Back in 1981 the economist and Harvard professor Theodore Levitt published his landmark article in the HBR, “Marketing Intangible Products and Product Intangibles.” It’s a great read since his insights relate directly to many of the challenges marketers face today.
When prospective customers can’t experience the product in advance, they are asked to buy what are essentially promises—promises of satisfaction. Even tangible, testable, feelable, smellable products are, before they’re bought, largely just promises.
Largely just promises. Doesn’t that just encapsulate the challenge marketers face?
In the car business, the marketing of intangibles is paramount to success. If a dealer sells a Chevrolet or a Ford or a Toyota, that isn’t necessarily a sustained competitive advantage. Unless you live in a rural area, there’s a dealer a short drive away who sells an identical product. What then becomes the differentiator? The intangibles.
What does this mean? In an automotive context…
Levitt wrote about this reality in the car business 35 years ago when he says in the article:
The promoted products of the automobile, as everyone knows, are largely status, comfort, and power—intangible things of the mind, rather than tangible things from the factory. Auto dealers, on the other hand, assuming correctly that people’s minds have already been reached by the manufacturers’ ads, focus on other considerations: deals, availability, and post-purchase servicing. Neither the dealers nor the manufacturers sell the tangible cars themselves. Rather, they sell the intangible benefits that are bundled into the entire package.
Note the last line in particular “…intangible benefits that are bundled into the entire package.”
The Importance of the Front Line
A key intangible going forward—something at which manufacturers and dealers need to do a better job—is emotion. It has to be infused into the vehicle buying and ownership experience more effectively than it has been. Millions are spent in tier one advertising to convey emotion, but sadly, it often doesn’t carry through at the dealership level when customers come in to buy.
I’m not alone in this thought. Forrester has recently come out and said that three factors need to be designed and built into CX programs: ease, effectiveness, and emotion.
As a manufacturer or dealer, how are you building emotion into your CX? Product and process training can only take you so far and many manufacturers are doing a pretty good job at this. The differentiator is the intangible of emotion.
Bond's recent Automotive Brand Telemetry Report found that loyalty to automotive brands is driven by consumer perceptions on a variety of Functional, Emotional, Brand Personality and Needs-Fulfillment evaluations. Emotional factors drive 31% of customer loyalty—so it's important.
I want to lay down a challenge to you (ok…several challenges but you get the idea). Regardless if you’re a manufacturer or dealer:
Until next time.