Customer Retention Psychology With Dr Bo Bennett | Customer Loyalty, Brands Advocacy & More | Retention w/ Rahi Podcast

Dr. Robert Bennett, on customer retention psychology, delves into the various aspects of buyer’s remorse and customer loyalty. He emphasizes the role of psychological factors in driving consumer behavior, such as the dopamine hits associated with purchase and product usage. Loyalty is established when consumers identify with a product or service, leading to brand advocacy. Dr. Bennett also discusses the ethical considerations in marketing, highlighting the importance of avoiding high-pressure tactics and being mindful of customer annoyance. The video covers topics ranging from the power of persuasion techniques to the impact of artificial intelligence on customer retention. Overall, the discussion provides valuable insights into the psychology behind customer retention and the ethical practices required to build lasting relationships.

• 00:00:00 In this section, Dr. Robert Bennett discusses the psychological aspects of buyer remorse and customer loyalty. He explains that buyer remorse is not a universal phenomenon and can occur under certain circumstances. People experience dopamine hits either when making a purchase or when using the product, and this is driven by psychological factors rather than rational decision-making. Loyalty is established when consumers identify themselves with the product or service, making them more likely to remain loyal to the brand. Dr. Bennett also distinguishes loyal customers from brand advocates, emphasizing the importance of creating a strong identification between the consumer and the brand. Moreover, Dr. Bennett highlights the concept of nudging in marketing and how it can be used to influence consumer behavior subconsciously. He provides an example of how the default effect is utilized to encourage people to donate organs. However, he cautions that the extent to which nudges are used should be tailored to the audience’s tolerance level and avoid deceptive tactics that guilt or manipulate customers.
• 00:05:00 In this section, the speaker discusses the potential annoyance and turnoff caused by repetitive and blatant use of persuasion techniques in customer interactions. They provide examples such as pushy donation requests at the cash register or on credit card machines, highlighting the negative impact on customer experience. The speaker emphasizes the importance of balancing the need to achieve sales goals with maintaining a long-term relationship with customers. They caution against pressuring customers excessively and acknowledge the human element in face-to-face interactions versus online or app-based interactions. The speaker also mentions instances where tipping is requested before receiving a service, creating a sense of threat. They further discuss high-pressure tactics used in donation requests, such as calls from the local police department. They reflect on the power dynamics and sleaziness involved in such approaches. Overall, the speaker suggests being mindful of customer annoyance and ethical considerations when implementing persuasion techniques.
• 00:10:00 In this section, Bob and the host discuss the psychological aspects of donation requests and the ethics involved in marketing sensitive products like health supplements and cosmetics. They highlight the concept of cognitive dissonance and the desire to be perceived as a good person, which can influence people to donate. They also explore the fine line between persuasion and manipulation, emphasizing that ethics in marketing depend on both the individual and the context. Bob suggests that while personal financial gain doesn’t always equate to unethical behavior, the intentions and overall impact of such actions should be considered.
• 00:15:00 In this section, Bob discusses the ethics of sales and how it relates to customer retention. He emphasizes the importance of ethical selling, where salespeople genuinely believe in the product and its benefits for the customer. He also explains that buyer’s remorse is a common phenomenon that can be mitigated by avoiding high-pressure emotional sales tactics and instead focusing on logical reasoning and reinforcing the customer’s decision through follow-up communication. By providing reassurance and support, businesses can help address buyer’s remorse and improve customer retention.
• 00:20:00 In this section, Bobennett7750 discusses the concept of buyer’s remorse and how it relates to customer retention. He explains that buyer’s remorse can vary depending on the emotional and logical aspects of the purchase. Some people experience a dopamine hit when they make a purchase, while others feel it when they use the product or service. To ensure customer retention, it’s important to offer a product or service that people genuinely want and get excited about. Matching customer expectations is also crucial, as failing to meet them can lead to buyer’s remorse and potential customer dissatisfaction. Bobennett7750 shares a personal example of how he adjusted his marketing tactics to align with his clients’ expectations and avoid misleading them. By setting clear expectations, businesses can improve customer retention and foster long-term relationships.
• 00:25:00 In this section, Bobennett7750 discusses the importance of having a good product for customer retention. He emphasizes that while you can hack growth strategies, retention relies on the quality of the product. He also mentions the power of the endowment effect, which is when people value something more because they own it. However, he notes that this effect is not as strong with digital products compared to physical ones. When it comes to creating loyalty, he explains that it often stems from a sense of identity, where consumers attach themselves to a brand or product and feel a part of a community. This identification with the product or service leads to increased loyalty and advocacy.
