According to Forrester Research, Inc. (NASDAQ: FORR), consumer goods firms and retailers have no other option than to adopt symbiotic loyalty*, which requires them to capture customers emotionally, develop the peer networks around them, and innovate to stay interesting. To apply this CRM strategy, firms need to first understand their customers¿ values, attitudes, and social influence. Forrester warns that slow-acting firms will miss the boat.
Fiona McDonnell, Senior Analyst, Consumer Markets at Forrester Research, states: ¿Consumers today are tired of the brand bombardment of almost identical products, marketed through TV ad blocks that they increasingly skip. Meanwhile, CPG firms and retailers pump tens, sometimes hundreds, of millions into realizing their CRM visions. But the responsible managers still say that they lack the budget and resources to execute successfully. Forrester believes, however, that their CEOs are right not to open their wallets again; more of the same will only make the situation worse.¿
Symbiotic Loyalty Calls For Different Data, Not More Data
According to Forrester, success doesn¿t necessarily require throwing more money at mass data collection and mass marketing, but requires firms to combine targeted customer communication and involvement with building knowledge about individuals. Marketers can get this consumer insight by collecting three levels of data:
- Collective data. Aggregated data like standard demographics and online demographics describe groups of consumers.
- Individual data. Firms can collect individual data to identify actual consumer details.
- Emotional data. Emotional data describes attitudes, motivations, aspirations, and other drivers that are a step deeper than individual details.
The key lies in the method of data collection. Each level requires a different method, with an increasing amount of consumer engagement. Marketers can only reach the highest CRM level ¿ emotive ¿ after mastering the preceding two levels. The bottom line: You cannot extract emotional data; you need to engage with your customers to get it.
Companies Are At Different Stages On The Road To Emotive Engagement
Forrester¿s interview data indicates that many firms today talk the talk of individual and emotive consumer data, but few walk the walk ¿ they try to extract everything from collective data, rather than exchanging or engaging with consumers. Instead, firms need to build on the collective and then on the individual information ¿ be open to two-way communication ¿ to create the trust needed to connect at the final level.
To realize the benefits, Forrester recommends that companies look critically at their current situation and make sure that they have a solid foundation for progress before continuing. This boils down to knowing when enough information has been assembled at one level to move on to the next level.
Serious Contenders Must Wake Up To The Value Of Data
According to Forrester, detailed consumer insight offers a lifeline for companies struggling to differentiate. Consumers can only realistically be emotive about a limited number of things, so the prize will go to those companies making the move first and successfully.
McDonnell concludes: ¿Retailers in particular need to recognize that they are sitting on a gold mine. CPG companies should make gaining consumer insight their priority, integrating and aligning all marketing activities. To succeed, these companies also need to get their IT managers on board and integrate their Internet activities with the rest of the business.¿
The research mentioned in this release, “Identifying The Emotive Consumer” is available to Forrester WholeView 2¿ clients.
* Forrester defines Symbiotic Loyalty as a dynamic win-win association where brands engage consumers emotively and consumers reward them with increased wallet share and peer recommendations.