How to Think Like George Washington and Abraham Lincoln
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In honor of the upcoming Presidents’ Day, here’s a look at one of the most respected traits Washington and Lincoln shared that can provide guidance to everyone from the CEOs to product manager and market teams.
They saw the world the way it was, not the way they wanted it to be, or thought it ought to be.
This trait has been universally viewed as a key to their ability to develop effectives strategies at two of the most critical points in our country’s history. It gave them a clear and objective view into the situations they faced and a realistic estimate of the strengths and weaknesses of their positions.
This may sound easy, but for many of us our desires, biases and enthusiasm for our products, companies and teams color our perspectives and prevent us from seeing things the way they actually are. Here are two techniques for viewing our markets and positions within them more like Washington and Lincoln; and one from Benjamin Franklin who while not a president had plenty of sage advice.
1. Identify your biases: Most of us are biased in the areas that matter most to our success. A simple way to identify these biases and blind spots is to make a list of the conditions that must be true for your product or strategy to be successful. Examples could include that the market considers a problem a priority to solve relative to other challenges, or that the market is dissatisfied with existing solutions, or that your sales reps will set 10 appointments a week. Once you have the list of conditions, objectively review the assumptions and evidence underlying each condition. The areas where you may be over- or under- estimating threats and opportunities will become apparent.
2. Make reference class comparisons: Individuals and teams tend to be inherently optimistic about their plans and strategies. We expect things to go well, and closer to the best-case scenario than to the worst. Reality usually falls somewhere in between. Most new endeavors will encounter the same challenges as previous internal efforts and/or as businesses that have faced similar situations. When planning product introductions, acquisitions, and sales & marketing campaigns look back at previous internal efforts and at case studies and examples outside the organization to see how these efforts panned out as a starting point for your forecasts. All things equal, your new product, campaign, etc. will likely follow a similar path. If you think that your efforts will go better, faster, etc. make a list of the reasons you believe that your efforts will be different than the norm. Then use Tip 1 to make sure you don’t have any blind spots or faulty biases.
3. Use Franklin comparisons: When most of us look at the strengths of our products or favorite sports teams we tend to forget that many competitors share those same strengths or have different strengths that compensate. To compare your offering to competitors (direct or indirect) make a list on the left side of a piece of paper of what you think your strengths and weaknesses are. On the right side, make a list of what the market thinks the strengths and weaknesses of your competitor are, not what you think they are. When generating the competitor list Tip 1 can help eliminate the biases you may have. Once the two lists are complete compare them and cross out any points of parity and offsetting conditions, e.g., the competitor’s brand equity offsets your better functionality. This exercise helps identify the mindsets and perceptions your sales & marketing efforts will encounter on the ground.
These three techniques will not make you as brilliant a leader as Washington or Lincoln, but they will help you see your market how it is, not how you want it to be. Paraphrasing Franklin, these techniques will make you wise and help you develop strategies that avoids common pitfalls and to set realistic expectations.
Making an effort to imagine yourself in your customers’ shoes may give you a false sense that you understand what your customers want. This counterintuitive statement stems from research conducted by Johannes Hattula of London’s Imperial College and his colleagues. Fortunately there are steps you can take to ensure you are not projecting your opinions onto your customers.
Dr. Hattula’s research indicates that the more empathetic you are (or try to be) the more likely you are to assume your customer preferences would be similar to your own. Put another way, when you try to put yourself in your customers’ shoes you actually think What would I do or want in this situation, rather than What might someone else want. This is engrained into our culture: The Golden Rule says Do unto others as you would have them do unto you. Unfortunately from a psychological standpoint the more empathetic a person is the more likely they are to use their personal feelings to predict what someone else would want. The research indicates that the effect doesn’t change with age or experience.
You can see this effect in your home life. Have you ever wanted to do something nice for someone who was having a bad day but found that the person didn’t appreciate your efforts or worse was annoyed by them? While they probably appreciate the effort, perhaps it backfired because you did what you would want in their situation, which isn’t necessarily what they would want.
These same dynamics can play out in the business world. Product managers with higher levels of empathy believe they understand the market thoroughly and are more likely to ignore research and data that conflicts with their views than less empathic managers. Sometimes they are right – but the Steve Jobs of the world only come around so often. As researchers we see this effect when conducting focus groups: Clients observing the groups fixate on an individual who most closely resembles their own views.