• 00:30:00 In this section, the speaker discusses the psychology behind customer loyalty and brand identity. They explain that customers often associate themselves with a brand because it reflects their values or gives them a sense of identity. This cognitive boost makes them want to be loyal and support the brand. While larger brands use marketing and endorsements to achieve this, smaller brands can focus on unique features or technology to create a sense of identity. However, it can be more challenging for smaller brands to establish this identity. They suggest that larger trends or themes can be used initially and as the brand grows, it can become more specific and synonymous with certain attributes. They also mention that piggybacking on existing trends, such as sustainability or veganism, can help create a connection with customers.
• 00:35:00 In this section, the speaker discusses the distinction between loyal customers and brand advocates. While there may be some overlap, brand advocates are typically more than just loyal customers. Brand advocates are usually motivated by something they gain from promoting the product, such as social credit or financial benefits. The key to creating brand advocates is getting them excited about the product and proving its worth. However, the speaker mentions that creating brand advocates can be challenging in certain industries where promoting the product may create competition. It’s important to consider the motivation of customers and whether loyalty or brand advocacy is more suitable for the business.
• 00:40:00 In this section, the speaker discusses the benefits of brand advocacy and the role of social credit in motivating individuals to promote a product or service. While financial compensation can be one motivator, the positive feedback and validation from peers can be even more empowering. For example, if someone has had a positive experience with a product that has helped them, they may feel motivated to share it with others in their network as a way of doing them a favor. The speaker emphasizes that genuine brand advocacy is not a zero-sum game, where individuals are paid to promote a product, but rather a reflection of personal experiences and the desire to share those positive experiences with others. However, if a brand ambassador promotes something that turns out to be a failure or dishonest, their credibility and likability can suffer, potentially leading people to disregard their recommendations.
• 00:45:00 In this section, Bobennett7750 discusses the impact of influencer marketing and the need for transparency in disclosing sponsorships. They mention that celebrities often get away with promoting products without disclosing the sponsorship, even though it has become a prevalent issue in today’s influencer marketing landscape. The conversation then shifts to the role of artificial intelligence (AI) in brand building and the importance of embracing it rather than fearing it. Bobennett7750 emphasizes that AI is here to stay and can be a powerful tool for entrepreneurs in various aspects of business, particularly marketing. They highlight how AI can assist in writing persuasive sales pitches and save countless hours of work. However, they also acknowledge that AI may have limitations in more complex scenarios or at specific intersections like marketing, product, and technology. Overall, they emphasize the importance of utilizing AI to its full advantage in a competitive landscape.
• 00:50:00 In this section, Bobennett7750 discusses the limitations and potential of artificial intelligence (AI) in the context of customer retention. He explains that AI currently has a short-term memory and lacks the ability to remember everything about a business, which limits its effectiveness. However, he believes that once AI can retain and recall extensive information about a company, it can be utilized as a knowledgeable CEO-like figure. Bobennett7750 also mentions the current level of AI being at an undergraduate college level, but expects it to advance to a PhD level in the near future. Despite these advancements, he advises not to be threatened by AI and suggests finding ways to incorporate it profitably and effectively.
• 00:55:00 In this section, the speaker discusses the benefits of using artificial intelligence (AI) for writing non-fiction books. They explain that AI has access to collective knowledge and can write eloquently and concisely, making it more accurate and effective than the average author. However, they also acknowledge that AI is not perfect and may produce incorrect information or require guidance in certain areas. The speaker shares their personal experience of using AI to write book descriptions, which was done far more efficiently and effectively than they could do themselves. This experience prompted them to start building companies around AI technology.
• 01:00:00 In this section, the speaker discusses the potential impact of artificial intelligence (AI) on consumer behaviors and the shopping experience. They highlight the example of real-time live help on websites, where AI could provide immediate and personalized answers to customer questions, improving the overall shopping experience. The speaker believes that once AI is trained extensively on a business’s data and can provide accurate and comprehensive responses in real-time, it will have a significant influence on consumer behavior and may lead to increased purchase decisions. They anticipate a major shift in how customers perceive products and interact with brands due to AI advancements.
• 01:05:00 In this section, the speaker discusses the potential behavioral changes that may occur as a result of AI becoming more mainstream. One example given is the expectation of a high level of service from AI-powered websites, where customers will come to expect quick and accurate answers to their questions about products. This may result in a shift in consumer behavior and increased reliance on AI. The speaker also emphasizes the importance of personal interaction and real-time feedback in customer retention, highlighting the value of human chat and the ability to customize based on customer needs. They mention that this personal touch and real-time interaction can provide valuable insights for product development and sales.