This article was first published in Smart Shopping – A Playbook by the Store WPP and IBM Watson.
Those were the days. Product, promotion, place and price used to be the sure-fire way to hit the marketing jackpot. Now, consumers want brands that offer them an extraordinary experience. A feeling, a picture opportunity, a memory –or at least the tools to create one for themselves. Brands need to go beyond meeting a need or leading a category, and help a consumer become the human being they want to be. Iain Ellwood is Chief Growth Officer at experience agency Group XP. He says experiences matter because, in mature economies at least, levels of relative wealth are high, and simply owning a reliable fridge or TV doesn’t bring the pleasure it used to. This is coupled with a greater desire to have a more flexible, connected life.
Time is now seen as a currency to be spent on experiences, especially those that can be photographed and shared, and this is particularly so for the young. Their ability to own cars and houses has decreased dramatically in the last decade, while the desire to connect with others has increased, so Gen Ys and Millennials are much more interested in living in the moment, looking for experiences in their day-to-day life, because they know they’ll be working until
they’re 75. That’s why you can charge £4 for a coffee in a seductive environment, when everyone knows the actual
cost of the coffee is nothing like that.
The brands that do this well are not just the obvious ones, though Apple and Nike are up there with the best. Brands as diverse as Pampers, Facebook, Tesla and IKEA are all world leaders in customer experience.
Is experience worth investing in?
Group XP quantifies the business impact of outstanding experiences, and has ranked the 30 most successful global brands that deliver extraordinary experiences. The Group XP Experience Index leverages data from BrandZ™ – the
world’s largest brand equity database – to evaluate brands according to the strength of their customer experience. The Top 30 Global Experience Brands have outperformed the global MSCI index over the last five years by 61 percent. “Our data analysis has built the statistical link between great experiences and increasing consumer demand, as well as outperforming stock returns.
What does it take?
In developing the Experience Index, Group XP has examined more than 43,000 brands across 46 markets with BrandZ™ data and has identified four key elements to building great brand experiences:
Impression: Stand for something unique.
Interaction: Deliver on your most important needs.
Responsiveness: Have brilliant online services and engaging content.
Resilience: Strive to make people’s futures better through a higher brand purpose.
Artificial Intelligence can help brands in all of these areas. Here’s how:
Customers are able to out-source simple, repetitive or menial tasks through widgets and chatbots that are much more capable of delivering excellence. Mining airline ticket prices or peak travel times is arduous unless supported by AI. The City mapper app is a brilliant example of the increased usability and efficacy of assisted travel planning
delivered in a user-friendly experience. AI enables us to re-direct lengthy tasks to a machine that delivers at quantum speed.
The ability for humans to augment their current capabilities enables people to do more with their life. Whether it’s a Tesla car that can anticipate and avoid a crash, or an augmented reality app that helps doctors practise heart surgery without ever losing a life, or using Alexa to find a great movie for while you’re making dinner for the kids, AI amplifies our physical and cognitive reach.
We can also use AI to build worlds that are yet to exist or that may never exist. This might be as simple as Ikea’s virtual kitchen builder app, or more engrossing online adventures where we can become entirely different personas for an hour or so. Using the brand’s “purpose” as a starting point provides businesses with a more ambitious innovation roadmap that can generate entirely new revenue streams
Brands that are able to find meaningfully relevant ways to use AI as part of the overall customer experience will increase customer preference and reap significant financial rewards.