• December 1, 2007
  • By Marshall Lager, founder and managing principal, Third Idea Consulting; contributor, CRM magazine

The Buyer Is Your Owner

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"The customer is king" is one of the oldest cliches of modern business. While never exactly a lie, the phrase usually paid lip service to the idea of customer experience rather than producing a policy with any teeth. But at "Social Media and CRM 2.0," a two-day seminar in October in New York, the cliche transformed into a compelling vision of the future of vendor-customer relations. Taught by Paul Greenberg, cofounder of BPT Partners and author of CRM at the Speed of Light, and Chris Carfi, blogger and cofounder of social media software vendor Cerado, the course focused on the rapid adoption of blogs, wikis, and other social media by consumers as a means of getting product information and building communities free of marketing hype. The specific goals of each of the 20-plus attendees may have differed, but the communal intent was the same: to learn how the customer has taken control of the market dialogue, and to get in front of the change before being steamrolled by it. (See "Power to the People"
for more on the conversation customers are having with or without you.) Beyond blogs, podcasts, and wikis, social media comprises social networks of all stripes, social tagging, organized user-generated content, and any community (even offline) where people share views. These views, whether on products, services, or corporate initiatives and image, connect with the consumer on an emotional level as well as on an intellectual one. "We are human beings first," Greenberg told attendees. "Our first reaction to anything is an emotional one." Some attendees -- who included consultants, business managers, and software executives -- had tactical needs: "Recruiting is a business built on relationships and networking, which is why I'm here," said Elizabeth Guevara, a recruiter with consultancy Acumen Solutions in Virginia. "I want to see how I can leverage social networks to help me fill positions better." Roshani Kothari, partnership director with Washington-based global nonprofit OneWorld.net, had a more strategic purpose: "Our mission is publishing U.S. and international perspectives on world issues, and coordinating nonprofit organizations' efforts to make progress through communications about social problems," she said. "Not only does this [seminar] speak directly to our efforts, but it may show me how to get our partners to take fuller advantage of the resources we offer." The impact of social media is beginning to seep into the mainstream. The Washington Post reported a year ago that NBC Universal was making "sweeping cuts to its television operation...demonstrating just how far a once-unrivaled network must now go to stay competitive with YouTube, social networks, video games, and other upstart media." That NBC put episodes of its shows online -- first on Apple's iTunes, and then on its own site and others -- is a massive shift, Greenberg says. "NBC changed its nature from a network that dabbles in digital content, to a digital media company that dabbles in network television." (See "Prime Time for Streaming TV.") After Greenberg's introduction to social media, Carfi launched into a more nuts-and-bolts discussion of what makes a good blog and why it can be a powerful tool -- in your hands, or in your customers'. It's already evident that the consumers will communicate, so it seems prudent to give them direct access to your thoughts and intentions, rather than waiting for somebody to leak your news out from under you. Acclimating the public to an ongoing dialogue with your company, and establishing yourself as the preferred source of information, also helps when things go wrong. "You'll already have the infrastructure in place when a timely event breaks and you need to do damage control," Carfi said. "You can defuse a bad situation with openness and honesty instead of 'turtling up' like Kryptonite did," referring to the 2004 scandal that broke when an online video showed how Kryptonite Locks' Evolution 2000 U-Lock could be neutralized with a ballpoint pen. The company failed to respond immediately, choosing to rely on its reputation as a quality lock maker -- and corporate silence nearly destroyed that reputation. (The company did eventually replace over 400,000 locks free of charge, and redesigned its products to nullify the pen method.) Greenberg noted that there are rules of engagement in the world of social media and CRM 2.0: "Use social media tools as part of a strategy, not a strategy unto themselves, and not as a toy," he advised. Don't be afraid to fail using those tools, he added -- but plan their use judiciously. "Love your customer by involving them in planning your customer strategy, including how social media is used. The customer's voice is still at the center, 2.0 or not."
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