← The Agile Brand with Greg Kihlström®: Expert Mode Marketing Technology, AI, & CX
The Agile Brand with Greg Kihlström®: Expert Mode Marketing Technology, AI, & CX
#627: The forces redefining brand loyalty with Ian Baer, Sooth
00:29:47
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- [00:01]
Strayer University Announcer
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Carvana Customer
I sold my car in Carvana last night.
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Ian Baer
Well that's cool.
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Carvana Customer
No, you don't understand. It went perfectly. Real offer down to the penny. They're picking it up tomorrow. Nothing went wrong.
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Carvana Friend
So what's the problem?
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Carvana Customer
That is the problem. Nothing in my life goes to smoothie. I'm waiting for the catch.
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Carvana Friend
Maybe there's no catch.
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Carvana Customer
That's exactly what a catch would want me to think.
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Carvana Friend
Wow. You need to relax.
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Carvana Customer
I need to knock on wood. Do we have wood? Is this table wood?
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Carvana Friend
I think it's laminate.
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Carvana Customer
Okay. Yeah, that's good. That's close enough.
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Carvana Friend
Car Selling without a Catch Sell your car today on Carvana. Pick up these may apply
- [01:04]
Strayer University Announcer
the Agile Brand.
- [01:13]
Greg Kilstrom
Welcome to Season seven of the Agile Brand where we discuss the trends and topics marketing leaders need to know. Stay curious, stay agile and join the top enterprise brands and martech platforms as we explore marketing, technology, AI, e commerce, and whatever's next for the Omnichannel customer experience. Together we'll discover what it takes to create an agile brand built for today and tomorrow and built for customers, employees and continued business growth. I'm your host Greg Kilstrom, advising Fortune 1000 brands on martech, AI and marketing operations. The Agile Brand Podcast is brought to you by Tech Systems, an industry leader in full stack technology services, talent services and real world application. For more information, go to teksystems.com to make sure you always get the latest episodes, please hit subscribe on the app you listen to podcasts on and leave us a rating so others can find us as well. And now onto the show.
- [02:11]
Greg Kilstrom (Interviewer)
Are you keeping up with the forces redefining loyalty, or are you relying on yesterday's strategies in today's fractured landscape? Today I'm joined by Ian Baer, founder of Sooth and a seasoned Expert with over 35 years of experience leading some of the world's most prominent advertising organizations, including Publicis, TBWA and and Omnicom's Rap Collins. Ian brings insights into how generational shifts, social commerce and fragmented media are reshaping the concept of brand Loyalty. He's going to share data driven strategies and real world examples that will help brands navigate this new loyalty landscape. Welcome to the show, Ian.
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Ian Baer
Yeah, thanks so much, Greg. Seasoned. I like that word.
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Greg Kilstrom (Interviewer)
Nice. I know. You know.
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Ian Baer
No, it works for me. It's great. Better than I, you know, I get veteran a lot. Like, I don't know. Yeah, seasoned is good. I'm well seasoned.
- [03:01]
Greg Kilstrom (Interviewer)
All right, all right. Full. Yeah. So let's, before we're going to talk about quite a bit today, but before we dive in, why don't you give us. I know I gave the high level version, but why don't you talk a little bit more about your background and also what inspired you to start Sooth?
- [03:17]
Ian Baer
So I graduated with a degree in journalism and social sciences and that's what I knew how to do. I knew how to tell stories, I knew how to understand people's motivations and psychological needs. So when I found myself being this sort of accidental marketer who took a job in an agency that he thought he was going to be a summer job and suddenly found himself promoted into a position of responsibility, I set out to solve problems with those same tools I had. If I understand somebody's motivations, what they need, what's important to them in life, and I understand the tools of storytelling, which I did as a journalist, well, that's kind of what this marketing thing is. And that's how I went at it. And over the years it really became my own school of solving marketing problems that was a bit different from the more traditional methods. And over time, actually what I found is it's the most effective way to go to market. So we hear a lot now about this notion of emotional connection and we hear about it like it's a new thing. It's not.
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Greg Kilstrom (Interviewer)
Right.