This tendency isn’t all bad. In fact, it is the core of many successful businesses whose customers seek out vendors that match their attitudes and philosophy: A conservative investor may seek out a conservative bank or a bleeding edge tech start-up may seek out the advertising agency that pushes the limit. This works well for existing products and relationships. However, when a vendor introduces new products or enters new markets, mistaking your perceptions for those of your customers can create problems. It can be seen in the number of product introductions that fail despite the product team honestly believing they are creating what the customer wants – their intention is good, but the execution misses the mark.
Fortunately there are easy steps you can take to ensure the level of empathy you have for your customers doesn’t backfire.
- One of the easiest is to remind yourself of your biases. In Dr. Hattula’s research, simply reminding people that their own biases exist reduced much of the egocentric effect. It makes you step back and think rationally about what is important to you and how it may be different than what others want.
- Group decision-making counters the effect. Since individuals have different opinions, the discussion helps people recognize their own biases and perceptions.
- Soliciting outside opinions or using market research can provide a less biased view of the market’s wants and needs.
Regardless of what you do to counter the effect it is useful to remember that as people we have an innate tendency to assume other people want the same things we do. Perhaps the new Golden Rule for marketers should be Do unto customers as they want to be done unto – leave your wants out of it.
A common concern with focus groups is group think. In most cases what appears to be groupthink is actually poor moderation – the moderator fails to control dominating personalities and elicit comments from the quiet ones. Beyond being strong moderators to further combat the possibility of group think Isurus includes individual exercises in most focus groups. This ensures we collect feedback from everyone and provides the more timid participants with a stick in the ground they can stand by when aggressive participants try to sell their point of view.
That said, recent research coming out of Yale University and published in the journal Psychological Science provides some interesting food for thought. Erica J. Boothby, Margaret S. Clark, John A. Bargh found evidence that shared experiences amplify how we feel about them. We find positive experiences more positive when we see someone sharing the same experience – we find our individual desert more delicious if others are having and enjoying a desert as well. The same goes for negative experiences, sitting in the jury waiting room feels worse than it is partly because there are others with you sharing the experience. The effect isn’t conscious. People don’t change their opinion based on what they think the group feels, they actually have more intense feelings about their experience. The effect isn’t great, but it is big enough to be measurable.
If supported by further research the implications for creating better work and social environments are obvious. As researchers we should ask ourselves, “Is this relevant to focus groups?”. Maybe. In instances when there is strong consensus—either positive or negative—on the appeal of a product or messaging concept the amplified experience phenomenon may kick-in. Individuals may find products slightly more appealing than they would when conducting an evaluation in isolation. They may also find an ad concept more offensive than they would if they actually saw it at home.
Regardless of what further research says about the amplified experience, thoughtful and effective research designs address this issue as well as the other challenges associated with focus groups. These include:
- Guides that explore current situations, pains, motivations, and mind sets
- Moderators that can control the dominant personalities and draw out the meek
- A holistic analysis that goes beyond participant reactions to the concept
- Applying experience and sound judgment to the data
Following these principles ensures that focus group research does not fall into any traps that exist – the known ones and the ones surfacing in the areas of behavioral economics and psychology.
Improving the B2B Customer Experience
Accenture recently released the results of a study of how B2B companies perform in providing the customer experience (CX) B2B markets want today. A summary infographic of the results can be found here: Start Playing to Win, Stop Playing to lose.
The customer experience the report explores is generally defined as the sum of all experiences a customer has with a supplier of goods and/or services, over the duration of their relationship with that supplier. In a thematic sense B2B customers have started to expect their interactions with their suppliers to be similar to their consumer experiences. They don’t expect to buy enterprise software or raw materials on their smartphone. But they do want their experience to be focused on their needs and for complexity to be reduced as much as possible.
The three statistics that jumped out us to from Accenture’s report are:
- 70% of B2B executives believe their customers constantly reevaluate supplies and partners in an ongoing search for the best results and CX.
- 85% believe their long-term financial goals are linked to how their customers view their CX.
