Think of your last holiday….did you put aside the camera in order to savour those special moments? Or did you take numerous photographs to capture the memories? When you returned home, how did those photos shape your memory of that holiday?
The reason I ask is because Behavioural Economics has recognised consistent differences between the way we report our experiences in the moment (such as whilst on holiday) and the way in which we subsequently recall our experiences (once we return from holiday). Daniel Khaneman, leading psychologist, calls these ‘two selves’ the ‘experiencing self’ and the ‘remembering self’ respectively. The distinction between the two selves has huge implications for consumer experience in areas such as service design and marketing.
To explain further, we will momentarily take a detour away from holidays to a much less pleasant experience, a colonoscopy. A study was undertaken in the early 1990s of patients undergoing this painful procedure which, at that time, was carried out without the benefit of anaesthetics. Patients were asked to report their pain levels every 60 seconds on a scale of zero, ‘no pain at all’, to ten, ‘intolerable pain’. After the operation, when the patients were asked their retrospective evaluation of the experience, researchers found that the average, or total amount of pain, did not really influence their retrospective evaluation of the amount of pain they had experienced. Instead, this was determined by both their experience of peak pain levels (experience of extreme, albeit short, amounts of pain) and the level of pain that was experienced at the end of the operation (pain at the end had a disproportionate impact).
So we have some very interesting mechanisms at play here, influencing the way in which these unfortunate patients recalled their experience:
Peak end rule: The overall rating of an experience is disproportionately impacted by peak moments and the end.
Duration neglect: The length of an experience has no impact on the overall rating (so a longer ‘experience’ typically cannot compensate for a highly negative ending).
Considering this, it’s easy to think of examples of the way this works: an otherwise completely dull soccer match can be saved in our memories as a great game by an exciting last minute goal; our experience of listening to music can be disproportionately marred by a jarring but momentary mistake half way through.
The way in which humans appear to approach the creation of memories seems to be to take ‘representative moments’ rather than rationally summing up the positive versus negative responses over the period of the experience. These representative moments are heavily influenced by the peak and the end moments as opposed to by the more rational approach of keeping track of the overall experience.
Returning to our holiday example, psychologist Ed Deiner asked students to maintain diaries of their holiday, recording a daily evaluation and also a single overall rating of the holiday once it was over. When asked about their intention to repeat their holiday, the students’ likelihood of doing so was completely determined by the final single overall rating they had given to their holiday, even when that score did not reflect their experiences as tracked in their daily evaluation.
Humans clearly do not typically engage in a rigorous evaluation of their experiences when they report. Instead we use simple rules of thumb to evaluate our experiences. Indeed, these can even be easily influenced in surprisingly mundane ways such as asking people about positive (unrelated) life events first or allowing them to ‘accidently’ find some money prior to asking about their well-being. These sorts of otherwise minor events can significantly affect the way in which we relay our well being.
So it is the remembering self and not the experiencing self that is absolutely critical in determining future activity, a finding which has huge implications for how brands design experiences for consumers. Market research has historically, and correctly, focused on consumer self-reporting of the ‘remembered self’ as this is clearly the evaluation of the experience that determines future action on the part of the consumer. Want to know how satisfied a consumer is with their handset brand? Then collect the consumer’s overall evaluation of their experience for, as we know, this is the most accurate reflection of the way in which the consumer perceives that experience.
However, it has long been known that there are ‘moments of truth’ which have a particularly strong impact on this overall evaluation. This is increasingly reflected within market research practices with a growing interest and use of ‘in-the-moment’ measurement, that is asking consumers to rate their perceptions at the very moment of their experience (or as close to it as possible). The mistake that is sometimes made is to assume that ‘in-the-moment’ measurement is somehow better than retrospective measurement; this is not the case. Indeed, it is useful for a brand to measure the experiencing self but only in light of understanding the way this then influences the remembering self, which is the driver of subsequent behaviour.
The collection of mechanisms underpinning the peak end rule allows us to better understand how brands can create an improved account of themselves and, importantly, what to avoid. Some simple rules can sum up useful ways to think about this:
Just because a customer has been with you for a long time does not mean that they are particularly loyal. Significant experiences with your brand will have a much greater impact on their propensity to switch than the time they have spent with you.
Ensure there are memorable moments – try to genuinely surprise your customer with something pleasant; this will stick in their minds and prove to be a significant return on investment.
Conversely, at all costs avoid unpleasant surprises; these will have a disproportionate impact on consumer perceptions of your brand.
Try to load positive experiences near the point at which they are making switching decisions (the end of their tenure); these have a much more positive impact on their perception of your brand.
Of course, the manner in which positive experiences are delivered matters enormously. Consumers are good at cynical or perhaps realistic interpretations of a brand’s actions, so ill-judged last minute positive experiences may backfire and have the opposite effect. Use customer satisfaction studies to learn the experiences that your customers really value from your brand, or conversely what your competitors are getting right (and wrong!).