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EMO Index is a tool which aims to measure the feelings of a customer, a group of customers or stakeholders towards a company, product or service. It serves as an alternative to traditional customer satisfaction research.
EMO Index is an indicator which measures the emotional state of customers and stakeholders and is a registered trademark of EMO Insights International. In 2012 the Company introduced the indicator in the study Emotional Management in the Spanish Retail Banking Market (Estudio de Gestión Emocional en el Mercado Bancario de Particulares en España [1] ). The study was conducted based on 1,968 interviews with retail banking customers, both male and female, aged 18 and over, residing in Spain. The study used neuroscience techniques [2] to analyse the customers' past and current experiences with the banks and the emotions these experiences generated in order to calculate their impact on the customers' behaviour.
EMO Index is an individual or aggregate indicator which determines the general feelings of each customer, group of customers or stakeholder towards a company, product or service. It is a combination of the Net Emotional State (balance of emotions felt) and the Net Intensity Balance (intensity with which they are felt) and, therefore, can measure values from -100% to +100%.
Since it is calculated at an individual level, it can also classify customers into seven broad, general emotional states which its creators call EMO Clusters:
This emotional segmentation model challenges the traditional models used for predicting behaviour based on sociodemographic variables (sex, age, social class, etc.) or classification parameters linked to a specific sector (product purchased, volume of purchases, reasons for purchase, etc.) [3]
Its creators argue that the EMO Index is a more reliable indicator than the likelihood to recommend used by other tools such as the Net Promoter Score. Their argument is supported by a second wave of the study on emotions in banking conducted one year later on 500 subjects who had participated in the previous study. The purpose of the second wave was to determine whether they had recommended the bank to their acquaintances and the following results were obtained:
The classification proposed by Reicheld in his Net Promoter Score (Promoters, Passives and Detractors) is not entirely consistent with regard to what the customers feel or what they say they will do, at least in the Spanish retail banking sector. In particular, it is worth noting that the term "Detractors" includes 62.6% of the customers and, therefore, it does not differentiate between the majority. Moreover, it does not seem to correspond to the emotional state and the stated behaviour of these customers or, at least not all of them. Is the Net Promoter Score (NPS) enough? [4]
Retail is the sale of goods and services to consumers, in contrast to wholesaling, which is sale to business or institutional customers. A retailer purchases goods in large quantities from manufacturers, directly or through a wholesaler, and then sells in smaller quantities to consumers for a profit. Retailers are the final link in the supply chain from producers to consumers.
Greed and fear refer to two opposing emotional states theorized as factors causing the unpredictability and volatility of the stock market, and irrational market behavior inconsistent with the efficient-market hypothesis. Greed and fear relate to an old Wall Street saying: "financial markets are driven by two powerful emotions – greed and fear."
Consumer behaviour is the study of individuals, groups, or organisations and all the activities associated with the purchase, use and disposal of goods and services. Consumer behaviour consists of how the consumer's emotions, attitudes, and preferences affect buying behaviour. Consumer behaviour emerged in the 1940–1950s as a distinct sub-discipline of marketing, but has become an interdisciplinary social science that blends elements from psychology, sociology, social anthropology, anthropology, ethnography, ethnology, marketing, and economics.
The loyalty business model is a business model used in strategic management in which company resources are employed so as to increase the loyalty of customers and other stakeholders in the expectation that corporate objectives will be met or surpassed. A typical example of this type of model is: quality of product or service leads to customer satisfaction, which leads to customer loyalty, which leads to profitability.
In the field of consumer behavior, an impulse purchase or impulse buying is an unplanned decision by a consumer to buy a product or service, made just before a purchase. One who tends to make such purchases is referred to as an impulse purchaser, impulse buyer, or compulsive buyer. Research findings suggest that emotions, feelings, and attitudes play a decisive role in purchasing, triggered by seeing the product or upon exposure to a well crafted promotional message.
Neuromarketing is a commercial marketing communication field that applies neuropsychology to market research, studying consumers' sensorimotor, cognitive, and affective responses to marketing stimuli. The potential benefits to marketers include more efficient and effective marketing campaigns and strategies, fewer product and campaign failures, and ultimately the manipulation of the real needs and wants of people to suit the needs and wants of marketing interests.