- Despite its perceived importance only 24% of B2B companies are “masters of the customer experience” as defined by Accenture.
The report goes on to outline how to systematically evaluate, manage and improve the customer experience business provide their B2B customers.
One of the key steps in the process is developing a thorough understanding of what customers notice and value. If you’ve been in the market long enough intuition and common sense can get you close to what is important to B2B customers. However, they can also overinflate the importance of some factors and undervalue others. They best way to understand what is important to your customers is to engage with them directly. Qualitative research can help identify the dimensions that customers find important and quantitative research can profile the relative importance of the dimensions. Once you know what is important to customers you can evaluate your investments and performance in those areas and make adjustments where necessary.
The research can be informal or formal, although Accenture recommends using hard metrics to evaluate your performance. You can handle the process internally or turn to an external research consultant such as Isurus. Regardless of the approach you take the end goal is the same – developing a customer experience road map that matches what your customers are looking for.
A tension exists between most marketers and their advertising agencies. Agencies want to push the envelope as far as they can to create advertising that cuts through the clutter and engages the audience. Marketers—especially B2B marketers—tend to be conservative and worry that edgy advertising will alienate customers and prospects. Who’s right? Research conducted by Jonah Berger of the Wharton School and Zoey Chen of the University of Miami indicates that both may be.
Berger and Chen set out to understand the degree to which controversy encourages engagement and conversation. The underlying assumption is that people notice controversial topics and talk about them with their family and peers. To explore this phenomenon they tracked two dimensions of stories posted on an online news site. The first was a rating given by a panel of readers of how controversial the subject matter was on a 7 point scale where 1 was “not at all controversial” and 7 was “highly controversial.” The second dimension was the number of reader comments that were posted for each article over time. For more details on their study click here.
The results show that mildly controversial articles generate the most engagement and reader posts. However, “mildly” is the key qualifier. If the controversy rating is above a 4.6 on the 7 point scale, engagement falls off rapidly. Berger and Chen describe the marketer’s challenge succinctly: To find the “sweet spot where an image or issue generates enough heat to elicit interest but stops short of raising qualms.”
Controversy isn’t limited to consumer advertising. B2B advertising is rarely as risqué as Super Bowl ads or consumers ads that go viral. However, within the norms of individual B2B markets there are conservative ads and edgy ones that create hand wringing among marketers and executives. This may be the use of “#$%&” to represent curse words in the text or not showing the product or including people who do not look like the products historical buyers. The key is to find the right amount of edgy.
A healthy debate between marketers and their agencies will likely result in advertising that balances being controversial enough to garner attention but does not cross the line as defined by the audience. Still according to Berger and Chen the margin of error is relatively narrow. As they say, “A little controversy goes a long way.” There are times when the debate can be enhanced by collecting feedback directly from the intended audience. We often work with clients when the two sides—marketers and their agencies—cannot agree on where the fine line of edgy exists or when agreement exists but so much is riding on the campaign that they want validation they got it right.
In the end marketers should be open to their agencies edgier ideas, agencies should value the constraints their marketers put on them, and the audience is the final arbiter of what crosses the line.
B2B technology vendors often overestimate the degree to which their markets make rational decisions. They forget the human element in business decisions to their detriment.
The results from PWC’s Global State of Information Security Survey: 2014 illustrate the irrational side of B2B decision making. Although enterprises across the globe see data security risks increasing and become more advanced, most have not invested in technologies that address these new challenges such behavioral network monitoring, security information event management platforms, data protection tools, mobile device management tools. Nor do they hold the partners they share data with to data security standards. Yet 74% of organizations overall, and 84% of CEOs, feel confident that they have effective data security strategies in place. A simple explanation exists for this disconnect between these internal perceptions and the realities of data security: Business decision-makers are human. They have limitations in terms of the amount of information they can process, they make decisions based on incomplete information, and their decisions are influenced by emotions to a greater degree than they realize.
The human brain can only process a limited amount of information at one time. When it gets overloaded it simplifies situations into contextual frameworks it can understand. This often happens unconsciously. Wall Street traders have access to vast amounts of information about the companies and markets they invest in. However, their investment choices are often based on a handful of dimensions that they feel most comfortable evaluating. Likewise, data security has grown so complex that even people devoted to it cannot keep up with the latest threats and solutions. When evaluating their comfort with their security position senior managers tend to evaluate the dimensions that they understand. If they feel good about those, they project that confidence to their overall situation.
