Realized opportunity, value of real customer conversations

Stuart Elliot writing on advertising for  New York Times described the purpose behind Omnicom Group’s launch of a new ad agency, sparks & honey.  The Agency seeks to capitalize on the latest evolutionary shift in the relationship between consumers and marketers, “from a monologue to a conversation.”

Customer services

Customer services (Photo credit: gordon2208)

Really? Brands have accepted that talking with customers no longer means talking at.  But are they really ready for interactive conversation?  Don’t get me wrong, I applaud the move to a higher level of engagement.  I merely wonder how the brands benefit from advertising agencies occupying this intermediary ground, especially when the brands livelihoods increasingly depend on their ability to respond immediately.

Implicit in a conversation is receiving, or listening made clear in non-verbal posture and behavior as much as  words.

As Dave Carroll’s viral video demonstrated, brand reputation can suffer when listening isn’t followed by appropriate responses.  Brand management teams everywhere noticed how translating a bad customer service experience into song  boosted Taylor guitars‘ reputation while tarnishing that of United Airlines . What got Carroll’s goat was the lack of response by airline employees watching other employees  manhandle his precious guitar.  The colorful story in the hands of a capable songwriter also boosted, if not fired up, Carroll’s brand.

To relegate the story as an abject lesson in Customer services misses the wider opportunity listening to your customers affords.  Either way, how will hiring a savvy intermediary help resolve issues, deliver authentic feedback to product development or spawn key insights into the changing behavior of customers for helping a company adapt and ultimately survive?

Why would a company want to pass on the opportunities listening and responsive internal systems can foster?  There’s great value in using smart analytic systems to mine the exchange of key word morsels caught in dialogues with customer service, sales or technical support.

As Peter Shankman, steak lover, discovered one day last year when he had no time or energy to grab dinner out,  but longed for the simplicity and consistency of Morton’s reliably delicious meals. As he describes it, one tongue in cheek tweet before taking off for home resulted in the surprise service of a lifetime. One only Morton’s could coördinate and deliver because they were listening to one of their most loyal customers far from home!

So, yes it matters, what conversations you are trying to make happen.  Increasingly you need to collect the data.  This requires that you will need intelligence gathering or listening posts everywhere your customers are talking about you, including  the virtual conversations. Just because they seem less critical  than face to face exchanges, especially since the nature of the medium is slightly off sync, today no conversation can can be ignored. What customers say, how each of you share it,  and with whom makes them both dangerous and advantageous.  Machine learning systems, algorithms and human insights can  track “the emerging cultural waves”  and that’s how sparks and honey plans to find and then leverage them.  Their business model relies on  their ” proprietary next generation, real-time engagement engine to distribute culturally relevant brand content.”

In the era of big data, business intelligence software has been actively integrating the new feeds and applying similar processes.  The merging of collaboration, productivity  and newer intelligence tools that digest  input from a variety of listening posts shows great promise and opportunity. I haven’t seen Cognistreamer, one of a number of  collaborative and innovation platforms; but I understand it combines feeds from social media, customer service and internal correspondence to allow more fluid interaction across sources operating within and outside the enterprise. I’m sure IBM and Microsoft are busy at work bringing these capabilities to their platform suites as well, I’m just not sufficiently in the loop to know.

I applaud the move toward authentic conversation that can displace the reign of the focus group or on the spot pop-up survey whether it’s at the mall or online. But I’m not sure I buy that ad agencies, or even Dave Carroll’s newly launched Gripevine service, and clever communications can effectively close  the natural gap between producer and consumer.   If I’m looking for a custom fit, or personal response how can any agency deliver,  no matter how clever or deft at communications they may be, the goods and or service I’m seeking?

I wish sparks & honey luck, but I do hope that brands looking to capitalize on the rising consciousness of consumers are also thinking a little more about finding ways to share the responsibilities for insight and innovation across their enterprise.  Giving everyone equal opportunity to engage with customers and share insights that wider conversations make possible, is certainly a great start to creating an innovation pipeline.


Finding hidden treasure in plain sight.

Prospecting, mining both are familiars metaphors describing the activities associated with finding and developing  resource rich opportunities.  Rarely  in plain sight for any passerby  to scoop up and gain advantage, prospecting for Gold, other metals or precious gems like diamonds require active and often deep digging capabilities.

