Tarnish your customers: They love it!! (or rather Did You Ever Hear the word Customer Advocacy?)

Long ago I came to the important conclusion – and I think that I am not the only one – that the web, the mobile telephony and many other less known amazing technologies developed and commercialized in the last 20 years have made our life easier in some respects but harder in some others. I do not refer here to complains about information overload, Internet criminality or the various forms of online addictions but simply about situations where technology should make our life really easy but this does not happen because it is not used in the right way. One reason for this is the rampant ignorance of businesses as to what technology can do and also as to what marketing in the 21st century is about.
But I also have another explanation: Some years ago my eye fell on an article (I think published in the HBR) titled Tarnish Your Customers: They love it. It seems that this article (or at least the title) has been read by many, mainly from the mobile telephony industry, who obviously decided to make this slogan their business mantra.
I can’t help it but this though comes back to my mind whenever the time for renewing our mobile subscriptions at home is approaching. To keep all four members of my family connected I pay, like all of us, an expensive ticket per year. I wouldn’t have many problems with that but I have: every two years when the end of our mobile subscriptions approaches the nightmare of searching for the new package begins all over again. I must say that I consider myself lucky to use the standard university subscription and so to have escaped the torture of searching myself for a new one. But since the subscriptions of my wife and children end about the same time a searching spree is begun in search of the subscriptions fitting to each one’s individual calling patterns and browsing habits.
I do not know if you are familiar with mobile telephony tariffs but every time I look to them I question the state of mind of the mobile marketers and their bosses. It is the rule rather than the exception that the customer will have to choose among 20 -30 different tariffs with sometimes minimum differences in the services per provider. Imagine that sometimes you must compare three or four of these providers with similar crazy service schemes. And in the end after you make your choice you will most probably feel like a fool because you overlooked another offer, much better and cheaper than the one you got.
It is not surprising that mobile service providers together with a number of other industries enjoy the lowest levels of trust and respect among the public. It seems that they do not mind about this at all, despite their efforts to persuade us in their television spots that they love and care for their customers. They are fooling us: the term Customer Advocacy (something that I consistently try to explain and propagate to all my students during the last 5-6 years) is a term not included in their vocabulary. I think that their marketing strategy is to make profit by confusing their customers in the hope that they will choose a more expensive product than they really need. Or maybe they have no idea what their customers go through when they fell in the swamp of their offers. If they had any idea about marketing they would now that the over-segmentation is a failed strategy and also it is something else than mass customization. The over-segmentation was a popular strategy in the 70’s and 80’ resulting sometimes in 1500 or more brands (see for example P&G or Unilever) that had to be drastically reduced when it was realized that the only result was high customer confusion and low profitability. The new form of mobile services oversegmentation results in hundreds of price cosntructions that are only confusing customers and make the services of different providers impossible to compare.
Is there any solution here; is there any hope for us the unlucky customers? Having no choice the customers of the mobile operators oligopoly have been tolerating such a situation that only gets worst by the year.
And what can be the solution? I think a very simple one: its name is Mass Customization. There is no service more suitable for this, the only thing you need is a configurator (in case they do not know what a configurator is go to the Configurator Database to see hundreds of examples. You can add to this an online advisor that helps the customers to identify their needs and even better merge the two systems in one!
Rocket science? I don’t think so, just common sense and a bit of empathy for the customer will do the work. I promise to the first mobile services provider to do this that he will have me as customer for ever. 
And something else, do not always believe everything you read, even if published in HBR.

A piece of advice to CEOs (and everyone else interested): The Social Media is not the silver bullet

The response of businesses to the Social Media as marketing tools is overwhelming. It is getting hard to find any company home pages that do not display proudly Twitter, Facebook, YouTube, RSS and other social links. To many managers the Social Media hype has triggered euphoric expectations and the illusion that jumping on the Web 2.0 bandwagon will magically solve all their problems and give them “competitive advantage”.

The countless Social Media aficionados and self-proclaimed “gurus”, “experts”, “evangelists”, “specialists”, and “prophets” I wrote about earlier are also contributing to the confusion; a very similar picture to the dot.com frenzy that some of us still remember but obviously many of us have already forgotten.

