3 ways to create Frictionless Transactions
I can’t tell you how many articles I’ve read about how the world of business is changing; or why your “old school” ways of selling are just not working anymore; or if you’re not working the social channels into your marketing, success will be elusive at best.
All of those articles are right, the world is changing (I prefer to say evolving), your customers and clients are changing, there is absolutely no way to deny any the facts. BUT, the basic concepts don’t change – and they haven’t changed for centuries …
- Business is based upon transactions
- Those transactions happen between the provider and consumer
- Both sides of the transaction will attempt to maximize “value”
- That “value” is realized through transactions
At it’s core, your business, my business, the guy’s business across the world is based upon the simple concept of exchanging value between the provider and the consumer. Even in the case of a consumer receiving something “free” there is an exchange of value. Google is a perfect example, they provide a “free” service or set of services in exchange to (1) collect data and (2) show you advertising. And to the paid advertiser, they provide a service that (1) delivers a huge worldwide audience and (2) that audience can be targeted based upon “what they do”.
So if business is based upon transactions, what is a frictionless transaction?
A business transaction can be thought of as having motion – so if you look at Newton’s Laws of Motion he states three principles about the forces involved…
1. An object either remains at rest or continues to move at a constant velocity, unless acted upon by an external force
2. the net force on an object is equal to the rate of change of its linear momentum
3. All forces exist in pairs and the two forces are equal and opposite
So what does this really mean in the world of business? The following three things have to take into consideration to create a Frictionless Transaction…
1. A business transaction does not happen without applying a little force
I tend to think of most consumers to the be in the state of “rest” except for the most basic of needs (think Maslow’s Hierarchy). So, Newton’s first law states that “an object will remain at rest until acted upon by an external force”, and that external force is you.
In our increasingly digital world, that external force can come from any direction – it could be a tweet, a web search, an online ad, a recommendation from a friend or someone with influence – but those are just the online versions. There are physical world versions, instore displays, printed coupons in a direct mail piece, a discussion over coffee with a friend, a tradeshow, a billboard, a TV or radio ad or even a “cold call” from a salesperson.
Is it the full responsibility of the provider to create the force necessary to get the consumer moving.
2. Once moving, transactions have their own speed,
Once we get consumer moving, there are two things we need to ensure (1) they continue to move in “our” direction and (2) we don’t do anything on our part to slow it down.
Have you heard the expression “it’s like herding kittens”? Well, the consumers in your pipeline are exactly like that – they don’t want to be “sold” but they do have to be convinced. In the process of being convinced to purchase from you, they will begin to move away from “you” as the provider and start looking at the “category” as the solution. This is where lead nurturing comes in – you can either help or hinder the purchasing process.
This is where having a deep understanding the purchasing journey comes into play. But with all things “experience” you have to be willing to fail to ultimately have success. Regardless of the what you call this process, it comes down to three factors (1) try something (2) measure success/failure and (3) adjust, revise and repeat. This means you will spend money and money resources trying new and different things, measuring them against expectations and trying again. I’m not going to go into all the ways that experimentation can happen – there are a hundreds of articles about that – the key is continually learning and improving. And once you have done it enough times, you will being to see what works and what doesn’t for your product or service – at the point you have success, and you understand the purchasing journey – you can start to replicate it.
Is it the full responsibility of the provider to understand the customer’s purchasing journey, and make it as easy as possible.
3. All transactions have resistance points, it’s up to you understand them
Expanding upon the previous point of understanding the purchasing journey, you will uncover several points of resistance. I would like to say they are “constant”, but they aren’t. The third law of motion states that all force exists in pairs, and they are of equal. In the world of sales, these resistance points were called “objections” and to master sales, you had to overcome these objections. As we move more to consumer-directed or consumer-supported sales process (happening outside any human interaction), overcoming the resistance of the consumer can be much harder – mostly because no one is there is actually “ask” for the sale, then hear the objection to purchasing “right now”.
So along with the purchasing journey, you have to understand these resistance point – and many times, you need to understand (and group) purchasers so you can virtually ask for the sale, get feedback and then adjust to their needs. All while attempting to speed the transaction, rather than slow it down.
A perfect example of this point is Progressive Insurance and the quoting process for car insurance. Car insurance is price sensitive service, it’s complicated, has lots of variables and every car insurance company has their pricing scheme. And everyone wants to “feel” like they are getting a good price, even for something they “required by law” to purchase. Progressive new this was a resistance point and slowed down the purchasing decision – they realized two things (1) price shopping was going to happen and (2) if someone purchased from them, and later found out they could have gotten a better price, they would ultimately lose that customer. Why not circumvent that process and show my price and the estimated price of my competitors? It’s a brilliant move, they understood the transaction resistance point, and then mitigated it.
It’s up to you to understand the transaction resistance points, then find ways to eliminate them
Is it possible to have a true Frictionless Transaction?
I believe the only way to eliminate ALL friction within business transactions would be to eliminate people from the process. I do believe it is possible to understand the consumers of our products and service – and that means understand who they are, how to help them along the purchasing path, how to keep them focused on purchasing from us (or eliminate them), and ultimately, how to evolve them from a “transaction” into a long term customer.
What are you thoughts? Do you have any good or bad examples? How do you do it for your company? I’m interested in hearing what you have to say.
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