Dive Brief:
- A majority — 70% — of consumers will choose a brand because they know the experience will be good, according to an Ipsos report released earlier this month. Ipsos surveyed 65,000 consumers from 18 countries.
- Nearly half of respondents — 46% — say they will pay more for better experiences. That number climbs to 52% for U.S. consumers.
- The findings are a validation of the importance of experience overall, according to Jean-Francois Damais, global chief research officer at Ipsos, who designed the study. “That just reinforces the fact that customer experience is important in terms of brand choice, it's important for retention, it's important for advocacy.”
Dive Insight:
For all the importance of experience on brand choice, consumers only categorized about half of experiences — 51% — as good. The rest were either poor — 18% — or unnoteworthy — 39%.
That leaves plenty of room to improve. To Damais, that begins with basics to ensure functional and operational efficiency. But brand leaders in each sector take it to the next level by focusing on emotional attachment.
“They tend to orchestrate the experience so that not only it meets the basic needs so it does what it's meant to do, but in addition, the experience makes people feel in a certain way, and the experience fulfills customers’ emotional needs,” he said. “That's really what differentiates the best performers from the rest.”
Take a furniture retailer, for example. A business can fulfill basic needs — you order a piece of furniture and it arrives — or it can take it to the next level, like Ikea.
“Ikea, they are quite strong in terms of belonging, because even their mission is the home of the home for everyone,” Damais said. “Their corporate values reflect that, and the experience is also in line with that.”
Ikea also has a buy-back scheme where they will pay for secondhand furniture that is still good quality but no longer needed, which drives a sense of belonging, Damais said.
Encouraging emotional attachment also leads to brand advocacy, and consumers are more likely to promote a brand they use to others. On average, emotionally attached consumers said they had recommended a brand 5.7 times in the past 12 months. Among those who were functionally satisfied, that drops to 3.2 times.
“If you manage to drive an emotional attachment, you will gain in terms of retention,” Damais said. “You will drive more value from your current customers, but you will also acquire more customers through more frequent recommendations from your customers.”