Customer satisfaction is a term frequently used in marketing to evaluate customer experience. It is a measure of how products and services supplied by a company meet or surpass customer expectation. Customer satisfaction is defined as "the number of customers, or percentage of total customers, whose reported experience with a firm, its products, or its services (ratings) exceeds specified satisfaction goals." Enhancing customer satisfaction and fostering customer loyalty are pivotal for businesses, given the significant importance of improving the balance between customer attitudes before and after the consumption process.
Net promoter score (NPS) is a market research metric that is based on a single survey question asking respondents to rate the likelihood that they would recommend a company, product, or a service to a friend or colleague. The NPS is a proprietary instrument developed by Fred Reichheld, who owns the registered NPS trademark in conjunction with Bain & Company and Satmetrix. Its popularity and broad use have been attributed to its simplicity and transparent methodology.
Frederick F. Reichheld is an American New York Times best-selling author, speaker and business strategist. He is best known for his research and writing on the loyalty business model and loyalty marketing. He is the creator of the Net Promoter System of management (NPS).
Visual merchandising is the practice in the retail industry of optimizing the presentation of products and services to better highlight their features and benefits. The purpose of such visual merchandising is to attract, engage, and motivate the customer towards making a purchase.
Customer engagement is an interaction between an external consumer/customer and an organization through various online or offline channels. According to Hollebeek, Srivastava and Chen S-D logic-Definition of customer engagement is "a customer’s motivationally driven, volitional investment of operant resources, and operand resources into brand interactions," which applies to online and offline engagement.
Customer experience is the totality of cognitive, affective, sensory, and behavioral consumer responses during all stages of the consumption process including pre-purchase, consumption, and post-purchase stages.
The Advocacy Index is a customer survey technique developed by VIRTUATel Ltd that is conducted over the telephone. The technique measures customer loyalty using a 3-point scale and is based on the Net Promoter Score (NPS) methodology developed by Fred Reichheld.
The hedonic music consumption model was created by music researchers Kathleen Lacher and Richard Mizeski in 1994. Their goal was to use this model to examine the responses that listening to rock music creates, and to find if these responses influenced the listener's intention to later purchase the music. The article begins with a discussion of why the issue of music consumption is important. Music is then explored as an aesthetic product, prior to a discussion of what hedonic consumption is, as well as its origins, and concludes with an in-depth look at the model itself.
Willingness to recommend is a metric related to customer satisfaction. When a customer is satisfied with a product, he or she might recommend it to friends, relatives and colleagues. This willingness to recommend can be a powerful marketing advantage. In a survey of nearly 200 senior marketing managers, 57 percent responded that they found the "willingness to recommend" metric very useful.
Fan loyalty is the loyalty felt and expressed by a fan towards the object of his/her fanaticism. Fan Loyalty is often used in the context of sports and the support of a specific team or institution. Fan loyalties can range from a passive support to radical allegiance and expressions of loyalty can take shape in many forms and be displayed across varying platforms. Fan loyalty can be threatened by team actions. The loyalties of sports fans in particular have been studied by psychologists, who have determined several factors that help to create such loyalties.
Customer delight means surprising a customer by exceeding their expectations and thus creating a positive emotional reaction. This emotional reaction leads to word of mouth. Customer delight directly affects the sales and profitability of a company, as it helps to distinguish the company and its products and services from the competition. In the past customer satisfaction has been seen as a key performance indicator. Customer satisfaction measures the extent to which the expectations of a customer are met. However, it has been discovered that mere customer satisfaction does not create brand loyalty nor does it encourage positive word of mouth.
Susana Bloch Arendt is a German Chilean research psychologist whose focus is in neurophysiology and psychophysiology. She is known for creating Alba Emoting, a psychophysiological technique that allows a person to consciously induce, express, and change in and out of basic emotions.
ING Bank (Australia) Limited is a direct bank operating in Australia. It is a wholly owned subsidiary of the multinational Dutch bank, ING Group. ING in Australia holds an Australian banking licence as a foreign subsidiary company.
Rob Markey is an American author, speaker, and business strategist. Often referred to as the Vince Lombardi of Customer Loyalty, he is perhaps best known for his research and writing on customer experience and loyalty marketing. Markey is also the co-creator of the Net Promoter System of management (NPS), along with fellow Bain & Company consultant Fred Reichheld.