Read: Magids, Scott, Alan Zorfas, and Daniel Leemon (2015). "The New Science of Consumer Emotions," HBR, November 1.1.

The article makes much of quantifying consumer emotions for analysis. Howthe authors quantified consumer emotions?How accurate are such measures?What challenges do these methods present to marketing managers and analysts wishing to acquire good data about their customers?

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SPOTLIGHT ON DIGITAL CUSTOMER ENGAGEMENT

The New Science ofCustomer Emotions

A better way to drive growth and profitability

by Scott Magids, Alan Zorfas, and Daniel Leemon

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SPOTLIGHT ON DIGITAL CUSTOMER ENGAGEMENT

SPOTLIGHT ^{ARTWORK Hong Hao, My Things No. 5}

2002, scanned objects, digital c-print

120 x 210 cm

The New Science of

Customer Emotions

A better way to drive growth and profitability

by Scott Magids, Alan Zorfas, and Daniel Leemon

2Harvard Business ReviewNovember 2015

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SPOTLIGHT ON DIGITAL CUSTOMER ENGAGEMENT

When companies connectwith customers' emotions,the payoff can be huge.Consider these examples:After a major bank introduced a credit card forMillennialsthatwas designed to

inspire emotional connection, use among the seg ment increased by 70% and new account growthrose by 40%. Within a year of launching productsand messaging to maximize emotional connection,

a leading household cleaner turned market sharelosses into double-digit growth. And when a nation wide apparel retailer reoriented its merchandisingand customer experience to its most emotionallyconnected customer segments, same-store salesgrowth accelerated more than threefold.

Given the enormous opportunity to create newvalue, companies should pursue emotional con nections as a scienceand a strategy. But for most,building these connections is more guesswork thanscience. At the end of the day they have little ideawhat really works and whether their efforts haveproduced the desired results.

Our research across hundreds of brands in doz ens of categories shows that it's possible to rigor ously measure and strategically target the feelingsthat drive customers' behavior. We call them "emo tional motivators." They provide a better gauge ofcustomers' future value to a firm than any othermetric, including brand awareness and customersatisfaction, and can be an important new source ofgrowth and profitability.

At the most basic level, any company can begina structured process of learning about its custom ers' emotional motivators and conducting experi ments to leverage them, later scaling up from there.

At the other end of the spectrum, firms can investin deep research and big data analytics or engageconsultancies with specific expertise. Companiesin financial services, retail, health care, and tech nology are now using a detailed understanding ofemotional connection to attract and retain the mostvaluable customers. The most sophisticated firmsare making emotional connection part of a broad

strategy that involves every function in the valuechain, from product development and marketing tosales and service.

In what follows we'll describe our research andour work with companiesto our knowledge, thefirst to show direct, robust links among specific emo tional motivators, a firm's actions to leverage them,

consumer behavior, and business outcomes.

Defining Emotional Motivators Our research stemmed from our frustration thatcompanies we worked with knew customers' emo tions were important but couldn't figure out a consis tent way to define them, connect with them, and linkthem to results. We soon discovered that there wasno standard lexicon of emotions, and so eight yearsago we set out to create one, working with expertsand surveying anthropological and social science re search. We ultimately assembled a list of more than300 emotional motivators. We consider customersto be emotionally connected with a brand when italigns with their motivations and helps them fulfilldeep, often unconscious, desires. Important emo tional motivators include desires to "stand out fromthe crowd," "have confidence in the future," and"enjoy a sense of well-being," to name just a few. (Seethe exhibit "High-Impact Motivators.")

Identifying and measuring emotional motiva tors is complicated, because customers themselvesmay not even be aware of them. These sentimentsare typically different from what customers say are the reasons they make brand choices and fromthe terms they use to describe their emotional re sponses to particular brands. What's more, as we'lldiscuss, emotional connections with products areneither uniform nor constant; they vary by industry,

brand, touchpoint, and the customer's position inthe decision journey.

4Harvard Business ReviewNovember 2015 COPYRIGHT 2015 HARVARD BUSINESS SCHOOL PUBLISHING CORPORATION. ALL RIGHTS RESERVED. This document is authorized for use only by Eliseo Ilarraza in Marketing Analytics Summer 2021 taught by JOHN (RANDY) SPARKS, University of Dayton from Jul 2021 to Sep 2021.

