Social technologies “may become the most powerful tools yet developed to raise the productivity of high-skill knowledge workers — the kind of workers who help drive innovation and growth, and who are going to be in increasingly short supply.
This is one of the surprising takeaways from our recent research on the economic impact of social technologies. The business world knows (or thinks it knows) a lot about how social technologies are changing the world. With consumers spending gobs of time in online communities (more than 1.5 billion consumers around the globe have an account on a social networking site and almost one in five online hours is spent on social networks), marketing departments have increasingly shifted their attention to social media. They’re not only advertising and creating their own social sites, they’re engaging with consumers, listening in on unfiltered conversations, and soaking up huge amounts of data on consumer behavior — all of which is producing nifty new insights for fine-tuning product requirements and marketing messages.
It’s powerful stuff that will continue to evolve and change the way that companies market to consumers and B2B customers. But, it turns out that there’s something even more powerful at play: the potential for value creation when social technologies are used to improve collaboration and communication within and across enterprises is twice as big as the value that can be created through all other uses across the value chain.
The amazing thing here is that business keeps trying to improve advertising — and always by making it more personal — as if that’s the only way we can get to Michael’s “sweeping, basic, transformative, and simple way to connect buyer to seller and then get out of the way.” Three problems here:
- By its nature advertising — especially “brand” advertising — is not personal.
- Making advertising personal changes it into something else that is often less welcome.
- There are better ways to get to achieve Michael’s objective — ways that start on the buyer’s side, rather than the seller’s.
…In The Cluetrain Manifesto, which Chris Locke, David Weinberger, Rick Levine and I wrote in 1999, we laid into business — and marketing in particular — for failing to grok the fact that in networked markets, which the Internet gave us, individuals should lead, rather than just follow. So, since business failed to get Cluetrain’s message, I started ProjectVRM in mid-2006 at Harvard’s Berkman Center. The idea was to foster development of tools that make customers both independent of vendors, and better able to engage with vendors. That is, for demand to drive supply, personally. (VRM stands for Vendor Relationship Management.)
Imagine being able to:
- name your own terms of service
- define for yourself what loyalty is, what stores you are loyal to, and how
- be able to gather and examine your own data
- advertise (or “intentcast”) your own needs in an anonymous and secure way
- manage your own relationships with all the vendors and other organizations you deal with
- … and to do all that either on your own or with the help of fourth parties that work for you rather than for sellers (as most third parties do)
Highlights from the online study include:
Exponential spending behavior: Luxury consumers surveyed showed a household income more than twice that of the non-‐luxury consumer with their online spend about four times higher…
Luxury consumers rely on expert voice: Though social sites were the most often visited by luxury consumers, they scored very low for trust and quality. Rather, these consumers valued premium content sites for “providing quality information”. 84% of luxury consumers said premium content sites were a trusted resource, while only 11% felt that way about social websites…
Desire for customization may outweigh objections to behavior targeting: Better than half of the luxury consumers surveyed said they “Really like the fact that advertisers are able to customize the ads they see based on their online behavior”.
“This data has interesting connotations,” said Stinchcomb. “While people may be reticent to have their behaviors followed online, it seems that the luxury consumer’s desire to have their environment customized may outweigh that concern.”
While I do value my privacy, I’m not overly concerned about about Hermes knowing that I like the color green or Amazon excluding me from their list of motorcycle owners. They are going to market to me anyway, they might as well tailor my ads. I have to admit that it’s super convenient. & yes, it has resulted in purchases I didn’t plan. I have a surplus of tennis clothing for someone who rarely (not by choice) hits the courts. I love stretchy, pleated skorts — It’s true.
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