Friday, January 30, 2015

Motivations for Engagement

"Want" is very often a mystery.  It is taken for granted that people want things, and there are some theories that attempt to explain the reasons that people are motivated to attempt to achieve certain outcomes.  But ultimately, it is often a matter of vague belief that someone simply wants to do something.  And as want is the driving force behind the vast majority of human behavior, it merits a bit more attention.

I was reading through a brief article on behavioral psychology that provided a short list of reasons people feel motivated to engage in any activity. I have the sense that it is a bit superficial, and likely not comprehensive, but worthwhile to take note of as a starting point for deeper exploration.


The most basic motivation, too often assumed to be the only one, is intrinsic motivation: people engage in an activity to achieve a specific outcome that is the result of undertaking that activity.   It's straightforward to the point of being a virtual tautology that "a person goes to the store to buy milk because they want to have milk," and in many instances there is no reason at all to consider any further motivation.

Extrinsic Motivation

Another motivation which is commonly known is extrinsic motivation: people engage in an activity to gain something other than the outcome of that  activity, which is generally granted to them by someone else.   Anyone who has worked at an unpleasant job, which is likely everyone, recognizes that they do their work in order to gain a paycheck - and not for the love of the work or the pride of creating a product or providing a service.

Intrinsic Motivation

Intrinsic motivation is a reward that arises by virtue of the activity, regardless of the functional outcome.  For most people, hobbies and leisure activities fall into this category.  A person who enjoys playing golf is not attempting to create or gain anything for participating in the activity, and quite often pays to participate in it, but finds the engagement so compelling that the activity becomes its own reward.


The motivation to engage in an activity to support self-perception departs from the realm of functional or tangible benefits and becomes entirely psychological: the reward of engaging in the activity is simply pride.  Many people in highly-visible but low-paying positions are motivated by the need to perceive themselves as a member of their profession - even though there are more rewarding jobs available, they prefer to "be" a teacher, a soldier, a firefighter, etc.   Self-perception is also evident in the way in which a person identifies themselves according to an activity: a person who enjoys playing video games calls himself a "gamer" and a person who enjoys surfing calls himself a "surfer" - this is a sign that self-perception is more important to them than the intrinsic rewards of being engaged.

Of particular importance: self-perception is differentiated from receiving esteem from others, though the two go hand in hand.  If a person identifies themselves as a "surfer" in order to make a certain impression on other people, the esteem he receives from them is an extrinsic motivation.


Norming is similar to self-perception in that the activity that a person engages in is a characteristic of the person they wish to be, but is slightly different in that the activity is not critical to the role.   A woman might buy a certain brand of peanut butter because she believes that "good mothers" purchase that brand for their children, or because it supports the sense of being environmentally conscious, or because it makes her conform to the purchasing behavior of a given social class.   The distinction between norming, self-perception, and the extrinsic motivation of gaining esteem of others seem a bit hazy, as it would be difficult to imagine a situation in which norming is entirely unrelated to self-perception or esteem, or where self-perception and esteem are not interrelated.

Cognitive Dissonance

The final motivation mentioned in the article was cognitive dissonance - the belief that a given action must be taken in order to put things right and restore balance.   The author's example in this instance are all acts of civic service - cleaning up a park or painting over graffiti.   The only commercial example that comes to mind is the moralist who purchases every copy of a book in order to destroy it, assuming himself to be protecting others from ideas of which he does not approve.  But I sense that may be a stretch and that better examples might exist.


Again, this is a brief list taken from an article which I suspect is not exhaustive, but provides a good start at considering the various motivations that drive a person to take action.  It is not by any means complete, sufficiently detailed, or perfect - but is likely a better alternative to resting on a tautology or allowing motivation to remain a mystery.

Monday, January 26, 2015

The Appetite for Change

Many firms claim to be eager to make changes that will improve their performance, or at least claim to be open to the changes that are necessary - but in truth, the only thing that has the power to overcome the inertia of tradition is the stark realization that the current practices are not sustainable.

This is one of the reasons that different silos within a business seem to have different levels of desire or willingness to change.  Typically, the closer an employee or business unit is to a stakeholder, the sooner they realize the need for change because they recognize a growing dissatisfaction in those with whom they have constant contact.

Departments such as sales and service are the closest to the customer, and interact with them daily.  As a result, they receive constant feedback and are highly attuned to the needs of the customer.  Salesmen find it harder to close deals and customer service representatives get more complaints, both because their firm has been slower than its competitors in meeting customers' demands and expectations.