This tendency to reduce complex situations into simpler frameworks creates challenges for many B2B technology vendors that focus their value proposition on functionality or ROI.
- Many vendors assume that prospects systematically evaluate solutions against each other; most prospects do not. Instead they heavily weight their decisions on a few factors that may or may not be related to functionality. They also rely on brand equity and peer usage as surrogates for detailed evaluations. Some companies recognize these tendencies and bring in external consultants to help review their needs and options.
- ROI pitches can fall flat because many B2B decision-makers do not have a clear picture of the cost of their existing solutions and processes. They view licensing and support costs as concrete. Promised costs savings from efficiencies gained are ambiguous because the decision makers have no real basis for comparison.
- From an emotional perspective any change in processes or vendors is a referendum on the performance of the current team and processes. Unless they are in crisis mode, most decision-makers will acknowledge that things could be better, but feel that they are doing OK and can be defensive. This explains why F.U.D. messages sometimes do not resonate as well as expected. It’s also why many changes in processes and systems come with new management – the new staff doesn’t have any emotional investment in the status quo.
Organizations and individuals also create a narrative of how they perceive themselves and look to solutions that fit within narrative (e.g., we only use large vendors, we use market leaders). This internal narrative may or may not be based on reality and the resulting choices may not be rational.
The implication of these dynamics is that in order to develop value propositions and sales approaches that resonate, B2B vendors must understand how their market actually thinks, feels, and makes decisions. Isurus helps organizations use primary research to better understand their customers and prospects as people, and the influence of emotional and non-rational factors on buying decisions.
New research from McKinsey & Company reveals a gap between the messaging themes that B2B companies communicate and the attributes most valued by B2B buyers. While most B2B companies emphasis themes like corporate social responsibility, sustainability, and global reach their target audience is most influenced by messages about honest and open dialogue, responsible supply chain management, and specialist expertise. In addition to this gap, the research also shows a lack of differentiation among B2B brand messages: Most B2B companies are communicating the same themes.
These same overall trends are evident in Isurus’ custom research for B2B clients. Based on our own data and the McKinsey study, we see three implications for B2B marketers:
Role of corporate and product level messaging
The dominant B2B messaging themes in the McKinsey study (sustainability, global reach, etc.) can work well for corporate-level messaging because they are relevant across product lines and can be easier to demonstrate objectively. These themes act as table stakes or are a “nice to have” when selecting a vendor, but don’t typically drive vendor selection. The themes valued by B2B decision makers are much more relevant to purchase decisions—communication, expertise, supply chain reliability, etc. For large complex businesses, messaging needs to accomplish address multiple needs: Corporate messaging builds awareness and equity at a general level whereas product messaging focuses on the value proposition that will drive buying decisions.
Humanizing B2B brands
The common theme among the attributes most valued by B2B buyers is that they are about personal interactions and the human aspect of doing business. Many B2B companies have historically positioned their brand on its functional strengths (e.g., number of locations, number of products, etc.). The transition to positioning on more emotional/relationship strengths is challenging. In some cases, it requires companies to go through a process of identifying these strengths by understanding what really matters to customers beyond functional “feeds and speeds”.
Creative execution does the heavy lifting
McKinsey’s research shows a lack of differentiation among B2B messaging: Most companies in their study are communicating about the same themes. There can be a “follow the herd” mentality among B2B marketers because they tolerate less risk than consumer marketers, which results in homogeneous messages. It is also the case that there are a limited number of relevant themes for a B2B company to position itself around. If customers care most deeply about only a handful of qualities, B2B marketers will need to rely on message execution and creative strategy to differentiate their brand.
Across the board, this research raises some good questions for B2B marketers and their creative partners about whether they are communicating about what’s important to customers and the level of differentiation in their messaging and creative strategy.
Words matter. Exhibit A: The “fiscal cliff”
I realize that most readers of this blog need no convincing when it comes to the importance of the words we use to name and describe products, companies, and issues. We spend significant hours and budgets thinking about the most compelling, resonant language with which to describe our offerings.
