Digital Channels - The Hidden Dimension

We've all met someone who is over-familiar. Someone who just gets a little too close.

That feeling of uncomfortableness that arises is normally because they've invaded our personal space. However this raises the question, what is personal space?

Back in 1966, Edward T Hall wrote a book entitled The Hidden Dimension where he discussed the concept of personal space. Defined as:-

The region surrounding a person which they regard as psychologically theirs. Invasion of personal space often leads to discomfort, anger, or anxiety on the part of the victim.

The measurement of this space and the distances between people as they interact is known as proxemics. In a physical sense we all understand the concept of personal space, and whilst peoples tolerance levels in terms of distance vary, they can be broken down into 4 main zones which are:-

• Intimate Space - For embracing, touching or whispering (= < 15cm)
• Personal Space - For interactions among good friends or family members (46 to 76 cm)
• Social Space - For interactions among acquaintances (1.2m to 2.1m)
• Public Space - For interactions such as public speaking (3.7m to 7.6m)

In essence, the closeness of these interactions are based on the closeness of the relationship we have with the individual.

This is something we all understand in everyday life, but what happens when offline interactions move online and when interactions are not person-to-person but are instead person-to-brand.

It was recently reported that just under half (46%) of shoppers now feel they are "bombarded with irrelevant information and offers via a dizzying array of touchpoints." - so something obviously isn't working well.

Just because a brand has a customers contact details doesn't necessarily mean it has permission to talk to them across every channel. Not all channels are equal and some are considered more personal than others.

If a salesperson repeatedly invaded a customer's personal space, making them feel uncomfortable and causing them to walk away, you can bet they wouldn't be employed for very long.

Ok, not a great example as that's exactly what many salespeople do to try and cross that boundary from acquaintance to friend; from untrusted to trusted. However, brands risk customers switching off by doing similar things within digital channels.

In proxemics terms, my letter box is considered public - I expect mass marketing messages to be posted to it and re-act accordingly; which is probably why response rates are so low. My mobile phone however is far more personal and not a channel I'd welcome un-solicited messages on.

As an example, this is how I'd categorise interactions across the various digital channels in terms of proxemics.

• Intimate Space = Telephone/Mobile Phone/SMS/IM
• Personal Space = Facebook, Foursquare
• Social Space = Email, Twitter
• Public Space = Direct Mail

However these categorisations can also be affected by the relevance of the interaction.

Mobile can be a great channel when the message is very relevant and personal - almost when it could be a whisper in your ear. When Premiere Inn sent me a text message reminding me of my hotel booking and asking if I wanted SatNav directions (which I did), then this worked very well. It was like a friend quietly asking if I knew where I was going.

When my bank rings me up though on the pretense of a customer care call, loosely covering a sales call, then this isn't welcome as I consider this channel far too personal for that type of interaction. This is akin to the salesperson trying to establish trust and cross that boundary.

When I post my thoughts to Twitter - just because they are essentially public does not mean the channel is. I want friends on Twitter that have something relevant, entertaining, informative or witty to say - not a brand advertisement.

With the increasing growth of location based services including the new Facebook Places, this will add another level of complexity. Commentators are already discussing the potential of this channel for advertising revenue with the Telegraph recently saying:-

The business idea behind such applications is that all these individual check-ins can be used to drive advertising. [Adverts] can be targeted more specifically because a user's spending habits are known.

However, knowing this information is one thing, knowing how and when to use it is something else altogether.

Can a brand talk to me when it knows I'm in the area, but not in their store?

Do I expect it to talk to me when I check in at the store specifically?

Will it increasingly be a faux pas if a brand doesn't recognise me when I tell them I'm in-store - almost like refusing a handshake?

With the explosion of digital channels available to talk to customers on I think the principles of proxemics are more relevant than ever. Marketing messages should be looked at not just in terms of what channel do we have available but also in terms of what is the tone of the message and what is the relationship with the recipient.

The classic CRM mantra of Right Message, Right Channel, Right Time could be added to through the application of proxemics with Right Relationship.

