The Benefits Of Boosting Customer Consumption
What options do you have for increasing your revenues?
Find more customers? Call more prospects? Set up more demonstrations? Run more ads?
All valid options, but they’re hard work.
These are all based on the concept of introductions – finding someone who has not heard of your brand, making them aware of what you sell, and asking for a sale.
There is another question that could be easier to implement, and more valuable over the long run: How do we increase our current customers’ rate of consumption?
Not just rate of purchase, but how much time they spend with our products/services, and how much progress they make.
For example, Netflix make personalised recommendations for each user, highlighting which of their new shows and specials would be of particular interest to that person.
Audible send out nudges to customers throughout the month, making suggestions around which audiobooks that customer might like.
Pubs give away nuts and pretzels covered in salt, which make customers thirsty and prompt another round of drinks.
These are all indirect manoeuvres, and none of them immediately lead to a sale.
While they might not be immediately measured, they certainly contribute to the company’s profitability.
It seems the two core elements of these nudges are empathy and patience.
By understanding what our customers are looking for, we can guide them towards the parts of our business that will delight them.
By staying patient with this strategy of delight, we are waiting for them to organically recommend us to their friends and reduce the likelihood of them cancelling their subscriptions/habits.
The reverse is also true – businesses tend to push their customers away through selfishness and impatience.
They make recommendations that aren’t purely in the customers’ best interest, and put short term sales spikes ahead of long term brand building.
This is the skill of paying attention to your customer after you’ve made the first sale.
Just because you persuaded one decision maker doesn’t mean you persuaded their constituents.
e.g. you convinced a manager to set up your SaaS platform, but their team aren’t using it.
The manager huffs and puffs about the rules, but the end user doesn’t have the motivation to truly embrace the change.
What are the chances that this business is still a customer in 12 months’ time?
You might have persuaded a customer to change their systems, but they haven’t changed their culture.
If the end user isn’t convinced that it’s worth switching to something new, they’ll drag their feet and make half-hearted efforts.
The sale isn’t the same as the tipping point; you want to reach the stage where customers have formed a new habit, and embraced your product as a part of their daily lives:
· They might buy a Keep Cup, and actually remember to take it with them.
· Your platform is one of the first things they check in the morning
· They keep going to the class five weeks after signing up, even when it’s cold and raining
Clever brands focus their energy on pushing customers towards these tipping points.
· Twitter know the number of accounts a new user needs to follow in order to have a good news feed, and makes suggestions until they hit critical mass.
· My gym refunds your joining fee if you show up 10 times in the first month.
· Wufoo sends you reminder emails if you abandon your first form.
Uber had a promotion where you could have a carload of puppies visit your office, in partnership with a dog adoption charity.
At the end of the visit, you could choose to adopt one of the puppies on the spot.
This is such a clever idea.
There are probably a lot of people who are open to having a dog, but not motivated enough to go down to the animal shelter.
It seems like it would be full of paperwork, and the choice is overwhelming.
But when they hold that one puppy and stare into their eyes, the choice is easy.
This is my new puppy.
That’s the secret to the consumption process, the moment when the customer understands what their life would look like if you were involved.
Some foresight is required, because the ROI is slow to emerge.
We’re previously looked at how Katy Perry and Lily Allen used MySpace to give their music away for free, in an era where money was made on CDs.
That’s because Katy saw the real money was in stadium tours, and by making fans through MySpace, these people would be happy to pay $160 per ticket to see her in their city.
Consumption of music is what creates a loyal following – why put the paywall in too early?
The same goes for other industries – if you can have your audience read more of your tweets, share your articles, download your templates, re-read you books, make the most of their membership etc., then you’re likely to see these people spread the word.
They’ll line up to shop with you in the future, and will often bring others with them.
When it comes to customer journey mapping, this is the “Extend” component.
By understanding our customers in detail, we can start to pre-empt their future needs and get in front of them at the right time.
We might be asking for a referral to a new customer.
We might be introducing them to new product that solves a pain point.
We might be offering a larger bundle to suit their growing organisation.
We might be offering a training package to acclimatise their new staff.
Fortunately, there are a lot of great brands you can imitate in designing extension offers.
There’s no real loser in the equation, maybe your competitors.
Why would you want people to have access to your products, services and content and then not use it?
The only cost is the time it takes to design and distribute your nudges.
These might be blog posts, social media content, calls to your users or maybe a visit to your customer’s offices.
The friction of their daily lives is preventing them from making the most of what you can offer.
How might you help them get un-stuck and form good habits?