MarketingSherpa Blog

As much as 45 percent of what customers do every day is habitual. That is just one interesting piece of research we shared in Tuesday’s MarketingSherpa blog post, which was part one of my interview with Charles Duhigg, Pulitzer Prize-winning reporter for The New York Times and author of The Power of Habit: Why We Do What We Do in Life and Business.

In today’s blog post, we share part two from the interview. You’ll learn about the reward schedule for customers, conducting research that informs effective writing and optimizing the habits in your day-to-day life, along with a question that was really nagging me — can you leverage the science of habit and still be an ethical, customer-first marketer?

If you’re interested in learning more about Charles’s research, we’re giving away a copy of his book in this week’s MarketingSherpa Book Giveaway (enter by December 13 for a chance to win) and Charles will also be a featured speaker at MarketingSherpa Summit 2016 in Las Vegas.

Understanding the reward schedule for customers

MarketingSherpa: So, in the book, and what you’re talking about, you talk about the ways that brands or marketers influence customers to create habits essentially like, hey, marketing to have milk with cookies, or what have you, or Febreze. Have you seen any examples of customer habits actually influencing the brand? So working vice-a-versa or a smart brand out there that’s doing some research and really sees what natural customer habits are and taps into them as opposed to creating them?

Charles: Oh yeah! Absolutely, all the time. I mean, one of my favorite examples of this is video games. Right? When a video game designer designs a new game, the first thing that they decide upon is what the reward schedule is. What that reward schedule is, is really looking at when people play games, when do they expect to get some type of thing that makes the playing continue to feel kind of fun, when you get a reward that you can anticipate, when you get a reward that you don’t anticipate.

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Let’s pretend for a second you are an alien from outer space studying economics. You’re presented with these two options:

• Option A: People can make a cup of coffee for 16 to 18 cents in the comfort of their home.
• Option B: They can haul themselves out of bed earlier, stop at Starbucks and pay two … three … four … five dollars for a cup of coffee.

As a rational alien studying economics, you would know that people will certainly choose Option A.

Except, as we all know, people don’t. They choose Option B. Not everybody, of course. But enough people to generate $16.447 billion in revenue for Starbucks. So many people, in fact, that you must look at this purchase decision — which we’ve become so accustomed to being a part of daily life — as an alien economist to even notice that it’s not a rational economic decision every time people make that purchase.

Why people make repeated, economically irrational decisions

So why do people act this way? Because they are no longer making rational economic decisions; rather, they are on autopilot following automated habits. Starbucks’ marketing department has helped turn a simple cup of coffee into a cheap luxury habit.

It’s not just Starbucks, of course. It’s the daily newspaper on your driveway. Movie night. And even, according to Charles Duhigg, the mundane act of brushing your teeth.

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When you think of social media marketing, you may think of the behemoth — Facebook. Sure, it has almost 1.5 billion monthly active users, but where there is a lot of sound, there is a lot of noise. It is difficult to get your message heard.

I interviewed Danny Gavin, Vice President and Director of Marketing, Brian Gavin Diamonds, about using emerging social media platforms to create brand awareness.

Here are a few lessons I learned from our conversation.

Focus on branding, not selling

Since many emerging platforms are, well, emerging, there hasn’t been a lot of commerce on them yet. Most social platforms focus first on building an audience, and only later on actually monetizing that audience.

New social platforms tend to have a loyal, niche audience that is looking for authentic, organic conversations and wary of the nefarious effects of commercialization. So whatever content you create, make sure it rings true with what the social platform is known for.

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Where does social media success begin? In many cases, it begins well off of an online platform like Facebook or Twitter. It begins with a valuable product.

Cambria Jacobs, Vice President of Marketing, Door to Door Organics, sat down with me to discuss the natural and organic grocery company that sells entirely through ecommerce. She shared how it started with a valuable product that customers loved and built off that base to grow its social media fans more than 600% in less than 18 months.

“We were really proud of getting our hands on the best organic produce. We weren’t necessarily looked at or aspiring to become this strong ecommerce player with a really strong technology savvy. And what has grown, being a pure ecommerce player, is our customers were finding us on social media,” Cambria said.

The product itself had enough appeal that it spurred a passionate base audience organically promoting it to friends, family and connections on social media.

“We had organic visuals that were popping up on Instagram and Facebook before we even had a presence on Instagram — just our customers taking photos of their box and of their delivery,” she said.

