How to Measure Customer Emotions: Introducing Beyond Philosophy’s Paper on Emotional Signature®
Emotions play a huge role in our personal lives, yet as business managers we often turn a blind eye to the importance emotions have in customer behaviour, attitude and ultimately business KPIs.
However, several key forces have forced customer emotional engagement as a means to competitive differentiation onto B2B, B2G and B2C organisations:
- In commoditized markets, price and product features alone are insufficient as a means of differentiation. Where previously a rational cost-benefit analysis was enough to ensure differentiation now this is easy to imitate.
- The rise of Social Media and the ease with which consumers can express negative feelings to a broad audience has exposed the emotional response customers would not disclose in traditional feedback surveys or at certain points only (e.g. after a call).
- Empirical evidence from FMRI and economics studies has shown how emotions influence consumer behaviourwhile behavioural economics has grown in popularity.
With this in mind, the question then arises why is it so difficult for business to “manage customer emotions” at a strategic level?
The reasons can be summarized in two clusters:
1) many firms lack the theoretical and practical understanding of emotions and
2) unlike, behaviour and revenues, emotions are difficult to measure and quantify
Hence, emotions have become subject to folklore; the unfortunate use of proxy measures of attitude to represent them (such as CSAT and NPS) and the replacement of hard quantitative metrics with soft qualitative feedback (such as sentiment analysis).
While these are useful measures, they all fail to quantify the effects on business value (KPIs) of emotion.
The paper is a response to the two key issues outlined earlier and aims to:
1) introduce business managers to the key theoretical principals about emotions in the business context, accompanied by real life examples from clients we have worked with
2) outline a well-recognised and thought-leading emotional measurement system (Emotional Signature®) that is used to quantify the impact emotions have on KPIs and guide business action
Emotional Signature® is used as this has a track record of helping firms in the design of their Customer Experience Metrics, in Benchmarking themselves against other company’s emotional engagement levels (using our world leading benchmark database of n=40,000), and in identifying the subconscious elements of a customer journey. For the purposes of the paper, we focus on its role in relating customers’ emotions to business value.
We highlight two sources of independent verification on Emotional Signature®:
Forrester Predictions for Customer Experience Management 2013
“As firms start to emphasize customer emotion in 2013, we expect to see more vendors developing offerings likeBeyond Philosophy’s Emotional Signature, which examines the rational, subconscious, and emotional elements of an experience.”
International Journal of Market Research Vol. 53 Issue 1, Peter Mouncey, Editor
On the book ‘The DNA of Customer Experience: how emotions drive value’ (the book on Emotional Signature®): “The case for focusing on emotion as a philosophy for building a better experience for customers as presented in the book is a compelling one. The methodology for undertaking the necessary emotional analysis is practical, simple, potentially very effective, and enables organizations to benchmark themselves by sector and ‘best practice’.
We highlight the blog:
“Over the past 7 years of analyzing emotions, Beyond Philosophy has built up a wealth of experience on how to measure emotions and how to understand what drives emotion. However, there is no point in looking at emotion unless it drives value to your business. So with this in mind we have recently gone beyond individual client engagements to see if more generally there is a relationship between emotion and key KPIs Net Promoter® and CSAT. To do this we have developed a single emotion number called Net Emotional Value.”
And, Forrester ‘Predictions for Customer Experience 2013’:
“Emotional insights will take center stage. The idea that happy customers are more likely to remain loyal, try new products and services, and spread good news about their experiences has started to catch on. Over the past several months, we’ve seen a rise in the number of companies pondering the connection between enjoyment and metrics like satisfaction and Net Promoter Score (NPS). In fact, one global company statistically demonstrated that several emotional factors trump NPS in predicting customer loyalty, effectively dethroning “would you recommend?” as the ultimate question.”
We also highlight the ES® article on Research Magazine:
”Without emotion, all predictions of value were substantially less accurate. Of total predicted levels of trust and likelihood to recommend earned from customer experiences, about three quarters was (either directly or indirectly) derived from emotional, not rational, factors. Without emotion, the total value predicted to be derived from the whole experience was underestimated by 41%; likewise the value predicted to be derived from recommendation was underestimated by 25%.”
Finally we reference the blogs:
“Beyond Philosophy has used a subset (n=10,000 over 18 experiences) of our world leading database of emotion interviews (n=30.000) to quantify both the effects of emotion on value and which touchpoints are emotional drivers”
“We decided to test the ‘predictive power of emotions’ over a sample of 2,503 interviews using customer data grouped into three categories. These categories reflect perceived emotional value, from falling into a traditionalhedonic value of service category to a more functional and hence, seemingly, less emotional category.”
All the evidence suggests that you must measure emotions. In fact you are not ‘doing’ Customer Experience without measuring and designing in the emotional experiences.
Emotional Signature does that for you. Read ‘Emotional Signature (ES) –The role of emotions in Customer Experience’ paper to learn more.
Co-written by Kalina Janevska, Consultant at Beyond Philosophy.