How to earn consumer trust in the post-buying, subscription eraby
The rise of automated buying and subscription-based business models forces brands to ask questions about themselves, their ethics, and whether customers deem them trustworthy.
It won’t be long until we move from the somewhat artificial and highly orchestrated current commercial market, into a situation where our needs will be automatically met and there will be very little ‘buying’ left.
This places a huge amount of trust into the hands of powerful brands, and if we don’t watch out there’s the possibility of this getting very dark.
There’s a ray of light, however. We are already seeing some companies integrate ethics into their culture and processes, and if handled correctly there are huge possibilities for humanity. They could be liberated from the burden of managing their basic needs, leaving more space to focus on their hopes and dreams. Businesses can prepare for the end of buying by focusing on a few key areas.
Earning consumer trust
A subscription model structure requires consumers to place their trust in a brand to complete the buying process for them. It could be for small things like coffee or shower gel – but it could also be big things like insurance contracts or holiday arrangements. This requires trust from the consumer - they will need to know that they can count on you.
To earn their trust, it’s essential for you to get it right. The algorithm needs to judge the needs and purchases correctly. If it sends a single person 5 bottles of shampoo per month, or if it orders a Presidential suite at an expensive hotel for a middle-income family, it won’t be trusted, let alone gain consumer loyalty.
Consumer knowledge also needs to be handled ethically. You will have access to huge amounts of data which needs to be used widely. It’s not just about the efficiency of your algorithms, but also what you tell those algorithms to do. If people suspect you of mishandling their data, they will easily find someone else to give them what they want.
If people suspect you of mishandling their data, they will easily find someone else to give them what they want.
Start forming your ecosystem
At the moment, most products and services are too fragmented to survive automated buying. Survival depends on working as an ecosystem. The more a buying experience is fragmented, the more friction there will be and the more processes will slow.
The Chinese already understand this and offer fast and frictionless experiences. An example is the ‘everything app’ WeChat, which is basically the operating system of Chinese society. It’s used for communication, gaming, paying, ordering food, hailing a ride-sharing car and lots, lots more. It’s no surprise that Facebook is looking to reinvent itself into an ‘everything’ experience in a similar way. It recently announced that WhatsApp mobile payments will be launching in a few countries this year.
To prepare yourself for automated buying, start reaching out to other brands to create your own ecosystem – and not just the giants like Amazon or Alibaba. Team up with adjacent players to see how you can create your own ‘everything’ experience. If you’re a health insurer, why not collaborate and converge with health fitness apps, diet experts, medical players or wellness specialists?
Find the gaps in the market, and then try to fill those with partnerships. Fragmentation will definitely be at your detriment when automated buying kicks in.
Focusing on the brand
Power branding will be vital in the new subscription era, even more than the offering or even the interface. Tien Tzuo, CEO of Zuora, says that whereas power branding used to convince you to buy the product, it is now something built into the experience of the service.
To succeed, services have to be able to fulfil the brand’s promise. If they manage to do this, they will see a flywheel where consumers continue to use the service. But if they don’t – consumers will simply walk away and not come back.
This isn’t just about strong individual brands. It’s about brands that bundle and then transcend other brands. It’s a real challenge for traditional car manufacturers to battle a strong platform like Uber by themselves, so it’s fascinating to see more and more competitors like BMW and Daimler join forces to enter the ride sharing service business.
Another example is Hulu, where the media companies like AMC, CNBC, Nickelodeon, CBS, BBC America, Food Network and many more bundle their forces to enjoy the benefits of the streaming model. We’ll see more and more strong brands connecting into an overarching brand that’s even more powerful.
Outcome over ownership
Tien believes that we are now more interested in outcomes, rather than the burden of owning things. We want music, but not the CD. Transportation, but not the car. An understanding of world events, but not the newspaper.
It is becoming easier and easier to subscribe to just about anything that is transforming a product into a service, through the internet of things which connects everything - cars, bicycles, and even million-dollar medical scanners.
Contactless buying experiences are rising: cashierless stores like Amazon Go, BingoBox, F5 Future Store, EasyGo as well as unmanned restaurants from Jingdong and JD, mean that each day, we’re getting closer to a future where the conscious act of buying is starting to fade.
Over the next decade we will begin to see automated buying, the subscription economy and personal AI assistants will move between brands and the consumer, which will change their relationship in new and exciting ways.
Prof. Steven Van Belleghem is an expert in customer focus in the digital world. He’s is an award-winning author, and his book Customers The Day After Tomorrow is out now. Follow him on Twitter @StevenVBe, subscribe to his videos at www.youtube.com/stevenvanbelleghem or visit www.stevenvanbelleghem.com