It has been a while since I am able to post something, and I am sorry for that…it is just that I have been in Final Exams and IE is very demanding school, however Prof. Dans (www.enriquedans.com), my professor of “WEB 2.0 and Customer-Driven Innovation” has asked us to talk about how we believe that Web 2.0 (for a definition refer to my first post) can be useful to companies and of course post it in our blogs.
In order to answer this in “simple terms” I will first talk about the importance of knowing your customers or potential customers….I will use an analogy to avoid sounding like a marketing textbook cause I think that would be boring for both, you and I.
Ok…so… let’s start on why would firms want to know info about their customers? well….firms need to know their customers, the same way a guy needs to know information about a girl when he is trying to get her to be his girlfriend.
When a guy is trying to date a girl, he will try to find out as much as he can about the girl in order to pretend (yes…we pretend sometimes…we really don’t like “The Notebook” movie) or to see if what he has to offer is what the girl is looking for. So a firm is like a guy, and the girl is like a potential customer… firms would love not only to “date” their customers but also if possible, marry them forever! That is why marketers use the fancy term Customer Lifetime Value or CLV (How much money you are going to make from a customer through the entire period that he/she remains as your customer)
Getting back to our analogy, in order to find as many information as possible, a guy would ask his friends, her friends, some guys will Google her name in order to find out what she likes, dislikes, past relationships what she wants from a boy etc etc. What the guy is doing, in Marketing we call it… Market Research, and Firms do that (or supposedly do it…there are firms like GM for example that launch products that nobody likes!) for every product or service they are going to launch in order to tailor or customize the product or service to the needs and wants of their potential consumers. Hence, increasing the probability of the product being liked by the consumer, the same way a guy would say that he loves “The Notebook” if he finds out that the girl absolutely loves that Movie.
Firms have been doing market research in various different ways, increasing its sophistication in order to get better results. Guys have also increased their sophistication of their Market Research, now we use WEB 2.0 tools!
Nowadays, some teenagers don’t ask what is your mobile number? They ask…Are you in Facebook? Why do they do that? Because Facebook is a great way to perform a great market research… although it is great for keeping in touch with friends, I will focus on my analogy. So today, a guy can just ask a girl for her Facebook name and add her as a friend… immediately he would see who her friends are? What she likes, dislikes, past relationships, where has she traveled to, favorite movies, sports and even (with the new Facebook Homepage) what is on her mind!!Facebook provides a tool to perform great market research, not only is constantly updated, it includes what she wants to say about herself as well as what her friends say about her! If you think about it that way, it is no wonder why Facebook has become so popular (130 Million active users worldwide). What makes it great is that you need to create your own profile in order to see other’s profiles, and since you know that others will be checking out your profile, most likely you will put some effort in adding interesting information (remember the girl will also check your profile).
Companies could also use WEB 2.0 tools to perform market research, there are big debates on whether Facebook or similar portals should or could “sell” the information they have to companies, however that is a complicated topic so maybe I will save it for another post. But leaving Facebook out of the game does not necessarily leave companies without the option to use Web 2.0 tools. Another Web 2.0 phenomenon are Blogs and today many companies are debating whether to Blog or not to Blog?
A company’s blog could potentially provide a way to interact directly with your consumer, you could allow consumers to comment about your products or services, ask them what they would like to see from your firm and what they don’t like from your firm. So you might be thinking, “Off-course they should do it” however a blog needs to be taken seriously by a firm. They cannot provide a way for customers to give their opinions and then never do anything about them, it would be like a girl telling you that she doesn’t like sushi and then you take her out to a sushi restaurant on the first date… for sure you will get the famous line “You never listen to me!”… and consumers will do the same to a firm, but they will not tell you by screaming at you but by not buying your product…so you can forget about their CLV!
Something else that companies need to consider is that consumers might complain about your firm, and you should never try to control or censure your blog (only of course if a person is using bad words or something like that), hence you need to be ready for customers telling you that you suck and allowing all other consumers to read that somebody thinks that you suck!
However if a firm is ready to take a blog seriously (an example of taking a blog seriously is DELL Computers creating the position Chief Blogging Officer) and is ready to receive honest opinions, then a blog could be very beneficial to a firm. It provides a great way to have a direct relationship with your customers and potential customers…. and of course improving drastically a firms Market Research.
As we said before, a good market research can help a firm (and a guy) better satisfy the needs of a consumer (or a girl), increasing the probability of “marrying” that customer forever, and of course getting profit along the way.
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