18 January 2018
Understanding the power of emotion in decision making
In his book Thinking Fast and Slow, the Nobel prize winning economist and psychologist Daniel Kahneman revealed there are two routes to persuasion, based on two basic modes of thought. “System 1” thinking is intuitive thinking – fast, automatic, emotional and often unconscious – requiring little energy or attention, but prone to biases and errors. It’s how the concept of brands work, providing quick mental triggers to shortcut decision making. “System 2” thinking is rational – slow, deliberate and demanding. It requires energy and focus, but once engaged, has the ability to filter the instincts of System 1 and result in more logical conclusions. Kahneman reveals how the vast majority of decisions we make are based on intuitive and emotional “System 1” thinking rather than rational “System 2” thinking, which of course, is where most of marketing’s focus has been mistakenly aimed for the last 100 years. In short, hearts win over heads!
So how can brands harness this understanding of the power of emotion within their media planning to help influence consumer behaviour?
Game-changing media targeting
Much of the insight derived from customer behavioural data focuses on the functional - which categories people shop, on which day of week, in which seasons and by which store type. Functional, rather than emotional attributes are often used to define target audiences: are they buyers of the category? Where do they live? How much do they spend on the brand, if at all? This knowledge alone provides the ability to define efficient and effective media plans.
But what if, rather than just targeting people on what and where they buy, we could work out why they buy? Could we help brands understand the emotional mindset, drivers and path to purchase behind why customers buy what they do?
Well the exciting news is that we are now applying advanced data science to combine the power of the emotional within media planning to support marketing strategies.
So how does the approach work?
It is important to start with the overriding principle of wanting to reach the widest available audience that could realistically buy the product. Typically, the start point could be to identify a functional audience base of all category buyers. This approach on its own, while still offering scale, may instantly reduce huge wastage at a stroke, enabling a greater brand presence to the right universe of customers over a longer period. Optimising with tailored messaging to brand and non-brand category buyers (acquisition and retention) will enhance this base plan efficiency further.
From this solid category buyer defined base, the challenge is to extend the targeting net further, but still do so efficiently. This is the point to consider and identify the emotional mindset your product appeals to, because not only are emotional drivers generally ‘category-agnostic’, they are ultimately what influences the customer’s decision-making process.
So how is this achieved? First we create ‘Product Affinity Clusters’. An algorithm clusters similar products together to link cross-category purchase behaviour, e.g. every low-fat product across the entire store. Once clustered, engagement of each customer across the different affinity clusters is overlaid to magically reveal customer segments which map to various functional and emotional need states. These are called “People Like Me” customer segments.
Consumers’ clustered buying habits reveal what is important to them in their lives. For example, customers that buy a range of fair trade and other similar products can be scored as “ethical” consumers, with a very specific belief system driving their behaviour. This meant that for a client with a CSR “Food Waste” brief, we were able to define and fine tune the ethical mindset to reveal segments such as “actively ethically engaged”, “sympathetic” or “ethically ambivalent”.
Similarly, emotional health drivers are identified to reveal mindsets ranging from proactive “healthy lifestyle/forever fresh” audiences, to “low/no sugar/fat” or “organic & free from” need states. This approach can be extended and applied within any macro emotional need state, such as Quality, Price and Convenience. None of these segments are bound by category – it’s why you buy, not what and where.
Identifying how customers feel at different stages of a decision-making process can allow for the design of a complementary customer journey too. For example, for a retailer’s Christmas campaign, historical analysis revealed valuable main shopper customers with a “plan ahead” mindset for Christmas. Being able to identify this group meant the retailer could ensure these customers’ early planning needs were met with the right category offers, but more critically, at the right moment, to psychologically ‘lock them in’ early.
By combining functional and emotional attributes together to design experiences around customer mind-sets, brands can build powerful media plans that are both efficient and increasingly relevant, and provide much greater scale. And importantly, this approach helps both the retailer and brand achieve mutual growth, which really is something to stir the emotions...
Just how important are heavy buyers for your brand? Check out our latest study Mass marketing or tailored to your tribe?