#2 UNCX NEWSLETTER | The Commoditisation of Everything
PLUS: Dirty Weekends and other consumer trends | Twitter will be PayPal 2.0 | Trend Spotting | CX leadership coaching |
Soon after 2025, buying will become automated and be a very different activity from shopping.
Think about this for a moment - as it becomes the norm, consumers will start actively ‘shopping’ only for the few select brands and products that help them express and shape who they are or want to be, or engages emotionally, or provide amazing experiences. This is their future.
It leaves Brands with relatively commoditised product at risk of getting relegated to automation unless they add further value to consumers.
A great example of how to pivot away from commoditisation is Lego. As their customers reached market saturation with their coloured bricks, Lego launched in-store experiences and conventions - for all ages - designed to encourage collaboration and to help build children’s cognitive skills. While other commoditised toy brands toiled and faded away, Lego doubled down; creating experiences, connections, and brand affinity, which has grown the brand further.
This continuing move toward experiences and an experiential economy shouldn’t surprise us. It’s a natural progression from where we are now. More technology, uncertainty, anxiety, and loneliness mean experiences become an even more important part of a consumer’s identity. Experiences that allow consumers to explore, learn, grow and connect will be where they increasingly spend their time and money.
The importance of human experience is not new. However, its accelerated, triggered by the perfect storm of rampant over-consumption, the pandemic, social platforms amplifying fears, and the pervasiveness of digital set against a desire to feel alive, to connect, nostalgia, slowness, and be a part of something.
I forecast that by 2030 the most successful brands will be those that nurture human experiences.
In a too-much-of-everything world and product ubiquity, the only way to strongly differentiate will be through emotion and human experiences. These will be marketing and CX, and the brands embracing this - and using data to power it - are the brands that will thrive.
One of the reasons experiential is such a force for engagement is that the change from looking at something to physically participating in something is a critical element of many experiences. But unfortunately, in most digital experiences, consumers don’t participate.
The more we use digital, and the more it leaves us full, the more we feel it leaves us undernourished.
If I were writing this a few years ago, I would be forecasting the death of physical retail. Why stand in a shop when online often gives better service, reviews and delivery, all without a queue?
I’d have been wrong. We only miss things when we lose them. The paradox of digital is that although it has driven speed, simplicity, availability and choice, it’s heightened our basic human need to connect and experience.
Red Bull built a major brand on consumers experiencing its personality. (Read here how they grew into a global brand). Lululemon claims they sell experiences. Patagonia focuses on trips, hikes, and classes as core parts of its business.
Experiences create emotional bonds between consumers and brands.
Where does that leave brands focusing on efficiency, optimisation, and customer-facing technology? In trouble, that’s where. It leaves customer satisfaction stalling or even falling - for nearly ten years, and it leaves the gap between what customers want from brands and what brands give them ever-widening - for the last three or four years.
I admit some concessions to reality. Brands were desperately trying to survive through the pandemic and struggling with scarce resources and ballooning costs. Consumers are pivoting their thinking, wants, and needs on a sixpence, leaving brands stranded. But it’s no excuse to blame rapidly changing consumer behaviours. If we look, we can see early change through signals and trends.
In my work, I’m struck by the too-many CX leaders who only talk the language of linear processes, focused on improving service standards (good to do but not a game changer), more digital expansion, and more tech. But memories, emotions, connections and experiences drive connections, engagement, loyalty and trust.
My Pick of the Latest Consumer Trends
Trends are your opportunities. Following them from early adoption to mass adoption and, finally, concrete new behaviours or wants gives you the foresight to differentiate by leading early on rather than following later.
1 YOLO.
There’s a behavioural pivot to living in the moment (You Only Live Once).
Consumers don’t know what tomorrow will bring, so they aren’t wasting any more time.
Money isn’t the only valuable asset for them. Time, health and small pleasures have become equally important. Price tags are still relevant, but they’re grabbing the emotional benefit to justify impulse or big-ticket purchase decisions. They’re allowing themselves to live a little.
Productivity, personal growth and joy are the new reasons to buy. Smart splurges and affordable luxuries let consumers reasonably indulge in unwinding or coping with the world. And alternative payment methods incentivise shoppers to take the plunge on more expensive items.
