Research shows that customers make purchase decisions almost entirely based on intuitive thinking. Still, many companies see feelings as a secondary consideration in business.
Upon entering Seedi Solutions Agency, the first thing you see is your personalised welcome message written on a blackboard. Then there’s the bathroom that not only plays music, but lets you choose the genre based on your state of mind.
The company’s CEO and innovation influencer Marko Parkkinen has accomplished his goal. The visitor has been put in a good mood before the meeting begins.
In a meeting room illuminated by daylight lamps, Parkkinen bemoans how little Finnish companies pay attention to understanding the emotional reactions of their customers.
“You can’t sell well if you don’t understand buying, and you can’t understand buying without understanding emotional reactions,” Parkkinen says.
According to him, the customer’s decision making should guide the company’s actions in everything it does: from product and service development to branding, spatial design, advertising and customer encounters
Intuition accounts for a whopping 90 per cent of our decision making
Parkkinen has worked in the area of emotional influence for nearly two decades, having first become interested in customers’ emotional reactions based on the research of the Israeli psychologist and Nobel Prize laureate in Economics Daniel Kahneman. In his book Thinking, Fast and Slow, Kahneman showed that only 10 per cent of our thinking is slow rational processing and the rest is faster intuitive thinking. The opposite of reasoning and rational thinking is not emotion, it is intuition, and it accounts for a whopping 90 per cent of our decision making.
“Rational thinking leads to a conclusion and intuitive thinking leads to a view. They create an emotional reaction that sparks action and leads to the purchase decision,” Parkkinen explains.
Parkkinen provides another example to illustrate the crucial role of emotions.
“In psychology there’s the famous case of Phineas Gage, a mid-1800s railroad construction worker who survived an accident in which an iron rod was driven through his head, causing severe injury to the part of his brain where emotions reside. Following the accident, Gage was capable of completely rational thinking but he could not make any decisions. Not even decisions on when he needed to go to the bathroom.”
CEO Parkkinen says it is important to note that emotional reactions are not created purely from thinking. The environment plays a significant and ongoing role in arousing and amplifying emotions. We constantly take in our environment through our five senses.
“In practice, we buy emotions. Despite this, many business leaders seem to think that customers’ emotions, or talking about them, is of secondary importance in business.”
The emotional journey opens up channels of influence
Business leaders’ suspicions about the significance of feelings are quite understandable when you realise how little empirical data there is on the subject.
“It’s surprising how little this topic has been studied around the world. I started delving into it in 1996 in the context of multisensory experience concepts,” Parkkinen explains.
One factor that slows the progress of research is methodological difficulties. In practice, emotional reactions can be studied in two ways: through projection-based methods and functional gaming-based methods.
The methods developed by Seedi Solutions Agency are focused on the emotional journey and charting it. Charting the emotional journey can be used to investigate whether the customer’s decision-making process is affected by factors that cause negative reactions in customers. It can also be used to determine what factors create positive emotions in customers and what timing and method is most effective for amplifying these emotions.
“The goal is to introduce encounters and messages during the emotional journey at the optimal time. The most impactful thing is to give the customer a positive surprise when the customer is already in a positive state of mind to begin with,” Parkkinen says.
Emotions are always unpredictable
Parkkinen says research methods can be used to create the conditions for the desired emotions to arise, but the customer’s reactions can never be fully controlled.
“You must never assume that a customer or fellow industry professional thinks in a certain way.”
Parkkinen illustrates this point by using supermarkets as an example.
“Customers’ emotional states coming into the supermarket can be so different that things that are meant to be positive, such as free samples, can cause the opposite emotional reaction. A customer who’s in a big hurry will be annoyed by the crowds around the tasting counters and frustrated by the staff’s suggestions to have a taste, perhaps to the extent that he will decide to avoid this supermarket in future, while a customer who’s in a good mood and not in a rush will be delighted by the opportunity to taste free samples and will come back to shop at the supermarket time and time again. If the shopkeeper recognises these emotional reactions, he will know to locate the tasting counters in such a way as to avoid the creation of negative emotions.”
A negative purchase decision always has an underlying negative emotion. According to Parkkinen, this surprisingly often comes down to basic feelings such as hunger, cold, physical discomfort or fear.
