THE MODERN CUSTOMER JOURNEY
Modern Shopping Landscape
Over the years, the shopping experience has evolved tremendously.
In the past, people’s purchasing options were limited by proximity and availability. By contrast, in today’s landscape, there is an enormous wealth of options, opportunities and information. People can enter or exit any store with the simple click of a button. If they want additional information about a product or service, they can quickly consult a friend, the general public or even get a celebrity’s opinion.
Consumer behavior and marketing strategies have fundamentally changed as well, to adapt to this ever evolving reality.
Defining the customer journey?
A question that online marketer’s are often challenged with relates to defining what the customer journey actually looks like. This is arguably one of the most important questions in advertising, yet one of the hardest to answer.
Understanding the customer journey and their decision making process allows marketers to uncover new growth opportunities and serve existing customers in a more effective way.
Current advertising tools allow marketers to measure outcomes with amazing detail and granularity. However, with the huge expansion of choice and opportunity, understanding consumer behavior is more complex than ever.
The marketing funnel
Over the years, marketers and behavioral architects have attempted to map out the customer journey. Several models have emerged over the decades, with the funnel being the most prominent.
Developed in 1924 by William Townsend, the funnel is a consumer-focused marketing model that illustrates the theoretical customer journey toward the purchase of a good or service.
Although various iterations of the funnel have been developed, the basics have remained the same. Customers initially go through an awareness stage, followed by a consideration stage, and finally they take action at the conversion stage.
Although the funnel is etched in the brains of most modern marketers, can this 20th century model still be used to explain behavior in the 21st century?
In today’s day and age, where information is abundant, attention scarce and consumers more sophisticated than ever, one can’t help but question if this linear model still holds up or if it’s an oversimplified depiction of the customer journey.
Decoding Decisions is the title of one of the largest research studies performed by members of Google’s consumer insights team. The objective was to gain a better understanding of the modern buyer’s decision making process.
Through their research they developed an updated model that depicts the journey a customer goes through from trigger to purchase.
The center of the model represents a complex space coined the messy middle. In this space customers are won or lost as they loop through phases of exploration and evaluation.
The model explained
Exposure is not so much a phase, as much as it’s an always-on brand presence that can impact an individual’s decision making process.
Triggers are responsible for moving the customer into an active purchase state. This can include an ad, an emotion or a need.
The Exploration and Evaluation Loop
During this phase, consumers are performing two activities either simultaneously or sequentially. The exploration phase is more expansive, while the evaluation phase is more reductive. During this phase people are trying to gather information and weigh their options.
This refers to the experience a customer has with the product or service. Although this is not necessarily part of the decision making process, it feeds into exposure and generates return customers.
Purchase is when the customer completes the desired action
Influencing the messy middle
Now that we have this new model to depict the customer journey, the next logical step is to determine how we can influence behavior during the exploration and evaluation phases to ensure the customer completes a desired action.
During Google’s research, they tested the impact of several behavioral biases that are closely associated with the exploration and evaluation phases.
These six biases are: (1) Category Heuristics, (2) authority bias, (3) social proof, (4) power of now, (5) scarcity bias and (6) power of free.
Shortcuts or rules of thumbs designed to reduce cognitive effort required to analyze key features or benefits of a product.
This is a common mental shortcut, where people rely on the opinion of an authority to inform their decision.
This describes the tendency people have to rely on other people’s behavior and opinions in order to determine what to do in ambiguous situations.
Power of Now
This describes the fact that people have a tendency to want things now rather than later.
Limited resources tend to be viewed as more valuable. Limited can be in the form of time, quantity or access.
Power of Free
Describes the fact that there is something special about the price of $0.
Impact of the Six Biases
In order to test the impact of these 6 biases, the research team studied thousands of shoppers who performed over 300 thousands purchases across a broad array of industries. Before the analysis the shoppers subjects were asked to select their 1st and second choice brand for a product they were in the market for.
The results of this study were quite astounding.
When their second choice brand was supercharged with all 6 of the above mentioned behavioral biases, there was a significant shift from the first choice brand to the second choice brand. Anywhere from 72 – 94% opted for the second option depending on the category. .
They tested a similar scenario, during which the customers first choice brand was tested against a fictional one, with the fictional brand being supercharged with all the behavioral biases. In this case as well, there was a significant shift from the 1st choice to the second choice, with anywhere from 28% – 87% opting for the new brand.
Based on this study we can conclude that behavioral biases have a very significant impact on how consumers make deductions in the messy middle.
Although known and dominant brands still have an advantage, the underdog can still disrupt preferences in the messy middle.
While the messy middle model is a relevant way of understanding the consumer, the funnel is still very much alive (and quite possibly immortal)
It’s important to target customers and speak to them in a way that resonantes with them and the right moment and the funnel model certainly helps with that.
However, as marketers we have to acknowledge that there’s a lot more to the picture. When setting up ads and evaluating the funnel and performance we should layer on knowledge of how the messy middle works and the cognitive biases that inform user’s decisions.
These principes should be incorporated throughout our ads and our content in order to serve customer effectively and increase the likelihood then persuading them to make the descisions we want.