The Social Customer Needs Your Attention to Get Theirs - Customer Relationship Management

Okay, so we have the customer ecosystem and we know that the customer is firmly in command of the conversation.What does that mean? Who is the customer firmly in command of the conversation? How did we get to this point?

Coming of Age
In 2006, Forrester released its annual North American Consumer Technology Assessment Survey.They found something that was interesting, to say the least, and profound for anyone who needed to acquire or retain customers:Generation Y is the first generation to spend more time on the Net than watching TV, with 10.6 hours per week watching TV and 12.2 hours surfing the Web.

The implied significance of that is nothing less than missioncritical when it comes to how you begin to think about the future of your business.The generation it’s talking about—those born, depending on who you believe, between 1977 and 1994—thinks of things differently and acts differently when it communicates.It also expects differently than either its immediate predecessor, Gen X, or Gen X’s parents, the baby boomers.Gen Yers are called by Sarah Perez of Read-WriteWeb (www.readwriteweb.com) “digital natives” because of their comfort levels in multitasking among their laptops, cellphones, and multiple other communications media.They routinely time shift and place shift.That routine actually impacts your business.

Do you even know what that means?

Time shifting and place shifting in combination would be downloading something to your iPod or other media player (place shifting) and listening to it whenever you want to time shifting).It means youre not tethered to what you listen to, how you listen to it, or when you listen to it.

Is that a really important characteristic of Gen Y and those driven by the change? It is to the entertainment media.

Beth Comstock, then-president of Integrated Media at NBC, said the following in a Fast Company interview in May 2007:

Fast Company:How are viewing habits changing?
Beth Comstock:We have had 60 million streams [of TV shows] at NBC.com.A lot of those are repeat viewers.others are timeshifting.They’re place-shifting, too, with iTunes or on phones.
Fast Company:And does that work for you?
Beth Comstock:It has to.If consumers are in control, they’re going to figure out how they want to watch.We have to find the right solution.

Her key phrase:If consumers are in control.The consumers, a.k.a. the social customers.

The entire premise of Social CRM is that these very same social customers are now in control of the business ecosystem because of the choices they have in their relationships to institutions and the intensity and sheer numbers of their relationships to their peers.Social customers have one other important characteristic:they are willing to mobilize into action.

Gen Y drives this.Gen X participates.Baby boomers are coming along.

Why Y?
If you accept the rough birth dates for Gen Y, their numbers come to 76 million, even more than the previously largest generation, baby boomers.Poor Gen X is only about 45 million strong.What makes Gen Y important to a book on Social CRM is as much what they reflect as what they drive.They are the first generation old enough to have an economic and social impact who grew up with the expectations that the ways they communicate and gather knowledge and then use that knowledge will simply be accommodated.

They are not just technology-savvy, which is often touted as one of their key traits.They actively use technology for their communication and personal productivity and they do it as highly obile, though still sentient, beings.

Here are a few numbers from the younger Gen Yers, those still in college:

  • 97 percent own a computer.
  • 94 percent own a cellphone.
  • 76 percent use instant messaging (IM).
  • 15 percent of IM users are logged on 24 hours a day/7 days a week.
  • 34 percent use websites as their primary source of news.
  • 28 percent author a blog and 44 percent read blogs.
  • 49 percent download music using peer-to-peer file sharing.
  • 75 percent have a Facebook account.
  • 60 percent own some type of portable music and/or video device such as an iPod.

This isn’t just savvy.This is active participation with technology, a tool in their lives that allows them to communicate with their “trusted sources, ”a.k.a.their BFFs. (If you need to know what BFF means at this point, it means “best friend forever.”That means “trusted source” in the far less colorful language that we older folks speak.For the purposes of this book, I may use them interchangeably.)

This active, untethered use of technology doesn’t mean it’s the only way they communicate, despite what you see your teen kids doing all day.When you’re thinking about your business strategy, you’d better be considerably less anecdotal, because the data is a little different than what you think you’re seeing.

A study done by eMarketer in July 2008 found that 60 percent of younger Gen Yers are purchasing online—the majority of them buying clothes, shoes and, of course, accessories.But 82 percent of them prefer to shop in stores, not online.Got that?

Why? Here’s what Mandy Putnam, vice president of TNS Retail Forward, said in the June 2008 Stores magazine:“…young people prefer the sensory stimulation that accompanies shopping with friends at stores.”If I had to interpret that, and I do, I’d offer a business translation that went something like this:The younger Gen Yers prefer the experience to the purchase itself.They are actively shopping online and that tells you about their comfort with technology, but the reason for that online purchase is primarily because it’s a more convenient way of trolling for good prices and value.Their online shopping is more for parsimony, not for reveling in experience.The social side of shopping with friends in a cool environment is where the experience is for them.

This is the first trump card to play when planning your customer strategy.Experience trumps utility.Note, though, I didn’t say offline or online—just experience, without modifiers.

This is also a generation with different expectations.They expect to get what they need.They’ve been raised to think they will.More often than not, they do.

