Consumers are not only spending more time using Web 2.0 applications like Facebook to socialise and stay connected with friends and family; they are also using them to become more informed about a broad range of issues and topics – ranging from potential holiday destinations and career plans to world events.

Importantly, they are using their new found social connections and research power to make purchasing decisions, by making enquiries about other consumers’ usage of specific products and services and experiences in dealing with vendors.

Web 2.0 is having a dramatic impact on the way companies like yours interact with customers, and in particular how they use the online channel as a customer acquisition, customer service and customer retention environment.

If your company sells directly to consumers, then it is very likely that dozens of current and potential customers are researching your company’s brand and product or service quality reputation while you’re reading this.

Hyro has identified four key trends that you should factor into your plans for customer engagement via your company’s digital channel:

Consumer preferences
Customer preferences for brands, products and services are no longer based exclusively on information communicated via traditional media or even company websites. In fact, consumers increasingly report that they consider traditional marketing an unreliable source of information, reflecting mass media’s diminishing effect.

Customers’ preferences, decisions and perceptions of your brand, products and services are increasingly influenced by information communicated via channels beyond your direct control, such as peer reviews and recommendations (or “positive word-of-mouth”).

Consumer decision-making process
As these uncontrollable factors influence consumer behaviour, the traditional customer purchase process is evolving. Influencing customer behaviour by traditional marketing media and practices is becoming less and less effective, and new approaches to influencing the consumer decision-making process must be adopted.

Customer advocacy
In this new environment, a greater emphasis must be placed on enhancing the customer experience of your company and its brand, products or services. This includes meeting customers’ information needs prior to purchase, and satisfying their customer service expectations during and after purchase. Meeting and exceeding customers’ expectations is the key to generating positive word-of-mouth.

One-to-one marketing
Consumers are increasingly expecting organisations to respond to this rise in consumer empowerment and individualism by providing personalised products, services and product/service experiences. Whereas this is quite difficult in traditional offline customer service contexts (such as call centres and retail outlets), it is comparatively easier and cost effective to achieve in the online channel.

The role of your company’s website, and other customer engagement activities conducted via online channels should be reviewed in this changed context, with a view to identifying opportunities for achieving meaningful customer interaction and communication that not only drives customer acquisition and loyalty but also positive referrals and recommendations.

If we think of this as the digital challenge, an enterprise must balance the diametrically opposed constraints of being more responsive and agile while keeping information, applications and services secure.

A key enabler that businesses need for the Digital Economy is a toolset to manage identity on a contextual basis.

In a business sense a person may also hold employee, prospect, partner, shareholder or other relationships. While all of those contexts are clear, the things that make them different are also the things that make them the same. Thus organisations need to manage digital identities that truly reflect the real world where people are part of various communities, business roles, customers, consumers and constituents.

Some of the challenges an effective identity management solution must meet for the digital age include:

• federated access
• single sign on
• authorisation support
• cloud readiness
• platform independence
• identity lifecycle and role management

If you are interested in discussing your identity management needs with please contact Hyro.

I asked what is special and different about this project, and Paul said:

“unlike a lot of other clients this one focuses solely on Windows, rather than trying to be all things to all platforms”

He also noted that “this enables us to personalise it a lot better, it’s an open source project too.”

Then I asked what are some of the cool features of MahTweets? And Paul’s answer was:

“Streaming realtime search is probably the best feature. During the ABC program Q and A (#qanda) there are so many tweets it’s hard to keep up and our streaming search pushes all of the tweets to your MahTweets client.”

I noted that it’s pretty unusual to see both ‘open source’ and ‘Microsoft’ in the same sentence. Then Nick Hodge from Microsoft explained that “the reason why MahTweets is so advanced is that it uses a lot of pre-existing open source elements such as TweetSharp, Hammock, Json.NET, IronPython along with the goodwill and effort of the development community.”

Nick also commented that “it comes down to making a client you can use day in and day out for things like Twitter and Facebook”.

Paul noted that there are about 2,500 users each for Twitter and Facebook via OAuth.

Which had me asking how they have found working in with Twitter and Facebook APIs and OAuth?

Paul said “I like OAuth; Twitter’s API is shaky at best - they’ll change things that break 90% of the clients and change it back because it doesn’t work; and Facebook is worse. The Facebook documentation is very bad.”

You can checkout MahTweets at www.mahtweets.com

Kate joins Hyro having held a range of senior management and advisory roles with organisations such as GE, AMP, Citibank, Westfield and NSW Treasury. 

Her appointment signals Hyro’s commitment to remaining at the forefront of the digital transformation that is reshaping the way all businesses and governments engage with, sell to, service and interact with consumers.

“Kate is a highly respected leader in her field and her experience at defining enterprise-level business and technology strategy strengthens our strategy capability and complements our existing strengths in the planning and technical delivery of digital customer experiences” said Mark Neely, Hyro’s Director of Strategy. “Kate’s background gives her a unique understanding of the challenges major organisations face in planning and executing business initiatives across digital channels”.