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Ian Baer
You know, marketing is really just one to one selling at scale, right? So if we think about the early days of one to one selling and we think about door to door salespeople, right? If somebody's selling brushes or vacuum cleaners or encyclopedias or a set of cookware, they don't just start with what they want to sell you. They start with they want to come and sit across that kitchen table and learn who you are, ask some important questions. Who else lives in this house with you? What sort of things do you do day to day, what's important to you? And then they tailor their message to an understanding of that person's emotional and practical needs. And yet somehow marketing over the years has all become about automation and scale. And as we've Gotten more sophisticated with data and technology, we've gotten really good at finding people who are ready to buy something. But the reality is most people need more understanding, need to be more motivated. And if you only focus on the people who are ready to buy your product today, marketing just doesn't pay out efficiently these days. So over all my years in marketing, I discovered that the work I was doing was actually substantially different from the work a lot of my peers were doing because of this obsession that I had in the agencies and teams that I built with really getting inside the head of that consumer or that business decision maker, knowing what motivates them, and then helping the brand tailor its message to that decision maker as opposed to the other way around. Eventually, when I pivoted out of the agency space after 35 years, what I wanted to do was bring this way of marketing that we now know is the most effective way a brand can go to market to more brands in more categories with a scalable, repeatable process. Ultimately, I developed a set of proprietary algorithms that actually allow us to access third party data and first party data and use it to interpret something, someone's likely emotional needs and decision making tendencies. And that's the capability that Sooth offers to any brand.
- [06:52]
Greg Kilstrom (Interviewer)
Nice. Nice.
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Ian Baer
Yeah.
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Greg Kilstrom (Interviewer)
So, yeah, it's, I mean, it's interesting how to kind of get to the emotional piece. You can, you, you know, you trace it back to an algorithm and then, and then it kind of goes back out to creating that, that emotional connection again. Right, that's, I mean, yeah, you know,
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Ian Baer
we, we can use the tools we have data and especially now with AI, just accelerates the ability to crunch through terabytes of data in no time. And that's what we do here. It can be used again in a very mercenary way. It can be used for, you know, even the words that marketers use. Right. And I'm guilty of this. You know, we talk about targeting and we talk about conquest and we talk about stealing share and you know, we sound like pirates.
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Greg Kilstrom (Interviewer)
Yeah, totally. Yeah.
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Ian Baer
But, but the truth is the better way to use data and the way that actually pays back about four times better from a marketing ROI standpoint is to use that same data in ways that help us understand the person making the decisions. Again, my background's in journalism. Right. So they teach you, you know, who, who, what, where, when, why, how, you know, maybe why now? And marketers tend to focus on so much, but not often the who, who is this human being that I want to buy my product or service and why, what motivates them. They focus so much on what, when, how, why now. But it's the human being being motivated that creates the connection that actually is the most beneficial thing a brand can wrap its head around.
- [08:37]
Greg Kilstrom (Interviewer)
Yeah, well, and I think that that emotional connection also, I mean there's a lot of outcomes of that. But I mean one of those, one of the outcomes is loyalty. Right? So absolutely. And to your point, it's loyalty isn't about someone that buys every day. It's, you know, it's that they think of your brand and you know when it's time for them to buy, when it's time to recommend and many, many other points, points throughout. But what have you seen, you know, in, in your career?
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Ian Baer
How have you seen loyalty evolve, evolve, devolve, evolve again?
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Greg Kilstrom (Interviewer)
Right, right.
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Ian Baer
Because we really did a very good job as an industry of creating a Pavlovian system of loyalty and that worked for decades. Sign up for some kind of program or scheme, I'll give you points, I'll give you free product, I'll give you miles, I'll give you a fancy gold badge, I'll give you whatever the case may be, but I will, in a Pavlovian way, reward you for your business. And that worked for a very long time. The problem is people got worn out on these loyalty schemes. They all started to look like one another. Businesses started to become wary of the liability on their books that these kinds of points programs cause. Because for anyone who hasn't marketed using a points program, at the end of the year, all the points you've given people, that's considered a debt by your accountants and that has to be accounted for. And at some point that debt needs to be burned off, written off or it needs to expire. Well, see how happy your customers are when you take their points away and say, sorry, they've expired. So people really got worn out on the system. They just started joining loyalty schemes, I don't know, to get a one day discount or. Because it sounded like a good idea at the time, but the majority of people didn't even know how many loyalty programs they were enrolled in. And the whole value of it got worn out. We've seen that in the airline industry, we've seen that in retail and what replaced it, and it was really, to an extent the canary in a coal mine for emotional connection is we started to see in loyalty marketing soft benefits becoming more important to people than hard benefits. Getting special access, getting special shopping hours, special treatment, recognition of their status, that became a lot more important than Being able to cash in three years worth of loyalty for an umbrella with your logo on it. You know, people got it and they said, no, it's actually much more. Loyalty comes from how you make me feel as a human, as a customer. Do I feel valued? Do I feel like my business has been appreciated? And where that has continued to move as people have gone away from these more quantified point schemes, reward schemes, what has replaced it is recognition. A lot of times I like to say loyalty really comes down to a few things, like, you know, do you make me feel like I'm valued? Do you make me feel like I'm appreciated? Do I feel like I'm on the inside of something special with you as opposed to being just like everyone's customer? And I think brands that have done that continue to demonstrate a different level of loyalty. We're not really in a post loyalty marketing world, which a lot of people like to say. It's just the stakes have changed.