Is it loyalty or is it addiction?

I have a confession to make… I’m an addict.

This isn’t however a drug addiction (or any other kind of substance), but I do tend to partake at least once a day.  What am I addicted to… well I’m kindof ashamed to say, it’s Farm Town on Facebook.

I realised I was addicted when I came home from holiday and within an hour had logged on.  Interestingly I’m not alone either – I've seen many people using their laptop in public and on the screen was Farm Town.  In fact, for those of you that haven’t heard of it, count yourself lucky, you’re not one of the 18.5m monthly active users, 6m daily users or the 1.1m fans. 

This got me thinking.  How was I so easily hooked in and how does it continue today to attract – no demand – my attention.  In fact, what has actually gone through my mind is how could I unlock and leverage this level of stickiness and loyalty for use in customer retention programmes.

At this point it’s probably worth explaining exactly what Farm Town is and in my opinion, why it is so sticky.

Farm Town is an online game which allows you to build and develop a virtual farm – going through the motions of ploughing, planting and harvesting and then earning an income from crops sold.  In this respect its a Tamagotchi style application as it requires regular attention to harvest crops before they go bad – so in order to continue to take part you have to continue to log on. 

However, as you build up money you’re able to extend your farm and buy buildings, animals, fencing etc. to personalise your farm as well as being able to grow more crops – and earn more income.

There are many reasons at play for why this game is addictive.

At a high level the stickiness of Farm Town is based on goal directed behaviour – using various mechanisms to set out different goals requiring specific interactions that draw people deeper into the game one step at a time.

To achieve this the game uses a form of tiering to unlock features. 

In the early days for a new player, it is possible to rapidly rise through these tiers and begin to unlock different crops, buildings etc.  This starts to create a feeling that the higher levels are achievable so you put more effort in to get there – however the higher the tier, the more effort is required.

This to me is one of the key aspects of the design which makes it so clever, the tiering is always achievable, but the more you do, the harder it is to get to the next tier.  Having experienced getting to higher levels and and the crops or buildings this unlocks – essentially setting you apart from other “newbies” – you want to achieve more – to keep climbing the ladder.

I’ve seen similar stickiness in an FMCG loyalty programme I’ve worked on where participants were able to partake in online games for little or no points and redeem points for prize draws.  It might be expected that where consumers are not forced to make a purchase to take part or where they constantly “redeem out” by taking part in prize draws, that there would be an element of wear out.  In practice though we saw the opposite of this.

Where we see increased online interaction - whether this is no points or low points interactions – we see a direct correlation to increased retention.

What I think makes Farm Town more powerful is that taking part is rewarded not with more of the same, but with more!  Increased interaction provides increased privilege.

The tiering is also clever in that it essentially creates two currencies.  Growing and harvesting crops earns “coins” which are the base currency to purchase more crops, extend the farm, add paths, buildings, fences and trees.  Money isn’t everything though – I’ve earned over 1m “coins”, but I still can’t purchase what I want as I need to earn “experience points”. 

This second currency of experience points is earned by working – helping others by harvesting or ploughing their fields or building your farm with additional buildings, paths and fences.

Now this bit is very clever, because if it was all about the money you’d simply plough the whole farm, plant crops and maximise revenue.  However to get higher earning crops you need experience and this means giving land over to farm buildings and to helping others. 

By combining 2 different currencies, one which measures “transactional behaviour” and one which measures “engagement”, it leads the participant to interact in a way which creates deeper engagement.

Some loyalty programmes attempt to do this – just look at frequent flyer programme tiering with it’s use of base and bonus points.  However, I’ve never seen a programme that has so visibly recognised the difference between transactional behaviour and engagement.  The recent Huggies programme  “Enjoy the ride” was a great example of an engagement currency – but then missed the opportunity to combine this with a transactional currency.

The social interaction cannot be ignored either. 

You get increased benefits by having neighbours and increased earning if you work your neighbours farm – this ensures that people want you to be their neighbour and you want to be theirs. 