Idea in Brief THE PROBLEM

THE SOLUTION

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THE OPPORTUNITY

Companies know that emotionsdrive customer behavior, butmost have little idea how toconnect in ways that motivatethe desired behaviors. Theprocess is more guessworkthan science.

The authors have createda lexicon of "emotionalmotivators" and, using bigdata analytics, linked them tospecific profitable behaviors.

By identifying the most

powerful emotional motivatorsfor a given customer segment,companies can design

marketing and other strategiesto leverage those motivators,giving them a new sourceof competitive advantageand growth.

Why Emotional Connections Matter Although brands may be liked or trusted, most fail toalign themselves with the emotions that drive theircustomers' most profitable behaviors. Some brands

High-Impact Motivators

Hundreds of "emotional motivators" drive consumer behavior. Below are 10 thatsignificantly affect customer value across all categories studied.

by nature have an easier time making such connec tions, but a company doesn't have to be born with

I am inspiredby a desire to:

Brands can leverage this motivatorby helping customers:

the emotional DNA of Disney or Apple to succeed.Even a cleaning product or a canned food can forgepowerful connections.

The process, in brief, looks like this: Applying bigdata analytics to detailed customer-data sets, we firstidentify the emotional motivators for a category'smost valuable customers. High-value automobilecustomers, for example, might want to "feel a senseof belonging" and "feel a sense of freedom." Nextwe use statistical modeling to look at a large numberof customers and brands, comparing survey results about people's emotional motivators with their pur chase behavior and identifying spikes in buying thatare associated with specific motivators. This revealswhich motivators generate the most-profitable cus tomer behaviors in the category. We then quantifythe current and potential value of motivators for agiven brand and help identify strategies to leveragethem. (See the sidebar "Getting Started.")

The model also allows us to compare the valueof making strong emotional connections with thatof scoring well on standard customer metrics suchas satisfaction and brand differentiation, thus high lighting the potential gains from looking beyond tra ditional measures. We find that customers becomemore valuable at each step of a predictable "emo tional connection pathway" as they transition from(1) being unconnected to (2) being highly satisfiedto (3) perceiving brand differentiation to (4) beingfully connected.

Although customers exhibit increasing connec tion at each step, their value increases dramatically

Stand out from

the crowd

Project a unique social identity;

be seen as special

Have confidence

Perceive the future as better than the past; have

a positive mental picture of what's to come

in the future

Enjoy a sense of

well-being

Feel that life measures up to expectations and thatbalance has been achieved; seek a stress-free statewithout conflicts or threats

Feel a sense of

freedom

Act independently, without obligations or

restrictions

Feel a sense

of thrill

Experience visceral, overwhelming pleasure andexcitement; participate in exciting, fun events

Feel a sense

of belonging

Have an affiliation with people they relate to oraspire to be like; feel part of a group

Protect the

environment

Sustain the belief that the environment is sacred;take action to improve their surroundings

Be the person

Fulfill a desire for ongoing self-improvement; live up

to their ideal self-image

I want to be

Feel secure ^{Believe that what they have today will be there} tomorrow; pursue goals and dreams without worry

Succeed in life ^{Feel that they lead meaningful lives; find worth that} goes beyond financial or socioeconomic measures

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SPOTLIGHT ON DIGITAL CUSTOMER ENGAGEMENT

The Value of

For the exclusive use of E. Ilarraza, 2021. Emotional Connection

As customers' relationship with a brand

deepens, they move along the pathway toward

full emotional connection. Although they

become more valuable at each step, there's

a dramatic increase at the final one: Across

a sample of nine categories, fully connected

customers are 52% more valuable, on average,

than those who are just highly satisfied.

when they reach the fourth step: Fully connected

Emotional motivators vary by category andbrand. Of the 300-plus motivators we've identified,

customers are 52% more valuable, on average, thanthose who are just highly satisfied. In fact, their rela

CUSTOMER VALUE IN RELATION TO

52%

tive value is striking across a variety of metrics, suchas purchases and frequency of use. (See the exhibit"The Value of Emotional Connection.")

The pathway is an important guide to wherecompanies should investand it reveals that theyoften invest in the wrong places. To increase rev enue and market share, many companies focus onturning dissatisfied customers into satisfied ones.However, our analysis shows that moving custom ers from highly satisfied to fully connected can havethree times the return of moving them from uncon nected to highly satisfied. And the highest returnsThe Value of

we've seen have come from focusing on customersEmotional Connection

who are already fully connected to the category from maximizing their value and attracting more of

As customers' relationship with a brand them to your brand.

