Using Technology to Extend Customer Intimacy
04 July 2007
In their classic book, Discipline of the Market Makers, the authors Tracey and Wiersema argue that in order to succeed in their market-space, companies have to excel at one of three disciplines:
Operational Excellence: the best price with the most convenience;
Product Leadership: the best product through innovation;
Customer Intimacy: the best service for a particular market sector driven through detailed knowledge of customers’ behaviour.
The discipline of customer intimacy is interesting from a technology viewpoint. Traditionally, detailed personal knowledge of consumer behaviour has been the speciality of small, local businesses dealing with regular customers on a face-to-face basis. In the last decade, this ability to gather customer-intimate knowledge has extended to large organisations by the use of technology; for example, the use of loyalty cards to track consumers’ purchases. Recently, technology has further extended this capacity to those organisations where an intimate relationship had been difficult to achieve, namely:
print media organisations are moving away from simply publishing readers’ letters to soliciting user-submitted opinion pieces and photos for use both in their print and online versions;
tv/radio broadcasters are moving away from postal and telephone contact to text, email and to an online presence.
The reason is the desire to improve service by learning the preferences of both existing customers and potential customers (shown by the grey oval on the diagram) by:
increased communication effectiveness;
increased communication intensity;
blurring the line between uni-directional (broadcast) and multi-directional (dialogue) communication.
The medium driving this increased intimacy is the online presence; most organisations solicit opinion pieces, photos and video; furthermore, online contributors can label this material with descriptive tags so that others can search using their own preferences. This creates a feeling of community, leading to an increase in visitor numbers and allows the audience to be selectively targeted through advertising, if required. Online registration to upload and tag such material gives the hosting organisation useful customer-intimate details, but the content of the submitted material and tracking which is most popular enhances the value.
As a result, the boundary between content-provider and content-reader is thoroughly blurred. The idea of free content sounds good but inappropriate material will drive people away - in the worst case, legal action can ensue. For example, copyright of the material is usually surrendered by the person submitting it. If this person does not hold the copyright, or the organisation does not advertise the fact that it will take it over – something that is often insufficiently advertised – the organisation will suffer from the resultant bad publicity.
Copyright aside, there is the issue of the quality of the material. Some of the material submitted will be just plain bad, or at least inappropriate for the brand. The answer to both the copyright and quality issue is the use of careful moderation. Some of this can be automated, but much of the moderation will have to be performed by skilled staff with brand knowledge.
Conclusions / Key Points
Many organisations are seeking to increase customer intimacy by hosting submitted material using an on-line presence, blurring the lines between broadcast and dialogue communication.
All submissions should be carefully moderated for material that is illegal or otherwise inappropriate.
Copyright expectations for all parties should be prominently displayed.