Modeling the Consumer Mind
IN CLEAR FOCUS this week: modeling the consumer mind with Daniel Burstein of MECLABS Institute. Focused on understanding online behaviors, Daniel walks us through the Institute’s patented conversion heuristic and offers practical tips to help optimize customer touchpoints for conversion. We discuss the benefits of adopting a customer-centric mindset, and reflect on how the growing adoption of smart devices, wearables, and the Internet of Things will impact digital consumerism.
Adrian Tennant: You’re listening to IN CLEAR FOCUS, a unique perspective on the business of advertising produced weekly by Bigeye. Hello, I’m your host, Adrian Tennant, VP of Insights at Bigeye. An audience-focused, creative-driven, full-service advertising agency. We’re based in Orlando, Florida, but serve clients across the United States and beyond. Thank you for joining us. Today, we’re going to be talking about how to better understand consumers’ mindsets and use that knowledge to increase the likelihood of conversion. Almost 20 years ago now, Coca-Cola’s former head of US marketing Sergio Zyman wrote a book entitled, “The End of Advertising As We Know It.” In the book, Zyman identified the goal of advertising as simply to, “sell more stuff to more people, more often for more money.” He also observed that, “if you don’t keep giving customers reasons to buy from you, they won’t.” In defining strategic goals for advertising, we typically weigh the long-term benefits of brand campaigns with the shorter-term financial performance of activation campaigns. Brand building is about building up consumers’ long-term memories and positive mental associations. Establishing emotional connections is key as brand-building reaches customers who may not yet be in the market or even aware of the brand. Activation campaigns, on the other hand, are more about eliciting an immediate response, typically a sale or a lead. The challenge is to convert a prospective customer’s interest in a specific offer into the actual sale. The number of digital channels available to marketers to drive awareness and push prospects through the sales funnel has grown exponentially, but so too has competition for that rarest of consumer behaviors: our attention. To talk about how brands can cut through the clutter and maximize conversions, I’m joined today by Daniel Burstein, Senior Director of Content and Marketing at MECLABS Institute. In his role, Daniel helps shape the direction for the Institute by digging for actionable discoveries around conversion while serving as an advocate for the audience. Daniel also oversees all content and marketing coming from the MarketingExperiments and MarketingSherpa brands. Daniel has 20 years of experience in copywriting, editing, internal communications, sales enablement, and field marketing communications. Welcome to IN CLEAR FOCUS, Daniel.
Daniel Burstein: Thank you. Wow – Adrian. That is a beautiful intro. I don’t even want to say anything. I just want to sit here and keep listening. And that was, that was fantastic. Tell me more.
Adrian Tennant: Haha, I love it! Thank you. Daniel, how do you define conversion?
Daniel Burstein: Yeah, so conversion is anytime you want the customer to take action to do a thing, so sometimes, when we think of conversion, it’s, “Hey, let me, let me get my product sold… Let me get my services sold.” But let’s say if you want someone to open your email, you want someone to click on your email. Even if you want someone to just pay attention to an ad, then that’s a conversion. That’s an action you’re asking the customer to take.
Adrian Tennant: Right. So what does the Institute do exactly?
Daniel Burstein: Yeah. So MECLABS Institute, it was founded by Flint McGlaughlin, more than two decades ago in the very early days of digital and the Internet and, and he saw that the Internet was a great way to answer a fundamental question – which is what we’re looking into – is how do people make choices, right? How do people make choices? Why did we say yes to one thing? No to another thing. Give our attention, like you said, to something and not do something else. And so for more than two decades, MECLABS Institute, the parent organization, has been researching that using real live digital interactions with customers through all sorts of different B2B and B2C product and service brands.
Adrian Tennant: Daniel, what does your role entail exactly at MECLABS?.