According to Carruthers, “The digital customer interface is now the critical channel for Australian business. We know that around 40%-50% of customer interactions with organisations, their brands and their products and services happen via digital channels. Our clients now realise these channels cannot be dealt with in isolation, or via ad-hoc initiatives. They must be included within all corporate planning activities, and given the priority they deserve. Having the capability to deliver on strategy, creative and technical fronts makes Hyro an interesting place to be. Very few companies have the ability to work with clients to plan and deliver digital services from the 60,000 foot strategic planning perspective and right through to ground-level technical implementation.”

Bloomfield joins Hyro after being Creative Director at Singleton OgilvyOne/Interactive, Clemenger Proximity and Euro RSCG. Most recently, he’s been consulting to Three Drunk Monkeys and GPY&R Sydney.

Hyro’s Digital Director, Mac Walker, said “Simon is a highly respected creative leader and brings to us a depth of creativity that complements our existing strengths in strategy, customer experience and technical development. Simon joins us at a time when Hyro is expanding on many fronts, and his appointment ensures our digital services will be as desirable to customers as they have always been useful and usable.”

According to Bloomfield, “Digital has become such an important channel for all marketing tasks over the past decade. I felt the time was right for me to bring together my skills in building strong customer relationships with Hyro’s undoubted leadership in the Customer Experience space.”

Hyro’s creative gains last year included Spirit of Tasmania, Buzz Insurance, REST and South Australian Tourism.

Social media does not represent the uniquely powerful new means of manipulating opinion promised by some*.

However, Social Media is a great place to simply listen.

There are many ways to ‘listen’. You can measure aggregate sentiment, gauge the success or failure of targeted marketing and communications activities,  gather feedback from individual customers on products and features, find out what your competitors are doing right and wrong.

 The good news: the data is rich, high volume, real-time and 100% free.

 The even better news: the opinions of social media users seem to be a very accurate measure of the opinions of the general population. Previously, I poked fun at those drawing a very long [and very wrong] bow based on research data. But in doing so, I found that the same research data showed the responses of active social media users did not materially vary from the responses of the general population, including infrequent users. In other words – what active social media users think and say is very close to what everyone is thinking and saying.

Brands can use social media as a real-time, unprompted focus group, tracking actual, intimate, and detailed conversations about their products, price and service.

Brands can measure sentiment, and derive Net Promoter Scores, across large populations, and track how these measures change over time.

Brands can collect immediate feedback on a product launch or marketing activity, and react rapidly.

These possibilities, and the appetite for analytics tools they will create, have not gone un-noticed by the global technology giants. I have seen a few sneak previews of Social Media Monitoring software to be released in 2010 – including Microsoft’s LookingGlass.

Access to these tools will result in an increasing sophistication and subtlety in the way that marketers address social media.

In the next post, I’ll consider whether the best way respond to social media is by using social media, and discuss the pros and cons of active participation.

- - -

*Nor is any new medium likely to deliver on this promise. Ever again. The 20^th century, one-to-many model of media is in decline, and will continue to decline as long as large numbers of individuals can easily produce content of good-enough presentation quality and access distribution networks like the internet.

To use the analogy of social media as the ‘water cooler conversation’ of the digital age - People don’t formulate the opinion that Bank A has great service, Politician B can be trusted, or Kyle Sandilands is a goose, purely through the mechanism of a debate around the water cooler. These opinions are formed elsewhere, and brought to the water cooler.

The following assertion, published by a leading agency, epitomizes the confusion between cause and effect.  

“It’s important to note that we found no variations in the responses among the people who identified  themselves as active users of social networks and those who use social media less frequently. In other words, as you study the survey responses, note that social influencers and social media have an impact on the general consumer population – not just a small elite of social media enthusiasts.” Shiv Singh Vice President & Global Social Media Lead, Razorfish Social Media Labs. Fluent: The Razorfish Social Influence Marketing Report, 13 July 2009, p 9

Using the fact that research shows no variations in response between those who are active social media users, and those who aren’t, to conclude that social media has a uniform effect on those who use it and (somehow) on those who don’t (by some kind of spooky osmosis?) is wonky logic and wonky science.

Possible explanations for the research observations include -

1. The opinions of those who actively use social media are influenced by their use of social media, and these opinions in turn (by a mechanism unknown) uniformly influence those who don’t actively use social media
2. There is an influencing mechanism, outside of social media, to which both groups are uniformly exposed, and by which both groups are uniformly affected

In the absence of a proven hypothesis explaining the mechanism by which the opinions of social media users influence non-users, the first explanation should be rejected. (Why? Read Wikipedia entries on The Scientific Method and Occam’s Razor).

There we go again - cause and effect.