Having neighbours or seeing other farms as you work them means you begin to see people who are at higher tiers, who have bigger farms, who have crops you can’t plant – all of this acts as “social proof” which further spurs on activity.

I think this is one area that many loyalty programmes today still haven’t grasped.  Many brands are so nervous about connecting consumers together that most programme interactions are largely centralised and push based.  However the power of social proof – or in effect the ability to compare your performance to that of others – is well known to stimulate increased activity.

What I think the developers of Farm Town have done very cleverly is to create a really well designed journey which drives early engagement, rewards interaction, encourages peer comparison and recognises increased experience.

Obviously for many people the simple pleasure of building a farm is what drives them to participate – it might not be an addiction - but whether they like it or not, they are being played as much as they are playing. 

PS. In case you’re interested, this is my farm ;o)

Retailers Need to Start Thinking Imaginatively

I was reading an interesting article today on retailers and their use of mobile within the buying process. I was quite surprised when it said that 40% of those surveyed said they already had an information-led mobile internet site or were considering building one – I'm guessing that there were more within that 40% that are considering it versus those doing it as the mobile channel is not something I've experienced in a major way from online retailers or any retailers for that matter. 30% of retailers questioned felt the use of mobile was unimportant and almost 50% didn't feel that the success of mobile and e-commerce are interlinked.

The article went on to say that the "survey showed the use of mobile among retailers is high but the benefits of having m-commerce capabilities are yet to be recognised"

Theodore Levitt said in his article "Marketing Myopia - Harvard Business Review" in 1960 that "Management must think of itself not as producing products but as providing customer value. It must push this idea into every nook and cranny of the organisation otherwise the company will be merely a series of pigeonholed parts, with no consolidating sense of purpose or direction". That statement is probably truer today than at any time before as customers are dealing with retailers across many more channels and are expecting the same level of service and recognition regardless. The buzz words in retail are "Multi-Channel Retailing" – having one cohesive customer centric experience across all channels rather than pigeonholed parts.

For many retailers though this is still a pipe dream – their e-commerce solution is completely separate to their EPOS solution, vouchers issued in one can't be redeemed in the other; customers (and hence purchases) in the online channel are known, customers in the offline channel are not. For some retailers there is almost a rivalry between online and offline with no real cross promotion of either channel, acting as if customers are either on or offline – but never both.

Retail loyalty programmes can help bridge the gap in this regard, acting as a centralised solution to bring together customers and transactions from all channels – providing a single customer view and a solution for creating and delivering relevant promotions back to all channels whether these are via email, SMS, direct mail or POS receipt. Even here though many retailers get it wrong – running a loyalty solution only for offline and ignoring online, or further muddying the water by running two loyalty solutions, one traditional and one via their store/credit card product – never the twain shall they meet.

In an ideal scenario I should be able to walk into a retailer and seeing something I like, text the product code to an SMS short code to get real time product reviews – if I like it I can order it there and then to be delivered, or pick it up and take it to the till. At the till I should be able to swipe my card and have the cashier know who I am, what I like to purchase and make a recommendation for something else I may like that is coming in next week. On my till receipt is an offer for something that I would like which I can go online to purchase. Going online I can see a history of all my purchases across all channels and can see items I've viewed before whether online or in-store via my mobile requests. If I choose I can post these to my social network profile so that my friends can see what I've purchased and react to this, comment on it and if they like it they can purchase it (and I may even earn some commission on the referral).

None of that is particularly hard to implement, but it's about putting the customer at the heart of the buying process.

Theodore Levitt went on to say that "the belief that profits are assured by an expanding and more affluent population is dear to the heart of every industry. If consumers are multiplying and also buying more of your product or service, you can face the future with considerably more comfort than if the market were shrinking. An expanding market keeps the [company] from having to think very hard or imaginatively."

Well we're not in an expanding market anymore – so retailers who continue to have expanding profits will probably be those who are thinking imaginatively and putting the customer at the heart of their organisation.