Daniel Burstein: So I’m, as I said, the Senior Director of Content and Marketing. So what I’m mostly just trying to do is learn – right? I’m trying to learn a lot about what works, how can we better market to our customers, how can we better serve our customers and then use that to teach. Then we share that out through content, through our written newsletters, through video medi, through podcasts like this and we publish through MarketingSherpa and MarketingExperiments – those are our two publishing sites – to help the marketers of the world to improve their marketing. So as I like to say, our job is to help you do your job better.
Adrian Tennant: It sounds like a mission. And what do your clients or customers typically look like?
Daniel Burstein: So, I mean, we have many different levels of interacting. At the base level it’s our audience, which is marketers all over the world internationally. It’s the great thing about this digital revolution. They’re in big companies and in small companies, agency-side, client-side. As we move up, we have some of them take our training and some of them are students. And then at the highest level, the direct companies we work with, again, there is a real mix there. More on the big company side. There’s some small companies we work with as well. Usually the common denominator is that digital is important to them. Online platforms are important to them. But B2B, B2C services, product-based, and publisher, many, many different kinds.
Adrian Tennant: What are some of the most common challenges facing marketers that you come across most often?
Daniel Burstein: Yeah. I mean, marketers that we’re working with typically have that fundamental question of either, “I’m not getting the performance I want to be getting and why is that?” Or, “Hey, I’m doing well, but I could be doing better.” Right? Then the third one tends to be, “Okay, we’re about to launch something, but we don’t know what it should be.” It’s these very broad fundamental questions and those are the questions that marketers really need to ask. If we’re just so focused on, “I’m not getting the email conversion rate I need,” or, “I’m not getting the,the right cost when I’m trying to acquire someone through PPC.” I think we’re looking too granular, we really want to ask that more fundamental question of, “What do customers want? What is my company’s value proposition and how can I serve customers with it?” And that’s where true success lies.
Adrian Tennant: Hmmm. Now, do you think these challenges differ for agency-side versus client-side marketers?
Daniel Burstein: So a company essentially is just a value creation machine right there. There’s four walls around the building. What’s going on in there, whether it’s manufacturing, whether it’s a bank – value is being created. However, no customer knows what that value is unless we tell them about it, right? So the marketer is inside that company, hopefully they have those daily interactions and they’re seeing what’s going on in their company and they’re understanding that value so they can communicate it. Agencies that have, that had that remove until they have to work extra hard to get to intimately know the customer, get to intimately know everyone inside that company that’s creating value so that they can ultimately communicate it.
Adrian Tennant: Now, at the top of the episode I quoted, Sergio Zyman, who gave the goal of advertising as “to sell more stuff to more people, more often for more money.” Do you think people like to be sold anything these days?
Daniel Burstein: Well, I think it’s a great example where we’re putting our goals first and we’re putting the customers’ goals second, right? It’s something Flint McGlaughlin calls, “The Marketer’s Blind Spot.” And it’s something that’s in our research, we call the need to focus on customer-first marketing. I mean really the goal – I tell you the definition I like much better, which you might’ve heard as well, is, “The Truth Well Told.” I mean, that at the end of the day is what advertising needs to be and not just for some moral high ground, but for the fundamental reason that customers have a lot of choices out there. So if it’s not the truth well told, one: they’re either going to find out pretty quickly, like you said, they’ve got, you’ve got his brand out there, they take an action and then they find out, “Oh wait, we’re not living up to this hype,” and two: when we don’t have the right intentions, it really comes through. So we did some research into customer-first marketing and what we did is we asked 1,200 customers, we said, “Think about a company you’re not satisfied with.” And then we said to another 1,200 customers, we said, “Think about a company you are satisfied with.” So we had half satisfied, half unsatisfied, and then we asked them about many different questions about the company. Two things we learned is: not surprisingly, satisfied customers are more likely to continue purchasing, right? But the difference is 713 percent, right? That’s a huge whopping amount, right? The difference between having a satisfied and unsatisfied customer. But the other difference, and this ties into the exact quote you were saying, is satisfied customers. We asked them to “describe the company, describe your interactions with and describe your experience.” And they had all these different things that the top thing they said is, “I consistently have good experiences with it.” Number nine was, “It puts my needs and wants above its own business goals.” So the exact thing we were talking about, customer-first marketing, are your goals. However, unsatisfied customers, the number one way they describe that company was “a company does not put my needs and wants above its business goals.” So what happens fundamentally, we as han beings, when we’re interacting with each other, when we’re interacting with a company, we kind of get a sense of, “Wait a minute, are they for me or are they out to get me?” When they’re, when they’re for me, when it’s someone for you, you have a good colleague who has a good heart, but he messes up here and there. you give him the benefit of the doubt when they think you’re fundamentally out to get them you’re fundamentally trying to sell more product more often more and more and more and more about them. And customers can kind of sense that. And then they’re not as forgiving when something goes wrong and they’re not as likely to do business with you. So yes, we need to have those goals, but take a look at your own intentions. And if it’s not to serve a customer, which is the whole reason a company in business, it is not to serve a customer with your marketing and advertising. Customers are going to figure that out.
