Monday 20 August 2012

What if your customer knows everything?

Minutes before I sat down to write this editorial, I got a call from a friend. He was in a Dell outlet and wanted to buy a laptop. He’s aware that I keep a tab on developments in the gadgets arena and therefore trusts my judgment. Interestingly, I could hear the sales representative trying to sell him a particular model at a price point he had suggested. Unfortunately for the folks at Dell, my friend wasn’t really listening to them. He was asking them for what I had recommended. And this is when the thought struck me – what do you do if your customer knows everything? What if a channel, which was supposed to convince prospective customers to make a purchase, is no longer seriously considered by the buyer? According to McKinsey’s Consumer Decision Journey report, “Consumers rather than sitting passively and having advertising come after them, are much more actively reaching out to their friends and family, the Internet and other channels to understand their options. As such, there is an urgent need to step back and re-evaluate, both how consumers go through the decision process and see what companies need to concentrate on in order to make their marketing efforts more productive.”

The fact of the matter is that traditional channels of advertising no longer serve the purpose of convincing consumers to buy the product. They merely help the brand in establishing its presence in the market. A television ad is as good as deploying a loudspeaker in a crowded market place which announces “Brand X is available at a store near by you.” End of story. This might surprise you, but CEOs already realise this. A recent study conducted by the London based Fournaise Marketing Group reveals that CEOs across the globe are increasingly getting with their marketing department. The study, titled Global Marketing Effectiveness Program 2011, states that “73% of CEOs say that CMOs lack business credibility and the ability to generate sufficient business growth, 72% are tired of being asked for money without explaining how it will generate increased business, and 77% have had it with all the talk about brand equity that can’t be linked to actual firm equity or any other recognised financial metric.”

If you, as a marketer, really want to stand out and survive this shift in consumer behaviour, you’ll need to do much more than allocate budgets and hire a great advertising agency. If your website does not answer all possible forms of questions but your competitor’s website does, you’ve lost the bet. Marketing in the 21st century is about going back to the basics. If you are one of those who have suddenly started questioning the viability of Facebook as a marketing platform just because its IPO tanked and a lot of your friends in the industry say their are no reliable metrics, then you’re making a grave mistake. Look at the immense potential of the native ads market. They’ve been around ever since the rise of Google. Google’s search ads let marketers display offers relevant to their search queries. Similarly Facebook has ‘Sponsored Stories’ which have been proven to be more effective than Facebook display ads.

The herd mentality does work at times, but when you are in the business of getting hold of a customer before your competitor tries to hijack her, listening to what everyone is saying might backfire. While there’s still time, forget everything you had learned about traditional marketing and start looking at data unique to your business instead of trusting your past experience – by all standards, that’s now obsolete.

Tuesday 15 May 2012

The consumer is king, again!

A lot of people say that we are about to enter a ‘Post-Digital’ world. Well, I would say, let’s stop talking about it as something yet to happen. It is already here and we are up to our eyes in it. It’s a world, where people come first. It’s a revolution, where word-of-mouth, the most persuasive media of all, is king. And it’s the very reason why Lady Gaga tweets messages and pictures to her 24 million Twitter fans, and iconic brands like Coca-Cola, Pepsi, Apple, et al, interact with their consumers on a real-time basis through Facebook. 

If you too are in the business of selling, then you are game to this revolution. Believe it or not, digital has taken over our lives. The reason is simple. As humans, we are hardwired not to live alone. For instance, there’s no way you’ll not speak even once to the passenger sitting next to you over a long-haul flight. And the very reason social media has engulfed almost everything is that it revolves around communication. Marketers who live by statistics might disagree, but ‘social’ is probably the most vital element that completes the very concept of globalisation. I mean think about it; there was a time when there were limited shops selling select products to a certain number of households. You never had to bargain and almost always you got the best deal because the shopkeeper knew you and your family personally. Soon, globalisation started seeping in and markets witnessed unprecedented proliferation of new brands. As corporations selling these brands expanded it became almost impossible for them to communicate with consumers. But here’s the catch. They realised this was more convenient. A message had to be funneled through and consumers had no choice but to consume it. Even if someone out there had a problem, he wouldn’t be a threat. How could this one alienated customer possibly speak ill about a brand to its million odd patrons? Further, everything could be just put onto a PowerPoint presentation. The insights were actionable and made great forecasts. What fun! But not anymore. The phenomenal rise of social networks, blogs, search engines, mobile and almost anything related to the world wide web has put the power back in the hands of the consumers. Try to ignore customer feedback/requests and you might find yourself in a more painful situation than you would have actually thought. 

AT&T CEO Randall Stephenson got a taste of what an angry customer could do when one Giorgio Galante decided to vent out his frustration through a blog. Galante had asked AT&T for an early iPhone upgrade. For this, he wrote an email to the CEO. Instead of a customer care executive reaching out to help, he received a voice mail threatening legal action if he tried to contact the CEO again. He later received an apology from a VP, but by then the blog had gone viral and much of the damage was done. 

Thus, companies which underestimate the relevance of social media will suffer. Its effects may not be immediate, but over the long run it’ll just become impossible to catch up. So, if you’ve a veteran heading the social media bench at your company who tells you that everything is under control, kick him out immediately because nothing is in control. Unlike traditional media, companies don’t own these platforms. They’re evolving everyday. Therefore, you’d do better by hiring a crazy looking chap who’s matured in the digital age. He’ll know what to do. After all, you can’t derive the value of emotional connect customers have with the brand by putting the number of ‘likes’ and ‘tweets’ into a statistical equation. The customer is no longer your muse, so try falling in love with her. Cheers to the consumer!