Bruce Tulgan, author of Managing Generation Y, put it well in an interview with USA Today on Gen Y’s expectations at the workplace:

This is a generation of multitaskers, and they can juggle e-mail on their BlackBerrys while talking on cell phones while trolling online.And they believe in their own self worth and value enough that they’re not shy about trying to change the companies they work for.That compares somewhat with Gen X, a generation born from the mid- 1960s to the late-1970s, known for its independent thinking, addiction to change, and emphasis on family.They’re like Generation X on steroids.They walk in with high expectations for themselves, their employer, their boss.If you thought you saw a clash when Generation X came into the workplace—that was the fake punch.The haymaker is coming now.

not going to dwell on this, because that would be beyond the scope of the book, but that haymaker has been thrown and it landed.The combinations that followed were heavy.The impact of Gen Y on other generations that were inclined to be like them to some degree (Gen X) or inclined toward change at one point in their lives (boomers) was powerful.In fact, it created what Springwise (www.springwise.com), a site that covers long-tail business trends, and I call Generation C—a cross-generational grouping that is exactly those customers you have to deal with now.Those social customers.

Generation C:From la Vita Contemplativa to la Vita Attiva
In his most overtly political work, Convivio, Dante Alighieri identified two states of life that most people desire and some attain:vita contemplativa, the thoughtful, pure intellectual life, and vita attiva, the active life.Dante saw them both as righteous paths to a good existence.Though the contemplative life is the optimal state in Dante’s view, vita attiva is the state of social customers.Let’s take a look at how they got there.

Gen C:The Early Years
In the earliest part of the 21st century, social and cultural shifts in combination with the beginning of the Web 2.0 technology developments began to change how people thought and what they expected of the institutions they had to deal with.To just give you a flavor, not an extended sociological analysis, here are some of the reasons worth mentioning:

  • Gen Y’s entrance into the workforce and their demands for what they needed in order to work and communicate
  • The development of the over-the-air infrastructure, allowing much higher speed data transfer and better quality communications
  • The easy availability of inexpensive or free hardware devices and software that could utilize those higher speeds, available bandwidth, and improved communications
  • The decrease in the cost of storage, making the archiving of large files for photos and videos reasonable for the first time
  • The fact that baby boomers did not retire due to both the early millennium economic downturn and their continued interest in working
  • The increasingly easy and inexpensive availability of Internet access through wired and wireless sources.

But the most important inflection point came when who and what trusted sources were began to change.In 2003, according to the Edelman Trust Barometer, “a person like me” (more on that later) was the most trusted source for only 22 percent of the population in North America and 33 percent in Europe.By 2005, that had shifted to an incredible 56 percent in North America and 53 percent in Europe, and it has never looked back since.Now trust was based on someone who had the interests and/or political beliefs that you had, not institutions that had been providing self-aggrandizing literature to convince you to buy products, or even industry experts who had the subject matter knowledge, or nonprofits that were pure of heart and motive with their social agendas.You and your social doppelgangers were the ones you went to for get advice or share beliefs.

Gen C:Technology Transformation and Lifestyle
Technology plays an important part in the social changes that have driven the growth of Gen C.It has been an enabler and even something of a driver in the confidence that social customers have in their decisions about how they want to do business and with whom they care to continue doing it.

From the corporate side, some of this was precipitated by the evolution of the on-demand model for software services.In the olden days of 2003, it was called the application service provider (ASP) market or “net native” services companies.Salesforce.com led the charge to this new way of delivering technology services.Denis Pombriant, whom you’ve already met, was the first in calling it “disruptive” and it was.For businesses, CRM-related services—sales force automation in particular—became a manageable cost with flexible, multichannel access.This revolutionized the delivery of CRM to companies, making them considerably more aware of what it was, precisely at the time when the world was changing.

There was one other important change.Lifestyle and business started to become inextricably linked.Consumer thinking began to mesh with business strategy and activity.Companies like Research in Motion (RIM), creators and manufacturers of the ever-popular BlackBerry, began to consider style as something that was a true feature of their business offering.The old clunker 7200 series was replaced by the very cool BlackBerry Pearl.

Additionally, people began to use the Internet not just for e-commerce, which was the first true business activity on the Internet, but also for research on the products and services that they were interested in using.This was reflected in the exponential growth of Internet search, especially Google, which reached to nearly 500 million unique visitors in the month of November 2007 alone.Getting information in less than a second became standard.Search software, which often cost thousands of dollars, was no longer necessary.The minutes it took to do an unstructured search turned into nanoseconds.The world changed.Google is free and so ubiquitous that to Google something is now a verb.In fact if you Google “Google, ” there are 2.78 billion results (which I found in 0.22 seconds).

Because of the shift in who you trusted and the easy availability of tools like Google, how you investigated information and what you believed became very different from what it had been when the millennium dawned (that’s 2000 or 2001, depending on how literal you want to be).The social customers, younger or older, didn’t have to rely on corporate literature and self-interested salespeople any longer.They could rely on each other for information on their potential purchases and for deeper knowledge about their common interests—work or play.

This gave rise to simple review sites.These sites were available to the users of products, services, or visitors to institutions.They provided a means to rate (usually with 1 to 5 stars) and comment on the products they used.This resulted in unvarnished information such as:

  • How good was the product?
  • Did it meet the expectations the buyers had of it?
  • What did it do right? Wrong?
  • Did the manufacturer or retailer product provide appropriate service around the product?
  • How did the company handle the order, shipping, and customer service?


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