Adrian Tennant: Hmmm, a great point. Daniel, your American Marketing Association piece on the conversion heuristic that you published, I think, late part of last year. Could you talk us through that and sort of the thinking behind it?
Daniel Burstein: Yeah, sure. So, MECLABS Institute has developed patented methodologies over the decades from the research we’ve done into customer behavior. And probably the one we’re best known for is the conversion heuristic. So, as I said, it’s funny, we were just at a bank in Toronto and one of the key executives there – we had almost 200 students at an in-person training – and one of the executives there, who learned it about a decade ago, he said, “Hey, there’s one thing you cannot erase my whiteboard and it’s this conversion heuristic.” And what we tried to do – and Flint McGlaughlin has a patent for it, like I said, he’s our founder – is try to pattern, give some pattern recognition to what makes a successful piece of marketing or any sort of time you’re asking for a conversion goal. I’m going to say real quick, but as Adrian cautioned me, I know you can’t see what I’m saying. You can go to our website and see it. So I’m going to, I’m going to try to simplify it as much as possible. It’s gonna sound more complex. When I say it, it really is. So here it is, first. It’s c = 4m + 3v = 2 (i-f) – 2a. I’ll break that down real quick. All that means is those are the different elements that affect conversions. “C” is the probability of conversion. So our job, our goal with conversion optimization is to increase the probability of conversion. You’re never 100 percent sure you’re going to get conversion, right? But what can we do to increase that probability? And then here are the factors; “4m” that means four, that’s the highest coefficient. It means that is the most important element. “M” stands for motivation of the user. The best thing we can do, again, focusing on that customer, is tap into their motivations. Yeah. So you can always try to sell people on something they don’t care about or they don’t want. But if you can tap into those motivations, those right motivations, that’s where success lies. Of that “3v,” then that is the force of the value proposition. Right? How clearly are you communicating your value proposition? How credibly is it something that people believe? Do you have a value proposition? Do you know what it is? All marketing is, is getting that value out to customers. If they perceive the value correctly and they think there’s value for them, they will most likely purchase it. So the “2 (i-f),” they add this friction. So that’s got a minus in front of it. That’s negative, right? So there’s friction in the process that’s going to slow you down. So I like to say, “We’re all inherently lazy,” right? Lazy kind of has a bad connotation, right? When you say that word, lazy, you think it’s negative. But really I think laziness is what preserved us when we were cavemen out on the plains and we would only go and burn calories if we really needed to, cause we didn’t know the next time we’d kill a woolly mammoth. I mean that’s han nature. We’re lazy. So any friction in the process, it’s gonna make people less likely to buy. The “i” is for incentive. So for incentive, I like to call it the bacon of marketing tactics. So what some marketers do is they don’t really have a lot of value. They don’t understand the motivation. They’re not trying to remove friction, but let’s just throw incentive, right? It’s free shipping. get a $20 Amazon gift card if you buy – incentive incentive incentive, let’s hit our numbers. Car companies, car companies were the worst with this. They were like, “We will pay you money to buy our car. Do you want, you want to send you, here’s $5,000.” And so the way we talk about incentive is you don’t want to sell just on incentive. It’s going to kill your margins. It’s going to kill customers believing in the value of your product, but it is that little extra something that can tip people, that can help them overcome that friction to want to purchase.and lastly, there’s anxiety that’s also negative. That’s, that’s a negative thing that’s going to stop people from purchasing. So understanding what anxieties do they have and how can you alleviate their anxieties about the process and the product.