One of the big management fallacies (shared and distributed by most of the ignorant “experts”) is that the logos of the trendy apps on the web site will make customers believe that things have suddenly changed: our products got better, the customer service works, we listen to the customer. Some serious research is of course necessary here to see whether these management perceptions have anything to do with reality and whether the introduction of Social Media is really by itself leading to any improvements.

Until such evidence is available I would rather advice some cautiousness: the Social Media is not the silver bullet. I consistently explain to those who follow my lectures on the subject that the Social Media is only part of the solution. Other parts are the Customer Advocacy and the of course the Marketing strategy on different levels. I explain them that you should not start investing (or rather throwing) money in social Media strategies if you do not first address the issues in the (E)-Marketing Strategy Pyramid.

Borrowed from the well-known Hierarchy of Needs Maslow model my pyramid simply says that in order to be able to apply any Web 2.0 / Social Media strategies you should consistently address ALL lower levels of the model. In simple words you can not have Social Media ambitions with lousy products and customer service, a marketing organization in a permanent state of winter sleep and a dysfunctional web site that was last updated in the previous century.
Anecdotal evidence indicates that indeed such situations are not the exception. I recently read the post of Tom Davenport and the post of Umair Haque in the HBR blog that discuss the problem from different angles.
For those who want to address effectively some of the issues arising I have a few simple advices. Before you start talking about Social Media Marketing:

- Place yourself in the place of your customer
- Try to listen (and hear) the real customer voice
- If you have outsourced your customer service to a Call Center break today the contract with them (if possible). If you do not do this you can never apply the first two advices
- Look to your organization carefully and without bias (or maybe let someone else to look to it).
- Have you ever heard the terms CRM (not the software packages that are called so) and Customer Advocacy? If not go to Google (or maybe in an old fashion library) and try to find out something about them.

Peoples' Empowerment through Technology: Who is watching who?

A very interesting video by Dr. Henry Jenkins, Director of the Comparative Media Studies Program of MIT and author of the "Convergence Culture" who talks about the new media landscape. Interesting for everyone in the marketing business but mainly interesting for those who still doubt that something new happens in the marketing landscape. Interesting is Jenkink's quote that with the new technology "with our little cameras we are watching the Big Brother every moment of the day". An interesting reminder not only to Big Brothers but also to small ones.

Detroit Blues

General Motors surprised the Internet world when some years ago became a forerunner on Customer Advocacy by sponsoring the Auto Choice Advisor web site (that evolved in the mean time to the MyProductAdvisor.com).
The Auto Choice Advisor (see the original web site above) was an exceptionally advanced for the time (2003) online tool (coming close to the Web 2.0 domain) meant to help customers obtain the best possible information needed in order to make the right choice when buying a new car.
The Auto Choice Advisor in its original and also present form is supposed to be a very powerful marketing tool. According to Harvey Bell Executive Director, Global Advanced Vehicle Development at GM. “The system provides the Advanced Vehicle Development group at GM with an unprecedented and timely view of consumer preferences as well as accurate market performance simulations for projected new products. It has guided many major product design and development decisions by allowing us to move directly from consumer research to product design. It is now widely used throughout the corporation". I use this online advisor as an example of how a corporation can help its customers to become successful and at the same time improve its image. The system is a very valuable source of customer voice that if properly used can provide marketers with very valuable information on consumer preferences and trends.

Despite the availability of such an advanced customer acquisition, retention and market research tool GM, together with the rest of the Detroit Automakers, are fighting for survival at the moment. And while the Auto Choice Advisor was supposed to give GM a clear competitive advantage it seems that no one there bothered to look to what customers were looking for when considering buying a new car. And not only this: despite the use of advanced tools meant to win the customer trust GM recently acknowledged that in fact it has violated the customer trust!!!
All the discussion at this moment is focused on the problems of GM and the other two American car manufacturers and on whether the US government will bail them out. With the discussion still going on today I was glad to read the post of John Quelch on the Harvard Business Review blog of 11 December explaining the background of the GM demise. Interesting for marketers as a case of anti-marketing!
Conclusion: Even the best Internet concepts can not compensate for bad marketing!

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