25 significantly affect customer value across all theHIGHLY SATISFIED

categories we've analyzed. Anywhere from five to

CUSTOMERS

15 additional motivators are important in any givencategory. For example, the sense that a home fur

+13%

nishings store "helps me be creative" inspires con Baseline

sumers to shop there more often. The wish to "feelrevived and refreshed" drives loyalty to fast-food-18%

restaurants. Emotional motivators also vary withincategories, depending on the desires of brands' mostvaluable customers. Because brands differ in howwell they align with their customers' motivators,

each may have a different starting point in any ef fort to strengthen emotional connectionsand thatpoint won't necessarily relate to conventional mea sures of brand perception. (See the exhibit "Mind the(Emotional Connection) Gap.")

Emotional motivators vary across customer

deepens, they move along the pathway toward

Not

Highly

Perceive

Fully

Four insights from our research are especially

segments. Recall the credit card designed with

full emotional connection. Although they

emotionally

satisfied

brand

connected

relevant to firms looking to build on emotional

Millennials in mind. Our model uncovered desires

become more valuable at each step, there's connection.

connected

but not fully

differentiation and satisfied,

and

satisfied,

a dramatic increase at the final one: Across

to "protect the environment" and "be the person

The Value of

a sample of nine categories, fully connectedcustomers are 52% more valuable, on average, than those who are just highly satisfied.

connected

but not fully connected

and able

to perceivebrand

differentiation

Emotional

Connection

As customers' relationshipswith a brand deepen, they

CUSTOMER VALUE IN RELATION TO

HIGHLY SATISFIED CUSTOMERS

+52%

The increased value of fully connected customers relative to highly satisfied onesvaries by category. Here are the values forthe nine categories sampled.

move along the pathwaytoward full emotional

+13%

Household cleaner

Tablet app

Credit card

connection. Although they

Baseline

^purchases+82%

^purchases+68%

become more valuableat each step, there's adramatic increase at thefinal one: Across a sampleof nine categories, fullyconnected customers are52% more valuable, onaverage, than those who arejust highly satisfied.

-18%

+103%

Online

retailer

purchases +52%

^Consumer banking

Hotel room stays +41%

^Fast food

swipes

Discount store

visits

+37% ^Casino gaming

^products+27%

^visits+23%

Not

emotionallyconnected

Highly

satisfied but not

fully

connected

Perceive

brand

differentiation and satisfied, but not fully connected

Fully

connected and

satisfied,

and able

to perceivebrand

differentiation

+35%

spending

The increased value of fully connected

6Harvard Business ReviewNovember 2015

customers relative to highly satisfied ones

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the nine categories sampled.

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A company doesn't have to have the emotional DNA ofDisney or Apple to succeed. Even a cleaning productor a canned food can forge powerful connections.

I want to be" as key motivators in the banking cat egory for that age group. (Traditional industry mo tivators such as desires to "feel secure" and to "suc ceed in life" are more typical of older groups.) Thebank crafted messaging and features to connectto those sentiments, leading to its fastest-growingnew credit card.

Emotional motivators for a given brand orindustry vary with a person's position in thecustomer journey. In banking, the desire to "feelsecure" is a critical motivator when attracting andretaining customers early on. When cross-sellingproducts later, the wish to "succeed in life" becomesmore important. To maximize results, companiesmust align their emotional-connection strategieswith their specific customer-engagement objectives acquisition, retention, cross-selling, and so on.

Emotional-connection-driven growth op portunities exist across the customer experi ence, not just in traditional brand positioningand advertising. For example, social media canhave a big impact on emotional connection. Onecondiments brand found that 60% of its social network-affiliated customers (especially followerson Facebook, Twitter, and Pinterest)versus 21% ofall customerswere emotionally connected. It accel erated growth in a matter of months by increasing itsfocus on its social media network, developing its on line customer community, and pointing customersto the website for recipes and promotions.

Putting Emotional

Connections to Work

Let's look at how an emotional-connection strategypaid off for a national fashion retailer. The companywas struggling with common industry challenges.Although it had a well-known brand and a strongmarket presence, same-store sales were stagnating,

and promotional pricing was shrinking margins. Soit focused on cost management, logistical efficiency,and streamlining the merchandise and store mix with limited success. Over the past two years we

worked with the retailer on a four-part strategy to

identify, understand, and quantify the value of the

most emotionally connected customers. This ex

posed a number of large, unexploited opportunities

and allowed the retailer to better direct investments

across the firm.