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Greg Kilstrom (Interviewer)
Yeah.
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Ian Baer
And loyalty now is much more of an emotional equation than a transactional one.
- [12:25]
Greg Kilstrom (Interviewer)
Are there generational factors at play here of. You know, we hear a lot of, you know, a lot of things about, you know, millennials and now Gen Z and soon to be Alpha and all that. And. Or I guess do you think that some of this is just. Consumers are getting more sophisticated and. Or I mean, you mentioned the kind of. The burnout as well.
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Ian Baer
Yeah.
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Greg Kilstrom (Interviewer)
I'm asking three questions at the same time here, but good luck.
- [12:50]
Ian Baer
Yeah, I'll do my best to answer them all within one pithy sentence. It's not so much generational because we actually have data that says people over 60 are more impacted by customer service, for example, when it comes to the brands they choose and continue to choose than younger generations. So they want those soft benefits. They want the recognition. In fact, they've got clearer memories of outstanding customer service than younger consumers who are very used to doing everything through automated platforms, who often don't even want to speak to a representative. So the soft benefits thing simply gets reinterpreted for each generation. What soft benefits means to an older consumer may be some kind of VIP status, maybe a personal rep that can speak to them, that can help them choose products. For somebody younger, it might be more customization within an app that gives them that same feeling. It might be access to a certain person who they think has something to offer to them. Access to thought leadership, access to content, access to features. So it's the same benefit, but translated through an experiential lens that's governed by how that person is used to interacting with, with companies. But all of it has moved towards benefits that help the person feel seen and understood. Loyalty used to be a lot more blind. People used to buy brands because this is the brand I grew up on or this is the parent, this is the brand that, that my parents bought. Or, you know, I'm loyal to this credit card because this company trusted me to have credit when I was 18 years old. And, and those things don't hold up the way they used to because experiences are constantly being improved and reinvented. And chances are, whatever category you work in, there's something newer and better on the horizon than what you're offering today. And this has created a level of consumerism where people are always looking for a new and better solution. So it's not so much that they're not loyal, it's that they want to have their needs met and their problems solved. And if a brand shows a level of understanding where I can actually think of them as the place I would go to first because they generally know what I need before anyone else. I think a lot of people, for example, if you're a member of what I playfully called the cult of Apple, you get it. No matter what new Android innovation has come out and you really got your eye on the next Apple iPhone because you believe Apple gets you or you get Apple and it is that mutual connection. The brand anticipates what I need and I expect the brand to continue to do so. That's what defines loyalty today.
- [16:01]
Greg Kilstrom (Interviewer)
Yeah, well, and I think another, another component of that also is being understood by a brand and is also that brand is consistent across, let's say, you know, a fragmented, you know, media landscape, omnichannel, whatever, whatever you want to call omnichannel, very much so multichannel, you know, all that stuff. And so, you know, I think the brands that I know, I gravitate towards. I don't. It doesn't matter what device I have in front of me, I'm gonna, I'm going to get service and it's going to feel like it's part of that brand. Right, that's right. How does a brand, you know, keep up in this, you know, in this kind of omnichannel? It seems like there's, there's new channels being added, there's continued fragmentation and all that. You know, how does the brand keep up?
