To Boost Profits, Appeal to the Heart, Not the Head
By Any Measure
By Meghan Lynch
Meghan Lynch says emotional campaigns ultimately outperform rational campaigns. Photo courtesy of Stephanie Craig Photography.
Likes and leads.
Most marketing professionals love to be able to show these statistics as proof of their effectiveness, and most business owners love to receive news that they have gone up. But marketers’ preoccupation with these short-term indicators is counter to what will drive the long-term effectiveness and return on a marketing campaign.
The Institute of the Practitioners of Advertising, a London-based trade association dedicated to marketing effectiveness, has analyzed the results of almost 1,000 long-term case studies, and finds that marketing campaigns with emotional appeal have a much stronger effect on market share and profitability than the more standard ‘features and benefits’ advertising.
The study found that rational, lead-generation advertising provided a short-term sales uplift, but provided no long-term increase in sales and no reduction in price sensitivity. The effects of emotional branding campaigns grew stronger over time, leading to volume increases and decreased price sensitivity at double the rate of rational campaigns when used for three years or more.
Emotional campaigns ultimately outperformed rational campaigns on a number of critical business measures: sales, market share, profit, penetration, loyalty, and price sensitivity. While social-media likes and leads might be feel-good statistics to read in a report, these other measures are of more bottom-line importance to CEOs and boardrooms.
In a way, these findings are more predictable than it might appear at first. Research, such as the work of Francesco Gino at Harvard Business School, shows that human decision making is largely affected by our emotions, even when we believe it is rational. Examples of these effects range from positive uplifts in the global stock markets on sunny days to video clips affecting people’s ability to properly weigh advice they were given.
Therefore, when customers have an emotional connection to a brand (positive or negative), it follows that this ‘emotional priming’ will affect the way that they respond when presented with a rational decision to make about that brand, i.e. whether to purchase or not. The prospective customer will be predisposed either to respond favorably to the sales pitch or to ignore it. Emotion centers of the brain are also critical for imprinting memories, leading to longer-lasting recall — a critical success factor for branding and marketing effectiveness.
It is important to note that the IPA findings do not recommend a total abandonment of lead-generation campaigns, but to a ratio that favors an emotional branding campaign, with the ideal mix being 60% brand campaign and 40% lead generation. Over time (a span of three years or more), this mix has been shown to provide the highest level of effectiveness.
The study found that rational, lead-generation advertising provided a short-term sales uplift, but provided no long-term increase in sales and no reduction in price sensitivity. The effects of emotional branding campaigns grew stronger over time, leading to volume increases and decreased price sensitivity at double the rate of rational campaigns when used for three years or more.”
Running multiple large-brand campaigns in conjunction with lead-generation activity has been shown to reduce price sensitivity among customers and prospects by 11 times the rate of companies who do not run significant branding campaigns. This integration has also been shown to double the efficiency of marketing budgets, again with three years being the critical threshold for that return.
Applying this philosophy means a drastic shift not only in the minds of marketers and agencies, but also in the demands of CEOs. For many businesses that feel the pressures of day-to-day cash flow or a sales team demanding leads to feed their pipeline, a long-term approach can sound like a cop-out, especially when the short-term effects of emotional brand advertising are particularly difficult to measure. At the same time, most businesses bemoan the intense pressure to compete on price, and see it as a huge impediment to business success and growth in the long term.
The idea that this effect of emotional priming and an emphasis on strongly emotional branding might be an antidote for customer and prospect price sensitivity should be one that causes CEOs to seriously reconsider what reports they are requesting from their marketing departments or agencies. Brand-loyalty and market-share metrics are more directly correlated to profitability than standard success measures such as impressions, social interactions, and even brand awareness.
“A lot of clients, especially in the U.S., are schooled in the rational USP [unique selling proposition] — finding a product difference and then using advertising to convey a message rather than building a relationship. They don’t understand the power of emotions,” said Les Binet, co-author of the IPA report, in an interview with Ad Age.
Treating emotional marketing as an essential component of the marketing mix can give businesses owners a true advantage in an increasingly crowded and competitive environment.
Meghan Lynch is president and CEO of Springfield-based Six-Point Creative; (413) 746-0016.
