Monday, June 30, 2008

Presonalized Customer Experience - Something completely new?

When I was running today on my usual track, I was thinking about the new personalized customer experience and what is so new about it. I came to the conclusion that we already had this concept in the past. It is not so new!


In the corner shops in the past, there was a truly personalized experience. The lady behind the counter knew all her customers personally and treated everybody different. She recommended products which she believed were of good quality and delivered some value to the consumer.
By sharing the experience of other buyers of the same product she could back up her own preferences. Customers met in the store and shared their experiences themselves - positive and negative ones.
The conversations were not limited to products, though. The people that met in the store chatted about their daily life and shared stories about family and friends. Sometimes interested people would spend some more thoughts about peoples problems and create solutions (could be new products or services).


With the globalization in the last decades the consumer got bombarded with new and cheap products from all over the world.
Innovative products reached millions of customers without any thought about their special needs or potential problems with the usage in different environments. No need for extensive testing or customer feedback - competition was fought on price and features.
As customers started buying in big stores without the personal support from the personnel or via the internet without any personal contact, there was no way to make problems public about products or services. Other consumers would buy the products because of the nice and shiny advertisements and producers made good money with selling bad products.
Marketing was made by analysts that gathered data, ran some algorithms on them and created products they believed had a good potential on the market. Supported by massive TV, radio and print campaigns the products were introduced to the market and produced with an efficient and cost effective SCM. No one ever spend any thoughts on products and services could be personalized and how the customer could be involved in the creation and evolution of them. And actually for quite a while there was simply no way to do this!!

But now there is way (!) and companies need to re-think their process of inventing, marketing and producing goods. The empowered customer is now able to share her/his experience with millions of other users via the internet and there are ways to create a personalized experience even for thousands or hundreds of thousand users.

So isn't CRM 2.0 a kind of 'back to the roots' thing? Weren't we as customers missing the personal component of the selling-buying process in the past years - but still want to keep the advantages of a global marketplace where companies have to compete globally on price, features and quality?

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The Customer changes... so do companies?

I know this youtube video is pretty old, but it still perfectly visualizes what happens if companies do not change and adopt the new Web 2.0 world...


But is a CRM 2.0 strategy everything it requires to make customers happy? What else does it take to make consumers loyal to a brand or product - why and when do they become advocates?

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Sunday, June 29, 2008

The Customer Experience

Some CRM vendors talk about Service and Support when they push the Customer Experience. But the full Experience of a product or brand is so much more than that (although service is a crucial part of it...)!

What is the Customer Experience and why is it so important?

Creating an Experience means that the consumer receives a product or service that emotionally touches her/him and leaves an impression that is positive in all areas.


The Web 2.0 technologies allow empowered customers to share their experience with thousands of other users or potential users. If the experience is negative it will seriously harm a brand - if it is positive the customer becomes an advocate and kicks of the viral marketing machine (don't like that term).

A CRM 2.0 strategy must acknowledge the power of customers and actively create an Experience that is unique and all positive. This could be achieved by engaging the customer in a real dialogue and listen carefully to what e says. Innovation has to be a central part in such a strategy as well. Innovation from both sides, internally and externally.

The consumer will only become an advocate for a brand or product if if it delivers a great value (which is not related to the price!). In general the consumer is looking for products and services that leave them with a good feeling which might be created by innovation, the price, the uniqueness or the reputation.

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CRM 2.0 Strategy Discussion

I collected my thoughts about what a CRM 2.0 Strategy will consist of.

Is this complete, anything missing here? Any feedback welcome!!

Next step is to get this structured and add some details in how this can be achieved...


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Thursday, June 26, 2008

Innovation centric

A. G. Lafley suggests in his book "The Game Changer" that companies should be centered on innovation. But he admits himself, that innovation that does not bring value to customers is nonsense...

So shouldn't the business be customer centric then?

I think there are many ways for customers to influence innovation and the products that come out of it. This graphic should visualize on a high level how that could look like:


The Web 2.0 will increase the influence of customers on innovation massively. Companies that actively support this development will profit from it and gain competitive advantage while companies ignoring it and staying with the old fashioned 'isolated' innovation process might not be able to create a customer experience that makes customers loyal.

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Tuesday, June 3, 2008

The Social Graph



The Social Graph could completely change analytical CRM in the future. Brad Fitzpatrick gives a good outline what the Social Graph is and why it adds value to users.

The OpenID project and Google's Social Graph API may be delivering the right tools to implement a working social graph across various web 2.0 platforms. If the critical mass is passed, no platform will be able to not open their APIs to connect to such a Social Graph.

As soon as this happens, companies will have to include this data in their business processes to make sure...
  • They address the right people with the right product offers
  • Customers are able to recommend the company or products
  • The buying experience is unique and exceptional
  • New and promising leads will be addressed
  • Customer support is leveraging the user community (save cost)
  • Feedback is possible and heard
Additionally it might be a good idea for businesses to play an active role in communities and the social graph to increase visibility and create a personal user experience. If I add a company or a brand to my list of friends, it shows my loyalty as a customer and makes this position public to my other contacts and friends. This is basically the same thing as if I am chatting with a friend and tell him how much I love my iPhone, but it's not only one person - it's a full community (across platforms) that can see my favorite mobile phone, including the vendor itself (-> cross-sell + up-sell opportunities).

As soon as the Social Graph gets usable (barriers are high in the web 2.0 world!) it will tear down the walls between the different platforms and web 2.0 communities and dramatically widen the horizon for each user. It will allow smaller niche platforms to operate with less user numbers - as long as the member can access friends in other platforms without registering twice...

Technically the Social Graph is ready to go (maybe the Semantic Web will get reality as well some day?). Google's initiative to create a standard API will probably help to make it usable also in a CRM 2.0 context to find new leads, help create a unique customer experience, initiate viral marketing (or however you want to call that) and build a community of users that help define, build and enhance new products.