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Ian Baer
One of the most important things that, that brands need to recognize is at this point, the customer is the medium, a human being carrying, you know, a device yeah, that's much more meaningful. And what they do with that device is much more meaningful than understanding in a vacuum how they use TV and how they use their computer and what kind of information they interact with when they're in their car. That device is tethered to their body 24 7. It is their lens to entertainment, information, problem solving, commerce. It tends to be the first place they go for everything. And when we start to look at people not as necessarily navigating a media landscape, but just kind of living their life with a steady stream of information that tends to flow through their handheld device, through their phone, to everything else they own, then we really begin to see that individual as their own unique channel. And everything we do, for example, at Sooth, is about being able to map the way this person interacts with devices and screens and information uniquely. Not looking at it as some sort of an integrated channel strategy, but it's really an audience driven connection strategy.
- [18:28]
Greg Kilstrom (Interviewer)
And so, you know, I'm gonna ask a couple questions at the same time again here. So, you know, we're talking about measuring what someone's doing. The, the data, the analytics piece of this. You know, that's a huge component to that.
- [18:42]
Ian Baer
Yes.
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Greg Kilstrom (Interviewer)
And yet we've got to balance that with. Again, my hypothesis is I do think consumers are getting more sophisticated and they're, they're able to tell when a brand is not being authentic and that authenticity,
- [18:55]
Ian Baer
or lack thereof, which by the way, is not just a matter of sophistication, but also a matter of access to information. Right?
- [19:02]
Greg Kilstrom (Interviewer)
Yeah. Yeah, fair enough. So, like, how do you, how do you balance this? You know, we're data driven and analytics driven and we're keeping authentic to the brand. Like how, how should brands be thinking about that? And I know that's, that's part of what Sooth does as well.
- [19:19]
Ian Baer
Yeah. Well, there's a reason we call the company Suit. Right. If you Google suit the definition, he gets one word, truth. It's because that is the way brands need to operate. There really is no choice. You will be exposed. I remember once having a conversation with a major toy manufacturer and trying to coach them into social media, and they just weren't comfortable playing in that space. We're going back, obviously, a few years and they said, well, we haven't decided if we want to be in social media yet. And I said, timeout, here's the news. You're in social media, you just have no say over any of the content that's out there with regard to your brand, because it's all being created by the people who buy your product and the people who compete with you.
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Greg Kilstrom (Interviewer)
Yeah.
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Ian Baer
So the only choice you have to make is whether you want to play an active role or a passive role in your social media strategy. And you know, I think we are in a similar position in terms of how we use data. You can leave everything down to that moment of chance, the moment somebody's ready to buy when it's you. And whoever is willing to spend a little more on a CPM basis, willing to target a little stronger, willing to increase their buy with a digital media platform to box you out with category exclusivity or whatever the case may be. So you can decide to always play for that moment, or you can decide to use data to build connections with people that you can continue to go back to over and over and over again. Because people who believe the brand actually gets the them, people who feel emotionally connected to brands, they spend four times more, they stay loyal customers almost two years longer on average. So this is what we're always trying to get brands to understand is people are going to see through anything other than a genuine attempt to understand and meet their needs. So you don't want to play in that space. That's okay, as long as you're fine with the fact that your marketing investment's probably not going to pay out. There's a reason that about three quarters of CMOs, according to a Gartner study, say they don't have enough budget to hit their goals. It's because we have such a reduced expectation for marketing performance that we're putting the pressure on budgets instead of putting the pressure on ourselves to actually understand and anticipate what people need and give it to them. Yeah, it's always been the surest sales strategy.
- [22:08]
Greg Kilstrom (Interviewer)
Is that a outcome of like a focus on short term measurements, like acquisition, Is that a, you know, where, where do you like From a measurement perspective and a goals perspective, how could a, how could a brand shift to focus on the right, you know, KPI, let's
- [22:25]
Ian Baer
say you're, you're asking all the right questions. Because one of the most disappointing things we continue to see is that the vast majority of marketing investments do not get measured beyond a six month window. And that means you are only as good as the last thing you did. Right. Because if success is being evaluated on a single click through rate, we have these, these vanity metrics that a lot of brands or individual decision makers will use to say, well, I'm responsible for retention, so if I increase retention from X to Y, this month I'll hit my number. But the reality is, the only thing that matters to the company, to the shareholders of that company, and to the customer is how good a job did you do of keeping that person, a customer who continues to buy more and recommend you to others. Right. Byron Sharp, who, you know, a bit controversial. People love him or they don't buy into him at all. But certainly he has forced us all to think about marketing very differently. And one of the things he proved out in a book, I guess, about a decade ago, was that there is no positive return on loyalty in a vacuum. The positive return for the brand on loyalty is the impact that loyal customers have on driving the acquisition of new customers, on recommending you to somebody, on advocating you in social media. Loyalty in a vacuum will never pay out. And it's such a great example in a microcosm of brands falling in love with vanity metrics. But the reality is the first things to get redlined for most marketing budgets are research and measurement. We don't want to overspend on understanding what people want, and we don't want to overspend on knowing what worked. And hey, we're in this world of digital media where we can throw 25 things out there at the same time and the metrics will tell us what the market wants. No.