Meanwhile, departments such as finance, human resources, and information technology are well insulated from the customer.  They have no direct contact, receive no feedback.  As a result, they feel no urgency in making or supporting changes that are necessary to continue to deliver what is required by their stakeholders and are prone to cling to the comfortable routines of business as usual.   They simply do not recognize the threat because they are too distant from the alarm.

It seems particularly ironic that information technology should fall into this category - but while technology is rapidly changing, those who manage technology are far removed from the front lines: they have no contact with customers, and often regard front-line employees with some degree of indifference, as the most unreliable component of a system that they feel the need to control.  They also have made significant investment in the current systems and tend to defend their past choices.  Extremely few have a service orientation, and are focused on the technical rather than the human elements.

Back on point: the need for change ripples through an organization: the sales department recognizes a deficiency in products that is causing customers to choose other providers.  They must communicate this back to the manufacturing department to request product changes.   Manufacturing must support the change and engage engineering to make the necessary changes to the production process and human resources to bring aboard the necessary skills.  All must then contact finance in order to get budget allocated to change the operation.

At each step along this chain, there is reluctance, which is institutionalized in bureaucracy: there is a process to request a change, a process by which the change is evaluated, and a process by which a change is approved.   All of these are designed to make it difficult to deviate from business as usual, forcing any new idea to prove its worth against an existing method that is backed by historical data and the implicit assumption that the future will be no different from the past.   The larger the organization, the more elaborate and numerous are the processes by which any request to change is discouraged and slowed.

These procedures hail from an era in which environmental factors (customers, employees, vendors, competitors, markets, and technology) tended to change more slowly - and companies could take months or years to slowly tend to the process of making changes.  In the present day, the time to make all the arguments, secure all permissions, and go through a chain of processes to institute a change is limited, and obsolescence sets in quickly.

Tuesday, January 20, 2015

Security and Customer Experience

Action is undertaken with the expectation of having the benefits that result from acting – whether directly through an intangible benefit  or indirectly through the creation of some tangible object that will later result in an intangible benefit.   In the economic sense, the benefit of creating an item is the benefit that will result of its later use - or in some instances, the benefit that will be given for it in exchange for providing it to another party for their use.  Without a reasonable level of security in that outcome, there is no motivation to undertake any productive activity.

The same principle applies to the prospective buyer of a product, and that this is a significant factor in his willingness to complete a purchase:  he is seeking to obtain the product (again, service or good) in order to derive a benefit, and unless he has a reasonable level of security in receiving the benefit, he has no motivation to make the purchase.  And it stands to reason that this is a significant cause prospects who show no interest in a product, or who lose faith in the product and drop out of the purchasing funnel.

To begin, every consumer is to some degree aware of his needs, or the needs of others on whose behalf he is purchasing.  The first mistake that a seller can make is in overestimating the degree to which customers are in fact aware of their own needs: some begin the purchasing process with only a vague sense of the problem they are trying to solve by making a purchase, and during that process they become more familiar with their needs and eventually conclude that their nature is different than they had originally thought.   There is little that a seller can do to recover a customer who has come to recognize that they do not have a given need – the suitability of the product to the service of the need is irrelevant if the need itself has been reconsidered.

This leads to the second critical point: that the prospect must have some level of certainty that the product is serviceable to the need that they have identified.   It is not merely whether the product is efficient or effective in its ability to function as it was designed, but whether it was designed in a way that would make it effective in solving the prospect’s problem.   The prospect may doubt either that the specific product is an effective solution.   To address this potential conflict, the seller must be accurate in identifying the specific need and cautious in depicting the product as a solution to that specific need.

Additionally, a prospect may discover during the buying process that there are a number of alternatives that would be effective in serving their need – such that the product under consideration falls from favored status in terms of its effectiveness or efficiency and another product becomes preferred.   Comparative advertising can be helpful in maintaining the prospect’s sense that the specific product is in fact the best among alternatives, but to be ethical and credible this must follow a thorough competitive analysis to ensure that it actually is thus.

In closing the deal, the prospect also considers the reputation of the vendor – as even the best product for their needs does not solve their problem if it is not delivered.   This is not limited to vendors who take payment and then fail to deliver the product (though this still sometimes occurs, particularly in services), but it also results when the correct product is not delivered as expected – it is a different model, parts are missing, and so on.  These problems are largely in order processing and logistics – and even in the present day are distressingly frequent.