Like precious metals or gems, the secret to good business is creating precious assets of intrinsic value. The attributes to value when known for durability and uniqueness, such as a brand, retain  value over time,  predictably generate  cash flow and  become  difficult for competitors to acquire. But the uncertainty of today’s markets and the disruptive threat of new technologies can quickly erode the value of any asset and so growth is essential.  Whether your strategy calls for acquisition or organic growth, either way, the underlying development and prospecting costs need to be contained.

In stories and legends, merely having a treasure map and knowing where to dig doesn’t always lead to happy endings. Technology has certainly helped to mitigate the risks or advance probabilities of success.  Ground and water penetrating radar and detectors   discriminate ferrous and non-ferrous metals pinpoint the site to begin mining and improves the probabilities of a fruitful yield.  The challenges in any mining activity depend not on the power of the technology or in making the dig profitable. Today’s WSJ headline reads Gold hits $1,700.  Absent reliable, hidden treasure maps knowing where to look is an advantage. Returns depend on offsetting the difficulty and risks associated with its extraction and the quality or grade found. Forbes recently summed this up  USAGX’s Denbow: Gold-Mining Companies Face Challenges Finding New Supply.

Prospecting is a perennial challenge for any and every business, and managing the costs is the key to delivering returns.  The current market turmoil has done more than merely  increase investors uncertainty.  for the Risk averse, who have shied away from innovation  or the adventurous  business who has wisely taken pause, I suggest this is a great time to revisit your strategies.  Standing still can prove surprisingly  advantageous if in the process of cleaning house you discover  undervalued or even overlooked assets.  What value does an earlier project, research or failed product launch buried for any number of reasons offer? Lance and Scott Bettencourt of Strategyn write in Harvard Business Review in June 2011 Innovating on the cheap  a series of suggestions on how you can  leverage your existing assets, or rediscover value in surprising places.

Mining existing assets

I suggest a process that may take you a little further.  Consider Google’s Search business and the  underlying value of its algorithms and index.  Maintaining these assets is of critical importance but so too is the value of constant improvement.  Daily, new content and pages added to the internet require Google’s index continuous update.  Including  rich and diverse content such as images, video and sound  files on the internet challenges Google’s index  and algorithm update to accurately rank and deliver the results.  Realized innovations  continuously contribute  to Google’s financial performance and persistent high  market valuation. Even Google however has failures. Research,  experiences of both internal and external users generate additional  assets hidden in plain sight. Actively sharing and reflecting on the meaning of both successes and failures  allow new project teams ready access to key insights that otherwise would be left to lie fallow collecting dust.  If Google continues to draw value  or benefit from their latent assets, can you?

Identifying data or purpose

Frequently, environmental conditions change a variable’s significance.  Strategyn authors talk about unrealized value in products that may have been premature for the market,  experienced formidable technical difficulties or their launch prevented  by high manufacturing costs . Nothing stays constant anymore.  Consumers are always adapting  their preferences to changing circumstances and environmental conditions, and  business are equally forced to adapt.  A variable’s significance in your business model  in one moment may prove insignificant later. Persistently changing conditions is  why its’ important to frequently revisit your tactical plan and forecast models; and occasionally revisit your business model/strategy.

In 1984, Jesse Jackson was the first Black American to run for President.  I was an assistant statistician working for CBS News assigned  to use the exit poll and early returns to create prediction models to track trends in voters behavior. Race became a significant variable , where as before it had not been much of a determinant factor.  To increase accuracy, the forecast model needed to adjust to accommodate and recognize this historic precedent.  Likewise, when I joined Citibank in 1985, the business needed a P &L model for an innovative new offering in four test markets that linked savings and credit products in a relationship.  No one had looked at  interactive product performance before and the experience was a revelation.  The adaptation to existing analysis and risk management tools were instrumental contributors to the explosive growth of Citibank’s  credit card business. The original business proposition  failed to consider that the risk in a bundled loan or relationship,  product was not merely additive but interactive.  Early, controlled testing allowed them to go back to the drawing board armed with new insights and better understanding of the boundaries.

New data is rarely the culprit in a failure; but as things change,  more data enhances interpretation and  provides insights to re-imagine your business.  When you are the largest issuer of credit cards in the world,  accurate risk models  can be built using available billing histories.  In the 1990’s  mountains of itemized purchase or transaction level was left untouched, though its potential value was clear,  there were no clear benefits to justify the monumental costs of analysis. This was a treasure waiting to be mined.  Lacking urgency or absent a competitive threat also minimized the value of uncovering additional insights into consumer’s behavior.

