The Post-Purchase Experience Matters Just as Much (or More) as Your Sales Funnel

I just finished up a few days in Austin with a group of other digital marketing executives at the GDS Digital CMO Summit, and as is usually the case after a few days immersed in discussions with other experts in the field, my head is overflowing with ideas. The one biggest takeaway from this conference though is that I really think marketers are starting to understand just what is meant by “experience” marketing.

For a while there, as the catch-phrase was starting to gain ground, it looked like there was a chance that experience marketing was going to veer off course and turn a bit more into a form of “gimmick” or “entertainment” marketing – but from the presentations and conversations this week in Austin it’s clear to me that many marketing executives are truly understanding the value focusing on the experience can bring to increasing brand value and loyalty.

This is why I was thrilled to see that a lot of the focus here wasn’t on prospecting or advertising, but instead on providing customers with a great experience throughout their lifetime. In my opinion, this is one of the most important things we can be focusing on as marketers today. As much as strategies and measurement have been traditionally built around KPIs like visits and conversion rates to determine what is an “effective” campaign, I think it’s much more important to focus on providing customers with a great experience throughout their lifetime engagement with our brands.

What this means is that understanding of customers, their behaviors, motivations and values is an area where we should be putting more of our focus as we continue to grow brands. Customers are more and more looking for engagement, truthfulness and brands that share a common sense of priorities with them. This, above all, means that it is key for us to be able to empathize with our customers and build out experiences as suited to them and their needs as we can.

Of course this all starts with getting the right message in front of the right people at the right time – and then providing a streamlined discovery, shopping and checkout experience – but it doesn’t end there. For too long the focus has been on closing that sale – getting that conversion. I propose that once you’ve done this, you’ve only just started.

As marketers, we need to concern ourselves with what happens after that sale just as much, if not more so, than what happens before. How are customers using the product? How can we help them realize more value from their purchase? What was the goal they were trying to achieve when they finally decided to buy from you, and how can you help ensure they reach that goal? If a customer is having a positive experience, how do we encourage them to share their experience with others and become an advocate? If a customer is having a bad experience, well then why is that happening, how can you fix it, and how can you make it not happen again?

We live in a connected marketplace where we are no longer the sole owners of our brand and message. Running some ads to drive people to your store to buy stuff just doesn’t cut it anymore (and I’d argue it never did – it just was “good enough” for some brands when customers couldn’t really demand more).

To succeed in today’s world, we need to connect with our customers in meaningful ways – and that means we need to understand them at all stages of their relationship with our brands. As we build those relationships and we continue to strengthen those bonds, build trust, and help our customers achieve success, we can build loyalty.

I’ve heard some people say lately that customers are no longer loyal to brands. That’s plain wrong. They’re no longer loyal to brands they had no choice about. Now that we can be mobile and agile in our relationships, we, as consumers are able to forge new loyalties and relationships. When we as marketers learn to connect with and understand our customers (empathize with them) loyalty is attainable.

Remember, in a world with so many choices, it may seem easy to jump ship at any time – and that’s definitely the case. But with all the different alternatives and decisions out there, customers also don’t want to be continually switching what they buy and from who. There’s decision paralysis out there too – and once you’ve build a meaningful relationship between customer and brand, there’s little reason for them to go elsewhere. They have more important things to worry about.

Using Incentives and Loyalty Programs to Alter and Guide Behavior

A few years ago I started work on what would eventually become the Musicnotes Rewards customer loyalty program. Initially starting from some recurring revenue concept models, the project shifted gears as continued research into different models highlighted the value a loyalty program can bring.

For our platform, we went with a company called 500 Friends (since purchased by Merkle) and it’s been a pretty good experience so far. Our customers like it – and and things like “double points” weekends are popular promotions, but these aren’t where I see the largest value in the program. In my opinion, the most valuable aspect of a “loyalty program” is the opportunity they give to guide customer behavior, particularly to guide behavior that may otherwise not have the levels of engagement you’d like to see.

