Ignoring the consumerate is a mistake, but fearing it may be nearly as dumb. The consumerate, as we’ll see, can help as easily as it can harm.
WHAT’S A COMPANY TO DO?
These Internet-driven uprisings that batter one business or another may have something in common. “They’re not about the money,” said Steven Cody, the CEO at Peppercom, a New York-based public-relations company that advises companies on how to handle social media. “People are pissed because they feel no one’s listening to them. And often, no one is listening to them.”
By now, most firms have embraced social media, at least in theory. An employee or two may be assigned to monitor the Twitter feed, like the Geological Survey does in scanning for reports of possible earthquakes. Some companies use their Facebook pages to push out press releases. “But that’s different than acknowledging the reality of social media,” Cody said. Social media is, well, social. If you were at a party, would you want to talk to someone spewing out press releases?
“The age of top-down marketing plans is over,” Cody declared. Once upon a time, he recalled, “you told people your new product was the coolest thing since sliced bread, then watched the dollars roll in.” But now, a brand’s success has everything to do with the global, real-time, 24/7, electronic conversation taking place around it.
Adapting to this new reality takes more than an updated marketing plan. Organizations need to make changes at the deepest, structural levels. “I guarantee you that every time you see one of these backlashes, you can trace it back to a company where customer service has been ghettoized,” Cody said. Even if it isn’t outsourced to call centers offshore, it becomes a menial caste of sorts. Not surprisingly, the representatives who actually deal with customers rarely talk to the marketing executives who craft strategy.
Not at Zappos. Few companies listen to their customers as slavishly. The online retailer emblazons its toll-free phone number across many a Web page, inviting customers to call day or night. It has become known for covering all shipping costs and allowing unlimited returns. Shoppers aren’t shy about ordering a half-dozen pairs of shoes, then returning five of them.
But what’s revolutionary about Zappos are things that consumers don’t see. The call center is housed inside the corporate headquarters in Las Vegas. Customer-service representatives, rigorously trained, know a lot about the products they sell and enjoy considerable opportunities for advancement. The well-paid staff and free shipping suggest that Zappos spends far more on customer service than most companies. But that’s not how the company sees it. “View each call as an investment in building a customer-service brand, not as an expense you’re seeking to minimize,” Zappos CEO Tony Hsieh wrote in his how-to memoir, Delivering Happiness.
It’s not incidental that all Zappos employees are also allowed—encouraged, in fact—to have their own Twitter accounts. They use these to develop lasting relationships with customers or simply to gripe about being stuck at work on a beautiful day. Consumers have rewarded this transparency and goodwill by reciprocating with their own. Zappos boasts exceptional customer loyalty, with the consequences apparent in its financial success.
Zappos’s business practices contrast sharply with those in most industries, ranging from banking to manufacturing, where the customer-service people hardly ever converse with the executives at the top. But some companies have been getting it right. Look at JetBlue, operating in a competitive, low-margin business rife with grumpy customers. After the upstart airline mishandled an ice storm in 2007, leaving thousands of fliers stranded, then-CEO David Neeleman issued a mea culpa through YouTube. Soon, the company embraced the fledgling Twitter platform and has now accrued 1.7 million followers. JetBlue not only uses its account to issue travel updates, it also trolls Twitter for unhappy passengers and addresses individual customers as well. “Hooray!” JetBlue recently tweeted. “We’re happy Ruth was able to help you out. Thanks for the shout-out, Winnie!”
Or consider what happened at Procter & Gamble a year ago, when its reformulation of Pampers prompted a consumer to claim that the product caused diaper rash. She built a Facebook page devoted to the accusation and enticed some 5,000 parents to complain to the Consumer Product Safety Commission. That the agency eventually agreed with the company that the diapers were safe didn’t avert the damage. But being smart helped. “P&G engaged ‘mommy’ bloggers to decide for themselves, and very quickly, the tide of opinion shifted,” said Jonathan Copulsky, who advises companies on customer relations for the consulting giant Deloitte. P&G had built a reservoir of goodwill, Copulsky explained, and was able to tap into it.