So What?
There’s an opportunity to target specific or special occasions. To use data to spot patterns in web activity that infer shopping motivations and trigger tailored promotions. To create campaigns that play on spontaneity, such as pop-up shops, flash sales, limited-time offers or exclusive drops to entice shoppers to buy on that whim.
Alternative payment methods are crucial to help ease financial burdens. The buy now, pay later model is increasingly popular in spreading the cost of big-ticket items over time. Loyalty programmes could allow cashback options and responsible and fair loan or credit options to make your products accessible to a broader audience.
2 Slow commerce:
Slow Commerce has arrived in Europe, and the US, as brands discover an audience of consumers wanting to slow life down. So supermarkets in Holland, France and, latterly, the US are dedicating checkout lanes to customers who eschew automation, speed and payment processors to chat in the queue, have a conversation with the cashier and each other, and choose cash.
So What?
You needn’t be a supermarket to see opportunities in your experiences where you can create a ‘slow lane’ to appeal to a part of your audience.
3 Returns:
What we used to think of as the final part of the customer purchase/use journey has become critical to both consumers and brands.
So What?
Eighty per cent of shoppers are now reading the brand’s return policy before they buy. Over 40 per cent will sack the brand and shop elsewhere if the returns policy isn’t attractive. What is appealing to the consumer? Free returns, fast refunds, an easy process, and a long window in which to make the return. Some 30 per cent of shopped products are returned. It’s hitting retailers’ margins and turning off customers as ‘bracketing’ (buying more knowing they will return some) becomes the norm. Charging a fee for a return may save short term money, but long term you’ll lose customers.
4 Dirty Weekends:
There has been a big shift towards more wholesome, winsome breaks. It’s part of a broader lifestyle movement, whether in interiors, gardening or food, where everyone is seeking a connection - to the land, to themselves and each other. The pandemic has played a big part because people felt isolated and reliant on screen time. So has the climate catastrophe, creating this yearning for breaks that take us into the natural world precisely because it feels so threatened.
Luxury hotels such as Heckfield Place (Hampshire, UK) have a pond for wild swimming rather than a swimming pool, as the hotel spa isn’t resonating so much.
Behind the trend is a wealth of scientific evidence that links time in nature to better mental well-being. Doctors are even turning to ‘green social prescribing’ to help treat depression and anxiety. In addition, using the healing power of nature to attract more consumers, some brands are partnering with others to host retreats, some free for burnt-out hospital nurses or long Covid victims.
This nostalgic set-up — getting mucky, losing track of time playing outdoors, putting away phones — seems to loosen formalities and encourage an almost childlike candour. Guests share secrets with strangers before plunging into a stream clean enough to drink from and so cold it whips their breath away.
They stroll back through the forest barefoot, laughing as the path becomes a rain-churned quagmire, sinking ankle-deep in squelching mud, discovering sensations they haven’t felt in decades. Wellness is undoubtedly an overused word, but behind the buzzword is a yearning most of us can identify with - for a sense of calm and connection.
Some trend data partly sourced from IPSOS, The Times, Future Foundation, Dentsu
If you want to follow the trends click here to read NCXT, my substack section dedicated solely to trends and foresight thinking
Twitter the Super-App?
The Future. Twitter 2.0 really has nothing to do with protecting free speech. It’s about turning it into Musk’s original vision for PayPal - where he was ousted as CEO in its early beginnings before he could see his vision through - that Musk said last year he plans to execute… with some improvements’ through Twitter. He wants Twitter to be at the centre of our financial life.
Elon Musk wants to turn Twitter into a super app.
Read my original article on super-apps here.
He wants to model Twitter after China’s WeChat, allowing users to send money to each other, earn interest on deposits, and become the go-to app for all your financial needs.
That would allow Twitter X, or whatever he calls it, to make most of its money from transactions and engagement instead of advertising.
Musk believes that the resulting revenue could eventually make Twitter worth $250 billion. Watch this space.
Trend Spotting
The problem is that brands and CX don’t know what consumers expect. We get the rational values, the table-stakes stuff, the things we must do and that if we didn’t do, we wouldn’t be able to compete.
