STORYTELLING AS CUSTOMER VALUE ENHANCING TOOL

One of the most recommended tools to create customer value around your product offer is to use storytelling. Joshua Glenn and Rob Walker designed the Significant Object Project, to empirically demonstrate how adding a fictional story to an insignificant object can turn it into a significant one.

“Stories are such a powerful driver of emotional value that their effect on any given object’s subjective value can actually be measured objectively.” — Joshua Glenn and Rob Walker

The idea was tested on eBay. A writer is paired with an object purchased from thrift stores and garage sales and he or she writes a fictional story about the object. Each object is listed for sale on eBay, but instead of using a factual description the newly written story is used. After 5 months, they sold $128.74 worth of thrift-store trinkets for an amount of $3.612,51. Their hypothesis was validated. The “value in trade” of the thrift-store objects was increased by the use of engaging stories attached to them.

The take-away message from the Significant Object Project is that stories increase not only the objective value of your offering but also the subjective value, which leads to willingness to pay a price premium.

Okay, now we know the importance of storytelling, but the next step will be to distinguish what kind of stories are the most successful to enhance customer value of your offering.

Heidi Cohen, president of the Actionable Marketing Guide, presents in her website 5 value enhancing stories every business can tell:

1.  Focus the story on your business history. Link your product to how the business started. This kind of strategy seems to work very well for family owned businesses.

2. Focus the story on your product’s secret ingredient. Enhance whatever is core to your total offering that makes it different.

3. Focus the story on the location of the business. Find something special of the place where the business is located and attach special stories of the place to your offering.

4.  Focus the story on the behind the scenes of your company. Bring attention to show the way people create the product. It can be done by interviewing different members of the team and letting them tell the story.

5.  Focus on the people behind the company. The idea is to gather content from your workers regarding why they chose to work for the firm, what they like about the product or their co-workers. This approach makes your offering more personal, creating a real connection between employees and potential customers.

6.  FOCUS ON YOUR CUSTOMERS! Gathering stories from your customers, showing how they discovered the company, how they use the product and why is this helpful in their lives.

As we can see, putting the customer as the creator of the story is a very effective strategy to be followed by companies. Having your story told by a trusted person seems to be crucial to introduce your product to the audience you intend to reach. 

An example of a success story is Kleenex. They wanted to shift the perception of their product from snot to style. In order to do so, they contacted hundreds of bloggers reaching an interior decorating and fashion audience, and offered them to own the first three pages of Google search results for the words "Kleenex style", this idea gave them 400% greater engagement on their blogs and at the same time the story was shared among the audience in a trusted way. Mother Overload was one of those storytellers.

CUSTOMER SERVICE TO INCREASE CUSTOMER VALUE: BEST PRACTICE EXAMPLES

Customer service is another source of competitive differentiation for businesses and therefore, it should be enhanced to increase customer value. Consumers have access to an increasing number of customer service touchpoints; traditional telephone support, email, digital channels like live chat, social media and mobile. 

Delivering good customer service does not necessarily come cheap but as stated by eMarketer, consumers have demonstrated they are willing to pay more if a retailer acts in their best interest, helps them to get more value out of the products they purchase, creates convenient new ways to shop, and let them know when to expect delivery of an order.

As stated by SkillsYouNeed, we tend to remember positive and negative experiences more vividly than average day-to-day ones. It is essential to make every customer’s experience a positive one that they’ll remember and talk to others about. Nothing is more powerful than going out of your way to give a customer something that they were not expecting or anticipating from you. Every contact between customer and company is a new opportunity to create an unforgettable experience.

It is important to know which are the preferred touchpoints and improve them to deliver the best customer service. According to a study from eDigital’s Customer Service Benchmark, from all the customer service touchpoints available within a company, live chat has the highest satisfaction levels (73%), followed by email (61%) and app (53%). SMS (41%) and phone (44%) can be found at the bottom of this list. 

