June 27, 2007

Power to the (online) consumer Part 3

Summary of Part 1 and 2. The new phenomenon of customer empowerment, based on a combination of new technologies and new forms of consumer interaction has brought about new types of communication formats; increased Peer-to-Peer information exchange is weakening the traditional corporate and mass media control on the marketplace, posing important challenges to 21st century marketers and businesses.

Part 3 (final)

One thing increasingly becoming obvious to strategies and marketers is that the good old (mass media based) marketing practice of one-way push communication is not anymore as effective as it used to be and becomes even less effective over time. Many marketing executives witnessing the weakening of the mass media and mass message power respond with even more advertising and more push, leading to message saturation, lower acceptability and increasing consumer mistrust. According to a Yankelovich survey in 2004 60% of the consumers have today a much more negative opinion about marketing and advertising than just a few years ago while 61% believe that the amount of advertising is out of control. Also a 2006 survey of the Advertisers Union in Holland suggests that only 18% of the TV audience is actually watching TV commercials in this country.
Decreasing effectiveness of the marketing and increasing customer suspicion and power are the perfect ingredients of a disaster marketing scenario. What is the right way to move forward? Certainly not increasing customer push because the empowered and informed consumer has the means to react.
According to a new school of thought the only way to win and retain the today's consumers is to become their partner by helping them become successful by realizing their ambitions and personal goals. This strategy known as Customer Advocacy is based on the simple idea that if you want to win the consumer today you have to win the consumer’s trust. Such an approach could mean that you must be able to understand the real nature of your customer’s needs, motivations and psychology and that in fact you should be so honest with him that you would even suggest a competitive product if you realize that your product is not what the customer looks for. The reasoning behind such an extreme case of advocacy is simple: if you fool the customer he will most probably find out and you will lose him for ever, if you help him he will trust you enough to come back to you next time.
What are the effects of customer advocacy and how this can become a useful marketing instrument are questions that begin to attract the attention of the academic community. On the other hand practitioners have already shown interest and there are already some interesting findings in the field ( see for example Forrester Research.)
Advocating the customer might sound odd to those used to think that control of the mass media and control of the message/content was enough to win customer trust and loyalty. This view, ignoring the new realities and power migration in the marketplace, can lead today to a dangerous form of digital myopia with serious long term effects on the marketing’s ability to drive company success and growth.

Interested to be informed of my new posts? Email me in e.constantinides@utwente.nl and you will be included in my mailing list