Imagine you’re in a supermarket. You’re browsing the shelves for a product – let’s say breakfast cereal. You compare prices. You might be drawn to one brand over another because of its name, reputation or packaging. You choose your cereal, drop it into your shopping cart and move on.
According to market research, this process takes around seven seconds or less, but it’s so important to the retail industry that marketers have given it a grand-sounding name: the First Moment of Truth (FMOT). The Second Moment of Truth (SMOT), they say, is when you get home, try your cereal and decide whether you want to buy it again.
These two “moments” have dominated recent marketing strategy. Capturing them has been the key to capturing consumers. But retail habits are changing, and with the growth of online shopping, a third moment of truth has emerged. Google calls it ZMOT (Zero Moment of Truth) and at an AmCham breakfast at Santiago’s Radisson Hotel on March 16, Google’s business acquisition manager for Latin America, Fernando Lopez, explained what it is.
“ZMOT is the moment when you open your laptop or switch on your phone, or any device that allows Internet access, and you start to inform yourself about something that you might buy.”
Lopez said 62% of consumers in Latin America now consult online before shopping, using search engines like Google. Around a third of them provide feedback about their purchases via comments on Internet forums or social network sites like Facebook. And 83% of consumers say they take those comments seriously when making their own purchases. So, “winning the ZMOT” (to use Google’s phrase) is crucial to successful marketing.
Lopez cited the popular travel website TripAdvisor as an example of how consumer feedback is increasingly important to other potential consumers. In the past, people read holiday brochures before booking their holidays. Now, they heed the advice of other holidaymakers. One person’s experience of a beach resort in Brazil or a hotel on Easter Island rapidly becomes the next person’s ZMOT.
So, what can companies learn from this? Google’s Managing Director for US Sales and Service, Jim Lecinski, has written an eBook about ZMOT (Downloadable for free in English and Spanish at www.zeromomentoftruth.com) in which he gives the following advice:
1. Put Someone in Charge of ZMOT
2. Find Your Zero Moments
3. Answer the Questions People Are Asking
4. Optimize for ZMOT
5. Be Fast
6. Don’t Forget Video
7. Jump In!
His book gives practical tips on how companies can best serve their customers and therefore keep them. He says, for example, that they should pay attention to the questions people ask on the Internet and answer them directly, rather than simply bombarding them with special offers. And he says companies should make more use of video to reach their customers, pointing out that the search box on YouTube is the second most used in the world (after Google’s own).
Lopez said companies in Chile need to take ZMOT more seriously. “Think about your companies and the areas they invest in,” he said. “Most companies invest in R&D, they dedicate resources to management and products, they invest in communications and media and they probably invest in marketing. But who is responsible within your companies for investment in ZMOT? Who is actively working to understand this new paradigm? It’s time to think about it.”
Consumers will increasingly use portable Internet devices to shop in the future, he predicted. In Chile, the number of broadband Internet users is expected to rise to 10 million by next year from 8 million in 2010, while the number of cellphones should climb from 19 million to 23 million over the same period. But the big increase will be in the number of consumers with access to 3G technology – expected to reach 15.6 million next year from just 4.5 million in 2010.
A smartphone is the new tool of choice for the Chilean shopper, and companies should react to that. “If not, those customers might well choose to shop elsewhere,” Lopez warned.
Gideon Long is a freelance journalist based in Santiago