Given that customers appreciate it, and it has shown to be helpful as a sales driver, I can see the use of live chat becoming more popular in order to increase customer value.

As we can see, those companies that understand how to use the latest digital channels to help customers will be rewarded with loyal customers who spend more and advocate for the brand. No matter the size of your business, if you wish to increase customer value, it is important to provide good customer service to all types of customers, including potential, new and existing customers.

PERSONALIZATION TO INCREASE CUSTOMER VALUE: BEST PRACTICE EXAMPLES

As we saw in the previous post, one of the most recommended tools to create customer value around your product offer is to make use of personalization. I will tackle personalization from an online perspective.

In a study by Janrain, it was found that 73% of consumers were fed up with being presented with irrelevant content. According to US marketers, the value of marketing automation goes beyond the top of the funnel. It also improves the performance of almost every other stage of the buyer’s journey. The infographic below, from Marketing Automation:Popular Tools & Trends, explains additional benefits associated with personalized marketing automation and customer relations.

As stated by Jose Perez in his post: How personalized marketing can increase your eCommerce sales, the key to personalized marketing is to create messages and actions tailored to the visitor based on their previous viewing and purchasing behaviour.

Having all this reasons to implement personalization in our company in order to increase customer value, how can we deliver personalized messages to our customers?

-       1. Requesting an email address after the visitor has displayed some intent to buy. It can be used to send them an automated email inviting them to look at the items they have in their shopping cart or email them with top sellers based on their last transaction. According to Experian’s 2013, personalized emails generate on average 6x more revenue than non-personalized email and recommended products automatically generate 46% more revenue than products that we select.

-     2. Personalized product recommendation engines. Amazon is making use of this tool in a very effective way. One option is to show items that have been frequently viewed, considered, or purchased with the one the customer is currently considering, but they also employ a method based on browsing history.

According to a MyBuys study of more than 100 top Internet retailers, recommending products in the shopping cart based on a user’s purchasing or browsing behaviour resulted in a 915% increase in conversion rate.

3. Modify website on real time, based on customer behaviour. This tool, commonly known as behavioural targeting, allows to modify the website to target different types of users (new users, users who have completed more than 3 purchases in the last month, unregistered users, etc). After a certain behaviour has been observed we can modify the website in the following ways (display a pop-up with specific content for specific visitors, a pop-up to capture unregistered user mails, replace existing web content, add or delete items).

The brands that will truly personalize the customer’s experience are those that take a hybrid approach to the above solutions. The combined approach of predictive intelligence and customized customer journeys will definitely increase engagement and drive sales, making brands industry leaders.

BEST WAYS TO DELIVER HIGHER CUSTOMER VALUE

When the customer perceives that a product is of a great value the willingness to pay a price premium increases, and again, we are not just talking about money. After searching several sources I made my own list of the 3 best ways to deliver higher customer value:

1. Personalization

With personalization we mean that the more personalized the experience, the happier the customer. Personalized marketing are messages and actions tailored to the visitor based on their previous viewing and purchasing behaviour. 

According to a study from the University of Texas, with personalization we feel more in control because we are getting something tailored to us, but also personalization can help reduce our perception of information overload. For example, when we know that certain product features have been tailored to us, it provides a higher level of engagement as we will be presented with the characteristics we were looking for. In short, personalization is an effective tool to create a closer relation between the company and the customer, increasing therefore, customer value.

2. Efficient Customer Service

A study by Zendesk found that consumers rank customer service higher than price to stay loyal to a brand. Such a statement should make every company aware of the importance of coming up with consistent multichannel approach, incorporating email, social and a call centre, but being present is just not enough. It is essential to have a proactive approach on every channel and the main objective is solve customer’s problems delivering value. In an ideal situation customers should end the conversation with the customer service team thinking that what started as a problem ended as something beneficial.

