About a minute into hedge fund investor Ray Dalio’s brilliant YouTube video How The Economic Machine Works, he says something intriguing: “An economy is simply the sum of the transactions that make it up.”
Economies, and micro-economies, exist everywhere in states, cities, countries, businesses and even down to an individual person. And those economies, too, are the sum of the transactions that make them up.
So, if you want a strong business economy, just increase the number of transactions. Simple enough. But what makes up a single transaction? Interactions.
The interactions between buyers and sellers, at the most basic level, are what power every economy. And every transaction that occurs is simply the sum total of every interaction that makes it up. Those interactions can be positive or negative experiences, but they exist.
In The Power of Moments, the authors tell how Southwest Airlines stumbled on to a hidden profit goldmine: jokes. Some flight attendants tell quippy jokes during the flight safety check, like this one: “Put the oxygen mask on yourself first, then on your child. If you’re traveling with more than one child, start with the one who has more potential or who is less likely to put you in a home.”
Southwest’s data and analytics team concluded that every person exposed to a funny flight attendant flew an extra 0.5 times a year. They figured that if they simply doubled the number of jokes told, they could add $140 million in revenue to their bottom line.
Think about that: a ten-second joke, during a routine flight safety check, could add an additional $140 million in revenue.
DoubleTree by Hilton provides another example of a key interaction. The hotel chain gives guests a warm chocolate chip cookie upon arrival. And yes, people talk about it. In 2020, it finally revealed its famous chocolate chip cookie recipe to the public.
The Cheesecake Factory gets people tweeting about its biblically epic food menu. Some people even put it on their bucket list of “books” to read in their lifetime.
Remarkable experiences like these get people talking and sharing. As far as acquisition channels go, word of mouth is still undefeated. People talking on their own volition about your brand continues to crush paid search, search engine optimisation and every marketing hack companies can muster.
But are remarkable interactions enough? They’re a great start, but there’s more to it than a singular moment in time. In the end, the success of any business lays with its people.
Brands are built on relationships, not just remarkable interactions. One transaction from one person will not sustain you. We need those buyers and sellers to continue to exchange value, over and over again. Acquiring customers keeps your business running, but keeping them coming back for more is where great brands play.
Relationships go beyond your customers. They include your team and key stakeholders. In a 1998 letter to his shareholders, Amazon’s Jeff Bezos said: “I constantly remind our employees to be afraid, to wake up every morning terrified. Not of our competition, but of our customers.”
Your employees belong on that list too. Culture matters. They have a deep understanding of your business, they have institutional knowledge and they serve the very people who keep your economy going. If they’re not making every interaction with a customer count, then expect a competitor to figure out how to do it better.
The point? The competition are not just coming for your customers. They want your talent, too. Again, be “terrified” of your customers and employees, not your competition.
The interactions between buyers and sellers, at the most basic level, are what power every economy
So, how are you developing these key relationships? When I think about the key relationships in my life, I think of how we grew together and supported one another. I think of the struggles and conflicts, and coming out of it. Of course, they didn’t always work out, but they leave a lasting impression. But we grew. We evolved. In most cases, we got better.
For businesses, the same principles apply. Businesses and institutions exist to help people make progress in their lives. And that’s an important word. As the late great Harvard Business School professor Clayton Christensen once said: “It’s about progress, not products.”
Progress makes journeys more meaningful. When someone senses they’re making progress, they gain confidence, feel more secure and trust increases.
According to research from the Havas Group, a meaningful brand includes the functional, personal and collective benefits it brings. “Functional” is your progress with the product. “Personal” is your progress as a person. And “collective” is the progress of your community. And when you deliver at all three levels, their experience of your brand will be more meaningful.
And the business value over time is immense. Three in four consumers prefer to buy from companies that share their values and more than half think businesses now have a more important role to play than governments in creating a better future. Meaningful brands enjoy higher purchasing and repurchasing intent, much stronger customer advocacy and they outperform the stock market by 134 per cent.
So what can you do today to build a deeper, more meaningful brand? Firstly, start by caring about your people and their progress. Humans are at their best when they’re learning, growing and becoming better. The question is what are your customers and employees aspiring to be? Start by helping them get there.
However, this can become even more powerful if you ask yourself: “Who do I want our customers to become?” You can replace the word “customer” with “employee”, but it works the same. Put another way, you have a company vision, and perhaps a product vision, but do you have a customer vision? What’s the best version of them that you see, within the context of your product or business?
Secondly, collaborate more with your community. Communities will be the next competitive advantage for brands, so make them a part of your product development and even involve them in your marketing campaigns.
At Typeform, we took this approach with Big Red’s Equipment, a farm equipment dealership in Texas. When building a native integration with Drip, an ecommerce customer relationship management software, we involved the chief executive with the development and marketing of the product. This included a 90-minute interview to get to know him, exchanging texts and emails that contributed to a video script, and eventually capturing his voice for the promotion.
We launched the campaign in just four days and it has allowed us to not only build a deeper connection with the customer, but the end result is generally much better than anything we could have done on our own.
Finally, leverage technology to build a connected strategy. Before Disney World launched its MagicBands, powered by radio-frequency identification, for visitors to wear, cast members knew nothing about the children they saw. Now they know their name and the last time they visited one of the park’s locations.
This increases not only the quality of meaningful interactions, but operational efficiencies too. They can schedule rides more easily, build itineraries and keep people flowing without a hitch. Great brands go beyond remarkable interactions, they enable connected experiences that relationships are built on.
Building a memorable brand is no easy feat. You need a strong product, sure. But today, products and features are being copied faster than ever. Getting to product-market fit used to be enough, particularly in the business-to-business sector, but not anymore. Today, you have to get to brand-market fit.
In the end, we know interactions lead to transactions and those transactions give you a business. Simple. But what if those interactions were more meaningful over time? And what if those meaningful interactions lead to more quality transactions? You wouldn’t just have a business. You’d have a brand you can feel proud of.
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