Digital Deep Dive: Tech puts emotions back into business

An industry with heart

Surprisingly, one of the most radical ways that technology is shaping our lives isn’t even digital. Instead, the Web Summit revealed that one of the most important things that technology can do is to put emotions back into business.

 

The feedback economy

Generation Z is made up of everyone born between 1996 and 2010. You might think of them as the digital generation, since everything they do starts on the web and for every activity there is an app or a website. But they are also called the lonely generation. From poor working conditions to inheriting a threatened environment, they are more likely than any other generation to feel like companies aren’t listening to them. Instead, what they trust are online ratings and the new ‘feedback economy’ driven by likes, comments and most importantly, reviews.

Ignoring feedback or complaints is no longer an option, and companies that listen better and faster than their competitors can adapt – and win – in the feedback economy. Take feedback very seriously, even if it’s negative, and respond quickly to dramatically improve your reputation. When customers get a response to a complaint they’ve posted, nearly a third will follow up with a positive review or delete their original complaint. And almost half say that when a brand replies to their feedback, it makes them believe the company really cares about them.

 

Experience is the new data

Customer expectations are continually rising, and every day is an opportunity for companies to win or lose a customer, since 80% of customers will walk away after a single bad experience. Companies today compete based on the experiences they deliver to their customers, and this means looking at data in a whole new way.

We know customers want an amazing experience from the companies they do business with, and ‘experience data’ is the new data to measure that. Operational data is straightforward: website clicks, customer visits. But that kind of data doesn’t tell you anything about the emotions driving those actions. On the other hand, experience data highlights how your customers are feeling. This is possible by creating feedback at the right points in the customer journey to put their actions into context.

 

A company with feelings

Businesses are increasingly finding that being customer-focused isn’t enough – they need to be people-focused. In a people-focused world, companies strive to make a positive impact on the communities where people live. Customers feel that companies have obligations to society and they want companies to care about social issues – such as gender equality, ethical behaviour and climate change which are all values that are very important to younger generations.

One company that is evolving to this people-focus is IKEA. At IKEA this focus change has meant thinking about longevity and sustainability. Seeing furniture as a service, for example, by renting your children’s furniture and giving it back when you they have outgrown it, is a way to move away from disposable consumption. In 2000, IKEA started to work exclusively with companies that have ethical standards, such as no child labor and no harmful chemicals. But they are also working on diversity and inclusion and are aiming to generate as much renewable energy as they consume. By 2025 they aim to consume and purchase only renewable electricity, and they plan to be climate positive – not just neutral – by 2030.

 

Leading with a purpose

Customers choose businesses differently today: they want buy into a community or a brand that stands for something. To set yourself apart, you need tell stories about your work that go beyond functionality and focus on how your business affects people. So when setting your long-term strategy, you need to think about purpose. Brand purpose is more than just your business goal, it’s what kind of impact your business will have on society.

Be careful, however, because authenticity is critical. Consumers are very aware when businesses try to fake a purpose without taking any real action. Brands without a clear purpose who just take up a trendy issue do more damage than good. Instead, listen to your audience and find out what is really important to them, not just what is trending. With a clear purpose to your brand, consumers are more likely to engage with your business and to help spread your message.

 

Also check out Part 2 of the Web Summit key takeaways that will reveal some of the biggest tech challenges coming up, and how you can stay ahead of the game.