Sunday, 19 June 2011

We’re only human! - Rationality and human emotions in B2B marketing

The notion that prospective purchasers in any domain are driven solely by rational considerations in decision-making is a nonsense.

Emotions, feelings and instincts influence buying behaviour more than any logical considerations. A high percentage of the time people make decisions based purely on emotion. They may rationalise that decision afterwards by using reason and logic, but the decision itself is made on emotion. Logic and reason play only a secondary role. Also, contrary to some popular belief this applies more to high-value B2B purchases than B2C consumption. Some low involvement, utility, fast moving consumer goods may be bought solely on instrumental considerations, such as price, since they mean less in terms of their impact on the purchaser’s lifestyle.

So what’s rational and what does it mean? The word "rational" derives from the Latin word "ratio," which means "reason" or "computation" and to be rational means having or exercising the ability to reason. Therefore to be rational is to be wholly reasoned, analytical or judgemental without any influence of emotions, personal feelings, instincts or intuition. Rationality is coupled closely to science that is assumed by some, albeit naively, to offer an “objective” viewpoint. It’s this idea of science that’s the basis of workplace organisation in the late 19th and 20th centuries. Historically, workplaces were typically characterised by hierarchies, order, linear relationships and high degrees of control that reflected a simple, mechanical view of science.

It’s believed by some that a good rationale for decision-making must be independent of emotions or any kind of “subjectivity”. It is evident, however, from modern psychology, cognitive science and neuroscience that study the role of emotion in mental function that no human has ever satisfied this criterion, except perhaps a person with no affective feelings, for example, an individual with a severe psychopathic disorder. Computers, not people, best exemplify this idealised form of rationality.

So what emotions might come into play in B2B purchasing? More or less all of them, we suspect but we’ll look at a few examples of common emotional motivations here.

One of the most common is the human need for safety and security. Its negative corollary is fear, more specifically, fear of loss. It might be expressed in the question, “If I buy this technology, will I be safe? Will I get to keep my job?” Back in the 1980s, it was against this type of fear that IBM promulgated the marketing myth, “No-one ever got fired for buying IBM.” The inference is that one might get fired for buying computer hardware from a competitor. It’s an example of “FUD” marketing that plays on a human’s most basic concern for personal security. Fear, Uncertainty and Doubt (FUD) are the appeal to fear in sales or marketing in which a company disseminates negative and vague information about a competitor's product. It exploits human fear. Fear and risk are probably the strongest emotions in the B2B buying process.

We came across another example very recently when we were looking at customer motivations that might apply to purchasers of a breakthrough piece of information technology. The technology had a significant and salient technical benefit that appeared to be compelling. In our research this particular advantage was marked way down the list of benefits that might apply, about eighth of twelve. Suddenly, the penny dropped; the first seven benefits all related to one thing and to one thing only. They might have been expressed or seen as seven distinct technical performance criteria, but they all related to security and safety and their emotional complement, risk and fear. Rationally, there was no security issue and the technology was low / no risk. But for the buyer, security was their main concern seven times over. Have you ever thought about how many late adopters might have adopted earlier if their feelings around emotional security and safety, fear and risk had been addressed and allayed in product marketing?

We say on our home page, “People buy your beliefs about why you do what you do first and foremost, then they rationalise about features and functions.” Here emotions come strongly into play, believing why you do what you do is much more than simple credibility. It’s about the resonance of personal identity, the reflection of self-image in the values of the vendor. It goes further than the two conventional axes of strategy and tactics, the “what” and the “how” to “why”. Here’s a simple list of priorities in order of importance from a large corporation. Let’s see what is says about their “why” and how I as a customer might relate to them:

1. Top line growth
2. Enhance shareholder value
3. Focus on global expansion
4. Enhance customer satisfaction
5. Our people

You probably will have seen that sort of sequence more than once. Our first observation is that people are at the bottom of the pile whereas for most successful organisations, those who are the most profitable, people are at the top of the list. Customers come in one before last and are less important than increasing shareholder value – their second highest priority. This says that lining their own pockets is more important than their customers. My reaction to this list is emotional and distaste might describe my feelings. Actually, it says they care less about me as an employee or a customer than they do about their share price. Caring is a powerful emotional attractant. I want a business to care about me. I don’t need some wishy-washy, sloppy caring affectation but as a customer, I do wish to matter. That brings me to other emotions that might be brought to B2B purchases, those of esteem and respect. Which of those might I experience as this corporation’s customer? Maybe there are more emotions here too…like would I trust a corporation that placed shareholder interest above customer satisfaction? Almost certainly, I would not.

Esteem is a complex buying emotion too. As a purchaser I’m concerned about how my actions are regarded by my colleagues and peers. I’m also concerned about how my decision might impact my reputation. If I go out and buy a new, breakthrough technology, albeit from a highly reputable vendor, what’s the cost to me in loss of esteem and reputation if things don’t go quite as planned? I may keep my job but that’s not the end of the story. How might I be regarded next time around? Will I be taken seriously? Perhaps the only way to recover personal credibility might be to walk away from that particular vendor. How easy will that be? Maybe it’s true that the technology didn’t fail but simply fell short in producing anticipated benefits. It doesn’t matter. The damage to my esteem and reputation with colleagues may take no account of the difference between failure and failing to deliver as expected. My confidence will have taken a pounding too.

We believe that customer service is a marketing function since the purpose of marketing is to create a satisfied customer. Nowhere are people’s negative emotions more likely to be deeply felt than in customer service. They may not be rational or even proportional but they are nevertheless real and deserve to be taken seriously. It’s vital that your customer services’ people are trained in handling and diffusing negative emotions, like irritation, frustration, impatience, disappointment, disillusionment and anger as well as being able to deliver the rapid and constructive resolution of customer problems. Customer service is not about shoving a person on the end of a phone in the hope that they deflect the barrage of anger for a business’s product issues and mistakes. It’s a highly skilled empathic people-centred role that helps deliver your next sales to the customer, your repeat business. Customer service is simply when a company works everyday to keep their business so that they never face a threat of losing it.

Emotions are everywhere in all that we do. To say, that emotions are distinct from rationality is not to say they are separate from thought. Emotions and thought are inextricably intertwined and inseparable. We can’t ignore emotions, either in life, in business or in marketing; they are part of our culture, our socialisation, our environment and our biology. Emotions count for everything. Reason without emotion is not a human capability.