Adrian Tennant: Hmmm I think what’s really fascinating, apart from the fact that you’ve been able to quantify the whole process of conversion into this formula is the philosophy you seem to be following is actually not technology-driven. It’s way more than human behavior-driven. Correct?
Daniel Burstein: Oh, I’m glad you said that. I think one of the biggest challenges that we have in marketing today is that we’ve lost the humanity. Like it’s all MarTech, it’s all AI and machine learning and buzzwords, buzzwords, buzzwords. And that stuff’s powerful. But at the end of the day, what is your goal as a marketer? I mean, what is your value in the organization? Why are you going to work every day? It’s to be that han face, that han communication for the company and tap into the humanity of your customers. So I think a real vision, that Flint McGlaughlin had over two decades ago when, when he started getting into this, it wasn’t about the Internet and it wasn’t about any of that for it. The whole point was on the Internet, you can measure and look at customer behavior like never before, and taking that and then creating this pattern methodology like he did to show, “Hey, here’s what, here’s what the elements that affect our likelihood to act or not act,” like you said, “as people, not just automatons or machines, but as human beings.”
Adrian Tennant: Now, looking back over the past couple of decades then, do you think though that we have evolved in some ways – consumers – with each iteration of personal digital technology,or are we pretty much the same as we were pre-Internet?
Daniel Burstein: So, I think in certain ways we’ve evolved just understanding. I remember a time when people wouldn’t want to do banking online or people wouldn’t understand that they could purchase online or some of these things they wouldn’t know how to interact with an online store, e-commerce, it would cost to put their credit card in. Now my mom who is well into her seventies, she’s comfortable purchasing online from Amazon. So yes, in the ways of learning how to interact, we have, but in our fundamental human nature, I don’t think human nature is changed in a thousand years, in 2,000 years. Some of these elements we talk about – anxiety, friction, value – they’ve existed as long as a human society has existed. And so what we’re just seeing is that’s just playing out in a new venue, in the online venue. So for example our anxiety a thousand years ago might be that, “The Visigoths, they’re going to come over the hill and destroy our village,” right? And so now first-world problems our anxiety now might be, “Okay, “I’m going to purchase these designer headphones, but they’re not going to last more than six months” or… You know what I mean? But we still have those anxieties and it’s understanding how to tap into them, and really overcome them with our marketing and make people feel better about them.
Adrian Tennant: How do you think that conversion heuristic will maybe need to adapt in order to take on maybe the influence of, say, smart speakers or even the Internet of things and multiple connected devices?
