Businesses can’t exist without customers—whether they consumers, other businesses or both. Increasingly, all customers expect something more than just a great product or service. That’s why companies have sharpened their focus on delivering great customer experiences over the last several years—both to win them and, perhaps more importantly, to retain them.
At Nielsen, we have seen firsthand how brands are placing greater strategic emphasis on the customer experience. And they’re using science in the process, increasingly applying tools like neuroscience, consumer psychology and behavioral economics to build and deliver great customer experiences. Dr. Carl Marci, Chief Neuroscientist of Nielsen Consumer Neuroscience, recently discussed this topic with a panel of innovators at the American Psychological Association (APA) Annual Conference. Speaking on a panel for the Society for Consumer Psychology division of the APA, entitled, “Leveraging Psychological Insights to the Consumer Experience,” Dr. Marci participated in a wide-ranging discussion with Daniel Goldstein, Director of Research at Microsoft; Paul Cohen, VP of Strategy at One Medical; and Paul Litvak, Senior Product Manager at Airbnb.
As each discussed the challenges of applying psychology insights from the world of academia to business, and the major differences between the two (primarily speed, scale and currency), panelists agreed on several elements of the customer mindset:
- Customers value good service over speed
- Customers are willing to pay more for personalization
- Customers are a great resource for innovation
But each panelist brought additional unique insights into the conversation around the scientific tools and methodologies that are being deployed for the benefit of the customer experience.
Marketers have been applying behavioral economics for years, often unknowingly. Some brands, including Airbnb, are taking a more systematic approach. Airbnb’s Litvak discussed how his company is using the principles of behavioral economics to develop different models to help users optimize the pricing of their listing and to reduce racial profiling and bias.
While that appeals to consumers’ rational thinking, brands must appeal to emotions, as psychology insights suggest that feelings and identities play a big role in choice. One Medical, as Cohen relayed, is using consumer psychology techniques to nudge primary care doctors to increase PAP smears for women and reduce the risk of cervical cancer.
These nonconscious approaches are critical for brands that want their marketing to break through today’s cluttered media landscape. As Marci discussed, this desire has led brands, big and small, to invest in consumer neuroscience. People may be fairly good at expressing what they want and like, but they’re not very good at articulating or recalling everything that influences those choices—in large part because more than 50% of brain processing occurs nonconsciously. And this has been exacerbated in an environment with decreased attention spans and rapid-fire messaging across an array of platforms.
Brands understand that getting to critical insights requires tools that understand what a consumer thinks and feels—even if they can’t express it. That’s where the fields of neuroscience, psychology and behavioral economics come into play. All of these fields can provide information that goes beyond what surveys and focus groups reveal.