1 Set the Stage for Success
Designing the Intangible
Bubble gum. Teddy bears. Legos. Roller skates. Red lipstick. Sports cars. All of these transcend the boundaries between object and experience. At each stage of life, designs become part of our lives and the stories we tell ourselves and those around us. They resonate with us emotionally.
Observing this phenomenon is much easier than creating it. There is no shortage of corporate attention and resources directed toward understanding the needs and desires of consumers. Despite these efforts, most new offerings fail to connect with consumers, and hordes of supposedly “satisfied” consumers defect. Without a consistent emotional connection, there is no brand connection—no barrier to defection. Worse still, the cost and visibility of these failures is increasing. However, the market performance of the success stories (such as the iPod) and the excitement generated by compelling new concepts provide a convincing case for the power of design to capture our imagination—and produce impressive returns in the process. For this reason, many companies today are integrating design thinking into their cultures at higher levels. This is an important shift in mind-set, but the success of these efforts depends on the degree to which insights can be translated into strategy and action.
New Rules of Competition
Today, firms in all industries find themselves competing on design. The concept of design has broadened beyond the purely aesthetic and now includes every aspect of the consumer’s interaction and experience with the brand.
Companies invest vast resources into innovation and strategy. They hire market researchers, consultants, and armies of internal staff to identify new opportunities and develop new concepts. Yet the results are less than encouraging: Some studies suggest that 70 percent of strategies never get executed and more than 80 percent of new product introductions fail or underperform. Of course, there are visible exceptions in the most crowded and competitive industries such as Apple (computing) and Target (discount retail). The companies that manage to innovate successfully enjoy financial rewards and the respect and affection of consumers. These successes depend on carefully integrating corporate strategy with design to forge deep, emotional connections.
These emotional connections are the little-understood magic that can transform a product from an object that simply serves a purpose into a rewarding and empowering experience. By creating these connections, design transforms business strategy into business success.
In Predictable Magic, we seek to demystify the design process to make strategy and design more understandable and pragmatic. Something you can use and profit from. In this way, we can transform what for many is a black art into a repeatable process. Psycho-Aesthetics® is the RKS philosophy of creating emotional connections between consumers and designs. It spans the spectrum from research to strategy to implementation and finally to consumer experience. This process harnesses your knowledge and creativity and cultivates them into results. To put it simply, Psycho-Aesthetics takes the magic out of the process and puts it into the consumer experience.
Those on the front lines leading innovation know the importance of balancing inspiration with execution. Design is an increasingly important ingredient in carrying out strategy and can also be a powerful tool for mitigating the risk inherent in bringing innovations to market.
A New Perspective on Design
Psycho-Aesthetics arose as a formal practice out of the study of designs that were lauded for their beauty but failed in the market. Careful analyses reveal a simple and profound truth:
“It’s not how you feel about the design, it’s how it makes you feel about yourself.”
This counterintuitive idea has major implications for how companies approach their study of consumers and the innovation process. Few consumers buy purely on the basis of need. In the developed world, a majority of purchases are driven by a need for entertainment and self-actualization. But even for the four billion people in the world who remain poor, aspirations play a pivotal role in their consumption decisions—note the size and growth of the cell phone industry in emerging markets.
When we look at design success across industries, it’s clear that the relationship between what catches our attention and what eventually wins our hearts can be mysterious and complex. Consider some of the brands in different categories that are consistently given top ratings from consumers—from airlines (Jet Blue, Southwest), cars (BMW, Honda, Toyota), and food (Costco, Trader Joe’s, and Wegman’s), to Internet businesses (Amazon, eBay, and Google).1 There isn’t a pattern to the functionality, aesthetics, or price points in their offerings. But there is a consistency to their quality and the unique and consistent experience they provide—in short, in the way that they tend to the well being of their consumers.
Of course, there is no shortage of alternatives for the specific products and services that the top brands provide. It is the way they respond to the emotional needs of consumers that sets them apart. The ultimate goal of design is not merely making things that people enjoy or creating awareness of the company. When design creates feelings of empowerment, people are eager to share their experience with others. This cycle is essential to generating demand virally and building brand loyalty.
Overcoming the Hurdles
The importance of creating emotional connections comes as no surprise for business leaders engaged in the strategy, innovation, and design process. Regardless of organizational function, those involved with creating new concepts or taking ideas to market are likely to find themselves frustrated in confronting two major hurdles:
• Information overload—There is no efficient way to process and prioritize the volumes of data and research that exist in most corporations today. The market research industry is estimated at a staggering $19 billion2 as consumer behavior and demographics can be studied in exhaustive detail. However, the vast majority of consumer purchase decisions are made on an emotional basis and experts estimate that up to 95 percent of buying behavior originates at a subconscious level.3
Although information is abundant, insight can be in short supply. Traditional market research reveals very little about the consumer’s emotional triggers in the decision process in a way that can inform design and strategy.
• Inadequate models for collaboration—Even in the most enlightened organizations, fostering collaboration between executive and creative teams brings special challenges. The differences in tools, education, and perspective frequently lead to delays, battles, unsatisfying compromises, and uninspired results. However, companies that find ways to resolve these issues can create an important source of competitive advantage.
As a design firm, we have had a unique vantage point in this debate. We have collaborated with companies in many industries for almost 30 years. At its best, design is an excellent method for creating organic growth, brand awareness, and meaningful consumer experiences. It also remains one of the most underleveraged tools in many organizations. We knew that we wanted to do more than help firms create one-time product success. Helping clients build brands for the long term requires understanding how to build and operationalize consumer insights and demands by developing an efficient collaborative process to enable repeatable success.
