Business Insight Zone

That’s what I told my audience last week at the Inbound Marketing Summit held at Gillette Stadium in Foxborough, Massachusetts.

The distance to your customer is nil because the wave of new social technologies — blogs, Twitter, Facebook, YouTube, etc. — has made it so easy, even frictionless, for customers to find out about your company, talk about it, and let you know what they think about it.

We can fear this revolution, or we can embrace it as a chance to get back to our honorable roots as merchants, creating customers by discovering what they really value and then giving it to them.

Here’s the slide deck I showed to the audience in Foxborough. I’ll annotate it slide-by-slide and relate it to other relevant posts tomorrow (when I have a better Internet connection than I do at the moment).

Annotations:

Slides 1 – 2: The picture of the crowd at Woodstock was offered as joking encouragement to the audience to have their questions ready so that the Q&A at the end of the talk could turn into a landmark cultural event.

Slide 3: The major thesis of my talk: The fundamental questions haven’t changed, and they CAN’T change.

At a surface level, the technology (Blackberries, Twitter, etc.) makes things seem different, but at the core they’re still the same — because business is still about people serving people.

Slide 4: The inspiration for the talk was Peter Drucker, who had a knack for asking disarming questions of businesses — questions with simple answers on the surface level, but deep implications for how businesses run.

I offered this list of questions as examples of business concerns that transcend eras, industries, and geographies:

• How do I get people to know the name of my business?
• How do I get them to think of me ahead of my competitors?
• How do I get them to come in my front door (literally or figuratively)?
• Once they’re in, how do I meet them at their point of need?
• How do I get them to come back for more?
• And tell their friends?
• Internally, how do I operate at a better margin?
• In particular, how do I take costs out of the business while delivering higher value — not just yesterday’s value, but something better?
• What IS value, from my customers’ perspective?
• What do they want?
• Given the answer to that, what business am I really in?

Slide 5: Questions like those would have occupied you just as much if you were a fruit merchant in a market in Cairo 500 years ago . . . or Henry Ford perfecting the Model T 100 years ago . . . or Anne Mulcahy rebuilding Xerox over the past 15 years . . . or the folks running the pictured hardware store today in Turkey.

We are all pursuing the honorable craft of merchant, and merchants will be just as obsessed with these questions 500 years from now as they were 500 years ago. [See "Social media makes merchants of us all" for more.]

It’s not about the technology, even though the social technology we can use today is amazing and allows us to address these questions in ways we never have before.

Rather, it’s about how you build a business — under any circumstances, in any weather — to meet human needs. (And it’s especially important to re-focus on these fundamentals when the economy isn’t cooperating.)

Slide 6: Business can be highly complex, but wherever and whenever you are doing business, some core principles apply. I suggested these three:

1. Drucker said that “The purpose of a business is to create a customer.” This works at the most literal level of finding a new person who will pay money to your company, but it also works at the bigger level of building a business that is a customer-creating engine for the long haul.
2. Successful companies build enterprise value all the time by constantly improving the ways they operate.
3. The short term is very important. In fact, this economy reminds us of the old piece of entrepreneur’s wisdom that “Cash is more important than your mother.” But even in times like these, you must use the short term to build for the long term.

While there are all sorts of complexities hiding within these three concepts, just these three are enough to keep all of us busy for every day of our working lives.

Slide 7: These old-school core questions should inform your use of new social technologies. But you should also use the arrival of these new technologies as an impetus to re-ask the old, fundamental questions of your business. It’s a two-way street.

Slide 8: Four examples to show how social technologies and age-old questions can play off of each other profitably:

• For Comcast, Frank Eliason and his crew have used the @ComcastCares Twitter account to re-ask the timeless question, “How can we make our customer service better?” Not only have they succeeded in improving service for individual Comcast customers, they’ve achieved something far more stunning: they’ve helped us reconceive what sort of customer service is possible from an industry notorious for bad service.
• Gary Vaynerchuk has used WineLibrary.TV to answer the timeless entrepreneurial question, “How can I bring something I love to a lot of other people and build a business around it?” He’s intent on changing the way people appreciate wine and the way the wine industry works, and he’s doing that by using every social technology at his disposal. As Gary said from the stage of the Summit the day before I spoke, he doesn’t care much about which platform he’s using — so long as he’s reaching people.
• At BreakingPoint, my friend Kyle Flaherty is using Twitter, LinkedIn groups, and so on to reach not a consumer audience, but a very particular slice of network engineers who can benefit from BreakingPoint’s knowledge — and from their high-end network testing equipment. By the way, this isn’t just general purpose brand marketing, but honest-to-goodness lead generation, which answers the most fundamental question of all: “How can I find more customers?”
• John Jantsch, who also spoke at the Summit, has answered the question “How can I use my passions to empower others?” He’s built DuctTape Marketing into a successful business through which he conveys his passion for marketing and social media in ways that empower legions of small businesspeople in many industries.