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“We see a lift, definitely, in conversion, whenever we have video on the page,” Val DuVernet, Senior Program Manager, Advance Auto Parts, told me during an interview in the MarketingSherpa Media Center at IRCE 2015.

Read on for three of the biggest lessons I learned from my interview with Val, and watch the below video to get your own ideas for using video to improve your brand’s conversion.

Three important points stuck out to me from this interview …

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Some ads, campaigns and branding ideas are pretty bad.

So much so that an old “Saturday Night Live” sketch — featuring Jerry Seinfeld playing the host of a “Jeopardy”-like show with stand-up comedians guessing the punch line — included the frequent answer from Adam Sandler’s character, “Who are the ad wizards who came up with this one!?”

Cold comfort, though, when your own advertising and marketing ideas don’t see the light of day: “How is that dreck getting made, while my brilliant ideas are being overlooked?”

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On the MarketingSherpa blog, we report on every conceivable element of marketing success — from customer service to content marketing, email deliverability to responsive design.

One element of marketing success you shouldn’t overlook is passion.

Push-through-all-obstacles, make-the-impossible-possible, Teddy-Roosevelt-man-in-the-arena passion.

I met Marc Lobliner, Chief Marketing Officer, TigerFitness.com, at the MarketingSherpa Media Center at IRCE 2015. TigerFitness.com has been on the Inc. 5000 list of fastest-growing companies for three years in a row with 659% revenue growth over that period to $5.6 million in revenue (as of 2013).

You can watch the interview to hear Marc’s passion for yourself.

TigerFitness.com is not Marc’s first business. He helped create a new $100 million-plus category in the fitness industry — the Intraworkout category — with a product called Xtend.

“When you’re first to market, the brand lives on,” Marc said.

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Ecommerce has long been considered to have a cost advantage over brick-and-mortar retailers. After all, real estate, inventory and human resource costs are all lower.

However, these reduced costs come at an expense — Internet retailers rely on a third-party for fulfillment. Which means their margins and perhaps overall business model is at the mercy of other companies.

This dependency became all the more clear recently when UPS and FedEx announced a significant change to shipping policies by applying dimensional weight pricing (also known as DIM) to all ground shipments. This means that the size (length, weight and height) of even lightweight objects could cause increases in shipping costs for ecommerce vendors.

A concrete example of this is The Wall Street Journal estimating a 37% increase in price for a 32-pack of toilet paper and a 35% increase for a two-slice toaster.

At the MarketingSherpa Media Center at IRCE 2015, I spoke with Abe Garver, a contributor to Yahoo! Finance and an M&A (mergers and acquisitions) banker, to discuss how these shipping changes are affecting ecommerce companies. Abe used the example of a peacock feather — which may really only weight six ounces, but due to its large size is considered weighing 17 pounds when calculating the cost of shipping.

Sometimes people fall out of love … with your newsletters and email marketing.

Or change jobs. Or email providers. There are a million reasons why they stop reading and engaging with your emails.

This is why email marketers need to run win-back campaigns. That is, reaching out to inactive subscribers and compelling or convincing them to re-engage with your email sends.

If they don’t re-engage, it’s time for a list cleansing — no longer sending emails to this group.

A smaller, but higher-quality, email list

The end result can be painful in some ways; it will likely result in a smaller email list (and the older the list is, the more shrinkage you will experience).

This is only painful because we all like big numbers. We like to tell our CMO, our clients and brag to our childhood friends at the high school reunion (hey, when they’re all doctors, you gotta brag about something) about how we run email marketing to a list of 1,000 … 10,000 … no … one million email subscribers.

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At the Media Center at MarketingSherpa Email Summit 2015, we interviewed your successful brand-side marketing peers, along with researchers and industry thought leaders.

One interview stuck out from the rest because we interviewed someone who’s title was “customer.”

Jill DAmato, the wife of our own Brian DAmato, Senior Vice President of Partner Solutions, MECLABS Institute (parent research organization of MarketingSherpa), agreed to sit down and answer a few questions.

We had recently fielded a survey with 2,057 American consumers about their email preferences, and it was interesting to sit down with a representative customer to help bring that survey data to life …

“Email is great, because it’s very quick and easy. But it does have to be something very catchy and very relevant and timely. Because if it’s not, I’m not going to open that,” Jill said.

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