Daniel Burstein: Well, I think it’ll be interesting. That’s to be seen. But, so something I’ve learned about the heuristic is, it’s not just really for a landing page or it’s not just even really for an email. Like when I go to speak, I do recruiting for clubs at the local university. Well, I’m speaking to those students. I use a conversion heuristic to walk them through the fundamental elements they should consider when they’re looking for their first career. So this isn’t just about a specific technology or a specific landing page. If we’re dealing with a smart speaker, if we’re dealing with the Internet of things, we’re still gonna have those same types of elements. Right? “Oh, what’s my motivation?” Like, “How can I tap into that with the smart speaker? What kind of friction is involved with that smart speaker?” So when you think about things like IOT and smart speakers and some of the things Amazon’s done, even what are they trying to do? They’re essentially trying to reduce friction to make it easier for people to make purchases or to find information. And they’re essentially trying to better tap into motivation by understanding, what, what motivates them and what they’re trying to get, what they’re looking for. So I wouldn’t say it would never change. I mean, one, one thing that we’ve changed over the years is to “v” used to stand for the clarity of the value proposition. And we noticed more and more it’s important to talk about the force of the value proposition because one thing that companies are really overlooking is the credibility aspect. So it could be clear, but if it’s not credible, it’s not forceful. So yes, it may change, things may change over time, but at the same time it’s pretty fundamental what we’re talking about here.
Adrian Tennant: Now I started the show by talking about long-term brand building versus short-term activation campaigns. Advertising industry veterans, Les Binet and Peter Fields – both over in the UK – believe that if brands can afford to do both, that is brand-building and activation, and that the ideal balance between them is 60 percent brand-building and 40 percent activation. But what if you can’t afford to do that? Is there a happy middle ground? Do you think brands can effectively combine both brand and activation within campaigns?
Daniel Burstein: So in my opinion, every customer touch point, every time you’re touching a customer, how it affects the brand. And I would go even farther to say, not even just direct response and branding, like those traditional advertising and marketing elements. I mean, if you’re a marketer in a company, a, if you’re working at an ad agency, you’ve got to understand how else the customer is being touched. Because no matter how much you get your messages out there, either branding or direct response, if, if your company is not living up to it, to the customer, you’re losing an opportunity. So I’ll give you an example of how this applies to me, I wrote about this. I bought, from the Home Depot, I bought a dryer or washing machine or something like that. And so then, I got them to come and install it and I bought it online. And then when they come to install it, I’m waiting by my phone window and I see a truck drive by and it’s like, just kinda like an unmarked van with a trailer and it’s got some washers and dryers in the back. And I’m like, “Well, that can’t be it.” And a few minutes later, sure enough, my doorbell rings and what Home Depot did – and I’m not picking on Home Depot, a lot of companies do this, but – they outsourced, right? They probably figured, “Hey, it’s, it’s cheaper to outsource to whatever local companies or whoever’s doing it than it is to have our own branded Home Depot truck and our own brand at Home Depot.” People come up there. So you talk about, “Hey, if you can’t afford to do both branding and direct response.” So I would say the budget’s everywhere. If [the fulfillment of your product, the delivery of your product. If you’re Home Depot and you’re looking at Hey, we’re going to save 10% on fulfillment by outsourcing like this. Well you’re not looking at is you’re shooting yourself in the foot from, from a brand recognition perspective and a brand affinity perspective. If that is that Home Depot, beautiful Home Depot truck pulls up and the folks come out and they’re dressed to the nines, they do a fantastic job and they’re even consulting with me there. Well I’m, I just had a great Home Depot experience and even if that’s technically a fulfillment budget and not a branding or a marketing budget that was marketing. The same is true for customer service. I call customer service one-to-one marketing. So maybe I got off on a bit of a tangent there, but I want to bring up the point that don’t just look at your direct response budget or any budget. Look at the whole company’s budget, look at every customer touchpoint and how can you make that customer touch point better? How can you serve the customer better? That’s gonna improve your brand. And then again, the same goes with the direct response. So that’s where we talk about incentive earlier where I said incentive is a bacon of marketing tactics, right? How would I mean is, well, a little bit of a cooking tip here. If you’re a bad cook, if you can’t cook and you just want to make something better, just throw bacon on it, right? So if you have a plain kale salad, it’s going to taste better if you throw bacon on it. And that’s what some marketers do, right? They don’t really have a good value prop. They maybe don’t have a good brand. It just throws bacon on – 20% off, 30% off. Like I said, the American car companies will pay you five grand to buy our car. So what is that doing to your brand, right? Yes, if you’re getting that near-term conversion of using programmatic, if you’re doing all these things, you’re getting that near-term conversion, but it’s not really a great experience for your brand. If 2% are clicking through and buying and you’re getting a good return on ad spend, well the other 98% are having a bad feeling for your brand. What is that doing? So I’d say let’s step back. Let’s hold hands. Let’s all get together. The branding folks, the I direct response folks that digital folks, customer service firm and everyone and look at it holistically and say, “how do we touch our customer and how can we best serve them?”