The prospect also considers his own ability to derive the benefit from the product, particularly when the product is a physical good (though services sometimes are misused by a customer who instructs the provider to do something that is ineffective).  Technology products suffer greatly from this problem, in that they are entirely capable of delivering the promised benefit, but the customer cannot figure out how to use them after the purchase is made.    Support after the sale is critical in reducing this problem, though the design of the product and the manner in which it is delivered may also contribute to the misuse of the product.   A liberal returns policy may do much to alleviate unwarranted anxiety, but ultimately success depends on the customer’s satisfaction with the performance of the product, including the elements for which he is responsible.

At this point, I think I have followed through with the buying process, from initial consideration through use, identifying the points in which there are security issues for the prospect/customer of a brand.    There may be areas I’ve failed to identify, but this should be sufficient for a broader exploration of the topic.

Thursday, January 15, 2015

The Flaw of the Game Metaphor

In my reading about strategy, I constantly encounter metaphors to games.  I'm fond of metaphors, and can see how a real-life situation in which multiple individuals are seeking to achieve the same goal is analogous to a physical or intellectual competition - but I'm also increasingly wary of the way in which the game metaphor is a Trojan horse and suspect that thinking in terms of this metaphor can be limiting and even debilitating.

The obvious flaw of the game metaphor is that a game is a construct.  A game an artificial situation that is defined, even contrived, to challenge players to succeed in pre-defined ways: to accomplish the goal that the game designer has provided according to the rules the designer has provided and using the pieces and space that the designer has provided.

This all works very well for an industry that is well defined and heavily regulated, and in which there is no room for innovation - because competitors have accepted a goal, must work with the known, and have little ability to play outside the rules that have been placed upon them by an external source.   But in an evolving marketplace, none of these things exist.

The goal of a business is variously defined: different organizations choose different goals to pursue and the rules change along the way.   A person starts a company because he recognizes there is a need among a large enough number of people that he can earn rewards (profit) by satisfying that need.  Or a person starts a company because he is fascinated by a thing (product or technology) and wishes to have the resources to perfect it, the profits of which are incidental or a necessary evil to achieving technical goals.   Or a person starts merely with a desire for profit and will do whatever it takes to gain it, which makes the object and the operations of little consequence.

The "rules" by which a business plays are also variously defined.  There are regulations that must be obeyed (or the penalties for disobedience accepted), common practices that can be followed, and even arbitrary restrictions that are placed upon oneself that, when considered, have no correspondence to any external requirements.   Ultimately, there are very few things that must be done a certain way, or at all, though one who accepts the game metaphor seems to search for rules, invent them where they don't exist, and obey them without question.

The resources available to a business are also not limited to the pieces and spaces defined by a designer, though this does not seem to be as widespread an issue as the goals and rules mentioned before.  A firm may acquire more facilities, personnel, equipment, and such and expand into different markets, whether segments of the existing market or untapped markets.   While all of this is possible, and is sometimes done, it is more common for firms to attempt to make the best of what they have, and to be reluctant to pursue any idea that requires them to acquire additional resources

My sense is that it is this metaphor of game that leads many to assume that the goal is fixed, the rules must be obeyed, and they must use the equipment that is provided.   There's nothing inherently wrong with this, and for a few firms it is entirely possible to plot a winning strategy by being more efficient and effective within a limited scope.

But at the same time, accepting these arbitrary restrictions prevents success: choosing a different goal, doing things others are not doing, and acquiring whatever resources are not common practices for established firms - though it does seem to me that they are common practices for the giant-killers, small and young firms that do things that the large and established ones will not.

And it is "will not" rather than "can not" because the only thing that prevents a large and established firm from being nimble is its willingness to do so.   Sticking to the original plan, pursuing the existing goal, following industry best practices, and refusing to make additional capital investments are characteristic of stagnant industries in which innovation is unknown.

So perhaps it is for the best that those firms that wish to be innovative throw away the rulebook, though it might be better still for them to recognize that the rulebook is a work of fiction, written by those who seek to define the terms of competition - whether to rig them in their own favor or merely to avoid the onerous task of thinking outside a defined and constrained system in which things are known and comfortable.

Friday, January 9, 2015

Relevance 101

There’s been quite a lot of buzz of late about relevance – and “buzz” is precisely the right word when a lot of people are talking about something as if they feel it is extremely important, yet nobody can seem to define quite what it is nor can they clearly tell you how to achieve it.   So I picked up Coville’s book on the topic, and found myself only slightly less unenlightened.   It’s largely cheerleading for the cause and attempts to define the topic in a bit more detail, but still falls short on the execution.  "You ought to be relevant.... somehow."

