Making the digital threat a digital opportunity

We're witnessing a dramatic global uptake of online social networking tools. Twitter, for instance, saw visitor numbers increase from 475,000 to over 7 million between February 2008 and February 2009. In the same period, Facebook user numbers rose from just over 20 million to well over 65 million.

This trend indicates three important aspects about your customers:

• They are discussing your brand in public in large numbers;
• They increasingly demand a personal slant to their interactions online;
• They are listening to each other rather than to traditional brand messages.

This presents a direct threat to the traditional ability of brands to manage their message. It may be easier than ever to reach a potential audience but it is harder than ever to be sure that they are listening.

Engage or cede control

Your customers are gathering in online environments and converse with family, friends, colleagues, like-minded fans-, or critics: they are no longer prepared to be at the end of a broadcast brand message that fails to connect with them on a more personal level.

The challenge now is for brands to engage directly with customers rather than to manage generic messages. This can be a daunting thought for companies long accustomed to controlling brand image and messaging. As a result, there is now a stark choice facing marketing departments:

• ignore the reality that customers control the conversation; or
• embrace this new digital world by consistently monitoring that conversation and responding appropriately.

U.S. computer manufacturer Dell faced this choice in early 2006. After a year of badly declining profits and an increasing number of adverse comments about quality and service on blogs and forums, CEO Michael Dell created a team to find customers online who were experiencing problems and to respond proactively. This helped Dell to become one of the most popular PC brands.

Dell also started a series of blogs confronting issues head on. Customer loyalty increased dramatically because prospective buyers now have access to a huge amount of information and product reviews, as well as having an emotional investment in new products that they have been invited to help specify.

This is about making information available, reacting to the needs of customers and addressing the problems they have faced. For this customer set, information trumps special offers and bonuses.

Make it personal

Social networking tools have raised customer expectations of digital interactions. On Facebook, Twitter, and on blogs and forums, participants relate to one another frequently at a personal level. This is also how brands are expected to interact. The perception of a human side is a key element of trust and of building loyalty.

By engaging directly with customers as an equal partner in a many-sided conversation, brands build up trust. Loyalty and advocacy become profitable by-products of this trust.  Ultimately customers will convey your brand messages to their peers or intervene when criticism is raised so that your representatives can take more of a back seat.

UK company Virgin Media faced constant accusations of poor service and suffered high customer churn. In response, it created a dedicated Twitter account for its support teams. They monitor Twitter and immediately contact users with problems. As a result, the brand's reputation among its core target audience is improving and the support teams are brought into conversations that help spread the message of improved support.

Give your customers space

Providing an environment in which your customers can share experiences, review products and services, or show how they use your products in innovative ways is a fundamental element of building loyalty online.

Dell built a community almost three years ago - IdeaStorm - to give their customers the space to complain, recommend, discuss, and learn. It now has 60,000 registered users and the community post about 300 ideas a month. 

Existing sites can also benefit from the recommendations and shared passion of its audience. Amazon's product pages, for instance, outshine those of rival online booksellers because of the power of reviews. The information available at Amazon - and provided free by buyers and visitors - adds value that Amazon itself could never supply directly.

Reap the rewards

The first move is to listen to what is currently being said about you and your competitors and different markets and different geographical regions present their own challenges. In China, for instance, government controls mean that sites with a global appeal elsewhere, such as Facebook and Google, are replaced by local alternatives. That said, the fundamental approach of brands remains the same: establish reputation through trust and engagement.

Reputation building is a task that works independently of any channel. The effect is cumulative and must be consistent across a variety of media and tools - from videos to blogs to text messages.

With reputation and loyalty established, your brand can build influence, watch as customers spread the message for you, and then reap the benefits for your business.