The Most Successful Brands Focus on Users – Not Buyers

September 3, 2021

In an enlightening piece written for HBR, a very curious idea is explored and proven with data – the most successful brands focus on users – not buyers. The idea may seem counter-intuitive for most business leaders at first sight. Still, some soul-searching will reveal that the leading technology companies that are so aggressively invading a range of industries nowadays focus heavily on experience rather than transactions. The experience brings loyalty and endurance to relationships with customers, resulting in more fulfilling, profitable relationships in the long term.

Pick #1. The Most Successful Brands Focus on Users – Not Buyers

A joint study by SAP, Siegel+Gale, and Shift Thinking suggests that digital brands don’t just do things differently; they also think differently. Where traditional brands focus on positioning their brands in the minds of their customers, digital brands focus on positioning their brands in the lives of their customers. Furthermore, they engage customers more as users than as buyers, shifting their investments from pre-purchase promotion and sales to post-purchase renewal and advocacy.

The difference between purchase and usage brands can be seen through the lens of the moments of truth method that has become a cornerstone of customer experience design. Purchase brands focus on the moments of truth before the transaction, such as researching, shopping, and buying the product. By contrast, usage brands focus on the moments of truth that happen after the transaction, whether in delivery, service, education, or sharing.

Our research reinforces the benefits of shifting from purchase to usage. Survey respondents show more loyalty to usage brands. They had stronger advocacy in the form of spontaneous recommendations to others. And they showed a higher preference for usage brands over competitors, not just in making the purchase but in a willingness to pay a premium in price. On average, the usage brands were willing to pay a 7% premium, were 8% less likely to switch, and were more than twice as likely to make a spontaneous brand recommendation.

Companies looking to exploit the branding potential unlocked by core digital technologies need to shift their engagement with customers – from purchase to usage. Typically, at purchase brands, customer service & loyalty take a back seat to marketing campaigns and lead generation. Usage brands, by contrast, elevate customer service and loyalty from resource-starved cost-centers to key drivers of growth and profitability.

Read more in the article by Mark Bonchek, Chief Epiphany Officer of Shift Thinking, and Vivek Bapat, SVP & Head of Marketing and Communications Strategy at SAP, written for HBR.

Pick #2. WhatsApp Has Launched Person-to-Person Payments into Beta in India

WhatsApp has begun testing a new payments feature in India that will allow people to send money to other WhatsApp users, excluding merchant accounts.

The company has been working on support for a payments feature for some time, which would take advantage of UPI (Unified Payments Interface) and include support by many Indian banks, including State Bank of India, ICICI HDFC Bank, and Axis Bank.

The addition puts WhatsApp into competition with other messaging services that already support payments, including the recently launched Tez from Google and Tencent-backed Hike, for example, as well as digital wallet platform Paytm, which expanded into messaging to take on WhatsApp more directly. WhatsApp’s support for payments is highly anticipated because of the app’s immense popularity among Indian users.

Read more.

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