February 25th, 2011

Conquering the Subconscious: An Interview with the Hindu Business Line

By Sublime Behavior

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Neale Martin was recently in Mumbai, India teaching our Level 3 Certification training class to consumer products employees at Godrej.  While he was there, Business Line (part of the Hindu news publication) engaged him in an in-depth interview on unconscious consumer behavior and habit-based marketing.  They’ve recently published part one of the discussion.

You mention that 85 per cent of new products fail, and consumer satisfaction does not equal loyalty. Is consumer satisfaction a necessary layer upon which loyalty can be built? Please explain.

There is very little correlation between customer satisfaction and repurchase or loyalty. When we focus on behaviour, we see that loyal customers are sometimes highly brand-loyal, but sometimes they are brand-indifferent. In both cases, satisfaction is not a good indicator of behaviour. In many studies of brand switching, switchers reported high satisfaction with a brand or store just before defecting. When behaviour becomes habitual, it is no longer tied to goals or intentions, so satisfaction measures become essentially meaningless.

However, customer dissatisfaction is different. If a customer perceives she is dissatisfied, this makes her consciously aware and can disrupt even the most habitual repurchase behaviour.

The statistics around new product failures are truly humbling — estimates are that 80 to 90 per cent of new products fail. Even products that receive great reviews in testing, flop once introduced. The primary problem is that new products are often overlooked in the store because shoppers are on autopilot at point of purchase, completely overlooking the new product. Many companies have sophisticated methods to create, screen and launch new products. But even if potential customers report they will probably or definitely buy a new product, they often fail to purchase when the product is released (one of my clients stated that they have a 90 per cent threshold for definitely or probably would buy, only 3 per cent actually purchased).

- excerpted from Gokul Krishnamurthy’s “Conquering the Subconscious” on February 25, 2011 in the Hindu Business Line.

Here’s the link to the full article: Conquering the Subconscious.  Part Two should be posted in the next week or so.

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