1. Target connected customers. We set out to

answer two basic questions: How valuable were the

retailer's fully connected customers, and could the

company attract more of them? We used statistical

techniques to measure the strength of customers'

emotional connections with the retailer and with its

competitors. The process began with surveys to dis

cern how consumers related to key motivators in the

category and with analysis to see which motivators

best predicted purchase behavior. We then modeled

the financial impact of building emotional connec

tions with customers at each step on the pathway

from unconnected to fully connected.

Our analysis showed that although fully con

nected customers constituted just 22% of customers

in the category, they accounted for 37% of revenue

and they spent, on average, twice as much annu

ally ($400) as highly satisfied customers. Enhancing

emotional connection could be a viable growth

strategy if the retailer could attract fully connected

customers from competitors, transform satisfied

customers into fully connected ones, or both.

Further segmentation revealed a group of espe

cially valuable customers. We labeled them Fashion

Flourishers, because apparel connects to their deep

desire for excitement, social acceptance, and self

expression. As a group, Flourishers are the most

emotionally connected segment by far; half are al

ready fully connected to the category. Comparing

the ratios of various emotion-based segments'

spending to those segments' size highlights ex

traordinary differences in value: Flourishers have

a ratio of 1.9nearly twice the market average and

more than nine times that of the least-connected

group (whom we called Can't Please Them, and

whose ratio is just 0.2). Given the relatively fixed

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SPOTLIGHT ON DIGITAL CUSTOMER ENGAGEMENT

cost structure of retailing, acquiring and retainingFlourishers represented an opportunity to boostrevenue and margins.

A detailed profile of Flourishers underscoredtheir attractiveness and exposed ways for the retailerto target them. Customers in this segment:

have a high lifetime value, spending an average of$468 a year in the category, versus $235 for othercustomers.

shop more often and advocate more: Fully 46%of Flourishers shop key fashion categories at leastmonthly, versus 21% of all shoppers. Flourishersare 1.4 times as likely as other customers to recom mend retailers to their friends and family members.

are less price-sensitive: They are 2.3 times as likelyas other customers to say they are "willing to paymore for the best fashion products," 1.7 times lesslikely to make fashion purchase decisions solely onthe basis of price, and 1.3 times less likely to shopfor the lowest prices.

are predominantly female and younger, more eth nically diverse, and more likely to live in urban cen ters than other customers.

are more digitally engaged than other segments:They are 2.3 times as likely to research a fashionretailer online, 2.9 times as likely to shop for fash ion products through their mobile devices, and 3.7times as likely to follow a retailer on social media.

Drawing on these and other insights, the retailercreated a blueprint for pursuing the most valuablecustomer opportunities. By applying the categorysegmentation scheme to the more than 25 millionpeople in its customer database, it determined thefinancial value and behaviors of its own Flourishers,confirming that they spent substantially morethan other customers and had the highest lifetimevalue and the lowest attrition and price sensitivityof any segment. It estimated that moving satisfiedFlourishers up the pathway to full emotional con nection could increase annual sales by 3% to 5%,and that luring Flourishers away from competitorscould increase revenue by 5% to 8%. Because mem bers of this group spend more per capita than othercustomers and turn over less often, the analysis alsopredicted improvements in operating margins andreturns on capital.

2. Quantify key motivators. Next, by analyz ing tens of thousands of Flourishers across the cat egory, we quantified the impact of more than 40motivators on the group's purchasing, spending,

8Harvard Business ReviewNovember 2015

For the exclusive use of E. Ilarraza, 2021.

loyalty, and advocacy. We identified the most im

portant category motivatorsthe ones that bore the

strongest relationship to purchasesand assessed

the retailer's competitive position in each. The fi

nancial analysis and modeling showed that further

investments to strengthen the customer experience

around the desires to "feel a sense of belonging,"

"feel a sense of thrill," and "feel a sense of freedom"

the motivators driving category purchase behavior

and for which the retailer already had the strongest

positionwere likely to yield the highest ROI. Those

motivators therefore became the focus of specific

customer-experience investments.