Having an efficient customer service is one of the pending subjects for the majority of companies in the market. In a bid to reduce costs many companies make it extremely difficult for customers to speak to someone on the phone and instead force people to get in contact via email or a web form. This damages the overall customer experience, and therefore diminishes customer value.

3. Storytelling

According to Zideate, an online site where marketing concepts are explained, storytelling is a marketing tactic based on the premise that people remember information better when it is told as a story rather than presented as a list of facts. The main reason for it is that, stories evoke an emotional reaction on the audience. Marketing campaigns that arouse an emotion response are more likely to be remembered even when the public is not interested in the product. The perceived customer value can be enhanced by using storytelling as a less obvious form of persuasion. The audience will be willing to pay more for the product as they perceived it of a high value because of the story attached to it.

Conclusion

There are many more ways available to improve customer value. After researching several sources I detected the above forms of delivering a higher customer value as the most used ones. I would like to deepen my knowledge in the following posts, so I will try to find best practice industry examples for each one of them.

HOW CAN WE KNOW WHAT IS VALUABLE FOR OUR CUSTOMERS?

One of the most extended mistakes from a company’s point of view is to communicate a set of attributes linked to the commercialized product without researching whether their customers value those attributes or not. 

Understanding what they value seems to be the first step in delivering customer value. A company may think that its offering has a very attractive value to the consumer but they don’t perceive it like that. In this case, all their efforts will not produce a positive response from the consumer point of view. It is important to know the consumer profile and what characteristics are more valuable for them. As stated by the Marketing Donut, understanding customers is the key to giving them good service and therefore, deliver better customer value. They identify three main ways to better understand customers:

1.       Put yourself in your customer’s shoes.

This point requires to take a hard look at the main touchpoints between customers and your company. Customers expect you to deliver what has been promised but also surpass their expectations. Being able to do so will increase customer value and therefore word-of-mouth recommendations.

2.       Collect and analyse data.

Understanding comes from constant refinement of data. A company’s database holds valuable information about customers that will enable to understand and anticipate their needs. CRM systems can help to identify customers’ needs by analysing their behaviour and preferences.

3.       Ask them what they think.

Not everyone complains, instead, they will tell their friends about their bad experience. It is essential to act proactively to discover what you are doing wrong. Conducting a customer satisfaction survey to gain valuable insights. It is important to tell them what the company has changed as a result of their feedback, it will make them feel valued.

To make things worse, knowing what your customers value the most is not enough, suppliers must have the capability to anticipate what customers will value in the future because it is constantly changing. The American Marketing Association identifies the following methods to anticipate customer's needs within a company’s offering:

1.       Direct measurement of needs and benefits: A survey research is conducted with large batteries of items, such as explicit indicators of current and future needs. Customers can be divided into groups according to the similarity of their profile of needs.

2.       Problem detection: Since it is easier that customers say what’s wrong with a company rather than what they want, this technique measures problems experienced instead of needs themselves.

3.       Information acceleration: This method tries to bring the future into the present. To understand customer response to a future environment they stimulate this alternative environment and measure response to them.

4.       Historic trend analysis/forecasting the future: Using knowledge of the past to bear to infer in the future. It uses customer behaviour of the past to build future business designs. The problem is that customers not always behave in the same way.

5.       Lead user analysis: They assume future reactions looking at people whose behaviour appears to be leading indicators of the future customers.



Okay, now that we know that customer value is constantly changing, what can a company do to overcome this situation? It looks like the solution is INNOVATION.

Customer Think presents innovation as a “New” Value Creation tool, it is described as a crucial process for any company to survive in a competitive market. To be truly innovative, the invention needs to create economic value, and it can be done in the following ways:

• Adding a new feature to a product (value = increase sales)
• Improving process to reduce waste (value = reduced costs)
• Creating a new product (value = penetrate new markets)

Until now, everything seems to be in the company’s hands, but I will analyse different sources to discover whether customer value resides on companies or customers.