Slide 9: The underlying reality of this whole social revolution (and the line from the talk that got the most play on Twitter) is this: The distance to your customer is nil.

Sure, there may be a fence there where your company stops and your customer’s world starts — but customers can walk right up to it, talk to you over it, and see way more of your operations than you might want them to. It’s certainly not a wall, a moat, or an ocean.

If this reality unsettles you . . . it should. You may realize that what your company offers (products, level of service, whatever) isn’t good enough, simply because customers are talking frankly to you and to one another about it. That’s a good thing — you can use this feedback to drive you back to improving the fundamentals on behalf of your customer.

Slide 10: Here’s another key: it won’t be enough to say nice things to your customer and then not to actually serve them in the ways they want. You can’t just say “We’re listening” or “We’re sorry” and then avoid doing something to fix the problem.

To put it another way — and to explain the slide — the era of mass media and mass marketing has meant that we can play with meanings, like Magritte did when he painted a picture of a pipe that says “This is not a pipe.” (Because it’s just a . . . picture of a pipe, get it?)

When companies controlled all the mass media for talking about their products, they could rely on damage control or brand marketing to change perceptions of inferior products. But the social media are a great leveling force in that game.

What I’ve seen in my near-decade as an analyst at Hoover’s tells me that there are many great and good companies out there — but many lousy ones, too. My hope is that this social revolution will force those companies (along with the lousy parts of all our companies) to change or die. We’ll all be better off when that happens.

Power will shift into the hands of companies with:

• Better ideas
• Better service
• Better hustle on behalf of the customer
• A real sense of caring
• The character to build real trust with their customers.

The companies that have the guts to embrace the new technologies and use them to answer fundamental, Drucker-level questions will succeed. This will obviously be true of little bootstrap companies — two roommates working out of a back room to implement a good idea — but it will also be true of old-school companies willing to re-earn their customer’s business and trust by providing value in every interaction.

Slide 11: Talking about old-school, I pointed out that Illinois lawyer Abraham Lincoln once served as a credit reporter for our parent company, Dun & Bradstreet. Hoover’s itself has been online since 1994 — which is pret-ty old-school for the business we’re in.

And even though we’ve been profitable for years and growing like clockwork, we’re more committed to a customer focus, interaction by interaction, than I’ve ever seen us before. Better, we understand that this is the price of admission for earning customer’s sustained trust in this era. So even though we’re not where we will be in terms of gee-whiz social technology, we’ve got the foundation right because we’re intent on re-earning it every day.

Slide 12: For every new tool you use . . . for every new technique or idea that you take away from a meeting like the Summit . . . you should be returning to THE fundamental question of the worthy merchant: “How can I be of use?”

And that’s my manifesto for how old-school meets new-school in business.

Slide 13: During the discussion period, I fielded two questions:

• How do you go about building that trust with customers? The social media give us many, many chances to interact with customers as real human beings. If we’re consistent in treating them fairly and giving them a square deal, they’ll know it. You earn it over time.
• What should you do when you encounter negative statements about your business via social media? Two things: (1) Address the individual complaint promptly, thoroughly, and in the mode of a human being rather than a robot or bureaucrat. (2) Look ten times as hard in that venue for other criticisms. As I’ve said more than once here, the Godfather dictum that “Mr. Corleone is a man who insists on hearing bad news immediately” should animate us all.

Slide 14: My contact information. It’s not just for the Summit audience — I want YOU to feel free to use it, too.

Comments?

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Related posts:

• Social media makes merchants of us all.
• Why companies should explore social media, in a nutshell.
• The Basic Basics: Solve someone’s problem.
• Social media: the right tool for the job.
• “The community of discourse IS the market.”

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Category: Marketing & Sales, Social media