Adrian Tennant: Daniel, what books or articles or other resources do you recommend for listeners that want to learn more about human behavior in general or conversion in particular?
Daniel Burstein: Yeah, I mean, in terms of books, I highly recommend the research and the work of Dr. Dan Ariely. He’s got a book, “Predictably Irrational.” It’s a great book and he does a lot of other things. He has a column in The Wall Street Journal, and he published on blogs. We’ve had him as a speaker before. He’s also a super cool guy in person and he does a great job of taking the complex research he does and distilling in a way that you easily understand it. So he’s a behavioral economist and really getting into any of the behavioral economic work is super helpful if you’re interested in conversion-focused marketing. Another book that’s great is, “The Power of Habit,” by New York Times reporter Charles Duhigg. We’ve also had him as a speaker. He is the nicest guy in person, super friendly guy. His book is a great reminder that not everything we’re doing is logically thinking through and making a purchase decision. There’s so many things we’re doing habitually. So how do you get through those customers are doing things habitually and how do you help them set up new habits? And personally what I do – and I really learned this even when I was back in college, one of my professors told me that copywriters are just the most well-read people you’ll ever meet – and I just read tons of newspapers and magazines. I like to read print cause I’m on digital all day and print it. And reading newspapers and magazines, it’s a great way to really understand different niche audiences and just what’s going on in the world. And he fills your head up with a lot that you later tap into when you’re writing that conversion focused copy. So I don’t entirely know how the creative process works. I’m sure you could have some great professors here. He said, but all I know is you, you gotta there’s an input in and output and if you’re just grinding all day, if you’re just trying to write that come up that next grade concept, come up with that great next campaign eventually you’re going to get tapped out. And so, I try to put in as much as possible and somehow magically be some niche magazine or read or the wall street journal or, or whatever. I know that idea pops in your head. I don’t know where I came from, but I know if I put it in there lunch would be there when I need to take it out.
Adrian Tennant: Daniel, can you tell us a little bit about the different kinds of learning opportunities that exist with MECLABS, both onsite and online?
Daniel Burstein: Sure. So we have four certification courses based on the methodologies we’ve learned through our experimentation. There is value proposition, landing page optimization, which is very focused on that conversion optimization – that heuristic I talked about, email messaging, and online testing. And you can either take it on your own at your own pace online or we also do in-person team trainings as well.
Adrian Tennant: Got it. And if listeners would like to know more about the work of MECLABS, where can they find you online?
Daniel Burstein: Oh, it’s really easy. MECLABS.com. You can find a lot of free resources there. A lot of helpful information.
Adrian Tennant: Daniel. It’s been a real pleasure. Thank you very much for joining us today.
Daniel Burstein: Thanks, Adrian – it’s my pleasure. Thanks for having me.
Adrian Tennant: My thanks to our guest, Daniel Burstein, Senior Director of Content Marketing at MECLABS Institute. You can find links to the resources we discussed on the IN CLEAR FOCUS page at bigeyeagency.com under “Insights.” Consider subscribing to the show on Apple Podcasts, Spotify, or your favorite podcast player. And please rate and review the show. And if you have an Amazon Echo device, you can use the IN CLEAR FOCUS skill to add the podcast to your Flash Briefing. Thank you for listening to IN CLEAR FOCUS produced by Bigeye. I’ve been your host, Adrian Tennant. Until next week, goodbye.