicated couriers, to as simple as knowing the local post routes. It’s up to you to decide what’s necessary, based on what is feasible from a financial standpoint and also what is expected of you.

Secondly, you need to factor in time. Certain borders take longer for goods to cross than others, and some shipping lanes can be disrupted by accidents or by human interference.

Distribution centers, places where you store your goods before the sale, can be dotted about in various places. You can refill stock there as necessary by keeping an eye on what is purchased in specific locations, either directly from the manufacturers or from a central distribution center. 

In this way, while the overall distance the goods travel is the same, the distance between you and the customer is much smaller, making for shorter delivery times and increased customer perception.

Wrapping Up

The key to having good customer perception is understanding that customers’ reality is not necessarily yours and that what they see & do will vary from person to person. 

There are plenty of factors that can affect how customers see you, from value alignment and trust, all the way to pricing and service. 

Collect and analyzing this data is crucial to driving growth. With it, you’ll be able to pinpoint what consumers think of you and how they see you

In the end, though, the best way to gain good customer perception ultimately is to provide them with an excellent customer experience. Not sure how to do that? Check out our comprehensive blog on the topic.

90% of the data was created recently

Posted on by Emily Louise Spencer

Market Research in a world where 90% of the data was created recently

According to a recent report by IBM’s Marketing Cloud,  90% of the world’s data was created in the last 2 years!!! Isn’t it amazing? The world had grown 10X in data in 730 days at a rate of 2.5 quintillion bytes of data a day!…there are so many implications for this – where do you save all this data,  how do you manage it, is there such a thing as too much data? What does it mean for the future? Will we have 10X data growth again in 2 years?

How do you shift your market research initiatives to handle such data volumes?

 

Using old Market research in a new world?

Market research used to be about data sampling and focus groups and surveys and in general peeking through the market peephole and estimating the overall market behavior and preferences based on a small group of individuals.

As data became more prevalent business started to use systems that can search data, but keep in mind these systems were set to search data that was likely 1/20 or so of what exists today.

So basically in the “old world” you either used brute manual effort or systems that could handle some data but most likely much less data then exists today.

 

How to process lots of data?

When processing lots of data, the data is typically unorganized (Unstructured is the commonly used term). Data can come from every brand encounter with consumers – emails, calls, surveys, website feedback….it also is available in the public domain online on eCommerce sites, review sites, social media etc.

This is a lot of data…sometimes in different languages, with a lot of different formats! To tackle it you need several core competencies:

  1. Deep understanding of languages
  2. Ability to relate data to a topic
  3. Learn to recognize latest ways to talk about a topic
  4. Understanding of sentiment

What is typically lacking in “old world” systems

Mainly autonomous decision making. When you need to go through lots and lots of data, you can’t rely on humans. Hoping humans will setup a computer system to analyze and handle any type of data is unrealistic. There are so many variations in the way people express themselves around a brand or product or feature that you can’t expect one person or even a team to figure all of these up. On top of it add languages, different data formats, ways consumers express sentiment and complexity just grows and grows…

Ideally if we wanted a technology that helps us handle unlimited data it would have to be one that can easily scale to multiple languages and data formats, automatically decipher the topics your consumers are talking about, automatically recognizes sentiment and can sum it all up for you.

Why is this difficult

Let’s pick and example.  Let’s say we’re a smartphone brand and want to analyze what consumers are saying about our latest phone’s batter life. We can try to scan online reviews and search for variations of the word “Battery”, but what happens if consumers are using phrases such as “doesn’t last long enough” or “phone died on me in the middle of the work day”?

Conclusion

Current market research technologies rely on humans and thus are slow to setup, miss a lot of things and are slow to adapt. In a world that generates more and more data each year, and the data grows so quickly, you can’t rely on humans or manual labor to figure things out.

The good news is that now there is enough data to make sure you can get answers to your questions, and all you need is just to analyze the data. No more need for feedback groups, surveys etc.

The sad news is that most tools out there to help you do this were not build for this task. Revuze is an innovative technology vendor that addresses just this with a self-learning, fast setup and low touch solution that typically delivers 5-8X the data coverage compared to anything else, and it does it without humans…