How to strengthen customer relationships in a crisis.
21 Apr 2020
Truly understanding your customer is the basis of forming a trusting relationship – one that could last a lifetime. But with an unprecedented period of disruption in retail, it’s difficult to predict how they’re feeling and exactly what it is they are looking for in a time of crisis.
We’ve asked Dr. Chris Gray, consumer psychologist and founder of retail consultancy Buycology, to share his tips on strengthening customer relationships. With a background in couples’ counselling, his experience in picking-apart complex emotional processes has helped brands such as The North Face, Addidas, Coca-Cola and Elizabeth Arden better understand their community. Here’s what he had to say:
How has your experience as a couples therapist informed your work in consumer psychology?
There’s definitely more similarities than you’d think! If you look at the features of a healthy relationship – whether that be with a partner or a customer – it all comes down to trust. When a brand connects with its customers and forms trust, that's when people become loyal. But that trust is something that has to be constantly tended to, and many years of trust can be lost with a single action, just like in a relationship. We’re at a crossroads right now as retailers - how we appear and how consumers perceive us will define us for years to come.
Let’s take it back even further - what inspired you to pursue an interest in the psychology of shopping?
It actually was never something I planned. My family owns a furniture boutique so I grew up around retail watching my parents grow a successful business, and the main way they did that was by creating relationships with customers. They understood their needs and responded to them – whether it be introducing lines of credit or changing their product mix. I like to call it the ‘unfair advantage’ that small community retailers have: they can be so much more agile to consumer needs because they’re constantly interacting with them. My parents were CEOs but they were also on the floor everyday – I’m glad to say they’re still going strong!
I studied psychology up until doctorate level with the intention of becoming a therapist, but what I found was that my interest in psychology lay in how day-to-day mundane decisions determine how we create our lives and identities. You’re able to see that some of the most mundane decisions can actually be very complex – particularly when it comes to shopping – and it’s kind of grown from there.
Can you elaborate on how the act of shopping is more complicated than initially thought?
Well, when we shop there are so many complex psychological operations happening, but because of automated services and repeat behaviours we think of it as really simple. What’s actually going on are dozens of underlying factors that help us make every decision, so even something as simple as buying a laundry detergent becomes more than just a transaction. When we shop we’re satisfying emotional needs, we’re exploring self-expression and self-creation and affirming identity. That’s not just satisfied with what we buy, but where we shop for it, too.
Retail is facing disruption on every front. Are there learnings from the previous periods of disruption we can apply here?
Right now, we’re experiencing a degree of intensity that’s really different to anything we’ve seen before, but if there’s one thing we can learn from previous downturns, it’s that shoppers adapt pretty quickly to new realities. After the economic downturn of 2008, people were definitely being more thrifty and there was a lot of fear that this was going to continue. But once the economy opened up again, people gradually went back to spending more. In a similar way, I’m hearing a lot of fear right now around whether Coronavirus is the beginning of the end for community retail - but I certainly think that’s overblown. To me, brick and mortar plays an incredibly big role in people's lives, so when we come out of this we’re going to see a new appreciation for physical space. I don’t think it’s in any jeopardy of disappearing.
How will customer’s needs change after this crisis?
I think safety will initially be at the front of everyone’s minds. Going back to day one of Psychology 101 and Maslow’s Hierarchy of Needs, when safety and security are at risk it’s difficult to think about any higher level needs, people want to know they’ll be safe. That will be something retailers will very clearly need to communicate and demonstrate to customers.
If not pushing their products, how can brands maintain authentic conversations with their customers?
I think it’s incredibly important to find the best ways to maintain contact with their customers - even when you’re closed. The key to authenticity is bringing value to your customers even when they’re not spending money. It’s like a relationship, if you do something nice to contribute to the relationship that you’re not gaining anything immediate from, that says a lot about that brand and it creates a very positive association with them. How you can add value varies depending on your customer, whether it’s providing emotional support and soothing anxieties or providing ideas and solutions.
What are some examples of this being done effectively by other brands?
After the 2008 downturn, people didn’t feel secure in making huge purchases, so car companies were seeing sales losses of 22% across the board. But Hyundai came out with an ad during the Superbowl in 2009 that introduced their Assurance Program where if you bought or leased a car and subsequently lost your job you could have it bought back from you with no effect on your credit score. They tapped into the consumer needs of the time - a desire to reduce risk and they ended up being the only maker who had gains in their sales at that time.
You recommend that brands show respect and humility at this time, can you expand on what you mean by this?
For a lot of brands, it’s sometimes difficult to understand that consumers don’t think about them as much as they do themselves. But at times like these it’s so important to realise that you’re not at the top of your consumer’s list right now, they’re all likely going through difficult times. Plugging usual promotions and sales without acknowledging the space they’re in can make you seem out of touch. It makes them question whether the brand really cares or not. Right now, brands can’t afford that.
So how can a brand communicate effectively with this in mind?
There are some key things to be done here: acknowledging people’s difficulties and normalising will have them feel like you’re in their corner. Using language that brings you together as a community can help too, like: ‘These are strange times for us too’, or, ‘we’re finding ways to be a good partner for you.’ That brings us back around to understanding what adding value means to them. It’s something I explore with all the brands I work with: above all, you need to stay on top of what your customers needs and go from there. There’s incredible power in observation.