“One example of the effect of hunger on decision making is from a study done at the Supreme Administrative Court of Israel in 2009. The study showed that people’s likelihood of obtaining a positive decision was more than ten times higher after the lunch break when the judges were satiated,” Parkkinen says.
If the customer’s emotional state can’t be determined beforehand, it should be sensed during the customer encounter at the latest; for example, by asking the customer how they feel and offering the right response as quickly as possible.
“A positive purchase decision can come down to surprisingly small gestures,” Parkkinen explains.
Arouse the customer’s interest
Parkkinen says boring the customer is the besetting sin of the business world.
“If the customer knows what witty remark or joke the company representative is about to come up with next, you’ve lost. Instead, you have to spice up the customer’s emotional journey with interesting stimuli that arouse the customer’s interest.”
Parkkinen points to a colourful pin on the lapel of his jacket.
“Almost every customer asks me what this strange pin means, which gives me a natural opportunity to tell them about our new approach and inspire the customer.”
Once interest has been aroused, the company must be able to create a connection with the customer.
“Controlled contradictions are the key to success. As a solutions agency, we serve up wild ideas for our customers, so we want to keep certain other aspects, like our dress code, quite formal. The customer must always be able to find something familiar in the person or business premises to maintain that connection. You mustn’t go overboard with peculiarity!”
Business premises play a critical role in the purchase decision
Parkkinen says companies’ business premises should be designed on the basis of the customer’s decision-making process.
“Emotional design, which involves designing premises to match the purchase decision, is a strong emergent trend.”
As someone who has been involved in founding more than 30 enterprises, Parkkinen sees the business premises as very significant, especially in the B2B setting. The same goes for e-commerce, where the website plays an equally large role.
“When designing premises, it’s important to assess how deals are made. Nine out of ten purchasing customers visit the seller’s business premises, so the space clearly plays a critical role. What kind of experience does the space create? Does it surprise you? Is there something interesting or, perhaps, amusing? No company can afford to operate in a boring space that lacks personality!”
Parkkinen quotes a surprising study to provide a concrete example of this.
“According to research, if a customer coming to a meeting can’t find a parking spot in time, he or she suffers a stress reaction that is equal in magnitude to the death of a loved one, only more short-lived. Does any company want to be responsible for having their customer make a purchase decision in that state of mind?
Let your premises speak for you
Parkkinen says good business premises allow the company’s representative to focus on the substance of the matter.
“Don’t try to come across as funny. Let your premises say that for you. In this meeting room, for example, we communicate our expertise through the newspaper and magazine articles featured in the wallpaper. One glance at these walls reveals our position as an innovator in our field. That means our people don’t have to try to impress the customer in that sense.”
In practice, customer orientation doesn’t always require a substantial financial investment. This is something Parkkinen has personal experience of. From 2009 to 2015, Seedi operated in concrete-dominated business premises that no-one had anything positive to say about. The company decided to turn this weakness into a strength by launching a social media competition on Finland’s ugliest buildings.
“The campaign meant that our customers had very low expectations regarding our business premises, which allowed us to surprise them with fairly small but pleasant details. Details are also important in fancier business premises. Studies indicate that approximately 80% of the impact of business premises comes from carefully thought-out details.”
Parkkinen highlights the catering of meetings as one easy yet underused way to influence a customer.
“A company that serves home made ice cream or the customer’s favourite sweets at meetings will surely leave a lasting impression and create a positive feeling.”
In location decisions, give customers’ wishes top priority
Seedi’s current premises have been designed from the perspective of customer encounters. Before the move, Parkkinen asked customers where they would like the company to be located. The focus then shifted to employees.
“It’s important to involve employees in the design process and to create a functional space. We also try to add some fun and inspiring elements to our interior design, operations and the use of the premises from time to time.”
- Has investigated the significance of multi-sensory experiences and emotions in business since 1996.
- Has been involved in founding about 30 companies, including a stint as co-founder and CEO at Bob Helsinki.
- Selected as one of Finland’s 10 Innovation Leaders in 2009
- CEO of Seedi Solutions Agency, a development and consulting company that works with high-growth companies
Parkkinen’s guidelines for spatial design:
- What location is best for your customers? What about your employees?
- What emotions do you want these business premises to arouse in the customer?
- Find out the employees’ spatial needs and wishes
- Based on all of these factors, make decisions on spatial solutions and interior design
- Think about details you can use to surprise the customer (remember that 80% of the impact of business premises comes from small details)