Thursday, July 15, 2010

Customer, the new Marketer

Indu Mahapatra, Soumyasankha Maiti, XIMB

A prize money of Rs. 50 lakh and 1% on the turnover: this is the new promo campaign for anyone who comes up with a hit new flavour for Lays. This is in essence the idea of Co-Creation wherein you are involving the consumer (one of the stake holders) of your product into its development.

If winter comes can spring be far behind? So almost at the same time Bingo asked people to create games, quizzes et al, around the theme “Bingo har angle se mmm..”. It got the wackiest of responses from someone suggesting George Bush should say “I’m sending Bingo ChilliDhamaka to Iraq”, and not bombs; to a blind man seeing with his mind’s eye how “yummy” the chips were.

The new trend is to use the global brainpower to develop new products, new commercials, and new virals – whatever a global brainstorming to solve your problems.Every solution has a reward and big corporation is asking Innocentive (Innovation+Incentive) for help.

Customer is the Designer
‘Customer is the King’ not only in terms of purchasing power and negotiation, customers are now contributing everywhere; starting from creating ad campaigns, product or service development contests, co-creating for the corporations by tapping into their intellectual capital, who in exchange give them a direct say in what actually gets produced, manufactured, developed, designed, serviced, or processed. Consumerism will never be the same.

P&G realised it, when the then CEO, A.G. Lafley, found that he was running out of ideas and it was getting impossible to keep up with the demands of consumers. P&G’s Connect + Develop were launched to ask customers to help. Its “Pringles Prints”, where interesting things were printed directly on the chips was launched at almost no cost & in no time. Through ‘Connect’, it found a small bakery in Italy which could do the job for them, proving cheaper & faster than developing the process in-house.

And the results so far have been amzing, to say the least: everything, from Swiffer Wet Jet, Olay Daily Facials, Crest Whitestrips & Night Effects, to Mr. Clean Autodry, Kandoo baby wipes and Lipfinity.

Customer Incentives
Most companies are trying to translate the enthusiasm of their most highly-engaged customers into valuable marketing. For the customers it can be any of the following:
•Status: people love to be seen; love to show off their creative skills and thinking
•Bespoke lifestyle: something consumers have been personally involved in should guarantee goods, services and experiences that are tailored to their needs
•Cold hard cash: getting a well deserved reward or even a profit cut for helping a company develop The Next Big Thing is irresistible
•Employment: in an almost ironic twist, customer-made is turning out to be a great vehicle for finding employment, as it helps companies recruit their next in-house designer, guerrilla advertising agency or brilliant strategist
•Fun and involvement:there's pleasure and satisfaction to be derived from making and creating, especially for brands one loves, likes or at least feels empathy for

How different is it?
Unlike most advertisements which furnish the consumers with all the information about the products, mob marketing ensures consumers get involved with the brand and have a feel of it. Consumers today are often well informed and selling them ideas extolling brands may eventually end up pushing the customer away. It is difficult now to influence consumers purely by overwhelming them with information and ‘nice’ advertisements.

For Example, At the Apple’s iTune’s store, user-created playlists enable customers to upload their favorite music selections and share them with others, who can then buy the songs if they like. Then there is the open marriage between customer-made and user-generated content. The four-year-old South Korean online newspaper OhMyNews works with 26,000 'citizen reporters', who send in stories and pictures to make up 80% of its content. OhMyNews pays up to USD 20 per article, though for many citizen reporters, getting their name in the paper is the real reward. Fiercely outspoken, it has successfully challenged the traditionally conservative press in South Korea.

Effectiveness of the medium
This form of communication with the people makes them feel involved with the brand. If companies create enough buzz about such campaigns then the rest of the promotions can be carried out word of mouth, helping companies cut down their advertising costs. Thus brands can register in the ‘Top of the Mind’ of the consumers and also drive sales.

The Electrolux Design Lab 2005 saw entries from 3,058 design students from 88 countries where they had to design household appliances for the year 2020. 12 finalists participated in a six-day design event in Stockholm, including workshops, model building and a competition for cash-awards, & appliances etc.

Core 77, the industrial design site, teamed up with Timex for a global design competition called Timex2154: The Future of Time to celebrate Timex's 150th anniversary. Designers from more than 72 countries explored and visualized personal and portable timekeeping 150 years into the future, with over 640 entries.

New Trend
Crowd sourcing seems to be a profitable model for businesses. “Innocentive” uses the global brainpower to develop new products, new commercials and new virals; a global brainstorming to solve your problems – can you beat that? Every solution has a reward and big corporations (P&G used Innocentive to launch Pringles print) are turning to Innocentive for help.

Moving past contests and gifts, this is where it gets really interesting: co-creators receive a cut of profits from whatever gets developed based on their input, suggestions, design or ideas.
Danish ‘Vores’ (‘Our Beer’) claims to be the world's first open-source beer. The recipe and the entire brand are published under a Creative Commons license, meaning anyone can use ‘Vores’ recipe to brew the beer or to create a derivative. As long as home brewers publish the recipe under the same license, they’re free to make money from their effort, which includes free access to ‘Vores’ design and branding elements.

But with the gap between traditional business practices and truly empowered consumers now reaching significant proportions, the ‘Customer is Designer’ trend will only accelerate, moving from the fringes to mainstream. In fact, ‘Customer is Designer’ may turn out to be one of the most exciting and long term engines behind change and innovation that the world of business has seen in years: a way of thinking that has the power to redefine the relationship between customer and brand, between consumer and producer, something that taps into the most awesome reservoir of intellectual capital ever assembled.

So, what is the future for the ‘Customer is Designer’ revolution? Maybe Customer-owned? As the number of ‘Customer is Designer’ initiatives grows exponentially, savvy members of generation will demand serious compensation; if not a fair percentage of whatever it is they've co-created. Soon, a simple iPod in exchange for designing the firm's Next Big Thing just won't do. Also expect a slew of intermediaries coordinating millions of knowledge exchanges between producers and consumers, from talent brokers to project managers.

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