As best I can figure it, relevance is about making customers care about your product by positioning it in a way that speaks to the things they already care about, as opposed to starting with a product and looking for ways to persuade people that they ought to want it for the reasons the manufacturer thinks they should desire it.   Which is to say, it’s a topic for an introductory marketing course that’s been largely relegated to the footnotes, and is now being overdramatized based on no additional information.

The basic definition of "marketing" is connecting people with products.   You make something people need and tell them how to get it.  If you’re correct in your assumptions about their needs then customers will show up cash in hand, eager to purchase.   That sounds simple, until you recognize that there are many other firms (possibly the vast majority) that make products people don’t really need, and who spend larger sums of cash attempting to convince them that they do.   Or perhaps they make something that people could  use instead of what they currently do, and spend equally large sums of cash attempting to convince people that the product they enjoy making is better in some vague way.

The difference, which may be a bit subtle, depends on where you begin.  Do you begin by considering what needs exist and then develop a product to fill them, or do you begin with a product that is irrelevant and attempt to convince people they have a need for it?   The former is the more straightforward approach, and more likely to result in success. For products that already exist, it’s equally important to keep an eye on the market to determine when they might need to be altered or scrapped because of the changing needs of the customer (or more often, because a competitor has discovered a better way to fulfill existing needs).

Why it takes ten chapters to communicate that basic notion is beyond my reckoning, and why the scores of articles, studies, and blogs that attempt to promote the concept can’t bring themselves to disclose this simple formula is likewise unfathomable.

Monday, January 5, 2015

Selling Envy

Advertisers are often accused of spreading envy and encouraging irresponsible spending by marketing to people who cannot afford their products.  My assumption had been that this is accidental - that because mass-media is not precisely targeted, their intention was to reach those who could afford their products, but because they cannot control who might be watching a program, attending an event, or driving past a billboard they could not avoid having their message seen by those who were not in their target market.   It turns out, I was completely wrong about that.

I had the opportunity to speak to three markers who work for genuine luxury brands - not merely the brands that want to pose as luxury but are affordable to the middle classes, but those products whose price is well beyond the means of anyone whose economic class doesn't end in "illionaire."  All of them openly admitted to sending out marketing messages to people who could not afford their products, and doing so intentionally.  And it makes a great deal of sense.

Esteem as a Benefit

There are two reasons that consumers purchase a specific brand (or even a specific product): practical benefits and psychological benefits, the most significant of which is esteem.   Often, people are motivated by a combination of the two, but sometimes one takes precedence over the other.

The consumer who seeks practical benefits needs a product to accomplish a task or convey an experience.   To this customer, a car is "basic transportation" - although their desire for certain qualities (smoothness or ride, fuel efficiency, etc.) also falls into the category of practical, although they are not strictly necessary to the functional benefit.  This customer may seek quality, but the quality is for their own experience - it is something that exists between themselves and the product they use.

The customer who seeks psychological benefits is indifferent to whether the product actually does anything practical.   They wish to own a product because it makes them "feel" a certain way about themselves - and because extraverted personalities take their emotional cues from others, they can only feel a certain way about themselves when others express or validate certain complimentary emotions.   In terms of esteem, am extraverted person can only feel he is important if he notices others expressing admiration or envy toward him.

This quality is not unique to luxury products, as there are many cheap products that cause a person to experience self-esteem.  Indeed, many people seem to take a certain satisfaction in paying very little, and brag to others about how cheaply they obtained things, with the desire to have others admire or envy them for their thrift.   With very few exceptions, luxury brands play on the same psychological tendencies, but in the opposite way: they wish to demonstrate their wealth (or pretend to have wealth) by owning very expensive things, to be admired or envied by others.

The psychological benefit of a product only occurs if people recognize it.  Therefore in order to be admired for owning an ecologically-friendly vehicle, people who do not wish to purchase one must recognize what the brand means so that they can deliver the admiration or envy that owners crave.  If they did not, then conspicuously consuming the product would not deliver that psychological benefit.   Likewise, if the ownership of a luxury brand is to confer any esteem on the owner, those who cannot afford the item must recognize it as being beyond their means in order to feel admiration or envy toward those who can afford it.