But that does not mean that companies looking to understand and incorporate design need to upend everything that they know. Sweeping corporate reorganization is not always a realistic (or effective) option, especially when a company is engaged with maintaining its competitive position. Moreover, changing the course of strategy and the inner workings of companies are not areas that design firms were traditionally consulted on. Therefore, the tools that we developed to lead innovation do not rely on a given corporate culture or executive champion. They are also not dependent on complex financial modeling. Psycho-Aesthetics guides the design process by creating dialogue and collaboration among stakeholders and empathy for the consumer.
Predictable Magic shows those interested in driving change how to move beyond brainstorming and create the consumer insight and collaboration needed to achieve breakthrough success—no matter your industry or company size.
Psycho-Aesthetics: An Integrated Approach to Innovation and Design
Confronting two of the major challenges in the design process— creating rich, actionable consumer insight and fostering more effective collaboration—led to the development of Psycho-Aesthetics. This framework makes it possible to systematically understand the emotional reactions of consumers to products, services, and experiences.
Just like the consumer marketplace, new tools and concepts have to connect with the stakeholders they are designed for…Capturing data and intuition in one place is a goal that remains elusive in most firms. Spreadsheets get updated far more often than assumptions about consumer behavior. Through our work with large corporations and entrepreneurial firms, we saw how business decisions about branding, channels, and pricing could weaken the impact of new concepts. The need for aligning strategy and design became obvious. Strategy without design is just good research. Design without strategy is just a good idea.
The case studies we share here span the range from start-ups to long-established, well-known firms. They are meant as an illustration of how to use emotional insight to guide the design process and to show the framework in practice across a wide range of industries. However, a single great design will not create lasting business success. Nor are we making the case that design can save a dying category or overcome inadequate funding, lack of corporate support, or flawed business models. Many good designs are quickly dismissed, and the best ones are quickly copied. Companies therefore need to innovate constantly to stay on top, and a predictable process for doing so can dramatically increase the odds of success. We know that the design process can be made more collaborative (for all stakeholders), efficient, and consistent with the right tools. And when design and strategy work well together, it can create new categories, transform industries, and drive financial results.
Psycho-Aesthetics is compelling because it creates efficiency in a complex undertaking—understanding the consumer. Technology has enabled the collection of large amounts of trend data. The problem is, all this data and measurement can create analysis paralysis in which companies cannot turn information into actionable insights. Measuring everything doesn’t create insight any more than eating everything creates health. This methodology enables executives and designers to zero in on the data that matters because it gives them a means to create a compelling consumer experiences.
The Importance of Emotion—and Action
Our experience shows that anticipating and responding to consumer emotions, rather than parsing demographics and focusing on market research, has proven to be the most reliable indicator of design success. Developing a simple, intuitive process for incorporating this emotional insight into the design process has involved vigorous experimentation. Over time, we discovered that factoring in emotion has not made design more complex but introduced clarity to the decisions and trade-offs that come with implementation. That clarity has enabled us to breathe new life into stale categories, help companies climb back from decline, and enter the market and seize share, faster, with more lasting results than we dared to hope for.
What does this mean in practical terms? How can a firm begin to practice this philosophy? What are the resources and skills involved in implementation? Based on our work with diverse clients, we have distilled the process into distinct phases that can be easily remembered with the acronym EMPOWER. The Psycho-Aesthetics process is a powerful catalyst in empowering clients and design professionals to innovate. Not coincidentally, EMPOWER also describes the experience that we aim to create for consumers. Empowering experiences create connections between consumers and brands. These bonds are the basis of market leadership and sustained financial performance.
Enable Your Stakeholders
Map the Future
Personify Your Consumer
Own the Opportunity
Work the Design Process
Engage Emotionally
Reward Your Consumer
The idea that emotional connections are the real drivers of growth and prosperity seemed radical when we began to use this approach. If the results from objective data can be misleading, it was hardly surprising that business people were once hesitant to base major strategic decisions on emotional considerations. But emotional insight translated into design creates real business results. Consider some of the following examples of this philosophy in practice:
• In the mid-1990s, the Minimed insulin pump was a breakthrough technology that unintentionally reinforced the stigma of being a patient. By redesigning it to look like a pager (which were then perceived as “cool” and “hip”), sales went from $45 million to $171 million in 3 years and the firm was acquired by Medtronic for more than $3 billion.
• An appliance engagement with Amana revealed that its products’ high quality was not reflected in its styling. Enhancing badging, knobs, and graphics to reflect its brand raised costs by $0.30 but commanded a $100/unit premium at retail. The result was more than $20 million in profits and an acquisition by Maytag.
• Collaboration with Discus Dental to create the Zoom! Tooth Whitening system began more than 2 years after Brite Smile entered the category and began taking market share. Psycho-Aesthetics was used to design all components of the professional tooth whitening experience (from the syringe to the whitening lamp). Today, Zoom! sells more than 100,000 of the patented syringes per week and ultimately acquired Brite Smile Professional to secure its market position.
Looking at design as a means to deliver empowerment was central to all these efforts. The credibility of many companies today rests on whether they actually deliver value to consumers as they produce profits. In an increasingly global marketplace, few opportunities can be understood with financial metrics alone (although these will always be an important measure). Many of these markets and new consumers can be better understood—and designed for—through a deep understanding of their needs, desires, and aspirations. In this way, Psycho-Aesthetics can help translate the good intentions of most businesspeople into tangible business results.
The poet Maya Angelou once observed, “People forget what you said, they forget what you did, but they never forget how you made them feel.” The emotional impact companies have on consumers is perhaps their most lasting legacy…and the largest element of their brand equity. It certainly deserves to be at the forefront of everything the company does.