So, in the most recent edition of Ampersand, H&K's global newsletter, Peter Walshe of WPP sister company Millward Brown speaks to the notion of brand attraction vs brand satisfaction.
Says the article: "Brands that stand for something and deliver a great product or service are more likely to get talked about. User endorsement is an extremely powerful and credible force. Frederick H. Reicheld¹, Director Emeritus at Bain & Company, has carried out work that suggests services that inspire their users to recommend them to others are ones that will grow and produce superior profits. He goes further and claims that ‘satisfaction’ is a poor predictor of success and that the one number you need is that of ‘Net Promotion’ – the positive balance of recommendation against detraction."
This is an interesting concept, further accentuated given the growing influence of social media.
But what about the flip side of the equation: the dissatisfied customers who go beyond being merely dissatisfied to actively communicating their negative experiences more broadly -- or what could be termed brand dissatisfaction vs brand detraction?
A recent "Retail customer dissatisfaction" study by the Wharton School of Business' Jay H. Baker Retailing Initiative and the Verde Group explores this side more deeply.
The Study was aimed at seeking to "better understand the effect of problem experience and negative word-of-mouth on the retail shopping experience." And while this study was not aimed specifically at bloggers or the Internet, the implication for this channel is clear.
According to the study, "shoppers experiencing problems are more than five times as likely to tell a friend or colleague about it than to contact the company."
Additional findings highlighted by Wharton in its article on the study's findings "Beware of dissatisfied consumers: they like to blab":
- only 6% of shoppers who experienced a problem with a retailer contacted the company, but 31% went on to tell friends, family or colleagues what happened.
- Of those, 8% told one person, another 8% told two people, but 6% told six or more people.
"Even though these shoppers don't share their pain with the store, they do share their pain with other people, apparently quite a few other people," says Wharton Marketing Professor Stephen Hoch.
Paula Courtney, president of The Verde Group, is quoted in the same article as saying that 'the exponential power of negative word-of-mouth lies in the nature of storytelling. "As people tell the story the negativity is embellished and grows," she says. For example, the first time the story is told, it might be about a customer service representative who was rude. By the time the third or fourth person hears the story, the customer service representative becomes verbally abusive. "To make a story worth telling, there has to be some entertainment value, a shock value," says Courtney. "Storytelling hurts retailers and entertains consumers."'
And these stories carry weight:
According to the study, "almost half of shoppers have avoided a particular store in the past because of someone else’s negative experience. A similar proportion say they will avoid buying a similar item at the store, or visiting the store altogether, in the future."
So while much of this simply reaffirms what many of us have already believed, it behooves us to continue to evangelize the growing capacity of social media in removing barriers that prevented one customer from talking to other customers...and so on, and so on...