It’s Tuesday -- and that means it’s time for another installment of #IMChat, a weekly tweet jam hosted by the interactive marketing team at Forrester. For today’s tweet jam, we’ve invited Shawn Shahani (@shawnshahani) from iCrossing to talk with us about challenges and possible solutions for companies with large and complex social presences.
Here are some of the questions we'll be discussing:
1) In which social networks does your company currently maintain presences?
2) How are you using these social media properties differently?
3) Do you have multiple presences within a social network?
4) How do you separate multiple presences? Geography, brands, job function?
5) Who manages different social media presences and properties?
To participate, just follow the #IMChat hashtag at 2:00 p.m. If you’d like to learn more about the rules of engagement, visit this community discussion on The Forrester Community For Interactive Marketing Professionals. To read some past archives, visit the documents section of the same community.
Today Forrester released a piece of must-read research for every organization that markets and sells to customers. In Josh Bernoff's report "Competitive Strategy In The Age Of The Customer," he illustrates how customer-led disruption forces firms to throw away old models of competitive differentiation. Competitive barriers like manufacturing strength, distribution power, and information mastery won't save anyone. The report concludes that the only sustainable competitive advantage is knowledge of and engagement with customers. In the age of the customer, firms must become customer obsessed.
eBusiness and channel strategy professionals are no strangers to customer-led disruption. Many firms' web strategies are just now finally catching up to the sneak attack of Amazon.com and E-Trade, if they survived at all. What happened in the early '90s will continue to happen again and again. In a companion document that I also released today, I argue that to survive, eBusiness and channel strategy professionals must embrace the principles of agile commerce -- optimizing people, processes, and technology to serve customers across all touchpoints. Specifically, eBusiness and channel strategy professionals must shift from:
Customer acquisition to retention.
Siloed channels to touchpoints.
Reactive to actionable use of customer data.
I encourage you and everyone in your organzation to read this critical document about surviving and thriving in the age of the customer.
This morning eBay announced it has agreed to acquire Magento, the open source eCommerce platform that will be combined with other solutions to form a unit within eBay called X.Commerce. eBay already had acquired a minority stake in Magento in 2010, but after this latest transaction, it will own all of Magento. The folks down in San Jose have been busy this past year, paying approximately $2.4 billion for GSI -- which came with a controlling stake in Intershop -- as well as a raft of other mobile commerce solutions such as Milo and RedLaser. This announcement today means:
For Magento users, this is a very good thing. It is time for Magento to mature as a solution and as a business. The same development approach and business practices that can support a small insurgent open source commerce platform do not scale to supporting multiple products with very diverse needs and across many maturing clients. Users of Magento’s enterprise solution have been struggling with support and product traction as Magento invested in the MagentoGo SaaS solution and tried to manage a rodeo of new and existing partners, customer acquisition, and diverse product initiatives. In retrospect this was too much to take on at once, and Magento may have outgrown its ability to deliver on the expectations. With the completion of this acquisition eBay has the ability to clarify the product initiatives, add needed investment to product development, and mature the support given to developers, partners, and customers. A failure to do so will erode the Magento value proposition and see a raft of clients evaluating their long-term commerce capability solution providers and platforms. It will take time for the core challenges to resolve, so for Magento users struggling now this announcement will mean little in the short term. For Magento users in the longer term, this should be a positive.
At least once a week I get a client inquiry wondering what is "the next big thing in interactive marketing," seeking to identify what will out-tweet Twitter or out Goog Google. Well, in his new report, Competitive Strategy In The Age Of The Customer, my colleague Josh Bernoff articulates what is next for all businesses: A disruptive shift, where the power of customers means that firms must focus on the customer now more than any other strategic imperative. In fact, the only source of competitive advantage is the one that can survive technology-fueled disruption — an obsession with understanding, delighting, connecting with, and serving customers. In this age, companies that thrive, like Best Buy, IBM, and Amazon, are those that tilt their budgets toward customer knowledge and relationships.
The zinger in this report for interactive marketers is to: Prioritize word of mouth over mouthing off. Cut your ad budget by at least 10%, and spend the money on connections that have a multiplier effect like social, devices, and content. Ads are far more effective when customers are primed to believe them.
This means that interactive marketing of the future is really focused on interactivity -- not just on pushing out marketing messages through digital channels. Three ways to get started creating more interactive marketing relationships:
Relationship marketers love customer lifetime value (CLV) as a concept because it puts the customer at the core of the marketing investment decision and sneaks a peek into the future worth of the customer. But in reality, arriving at customer lifetime value is often a herculean task and the assortment of CLV approaches available doesn’t make the process any easier.
My latest research, titled “Navigating The Customer Lifetime Value Conundrum,” highlights key considerations for firms who plan to embark on the CLV journey. As a continuation of this research stream, I asked our Customer Intelligence community members what their experience with CLV was and a few interesting points emerged:
Inclusion of intangible value. At what point is it important to account for the intangible, non-transactional value that customers are generating especially through all the emerging channel interactions such as referrals, recommendations, likes, user-generated content, etc.?
