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Customer Network Value

by Donal Daly

In June 2012, Angela Ahrendts, CEO of Burberry appeared on the cover of Fortune magazine. As Fortune reports it:

Last May, Burberry CEO Angela Ahrendts flew to California from her London headquarters to introduce herself to an executive she thought could be critical to the future of her business: Salesforce.com CEO Marc Benioff. When the two met at the Ritz-Carlton in Half Moon Bay, they stood in the hall batting around ideas for 15 minutes before even sitting down. Ahrendts explained her vision: to create a company where anyone who wanted to touch the brand could have access to it. She just needed a digital platform to make it happen.

Benioff sketched a diagram of how Burberry could become a "social enterprise," overlaying technology like Salesforce, SAP, Twitter, and Facebook atop the entire company. (Benioff signed the drawing "Angela + Marc = LIKE," and Ahrendts keeps the framed original, pictured below right, in her office.) "I told him, 'I think I finally met someone who talks faster and has more energy than I do,' " she says. "We just connected."

However, as anyone who attended any salesforce.com event between mid-2011 and 2012, physical or virtual, could tell you, you could see that Ahrendts' new celebrity status is due in no part to the level of exposure given her by Benioff. It even got to the stage that Twitter contributors were wondering if she was going to wear ‘that white suit again’. Benioff – certainly one of this era’s marketing geniuses – knows how to make his high-profile customers feel special – and knows, better than most, the value of the Customer Network Value.

In many cases customers are totally bypassing the early stages of the traditional buying cycle. Rather than calling a company for information, they are instead joining forums on line, engaging in conversation on Twitter or Facebook, looking to people with ‘Klout’ or influence to guide them through the information gathering and evaluation phases of the buying cycle.

They look for recommendations from peers and others ‘like them’ to short-list potential suppliers, refine their requirements, and gain insight in the application of a vendor’s product that often surpasses that of the vendors sales person.

To care about your Customer’s Network Value, you must first care about your customer, and treat customer service, and every customer interaction as an extension of marketing. Caring about your customers before they become customers is actually more difficult but increasingly important.

You can achieve this firstly by participating in the same networks in the Social Universe as the customer traverses the Contact phase of the buyer/seller transaction. Then you need to monitor what is happening and respond to your customer during the Control phase, as that is where they can have most impact on your future customers. In any case, if the customer wants to interact in the Social Universe, it is your job to facilitate that interaction. It is increasingly becoming an implicit part of your promise to deliver – and you need to be prepared.

We need to recognize that our customers and prospects hang out somewhere, and that somewhere is increasing somewhere online in the Social Universe, where each is weaving their own tapestry with the threads of their network.

You really do want to be one of the threads!

Unless you want to become irrelevant, or unless you can consistently be the low-price provider servicing those who care only about price, then you need to be part of the ‘recommendation chain’. You must establish trust, and the customer must see you as someone more ‘like them’ than a representative of your company. But, the threshold is high – because in the end, for new customers, you’re going to ask them to do business with you. Being ‘like them’ breaks down some barriers, but it’s not enough. You must continually add more value in the Social Universe than you expect to get in return. You’re looking to recoup the return on the influence you have developed online later.


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