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Best practice for engaging the customers online

In an ideal world the marketing cycle will start with the customers’ needs analysis, is constantly influenced by customers and will change as fast as the customers change their mind-set. However, during the last decade we have become masters of the “creating the need” game, abandoning this important first step.

Listening to customers is often replaced by a marketing effort to convince the consumers that they absolutely need the advertised product, service or offer. “My product or service is truly the best and truly unique” became a very difficult message to convey within the advertisement clutter we live in.

The internet is giving marketers an interesting opportunity to once again start listening to their customers.

The new marketing model that is emerging from the use of internet is interaction driven and uses the customers’ feedback as a wrapper around all its activities.

The purpose of customer relationship management changes from managing relationships with customers to engaging the customers in building and launching the products or services.

Social TV is one example of a new “communication tool” exploited within an “old” entertainment industry. Viewers are often looking for more meaningful interaction with the shows and content producers are trying to find new ways to engage the audience. In the US, using the internet social TV, presenters integrate live segments of their hosts answering tweeted questions, Facebook comments and commenting on real-time poll results. This dynamic approach helps them attract millions of viewers.

Hungry for new, relevant ways to reach consumers, companies such as Apple, Skype or Netflix have changed the way the market responds to customers’ needs. By completely challenging the idea of a portable computer, Apple understood the existent customer need for tablets and gained the significant market share within the industry.

Listening to the needs of customers, Skype introduced a low cost telecommunication service that allows clients to call and message on the same interface for a fraction of the traditional telecommunication cost and has achieved some amazing statistics: between 2004 and 2010, the number of registered Skype users increased by almost 30 times, reaching the figure of 560 million worldwide.

Tata Nano (an Indian car manufacturer) offers a car for $2,000, offering just bare essentials; it challenges the traditional car manufacturers and the ways that they set their prices and margins.

Meanwhile, Netflix in the US has introduced an internet DVD rental offer for $16 a month (no limits on the number of movies watched) and with its 25.6 million subscribers, pushed the traditional DVD rental chain Blockbuster to bankruptcy.

The OECD, in its June 2011 report ‘The Internet Economy: Generating Innovation and Growth’, published statistics which show that almost 30 per cent of citizens in EU countries download music or plays games on the internet. Playing or downloading music is most popular in the Netherlands (51 per cent), and Finland (47 per cent).

Pandora, an US online radio, anticipated this trend and it has created a customised radio offer – playing a music selection for each individual user, similar to songs suggested by the user. Pandora also takes care of the positive or negative feedback provided by the users.

The radio builds its business model on offering commercials. However, aware of the nuisance the commercials could create to music lovers, they have limited the space to 80 seconds of advertisement per hour (a regular radio runs anything from 10 minutes of adverts per hour). Pandora’s innovative idea has earned its owners revenue of $600 million in 2011.

The internet is making companies re-think their strategies and forces them to listen to the customers’ needs. The challenge now becomes managing this bi-directional communication without getting into potentially damaging situations where customers are for some reason unhappy and express their unhappiness publicly. To successfully manage this challenge, the company needs to be open-minded and culturally ready to work with its customers, cherishing and respecting both innovative ideas and criticism that comes directly from the source of all the money and the knowledge – the buyer.

www.alert.com.mt

Ms Pantović is a marketing consultant at Alert Communications, a local web development company.

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