The individuals and institutions that run our country apparently need a reminder of this, in the case of the “fiscal cliff”. As we sit here in mid-November 2012, the looming fiscal cliff dominates the headlines. Congress and the President are attempting to find a compromise in order to avoid the automatic tax increases and spending cuts that would take the country “over the fiscal cliff”. The fear is that if we go over the cliff, the country could enter another recession. If the goal is to avoid recession, where consumer confidence and spending contract, why do we keep calling it a “fiscal cliff”? Even if lawmakers are successful and reach a compromise, the anxiety created by weeks of constant media attention to the “fiscal cliff” will negatively impact the economy. It is a serious issue and decisions need to be made, but can’t we call it something less scary? Even the “fiscal slope” would be better.
For the marketing community, let’s use this as a good reminder that the words we use to name, position, and sell our products do matter.
Sometimes your channel is your brand
“There is very little loyalty left. Manufacturer X is mercenary. They just want to make money, and I’m mercenary. In other words, Manufacturer X doesn’t care about me, and I don’t care about Manufacturer X. They just make a good product.”
This quote from a recent study sums up the state of many of the channel relationships we see across a range of technology and industrial B2B markets. In tight economic times everyone is looking for ways to protect or increase revenue streams. Channel partners want exclusive territories and the luxury of carrying your competitors’ products. Manufacturers use channel partners to extend their geographic reach and then make plans for selling direct. This situation may be unavoidable, but it is important not to lose sight of the importance of your channel partners in defining your brand image and equity among your end-customers.
In our research across a range of B2B verticals and product categories we often find that end-customer perceptions are shaped entirely by their experience with the product and with their local distributor or VAR – customers often have no meaningful knowledge of the manufacturer outside of these experiences. This can also extend to loyalty where end-customers rely on a trusted distributor or VAR to help them select the best products for their business; if their partner recommends switching brands they follow that advice. In addition, while in principle many end-customers find the idea of buying direct appealing there are often internal barriers and hurdles to doing so.
For many manufacturers their channel partners will continue to have the most direct contact with end-customers and remain a critical component of revenue streams for the foreseeable future. Therefore it is important to understand the role your channel partners have in the buying process and the influence they have on end-customer perceptions and decisions. Even when positive channel relationships exist, it is not unusual to find that channel partners lack the product knowledge or business process expertise to promote the manufacturer’s products effectively.
Manufacturers sometimes worry about asking the opinions of channel partners; they assume all they will hear are requests for lower prices. Some channel partners will indeed cry price, but most are interested in a legitimate dialog with the manufacturers they partner with. Bringing in the end-customer perspective into the conversation can be instructive for both sides.
Regardless of how you approach this conversation—internal outreach, conferences or primary research—knowing more about the role your channel partners have in shaping your brand will help both you and them be more successful.
Why likability matters
Unless you’re isolated from every media outlet on the planet these days, you’ve heard something in the news about candidate likability in the various races for national, state, and local office. Nationally, voters “like” Obama more than they do Romney. Here in the tight Senate race in Massachusetts, voters “like” Republican Scott Brown more than Democrat Elizabeth Warren.
Why so much focus on likability over metrics such as experience, intelligence, ideas, competence, etc.? Likability has been a top predictor of electoral success in every presidential election since 1960. Remember 2000, when voters said they’d much rather sit down for a beer with Bush than Gore?
Likability is also one important criterion we use to test advertising. Even as advertising and advertising research have become much more sophisticated over time, likability continues to be a useful predictor of effectiveness. Clients sometimes push back on the relevancy of “likability” as a metric. They see it as too simple, or as not strongly related to their overall communication goals, such as whether the ad campaign will motivate consideration and purchase. Although it seems simple, likability is actually a higher-order perception that combines trust, relevance, empathy, and authenticity. All of these are good predictors of consideration and purchase – we tend to buy from brands and people that we trust and that understand our needs and values. “Do you like this ad?” is also a question that people can answer easily and honestly, whereas it is harder to get a reliable answer to the question “Will you buy this product now that you’ve seen this ad?”
So just as likability will continue to be an important predictor of electoral success, it will also continue to be a useful predictor of advertising effectiveness.