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Greg Kilstrom (Interviewer)
Right? Right. What could go wrong?
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Ian Baer
What you're doing, first of all, you're wasting a lot of time, you're wasting a lot of money on things that don't work. And every one of those interactions that doesn't work is creating a negative touch point with a consumer who in that moment didn't feel like he gave them what they needed, they moved on to somebody else, and they'll probably never look at you again. So the only antidote for that is investing once again in understanding and in measuring to really know what worked. And the beauty of all of that is because of all the advances in technology, in AI as a huge hero element of what we do, it doesn't take nearly the amount of time or money as it used to take. Right. We can now give in the work we do for brands. We can give a brand what used to take me about two years worth of research and in market testing in about a month. In terms of actionable insights, we can use data to proxy for very expensive quantitative research studies on brand metrics and share of mind and share of requirement. We could crunch that data based on what we already have in about two weeks for maybe 10% of what traditional research costs. So that's A big part of what we're trying to combat with our offering is putting understanding and measurement back into brands marketing plans so that they actually can invest in the things that work not only for them, but work best for the people who buy from them.
- [26:43]
T.J. Watt
Yeah.
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Greg Kilstrom (Interviewer)
Love it. Well, as we wrap up here, what are you excited about and what should brands be paying attention to in the loyalty space and understanding and engaging with their customers better?
- [26:59]
Ian Baer
Well, I'm excited to see everyone understand that brands are more experiential. It's no longer a separation between what is the brand and what is, you know, the app or the website or the store. The fact is, every way somebody experiences a brand, that's the brand. The brand isn't what we say it is in marketing or advertising. It's my last call with somebody in your customer service center. It's the last time I logged in and used the app. That's the brand. It's the last time somebody said something about you in social media. And seeing brands adapt, this more holistic understanding of what a brand world looks and feels like is very encouraging and ultimately is going to lead to better experiences for consumers. And that's why we're here. Our mission is really to act in service to the consumer on behalf of the brand. And more and more brands seem to be understanding that that's really the best equation for everyone. So I find it really encouraging. And the way technology and data are lining up to bridge that gap between brands and the people who buy from them is incredibly exciting and opportune and I'm thrilled to be a part of it.
- [28:25]
Greg Kilstrom (Interviewer)
Love it. Love it. Well, one last question before we go. I like to ask everybody, what do you do to stay agile in your role and how do you find a way to do it consistently?
- [28:36]
Ian Baer
I'm an information junkie, so I am constantly reading, absorbing, exposing myself to people who are shaking things up all over, not just the marketing world, but, you know, really every aspect of marketing requires an understanding of the evolution of consumerism itself. So I have always found it really valuable. Like if you work in marketing and you haven't paid very close attention to every single innovation coming out of CES this month that's going to shape the future of marketing. That's going to change what we can do. It's going to change what people expect. Every innovation creates a hunger for the next innovation. So I try to stay on top of how people live their lives and that usually gives me the most information as to where to borrow Wayne Gretzky's old term where the puck is going in marketing.
- [29:41]
Greg Kilstrom (Interviewer)
Yeah, love it. Well, again I'd like to thank Ian Baer, founder of Sooth, for joining the show. You can learn more about Ian and Sooth by following the links in the show notes.
- [29:52]
Greg Kilstrom
Thanks again for listening to the Agile Brand brought to you by Tech Systems. If you enjoyed the show, please take a minute to subscribe and leave us a rating so that others can find the show as well. You can access more episodes of the show@theagilebrand.com that's theagile brand.com and contact me if you're interested in consulting or advisory services or are looking for a speaker for your next event, go to www.gregkilstrom.com that's G R E G K I H L S t r o m.com the Agile brand is produced by Missing Link, a Latina owned, strategy driven, creatively fueled production co op. From ideation to creation, they craft human connections through intelligent, engaging and informative content. Until next time, stay curious and stay agile.
- [30:46]
Strayer University Announcer
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T.J. Watt
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