3. Optimize investments across functions.

To maximize opportunities from emotional connec

tion, companies must look beyond the marketing

department. The retailer examined every function

and customer touchpoint to find ways to enhance

high-ROI emotional motivators. This brought four

major investment areas into focus: stores, online

and omnichannel experiences, merchandising, and

message targeting.

Stores. To estimate which of the retailer's more

than 700 stores had the most Flourisher customers,

we scored each one according to the presence of this

segment in the store's trading area. We found that

high-scoring stores generated up to 25% more reve

nue than others. Their same-store sales were growing

twice as quickly, and their operating profit was 30%

greater. Their profit margins were enhanced by 10%

To maximize opportunities fromemotional connection, companiesmust examine every function andcustomer touchpoint.

higher inventory turns andconsistent with expec

tationsby lower coupon usage. (Flourishers don't

just say they're willing to pay morethey actually

do pay more.)

These analytics changed the retailer's store lo

cation strategy. We mapped the concentrations

of Flourishers in all U.S. markets and submarkets,

along with the segment's propensities to shop at

more than 150 other retailers. The company's real

estate team now uses a predictive model to identify

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Mind the (Emotional Connection) Gap

The "emotional connection score" (ECS) of a brand measures the share ofcustomers who are fully connected. A gap between a brand's ECS and theshare of customers who consider it a "good brand" signals an opportunity totransform satisfied customers into fully connectedand more valuableones.Gaps between a brand's ECS and competitors' indicate opportunities to seize(or maintain) advantage by attending to emotional connections.

Emotional connection score Considered a "good brand" 60

sites near Flourishers and also near other retailersthey frequent.

The change is paying off. New stores in tradingareas with high concentrations of Flourishers havefirst-year sales that are 20% higher than historical av

AUTOMOBILES

AIRLINES

FINANCIAL SERVICES

BMW

Toyota

Virgin

America

United

Airlines

Charles Schwab

American Express

38

49

28

48

43

27

63 62

76

72

70

erages, leading to faster break-even times and higherreturns on capital. Further analysis has revealedopportunities to open hundreds of stores cateringto underserved Flourisher populations. To free upcapital for new stores, the retailer is closing ones inlow-Flourisher areas.

Emotional-connection analytics have also al lowed the retailer to understand which aspects ofthe in-store shopping experience are most impor tant to Flourishers. Because those qualities oftenaren't recognized by customers themselves, theyhad not informed store design. Flourishers say it'simportant that sales associates are easy to find, thatclearance items are easy to locate, and that storeshave free Wi-Fi. However, analysis showed that

PERSONAL TECH

COFFEE

CHAINS

ATHLETIC WEAR

INTERNET MEDIA

BEVERAGES

DISCOUNT RETAIL

Apple

Microsoft

^Dunkin' Donuts Starbucks

Adidas

Nike

Google

Facebook

Pepsi

Coca-Cola

Target

Walmart

34

28

32

26

31

30

27

18

26

24

23

22

37

66

55

67

69

68

73

57

42

64

66

47

those aren't actually the features that drive theirvisits and purchases.

On the basis of its modeling, the retailer pre dicted that the option to purchase online and pickup in-storesomething that few customers say isimportant and that was available only on a limitedbasiswould be a key driver of emotional connec tion (it speaks to Flourishers' desire to "feel a senseof freedom"). It tested targeted communication andin-store promotion of the option and saw a mate rial lift in sales; it has now committed capital to anationwide rollout of the capability. Similarly, theretailer predicted that seeing imagery in-store of

"people like you" would drive emotional connectionand purchasing among Flourishers (although theysay that this factor is unimportant). As a test, it ex panded its presence on photo-sharing social mediasites and encouraged customers to submit selfiesshowing their favorite outfits and styles. Selfie slideshows are (with subjects' permission) displayedon large screens in test stores, thus addressingFlourishers' desire to "feel a sense of belonging."Research indicates that the segment has respondedto this motivator and increased purchase intent.

The retailer is now designing and testing storeexperiences to leverage nearly a dozen other driversof emotional connection.