Therefore, it is important to the establishment of prestige to make the general public, not just prospective buyers, aware of the qualities of the product that they will likely never own. And this is the main reason that luxury brands advertise in a seemingly indiscriminate manner: to those they know cannot afford the product, their message is "you cannot have this, and must envy those who do."   Without that, the benefit of esteem cannot be delivered by product ownership.

Self-Esteem as a Benefit

While the extraverted personality craves the admiration and envy of others, the introverted person is largely indifferent to the reaction of others and his feelings of self-worth come from within.   But even self-esteem must be based on something, and the introverted person must be taught what will grant him self-esteem.   For this reason, luxury advertising is not lost of the introverted customer, but functions in a different way.

In terms of esteem, it would be accurate to state that the introverted person admires and envies his future self - the future self who has achieved the goals to which the present self has not yet achieved. In this way, luxury advertising teaches the consumer what he ought to want, and what he ought to be fulfilled by achieving, by showing him the goal or reward of behavior he has not yet undertaken.  In that way, luxury product is a way for the customer to reward himself for success - without being prompted, he may not know precisely how to do so.

The distinction may be difficult to assess from an external perspective: when we are aware that a person possesses a luxury product, our assumption about his motivation is inaccurate (and is often reflective of what are or would be our own motivation to engage in the same behavior).   Given the predilection for absolutes, we like to declare that all people who do a certain thing do so for the exact same reason, and fail to recognize that their actual motivation may be different to our assumption.

The only instance in which it can be confidently declared that a person is motivated by self-esteem rather than esteem is when they are discreet in their use of luxury products - but because they are discreet, it is difficult to observe.  The discreet consumer removes the tags and labels of luxury items, or purchases items whose marks of brand identity are subtle enough that they will be unnoticed.

As such, the advertisers of luxury products must be discreet in appealing to the introverted customer for whom luxury is personal:: make too big a splash, and luxury seems vulgar and ostentatious, done for the sake of impressing others rather than rewarding oneself.   In these instances, the original assumption that any non-qualified audience is accidental is partially correct - only insofar as the advertiser sends a message to those who may be able to afford their product in the future, but cannot presently.   If they were more capable of predicting which persons might have greater wealth in future, they could more precisely target their advertising.

Fiscal Irresponsibility

Thus far, I have considered the idea that advertisers seek to promote envy of their products, or more accurately they promote admiration and envy of the people who are able to afford them on the part of the people who are not.  What remains is the notion of encouraging fiscal responsibility.

It can be argued that by causing people who cannot afford a product to envy those who possess it will in some instances cause them to purchase things they cannot afford, to the detriment of their other needs.  It is very much like addiction, in that an addict will neglect every other responsibility in order to feed their addiction.   And it is also very much like addiction in that it is atypical behavior: not everyone who drinks is an alcoholic, and not everyone who envies luxury spends irresponsible to obtain things they cannot afford.

"We don't want poor people using our brand," one marketer told me.  "We would end up like Mercedes."   Which is to say that when a luxury brand loses its esteem when is conspicuously consumed by too many of the wrong kind of people.  It may still fall into the "premium" category of brands, but it is no longer a luxury item and is no longer capable of drawing attention or inspiring admiration or envy.

Unfortunately, this cannot be avoided: a manufacturer cannot (legally) refuse to sell its product to anyone who can afford it.  And they are unaware of whether a customer has the funds to purchase their product because he is wealthy, or simply because he has scraped together the means to purchase by neglecting other responsibilities.

It is also difficult, if not impossible, to make a non-qualified individual aware of a luxury brand so that he may give esteem to those who can afford it (or can consider it to be something he can obtain to reward himself for his own success) without also causing some of them to seek to pacify their envy or satisfy their own craving for esteem by purchasing things they cannot afford.   It is not an intentional effect of luxury marketing, but an unavoidable side effect.


The question as to whether it is "right" to sell envy is a moral consideration rather than a practical one, so I don't intended to explore it fully here.  I'm generally satisfied to accept that envy is something a person can choose to feel, and can choose not to feel.  If it weren't for luxury advertising, those who are prone to envy would find something else to covet.

And the question of whether luxury brands are to blame for the fiscal irresponsibility of others is likewise a moral consideration.  And again, I tend to accept that it is more a matter of personal morality: advertisers don't "make" people purchase things they cannot afford simply by promoting them to those who can.  If this were intentional, it would certainly be entirely immoral.

But the core accusation, that luxury advertising sells envy, is entirely true and entirely intentional - of that there can be little argument.