A Look Back At 2006 – The Customer Really Is In Charge

This is my look back at 2006 from the current issue of CRMGuru.


Companies Are Actually Engaging in Conversations With Customers

By Christopher Carfi, Cerado Inc.

In 2004, there were a few odd shakes. Some organizations noticed them, but most ignored them, perhaps attributing them to the distant passing of large truck.

In 2005, a few small, but noticeable, cracks appeared in the fortifications that separated The Corporation from its customers.

In 2006, the cracks widened. For some organizations, portions of the fortifications began to crumble and crash to the ground, casting away long-held beliefs and practices as they fell. It was the year the reliance on one-way “control” of the customer began to give way to “conversations” in earnest.

While viewing the world through the three-sided prism of “sales,” marketing” and “service” still holds as a reasonable way to characterize the breadth of CRM, these changes in customer relations affected all three areas very differently.

Sales

For some in sales, “CRM” is synonymous with Sales Force Automation (SFA). The problem is, very few customers want to be “managed” by their sales representatives. In 2006, those customers who “weren’t going to take it anymore” started taking up arms.

We’ve entered an era rich with cheap, easy, accessible of online tools to publish in nearly any format. Consequently, 2006 saw an explosion of words, photos and videos of customers documenting their experiences with products of nearly every stripe. Did you see the photos of the exploding Dell laptop in Osaka? If you didn’t, search on “dell laptop fire.” Those pictures sparked Dell to recall more than 4 million laptop batteries, and the incident ultimately may cost Sony, which manufactured the batteries, hundreds of millions of dollars. Millions of customers shared their experiences with companies with the world via their personal blogs, as well as through online communities such as TripAdvisor. Consequently, salespeople have been put in the unenviable position of competing in a world where the customer is, in many cases, better-informed than they are.

Another trend that affects sales is the rise of a new type of corporate customer: the “bizsumer.” These are individuals within large organizations who are making buying decisions at an individual level, oftentimes as a means to “get things done” in their groups without having to deal with the bureaucracy of their own organization.

The bizsumer is purchasing tools for project management, collaboration, business social networking and other systems at a price point that is often below the radar of centralized organizational planning—and usually delivered as an online service. (Joe Kraus, CEO of collaboration provider Jot, calls this purchasing things that are “expensable,” rather than “approvable.”) As such, sales has needed to embrace tactics that are much more common in the mass-market realm, such as online ordering and payment by credit card, which is a marked shift in the customer engagement process.

Marketing and PR

Of the three primary CRM areas, the areas of marketing and public relations made the most strides with respect to customer engagement. Not only startups but also behemoths such as General Motors, Microsoft, IBM and Sun Microsystems have embraced social technologies such as blogs and podcasts in a big way, as a method of getting their message out and engaging customers in the conversation about their products. These processes of engagement with customers through social media, however, need to be done correctly, and with unassailable ethics and transparency. As an example, Wal-Mart and Edelman, a PR firm, found themselves in significant hot water in October 2006, when it came to light that a blog framed as a “grassroots” effort of regular, everyday folk (“Jim and Laura,” who were driving their RV across the country, from Wal-Mart to Wal-Mart and documenting it) was actually a planned marketing campaign, paid for by Wal-Mart and supported by Edelman.

It turned out that “Jim” and “Laura” were professional journalists on assignment. (“Jim” was Jim Thresher, a photojournalist for The Washington Post, and “Laura” was Laura St. Claire, a professional freelancer.) With incredible research tools at their fingertips, customers now can ferret out the truth about products and companies in only a few clicks. Despite such missteps, through social networking, other companies began to put a more human face on their organizations. An increasing number of companies are engaging with their customers directly online; answering their questions in the public square; and moving away from “marketingspeak” and toward developing deeper relationships with their customers based on actual interpersonal trust.

Beacons

And then came “support tagging.” Stowe Boyd and Greg Narain, of the social application firm Blue Whale Labs, call these tags “beacons.” A beacon is a post in a public place, such as a personal blog, meant to draw the attention of a service provider to an issue the customer is having with the company’s products. In essence, beacons turn the service model upside down, drawing companies to the customer’s site to help them, rather than forcing the customers to go through the often onerous support process prescribed by the vendor organization. (The vendor organizations respond to such beacons through diligent, often automated, monitoring of search engine results for new items containing their company name, their products or relevant phrases.)

When it works, a representative from the vendor organization, or even an individual who may be part of a larger enthusiast community, will connect with the customer in the customer’s space and resolve the issue.

So I would call 2006 a sea-change year for CRM. Sales faced an ever-more-vigilant buyer. Marketing engaged with customers—and was called to task when it went overboard. Support is actually—surprise—supporting the customer, as opposed to purely being a cost center. The customer really is in charge.

(link)

5 Replies to “A Look Back At 2006 – The Customer Really Is In Charge”

  1. As He Would Say, Chris Carfi is Right On!

    Background Music (I’m writing this while listening to the Cirque de Soleil’s mashups of the Beatles called “Love” and I gotta tell you, this is incredibly done for us old boomers who love the Beatles and are in awe of Cirque de Soleil. Listen to it on …

  2. Are You Watching For “Beacons” That Can Ruin Your Business?

    My friend, Chris Carfi, of Cerado, recently wrote about a concept called beacons. He describes them as the following: A beacon is a post in a public place, such as a personal blog, meant to draw the attention of…

  3. Christopher, thanks for this post. This is one of those little items that I knew was occurring, but didn’t really try to materialize what it meant. You’re right, though. Companies are reaching out to consumers, instead of it being the other way around (as it has been for so long).

    In our company (my full time job is Customer Care manager for an ISP) we are using incoming call metrics and connection uptime data to determine if we need to reach out to customers who might be having issues but haven’t contacted us about them.

    I can only hope more companies begin to take this direction. The best customers you got are the customers you got!

    Thanks again, and Merry Christmas.

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