Online and omnichannel experiences. Like indi vidual store environments, online and omnichan nel experiences can be optimized for emotional

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SPOTLIGHT ON DIGITAL CUSTOMER ENGAGEMENT HBR.ORG

Getting Started

Identifying and leveraging customers' emotional motivators

can be broken into three phases.

connection. To this end the retailer quantified theimpact of more than 100 omnichannel touchpointson customers' emotional connection and spend

1

FIRST, inventory yourexisting market researchand customer insightdata. You will probably

them into quartiles according toannual purchases, advocacy, and soon. Examine the top quartile to seehow the characteristics and behavior

ing. These included mobile app browsing and pur chasing, visits to the retailer's social media pages,e-commerce site navigation, and in-store returns ofmerchandise bought online. Each touchpoint wasscored according to its potential impact on emotionalconnection and spending. Statistical models thenrevealed the most powerful combinations of touch points at each stage of the customer journey, allow ing the retailer to hone its omnichannel strategy andprioritize investments.

For example, Flourishers say that using a com puter to shop online via an easy-to-use site is impor tant to purchase decisions. In reality, the ease and al lure of the mobile site and the availability of servicessuch as ApplePay have a far greater impact on emo tional connection and spending levels. The retaileris using such insights to design investments acrosse-commerce, mobile, and social media that willbuild emotional connections with Flourishers. Forinstance, it developed multiple concepts for the nav igational redesign and aesthetic reskin of its mobileapp, tested how effectively each version enhancedfeelings of "freedom," "belonging," and "thrill" anddrove purchases, and rolled out the best one.

Merchandising. Merchandise selection, from thebroad category level to specific labels, can be opti mized to drive emotional connection. The retailernow tracks the purchasing habits of Flourishers na tionwide through point-of-sale data collected fromhundreds of retailers by independent research com panies. By applying the Flourisher segmentation tothese POS databases, it has modeled the segment'spurchase behavior across more than 20 product cat egories and 100 labels and learned which of the ap proximately 10 competitive retailers these consum ers buy from. The resulting insights have exposedgaps in merchandise important to Flourishers, andthe retailer is working with its manufacturers torebalance its mix.

Message targeting. Having identified itsFlourisher customers, the retailer can now sendthem personalized messages designed to resonatewith the emotional motivators that drive behaviorat each stage of the customer journey. For example,when Flourishers are initially considering the retailer,

"having fun" while shopping is paramount. At thepoint of purchase, "helps me feel creative" emerges

10Harvard Business ReviewNovember 2015

find qualitative descriptions of yourcustomers' motivating emotions,such as what aspects of life theyvalue most (family, community,freedom, security) and what theyaspire to day-to-day and in thefuture. From there, pursue researchto add detail to your understandingof those emotions. Define a set ofemotional motivators to probethelist in the exhibit "High-ImpactMotivators" will provide ideas, aswill your qualitative research. Onlinesurveys can help you quantify therelevance of individual motivators.Are your customers more drivenby life in the moment or by futuregoals? Do they place greatervalue on social acceptance or onindividuality? Don't assume youknow what motivates customers justbecause you know who they are.Young parents may be motivatedby a desire to provide security fortheir familiesor by an urge toescape and have some fun (youwill probably find both types inyour customer base). And don'tundermine your understanding ofcustomers' emotions by focusing onhow people feel about your brandor how they say it makes themfeel. You need to understand theirunderlying motivations separatefrom your brand.

2

SECOND, analyze your

best customersthose

who buy and advocate

the most, are the least

price-sensitive, and are the mostloyal. To do this, identify thosewho are highly satisfied with yourbrandwhatever the degree of theiremotional connectionand divide

of your best customers differfrom those of people in the otherquartiles. Look at demographics,whether people buy in person oronline, how much they buy from yourcompetitors, and where they gettheir information about your brand(traditional media, social networks,and so on). Compare the emotionalmotivators of your best customerswith the ones you've researched foryour overall customer base and seewhich are specific or more importantto the high-value group. Find the twoor three of these key motivators thathave a strong association with yourbrand. They will serve as an initialguide to the emotions you need toconnect with in order to grow themost valuable customer segment ofyour business and to the marketingstrategies and customer experiencetactics that will provide the greatestconnection opportunities.

3

THIRD, make the organi

zation's commitment to

emotional connection

a key lever for growth.

Use the language of emotionalconnection when you talk aboutyour customersnot just in themarketing department but across thefirm. In our experience, successfulstrategies based on emotionalconnection require buy-in from thetop and must be embraced acrossfunctions. For example, if people inproduct development are workingon a version that's easier to use, theyshouldn't just ask whether customerswill be satisfied with it; they shouldlearn which emotional motivatorsit resonates with and how it willstrengthen emotional connections.

