The evolution of Social Business Strategy: How the customer took control of the conversation
Marketing underwent a massive shift in the last half century, with traditional methods of mass marketing moving to more niche strategies, targeting small groups or even individuals. The change came about as companies were able to learn more about their customers; improvements in technology meant they were able to gather huge amounts of transactional data and use this information to target relevant marketing material to their customers.
The information allowed companies and brands to build relationships with their customers, no longer just pushing out one message to all with huge mass marketing campaigns, but rather target their core customers with messages directed to their habits, wants and desires. A new field of marketing was born, Customer Relationship Management, or CRM for short.
However, marketing is undergoing another shift and it is again driven by technology. In recent years improvements in availability of broadband communications has allowed Internet access to become ubiquitous and improvements in technology have provided customers with access to more information about companies and brands than ever before. Knowledge of the information being sought by customers can also provide essential data to the companies in terms of honing their messages.
It used to be that information flowed one way, from the company to the consumer. Companies were very careful about the message they sent out, they spent huge amounts of money on slogans, jingles and advertising campaigns, all to provide the company mantra to the consumer. The conversation with the consumer was one way.
Professor Urban of MIT’s School of Management argues that “marketing is changing from the push strategies so well suited to the last 50 years of mass media to trust based strategies that are essential in a time of information empowerment.” (Urban 2004)
The Internet has allowed people to share their experiences and opinions of brands online. The role of consumers online has definitely changed. The Internet is not just a tool for finding information; it is also a tool for communication.
Jake Hird, (2009) referencing a recent study by Netpop Research argues that that with the increase in popularity of sites such as Digg, Twitter and Facebook, users are discussing their brand experiences online with their friends and other contacts. This kind of communication obviously happened offline before the Internet, but talking about a brand with 2 or 3 people around the water cooler or with the family over dinner is a vastly different scale to posting a message that is then available to several hundred contacts.
The power of the individual has never been greater, with almost immediate access to their entire network “consumers can openly challenge brands in an environment where there is scope to make a massive amount of noise.” Hird (2009) argues that brands cannot simply ignore these users, nor can they gag them. The users have taken a large chunk of power, and they aren’t likely to want to give it up any time soon.
It is this shift in power that is driving the revolution in branding and marketing. Companies are no longer able to control fully the message of their brands; the breakdown of the traditional broadcast paradigm (Moore 2005) is forcing companies to change tactics.
We see brands doing this with varying degrees of success, with Dell famously responding to a slew of customer complaints, most notably blogger Jeff Jarvis, by creating a dedicated a dedicated corporate blogger to engage directly with customers. They were pioneering engagement in a new era of socially networked communications. And they learnt a lot in the process, speaking at a Lionel Menchaca described how the game has changed:
• Customers are in control. Work with them and learn from them.
• Real conversations are two-way.
• Think before you talk—but always be yourself.
• Address any form of dissatisfaction head on.
• Be aware that any conversation can become global at any time.
• Size doesn’t matter—relevance does. Just as one journalist can trigger a newscycle, one blogger can do the same.
• Don’t be afraid to apologize.
• Develop direct links to customer community (IdeaStorm for Dell), listen for how we can improve.
• One customer is part of many communities.
• Teamwork, transparency and frequent consistent communication are key in this new world.
• No shortcuts are possible. Implementing business change requires much effort across departments.
David Armano describes the process of moving towards a Social Business Strategy as “the intentional creation of dynamic and socially calibrated systems, process, and culture.” In other words, companies now must learn to engage with their customers and enter into the conversations they are having. By doing this, they eliminate the middleman of advertising and can enhance their business by actually listening to, and engaging with their customers’ conversations in the social sphere.