As you will learn from any small amount of research into loyalty programs, it’s true that customers like to be appreciated for their loyalty (I think it’s important too). Likewise, loyalty programs can also be extremely useful in tying together customer data points from cross-channel interactions. The one aspect that I find often overlooked, however, is how you can use incentives to encourage a customer to partake in a desired behavior.

For example, product reviews are viewed by most retailers as very important in helping their customers make purchasing decisions, as feedback and opinions from their peers are often much more useful and carry a stronger sense of “weight” than company-written copy usually provides. The problem is, getting a customer to write a review isn’t the easiest thing to do. Yes, you’ll have some customers who write reviews to position themselves as “experts,” others who want to share joys or frustrations, and still others who write the reviews out of a sense of community-based trade (they know their reviews are of value to others, and would like others to write reviews to help them later as well, so it’s people helping people) – but oftentimes you’ll find that these aren’t enough to drive the behavior at the scale you’d like.

So, what we’ve done is give people “points” for writing product reviews. The points can be used just like any points you receive from a purchase, meaning they can be redeemed for product, coupons, etc. We also have a badging system in place to help gamify the system, encouraging people to get “badges” (i.e. “bragging rights”) once they hit various numbers of total reviews written.  After implementing our reward-based structure of reviews, our incoming product reviews increased 5X – meaning much more valuable content on the site for customers, happier customers and lower rates of cancellation or customer service inquiries.

Taking this concept a bit further, however, you can get into some even more useful behavioral incentives, so much as to not only push someone to do your desired behavior once, but ultimately make it a habit. A great example I’ve seen of this is how Walgreen’s “Balance Rewards for Healthy Choices” is encouraging people to make exercise a regular habit. With their system, they are encouraging people to tie their FitBit or other activity tracker account to their Walgreen’s “Balance Rewards” program, and rewarding points for steps walked. Not only does it encourage more interaction with Walgreen’s as a brand by driving FitBit users to their stores to use their accumulated points, but it also actually will guide the behavior of walking to get people to start to do it regularly because of the incentives it provides. Do something long enough, and the incentives can start to fade as the behavior becomes part of your daily life, and you have a new habit.

Another usage in using loyalty programs to build habits can be as simple as encouraging customers to use products in ways that they may not have considered before. For example, many CDs purchased on Amazon come with an “auto-rip” of the MP3s of the album that can be used in the Amazon Music app. If Amazon were to want more people to try Amazon music, they could even go so far as to encourage customers who haven’t used Amazon Music yet to try out their new purchase in the player (meaning install the app, and sign in) and give them an incentive to do so (points, or more likely in Amazon’s case, a coupon toward a future music purchase). Assuming most consumers who use Amazon Music have a good experience, and are more likely to purchase additional digital music once they’ve started to make Amazon their platform, the incentive to get them to change behavior can be well worth the investment.

Take this a step further, and Amazon could go so far as to incentivize people to upload their entire music library to Amazon, and say for every ten albums they upload to their library, they get a dollar in Amazon MP3 credits. Small cost to Amazon, but by getting more people to have their music library live in the Amazon store ecosystem, they could very likely be converting iTunes or Google Play customers into Amazon customers, just by changing the behavior and habit in how they consume their existing library.

The point is, once you’ve identified desired behaviors that may act as “tipping points” such as making a non-customer a customer, or a one-time customer a regular subscriber, or even regular customers into ardent fans and influencers, there is a large opportunity to encourage more customers to hit these tipping points. Loyalty programs are a great way to do this, as you’re able to, in essence, pay a customer to try something new, with the idea that your investment in guiding their behavior will help (ideally in both you and your customer’s favor).

Opportunities to reward other than through Loyalty programs are obviously available as well, such as badging, coupons, “social currency” (i.e. bragging rights) or the general economics of a sharing economy, but nonetheless incentivizing desired behavior is the one sure-fire way to realize additional, similar behavior.