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About the Research

Beginning with a two-year research project involving literature

review and social science experts, we identified 300 universal

motivating emotions. To measure their impact on consumer behavior,

as key. Working from such insights, the retailer hasdeveloped a series of messages targeting Flourishersand timed according to their position in the journey:A rules engine sends out e-mails tailored to browsing,

transacting, and servicing interactions. Responserates to this direct-marketing campaign are 40% to210% higher than historical averages.

Media selection can also be finely tuned to boostemotional connection. We profiled the media con sumption of Flourishers across 500 TV shows, 100websites and social networks, 50 types of mobileapps, 80 print publications, and 20 types of radioprogramming. Working with its ad agency, the re tailer is executing emotional-connection-based me dia plans. For example, knowing that Flourishersare enthusiastic users of Instagram, YouTube, andTwitter, it has scaled up its programs on theseplatforms, which has increased its marketing ROI.

4. Systematize, measure, and learn.Leveraging emotional connection does not requireturning your business processes upside down; youcan embed relevant strategies into existing workstreams. This is most effectively done by makingemotional connection a key performance indica tor and including it on the cross-functional senior management dashboard.

The retailer developed a scorecard that givesthe CEO and the executive team a single-pageview of customers' progression on the emotional connection pathway, along with the increase ordecrease in connected customers of the companyand its key competitors. The scorecard shows thecorrelation of customers' emotional-connectionscores with lifetime value measures such as annualspending, churn, and tenure. It also shows how thebusiness impacts of specific emotions are trendingand how Flourishers engage with key in-store andomnichannel touchpoints that drive emotional con nection. In addition, the retailer includes emotional connection metrics in its ongoing testing of mediamessages, store designs, and digital and mobileexperiences.

The results of these strategic and operationalchanges are startling. Same-store sales for stores serv ing Flourishers realized growth of 3.5% over the pastyear, whereas annual same-store growth over thepast five years has averaged just 1%. Inventory turnsincreased more than 25%. Market share and cus tomer advocacy also grew (the number of customersrecommending the retailer is up 20% year-over-year),

11Harvard Business ReviewNovember 2015

we conducted intercept surveys of more than one million U.S. consumersthrough thousands of websites, gathering data across 30 industries and400-plus brands that included measures of brand consideration, trial,repurchase, advocacy, customer satisfaction, brand differentiation, andemotional connection. Over six more years we collected more than onebillion data points, including demographic and actual purchase data. Usinganalytical techniques such as multivariate regression and structural equation modeling, we determined which emotional motivators are most powerfullyassociated with customer behavior and customer value by category and bybrand and the degree to which connecting to those motivators influencescustomer behavior, both in absolute terms and relative to more commonlymeasured drivers of behavior.

contributing to record-high customer lifetime values.

Underlying all these gains is a 20% rise in the com

pany's emotional-connection scorelargely the re

sult of moving satisfied customers to full emotional

connection.

The Management Imperative

Embracing an emotional-connection strategy across

the organization requires deep customer insights,

analytical capabilities, and, above all, a manage

rial commitment to align the organization with the

new way of thinking. It's important that marketing

not hoard the strategy as "its" domain (although the

function can and should use emotional connection

to demonstrate the direct financial impact of its

spending). Instead, marketing must partner with

other functions, teaching and socializing emotional

connection. The retailer we profiled now uses emo

tional connection to drive alignment across the oper

ations management team, the C-suite, and the board

room. At the outset the CEO identified emotional

connection as a strategy to restore profitable growth.

The CFO and the chief strategy officer then "sized

the financial prize," leading the heads of marketing,

stores, customer experience, and merchandising to

collaborate on an integrated strategy.

The advent of big data analytics brings clarity,

discipline, and rigor to companies' long-held desire

to connect with the customer emotions that truly

matter. Emotional connections no longer have to be

a mysterythey can be a source of real competitive

advantage and growth. HBR Reprint R1511C

Scott Magids is a cofounder and the CEO of Motista,

a consumer intelligence firm. Alan Zorfas is a

cofounder and the chief intelligence officer of Motista.

Daniel Leemon is the lead director of CEB, a best-practice

insight and technology company.

This document is authorized for use only by Eliseo Ilarraza in Marketing Analytics Summer 2021 taught by JOHN (RANDY) SPARKS, University of Dayton from Jul 2021 to Sep 2021.