But the expectations that drive changing behaviours and choices are mostly-emotional, and that’s tough to get a handle on, for two reasons: Consumers don’t think how they feel, don’t say what they think, and don’t do what they say. And, emotional expectations – the ones we must meet – move faster than we can keep up, and change at the speed of the changing consumer. That’s why watching trends is critical.
If we know what to expect, we have an opportunity. To not stay chasing the consumer, but to know where we need to go even before most consumers move there. But if consumers don’t articulate it, only do it, how can we know without knowing the trends?
Behaviours always shift, but today they are doing so at a dizzying speed. It’s a sign of our times - we’re in a permacrisis. But we can see trends. Early shifts by behavioural ‘innovators’, moves that gain momentum, moves that are likely to reach mass adoption faster than we can keep up. Brands, even the top-performing ones, leave a big gap between what consumers desire and what they see brands delivering - because their expectations are emotionally driven, consumer-created, and unconstrained by reality.
The first step for a brand to meet customers’ wants is to understand what they are and then meet them in a well-executed way.
Consumers’ actions for those mostly-emotional values often turn out to be leading indicators. They’re the best indicators because they are forward-looking - a predictive early-warning system for your category and brand of the consumer changes coming your way. It alerts you to what’s coming down the road - faster and more accurately than traditional focus groups and brand trackers. You can pre-calibrate strategies and pivot to make the biggest, most-leverageable improvements well ahead of your competition. These indicators can guide your marketing and experience efforts and address factors driving awareness, purchase, engagement, and profitability.
The future isn’t new technology, it’s changed people. Placing your bets on who we will become allows you to own that future and set you apart. My newsletters include explainers on CX strategy and my pick of the latest trends, as well as opinion pieces. If you don’t want to miss them, sign up (always for free) for the next issue.
Coaching
CX management is one of the tougher leadership roles within an organisation and successful CX leaders usually demonstrate most of these skills:
Interpersonal, networking and influencing (and storytelling) skills. Your work will never be siloed, even when you work independently, so cultivating relationships must be top of your agenda to be effective. Your leadership is about showing the way, breaking down silo’s, and inspiring others to progress toward success - but it is a challenging and difficult skill to master.
Strategic thinking and foresight. To be able to foresee market changes, dynamism in customer expectations and strategize to guide the company to live up to those expectations
Problem-solving and analytical skills: CX leaders are usually adept at interpreting and leveraging data insights. The ability to understand data analytics and extract useful or actionable information from it, along with strong problem-solving skills, is a power-packed combination
Ability to understand business objectives and align CX accordingly. The strategy must align with the overall business strategy. A clear understanding of business objectives and the ability to align CX with the same, places the CX leader in a stronger position to get buy-in from the CEO and CXOs and to propagate a customer-centric culture within the organization
Data-driven mindset and an aptitude for technology: Data and technology are the foundation of today’s customer experience. CX leaders are adept with the tools and technologies that help deliver, manage, measure and improve customer experience.
Knowledge. Influential leaders bring culture change, data, technologies, behavioural science, insights, process, strong leadership, team building, project management, delegation skills and more together.
Above all, they need resilience, energy, and stamina to last the course.
With 30 years of CX leadership experience in major brands and training as a leadership coach (with the International Coaching Federation), I support CX leaders in developing all the skills, context and knowledge needed to win.
If you’d like a private conversation to explore how I can support you, please get in touch with me for a chat to see if I can help.
Smart Thinking
Reducing friction is great for scraping incremental conversions off the floor - winning over shoppers who are on a mission to find ‘product x’ but have little to no relationship with your brand.
It treats your customer base as a monolith, assuming that your best customers want the same frictionless experience as casual browsers. And ironically, it completely ignores two other popular industry talk tracks: personalisation and customer journey mapping.
Alex Greifeld, Insiders #107: Dork Mode: An Antidote to the Sea of Sameness
Thank you for reading this edition of UNCX. If you want to share your thoughts or feedback about this newsletter or my topics in general, feel free to comment or contact me at: michaelcooper@pobox.com. Thank you for reading this week. Please share this with others you think would benefit.
UNCX is a substack newsletter by Michael Cooper. UNCX is a different take on customer experience, unthinking today’s approach and bringing the future to subscribers. You can read more unthinking online at www.uncx.substack.com or sign up below for my regular free newsletter.