Fast forward just under 25 years and the costs of time and computing resources to sort high volumes of transaction data is trivial and the returns from real-time processing lucrative. Mined transaction data triggers fraud alerts and delivers additional purchase suggestions based on comparison to  individual consumer history and that associated with cohorts, peers or “friends.”  Amazon  demonstrates   mastery in mining  typical  point of sale enhancements and redeems enormous  value from its dual function processing.

Opportunities and technology capable of mining even richer, more complex data eclipses  the significant value accrued from mining transactions.  The potential  value is driving the collection and complex tagging and sorting  of recorded customer service conversations, video capture of consumers shopping or following their daily routine at work or at home or all the places they go  online, key strokes, eye tracking, written comments.  It appears that there are very few domains of human experience and activity that remain a hold out from data capture.  The number of matching and sorting tools, the algorithms and systems also are getting simpler and more widely accessible.  Today, the speed and volume of results Google returns in a general search is far more advanced than credit card billing records I analyzed.  When was the last time you checked out Google’s  specialized search tools or the technology  coming out of their labs?

Returning Power to the People

The  insurmountable challenges are no longer in finding available data, or even privacy. Its ubiquity and increasing open source availability creates an even bigger challenge,  turning the vast amount of real-time data into a durable advantage.  Sunday’s New York Times (August 7, 2011) reported the unusual establishment in Chicago of a team of specialists tasked to help Chicago harness the technology and gamut of rich data the city collects.  Not alone in its efforts, Chicago is  farther ahead of other governments in creating easy interfaces that contribute to the public’s use of  its treasures of recorded and collected data.  Transparency adds more value by increasing the number of analyst reviewing the information, spotting trends or creating applications that simplify the lives of residents.  For example, the free Bus tracker application to let riders and plan their trip better.  It also holds his office more accountable  and increases the opportunity for activism by city residents.

There’s no doubt that power accrues to those who can imaginatively convert  data into both meaningful and doable innovation.

Finding treasures by leveraging connections

Today’s data mining technologies facilitates more than  accountability and activism.  Beyond knowledge of the type and place of available data,  a dedicated commitment to sift and mine the growing mountains of data requires critical analysis and matching skills.  Google does not stand alone in its specialized capabilities, numerous competitors offer diverse and specialized alternative search tools.  Numerous open source tools  make it easy to sort and manipulate any of the open data made available online.  As in prospecting, the tools and ability may narrow the competition and may advance the process. But those systems capable of exploiting and  enhancing anomalies  with supplementary information increase their chances  to uncover intrinsic value and thus create durable advantage .

Innovation results from capabilities to invent but can equally result from abstraction and adaptation.  Most of us at one time or another have come across a person who managed to re-purpose or refashion an object for an alternative use.   For example, the flower bed below.

Between Naps on the Porch eclectic landscape

Don’t merely consider looking at your existing data in its current form, but revisit it with newer analytic capabilities made possible from the numerous open source and proprietary data mining tools rich in functionality.  Consider supplementing your understanding of your assets from the perspective of your final judge, the consumer.  Also consider these sources:

  1. If images are worth a thousand words, spying consumers who refashion or use products for purposes beyond the manufacturer’s original conception can prove inspiring.
  2. Conversations and story are at the core of social media’s power.  The words of mouth, or stories  associated with transmitting and  promoting your business also motivate, inspire and compel employees to higher performance and deliver insights into how your product can be improved.  How often are you  using these to find products  in your inventory or services, that you may over overlooked or underestimated, but  are important to a group of consumers?
  3. Sales Data–Data mining tools can be used to find surprising blips, if you look beyond the blip.  Focus your analysis on the less understood context such as coincident placements or other variables that may not have made it into your database but none the less explain the anomaly.  They may very well be the source of an unrealized opportunity to refashion and reposition products that have trailed in sales.
  4. Last, perhaps you need to apply data mining tools  on your own data collections. The files of failures, tucked into drawers or file cabinets, the product research and or launches that never saw the light of day may call for another look.  After all, consumer preferences are always evolving, but so are your competitors, as well technology that may allow you to overcome previous cost barriers.  For example, oil and gold extraction from very difficult places is now proving economically viable as both these commodities benefit from high market prices.