Blurry definitions of "best" customers. Traditionally, resources are channeled toward your best customers with positive net present value (NPV). But often there is conflicting choice between investing in high-value, low-usage customers and low-value, high-usage customers. As a result, defining your "best" or "worst" customer/segment is not as obvious as a positive or negative NPV.
Diversity of CLV users. CLV is not just the domain of marketing or customer-focused teams, but it touches other stakeholders in the organizations. How do non-marketing stakeholders such as finance teams in your organization view this metric? Is CLV as important to non-marketing stakeholders as it is to marketing?
I had the good fortune to work with Josh Bernoff, co-author of Groundswell and Empowered, on a groundbreaking new report. Along with colleagues from across Forrester, he has raised the red flag on a new era of competitive advantage that ties together what technology has brought us — information — with the end goal in mind — the customer — to define a new strategic focal point for companies that he and we now call the age of the customer. See his initial blog post here, or watch this video about the report:
Why is this so important? Because many companies have maximized the value of information that has dominated technology investment and decision-making since the early 1990s when the Internet boom began, computers got substantially cheaper and more powerful, and connectedness began to change the dynamic between people and companies. Over the next decade or more, the only way companies will truly stand apart from their competition will be a devotion to combining information, technology, and decision-making into a defensible and fundamentally stronger position — obsessing about the best customers that they have and demonstrating that value in terms of products, marketing, and service.
Do you think your company is customer obsessed already? Look at your customer systems and ask yourself some key questions:
Do you know the share of wallet you maintain with customers?
Do you engage customers when they are not in the buying cycle?
Whereas in the age of manufacturing, the age of distribution, and most recently the age of information, companies that had the best skills were winning, in this age of the customer, only companies that fully understand their customers’ needs will win over their hearts (and with that, wallet share). And it’s not enough to be customer-centric — in fact, companies should be customer-obsessed. This is not just jargon, it has a real meaning:
A customer obsessed company focuses its strategy, its energy, and its budget on processes that enhance knowledge of an engagement with customers, and prioritizes these over maintaining traditional competitive barriers.
This report is very relevant for market insights professionals because they are the ones that will need to support their organization to understand the (hidden) drivers behind the needs of the customers — and how to delight them. Josh Bernoff shares more of his insights in this blog post, and clients can access the report here.
When I was asked to give a keynote at DemandCon on the past, present, and future of demand generation, I wondered what new wisdom I could share about the past and present. We've all lived it; we all know how bad marketing and sales teams have been at generating demand. So I shared some research data that validates what we know about the poor current state and then shared four counterinituitive mindset shifts that marketing and sales leaders need to make if they want their future to be rosier than today:
Fight funnel vision.
Stop trying to align marketing with sales.
Don't talk about what you do.
Take a stand.
You can watch the presentation, or click Watch A Segment to go directly to The Future:
There are a lot of vendors pitching their social media listening capabilities. And, the more that I hear these pitches, the more it has made me think that a bunch of companies jumping on the social media bandwagon are going down a dangerous road of using it as a customer service escalation strategy — which is a horrible idea.
Let me illustrate with a recent story I heard. A woman discovered that the VIN number of her car was improperly recorded on her last visit to the California DMV. As she tried to get it fixed, she found out it was going to require a lot more effort than she hoped (perhaps it included a visit back to a local office). She tweeted about it. Remarkably: The California DMV was listening!! It tweeted her back, contacted her, and helped her resolve the issue in a fraction of the time and energy it would have taken. The result: a happy customer.
There are a couple of strange things about this story. First, the DMV can’t fix its long waits and broken processes, but it has people listening to Twitter. Hmm. Second, it rewarded someone who complained to the entire world about its broken process. The next time I want a quick fix to a problem I have with the DMV, remind me to tweet about it!
Congratulations to companies that can respond to the relatively few tweets they get via this channel today. Are you prepared to scale this operation as you re-enforce people to get service from you this way? More importantly, is that really the venue in which you want to solve problems?
I don’t love the name enterprise feedback management (EFM) to describe the technologies that enable voice of the customer (VoC) programs. It’s just not sexy. Unfortunately, it still accurately represents what vendors in the space actually do. As my colleague Roxie Strohmenger and I explained in a March 1st report: “We believe EFM still accurately represents the category. Why? Because 1) the vendors are still primarily focused on feedback as their primary data source, and 2) managing that feedback extends to the various analytical, alerting, and reporting activities that they pursue beyond just supporting survey processes.”
Since then, we’ve been knee-deep in EFM solutions, preparing for a Forrester Wave due out this summer. The experience has totally validated our earlier decision. Here’s a brief explanation:
Enterprise: The vendors pull together data from across an organization, from contact center to web, store, and social. Many also incorporate data from noncustomers, such as prospects and employees. In other words, they provide enterprise solutions. Check.
Feedback: It’s widely accepted that feedback includes more than numerical survey responses. It includes unstructured and unsolicited feedback too. Many EFM vendors also go beyond what we typically regard as feedback by incorporating transactional and operational data. But their solutions are totally built around feedback. Other data is treated practically as feedback, and it’s used to put feedback into context. Check.