Social media use is not the mechanism that causes users’ responses. The cause originates in the media in general. What is observed amongst social media users is the effect. The real good news from Razorfish’s research is that the opinions of social media users seem to be a very accurate measure of the opinions of the general population. But more on this in the next post: “Rule 2 – listen”

Before I sign off, one more hype-puncturing factoid.

Dell is one of the poster children for Social Media strategy, especially when it comes to Twitter. Dell have invested properly in their Twitter strategy, and do a very good job at it.

In June Dell announced that Twitter had contributed to $3 million in sales revenue over a 2 year period.

Dell’s turnover for the same period was $122.2 Billion – so that’s 0.00002% of sales.

Some of them have been very good answers – but needlessly complex, since there is, in fact, a very simple answer.

The difference between Customer Experience and User Experience is the difference between a Customer and a User, and the difference between a Customer and a User is that a Customer has a choice.

Your digital business is competing moment-by-moment for the customer’s attention with other digital businesses, other channels (TV, Radio, iPod, billboards), and now (on mobile internet) with the good-looking girl/boy sitting near them on the bus. Before the potential customer even thinks about doing anything an usability expert can measure, they are making a split second, emotional decision to give their attention to you.

I particularly like sharing this insight with senior marketers. It instantly transforms them from slightly-intimidated-by-Digital to smartest-guy-in-the-room. Because if there’s one thing marketers know about, it’s Customers, and the Consumer Decision Journey. By contrast, we in Digital Services were calling them ‘users’ a year ago - and still routinely refer to them as ‘visitors’ or ‘browsers’. Quaint, really.

“Oh, we have some visitors!

Should we make them a cup of tea?

No don’t worry, they just want a look around, they’ll be off soon.”

Anyway, the point is that the Customer Experience point-of-view allows us to access and apply years of excellent learning from the offline world and marketing science. It allows us to ask how a customer feels about completing an online task, rather than just worrying about how many clicks they have to make. More importantly, it allows us to stop feeling guilty about using emotive words like ‘cool’ or ‘kick-arse’ when talking about the visual and tactile interface.

In Forrester’s first-ever evaluation of Australian interactive marketing agencies, Hyro and six other vendors were shortlisted and evaluated against 36 criteria, grouped into three high-level categories: Current Offering, Strategy and Market Presence. These combined results placed vendors into one of four “waves”: Leaders, Strong Performers, Contenders or Risky Bets.

As well as being named a Leader overall, Hyro earned the Number 1 score amongst all vendors for Current Offering.

To download your copy of the The Forrester Wave™ report visit www.hyro.com/forrester

These calls are admirable; and not to be discouraged. Digital channels can be the fulcrum of accountability, interactivity and personalisation in a multi-channel, multi-device marketing campaign. But if you stop there, you’re missing a large and important part of the Integrated Marketing picture.

Let’s call the integration of campaign messaging across traditional and digital channels Horizontally Integrated Marketing.

Digital channels also deliver the promise of Vertically Integrated Marketing.

I’m talking about the seamless transition between delivering a message and delivering a service.

Digital channels let you build customer experiences around the entire life cycle of the customer experience – through the stages of awareness, preference formation, purchase, consumption, confirmation, and back through the loop.

Which leads us to two questions:

Why confine your interactive marketing to activities around building awareness?

And

Is the notion of the ‘campaign’ relevant anymore?

Now, the answer to the first question may be – “we have to focus solely on awareness because there are real constraints to fulfillment via digital channels”- for example if you’re an alcohol brand. But where there is any opportunity for clients to configure, purchase or consume online, there is no excuse for confining interactive marketing to building brand awareness.

 The answer to the second question - is the ‘campaign’ relevant anymore? No. Not if you are using Vertically Integrated Marketing to build experiences around the core of the customer relationship cycle – configuration, purchase, consumption, service, confirmation, retention. Your marketing activities should be ‘always-on’ and constantly optimised.

Chris Maloney of the Commonwealth Bank knows what this is all about. He is ADMA’s Young Direct Marketer of the Year, and recently took a victory lap in the form of an extremely popular presentation – so popular it was repeated three times to cope with audience demand. His presentation didn’t use exactly the same language as I have, but the principles were the same – and he executed these principles to increase the number of home loan applications referred from online from 1% of applications to 13% of applications in less than 12 months. This is an extremely impressive headline, also the main reason people flocked to Chris’ presentation - to find out how he did it. Chris pulled together a roster of agencies to implement his plans - although there are agencies combining all the necessary elements under one roof, like (ahem) Hyro (excuse the shameless self-promotion)*.  

Chris described the traditional notion of the marketing campaign thus: “It’s like the hokey pokey. You put your campaign in, you pull your campaign out, you put your campaign in, and you shake it all about.” He’s obviously not a big fan of the idea either.

*Hyro was not one of agencies used by the Commonwealth Bank, so maybe I’m not such a shameless self-promoter after all!