More reason to harness data mining technologies to jump-start innovation in product marketing, reuse or refashion your assets to generate additional cash flow.

I’d love to hear of your experiences recapturing value in your business by any other routes as well as  suggestions for good tools or tips to improve your data mining or prospecting success.

Connecting the dots to measure value


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Last week, IBM celebrated 100 years of business and coincidentally posted  annual sales of $100 billion.  Recently, several profiles and news stories acknowledged  this milestone; and IBM itself has hosted many “parties”  to celebrate. The roster of American companies and … Continue reading

Value in Being Memorable

This morning, thanks to RSS, the following headline in Forbes came in through an email :

The Most Memorable Product Launches Of 2010

I breezed past the summary of findings, and then read the following ending slapper:

“When it comes to determining which brands jump to the forefront [people’s recall], it’s usually the
companies that “people look for, the ones that they are familiar with,” says Patrick Richardson “

The conclusion is pretty obvious right? I’m more likely to remember something that I already know.  So, if I read the article correctly, this is what I learned.

  • New product launches have an  85-90% failure rate.
  • 75% of survey participants were unable to recall any of those products listed in the top 10
  • 45% couldn’t name a single one at all.

“The results were per unaided recall studies, meaning experiments conducted with very little or no prompting from researchers.”

OK, so what is going on here?  If you haven’t seen the list of most memorable launches, you might guess that Apple and Microsoft were in the #1 and 2 spot.  I’m betting in a survey of the most recognized brand names Apple and Microsoft would top that list too.  Steve Jobs is legendary especially when it comes to new product launches.  Microsoft, however has a completely different mojo about it, but its mere size impacts the market.  The actual products that made the list, surprised me a bit.

Apple’s iPAD, as I recall had a few hiccups on its launch; but that weak start out of the gate  didn’t last. Instead,  the product generated  that much more news coverage.  It seems that there wasn’t a corner in the world that hadn’t heard or reported on this launch, and the reports just kept coming.

By comparison, in spite of the automatic announcements to every windows PC ,  2010’s #2 from Microsoft,  the release of Windows 7 , surprised me.  Yup, I don’t know how many pings from Microsoft I got encouraging me to upgrade, but the news certainly didn’t have the same excitement that surrounded Apple’s iPad.

So,  no surprise to read that most new products that hit the shelves go unnoticed; and that even more new products never even hit the shelves.  In a survey where brands that dominate their market stack up against every other consumer product being launched, there’s no secret to dominion. Of course holding  a  market position is another matter.

Value ContributioN of BuZZ

Can you separate out the value of being memorable?  Elaine Wong, writing for  Forbes takes this view:

“sales aside, a product launch that’s effortlessly recalled by the public proves that marketers–and their brands–have staying power. “

The power of Brand is an old story, and certainly when there are more than 250,000 products launched in a given year, one can see why being top of mind does readily correlate with sales. This is the ongoing case for advertising, creating buzz still matters.  It’s Buzz that increasingly makes social media matter too.  Proof is in the success of  companies that made the memorable list this year and waged significant integrated social media strategies.

Take Kimberly Clark,  Kleenex, has been a household name for a long time.  The brand is so synonymous with the product that it’s hard to believe that anyone calls a tissue by any other name.  Why would more buzz matter?

At the point of purchase , the Brand can command a higher price on the shelf  than the surrounding competition.  Kleenex to seal the sale needs to imprint more than its brand name.  That’s where social media can help.

Not long ago, I copied the following comment from a social media analyst , but sadly failed to keep the source link. ( If you know or are the author please let me know and I’ll credit you).

The companies that try to understand the return on investment to their social engagement don’t get the picture. I mean, of course you have to do that, but if you have the best intentions of the brand and the
company, you understand that social media is the biggest marathon we’ve  ever run. This is a marathon, not a sprint. If you want to build a  brand, it’s a marathon. It’s not trackable.

Are you trying to track, or correlate your social media efforts?

I’d love to know whether the decision-makers in your firm, or your clients, understand the changing nature of the game.  Do they buy into the idea of the marathon? Or,  are they still stuck in the old “campaign” cause and effect paradigm?  Not sure my a solution  guarantees your budget;  but, word of mouth is still the king-maker in my world.  If your buyers are talking, help them talk positively about your brand and the bottom line–receipts will speak for testify to its value .

FYI, here is the full survey from Sentient