By Piers Lee, Director, BVA BDRC Asia
Customer loyalty research has evolved to recognise that few customers have true loyalty to brands. Research has shown that 94% of today’s brands could disappear without consumers caring, and 77% of consumers state that they have no relationship with any brand.
The main factors that determine the continued usage of brands (so-called loyalty) are: 1) habit, 2) general satisfaction that the brand delivers on customer needs, and 3) too much effort to change.
Brands do not necessarily need to ‘delight customers’ (except some luxury and high-tech categories), but they do need to make the service interaction between the brand and the customer as easy and effortless as possible. Hence, many brands have switched from traditional loyalty measurement, such as Net Promoter Scoring, to assessing customer effort – the perceived ‘ease of use’ of the brand and its ability to ‘get jobs done’ for the customer.
Brands have therefore been examining how to reduce the stresses, microstresses, and various frictions customers have when using brands. At the same time, they need to make the onboarding of new customers as easy and effortless as possible within the purchase path.
These practices have raised demand for research into behavioural science, and with it specialist practices such as the BVA Nudge Unit within the BVA Group.
However, for brands to design their products and services to reduce customer effort, we need to understand more about its key components.
An effective approach is to categorise effort into the constituent elements that make up net customer effort, including cognitive effort, emotional effort, physical effort, and time effort. Customer interactions with brands can include expending effort in some of these constituent elements.
Some of the more ‘painful’ types of effort for customers are cognitive and emotional effort, so these should be the areas that brands pay most attention to.
The human brain likes to ‘power down’ whenever it can to preserve energy, so most customers do not want to do too much thinking. Making your product easy to understand should be one of your main priorities (e.g. in software and IT). A lot of cognitive effort can occur when a consumer first comes to using your services, and so the application process for taking out a new product should be as simple and straightforward as possible. Attention has to be given to the design of application forms by using layman’s language, making websites easy to navigate, and reducing the number of steps in the purchase path to completion.
Emotional effort is the stress endured by customers due to uncertainty and fear. Consider how much emotional effort is expended if you lose your phone or credit card. If the phone or credit card company makes it easy for you to block the line or the card, and makes it easy for you to get timely replacements, they will have done a lot to reduce the level of emotional effort for the customer and will be rewarded by the customer accordingly.
Insurance products are designed to give peace of mind (e.g. cover in the event of accidents, poor health, or loss) and so these products directly serve the need to reduce a consumer’s emotional effort, such as when they are taking an overseas trip.
Some products require a level of physical effort to use, which ranges from the smallest interaction such as opening the packaging, to more intense interactions such as driving a car for long periods. While the simple opening of packaging can seem like a trivial interaction, have you ever gotten frustrated when you could not open a jar or a bottle? These micro-stresses count when the consumer could expend far less effort by buying an alternative brand with more user-friendly packaging.
Finally, there is time effort – this is one of the more nuanced types of effort that brands need to understand better. Generally, customers do not want to waste time (e.g. travelling somewhere to get something done, which also involves physical effort) and they usually like things to happen quickly. Certainly, we want to be able to see our doctor as soon as possible and spend as little time as we can in queues.
Fast and instant food are product types that take away the need to wait for a long time, instead providing instant gratification and removing the cognitive and time effort involved in making a meal – although there are many who like cooking, and therefore this time effort is enjoyable for them, rather than stressful.
While many people like to bank online (taking away the physical and time effort of going to the bank), some people might like making a trip to the bank as a means of breaking up their day by expending a bit of time and physical effort.
With the exception of quick-service restaurants (which serve a need for speed), serving up food too quickly in a restaurant can take away some of the perceived value of the meal. Spending a bit more time waiting means someone else is making an effort on our behalf – something we are willing to pay for.
One of the best examples of how time effort works in a brand’s favour is with the Irish stout drink Guinness. In order to pour the ‘perfect pint of Guinness’, bar staff are encouraged to pour the drink in stages, usually taking a couple of minutes, during which time the customer is kept waiting. This builds the perceived value of the drink – in fact, Guinness implemented a TV advertising campaign that was themed around the pleasures of waiting.
Therefore, a customer effort research programme will have to take into account the context of customer effort and whether expending some effort is actually pleasurable. The framework described here is an effective way to diagnose the type of effort that good products and services can be designed to alleviate.
This article was first published in the Q1 2023 edition of Asia Research Media