YouTube Direktvideo link

How can companies be customer focused through delivering “WOW”?

Brandon Schauer from Adaptive Path shares some of his insights from one of the better presentations I’ve seen in some time (with Audio) (see also their blog)

| View | Upload your own

http://www.bbc.co.uk/blogs/technology/2008/03/the_mobile_internet_kids.html

Years ago, when we were running Wireless World Forum, mobileYouth and Statsmine amongst other ventures, we stood for many things, but not one thing in particular.

Having gone through the mill, we realized that standing for and being recognized as the best in your field for one thing alone was far more valuable than being 2nd and 3rd in multiple fields.

So now we only do youth and marketing and we hope that’s why you’re here.

So let’s talk about youth and marketing. What exactly works?

Be clear in your message. Stand for something

Toyota stands for reliability. It’s the most profitable car company on the world - built on kaizen philosophy of “highest quality is lowest cost”. Yet, if you stand for reliability, how relevant is that when you are dealing with consumers who want something specific to their lifestyle. A hip hop, skateboard loving student does not identify with the same lifestyle as the executive hungry for the moniker of “arrival” through status. Toyota is able to maintain its brand clarity to its consumers through lifestyle branding without impinging on the clarity of each of its portfolio brands.

Toyota offers the main Toyota brand, Lexus, Crown and Scion. Consider the latter

Consider the Scion Hako Coupe - aimed specifically at the hip hop loving urban youth of the US (which the rest of the world identifies with). In this consumer beach-head the Scion brand has found a home - an affinity with a lifestyle group supported by Scion’s own branding activities of DJ Jams, urban lifestyle magazines and Scion owner websites such as ScionRide. Unlikely to kick it with Lexus owners, but underneath it’s fundamentally the same brand in a different guise. The Scion logo bears a close resemblance to that of Toyota, but the consumer is largely unaware, and Toyota has cut some slack for the upstart brand to be able to innovate outside of the interference of the ivory tower.

Scion’s success is well documented. Here is a large mass-market consumer brand playing at being a niche lifestyle offering without detracting from its core offering. So, one must ask the question, how is this approach relevant to telecoms?

Our challenge is we try to take things the other way. When we communicate with consumers, we try to complicate things, because we lose sight of the core emotional bonding consumers have with our products and go long on features.

Wired runs an article about consumer disconnect with mobile phones in Japan due to overcomplication of features.

“There are tons of buttons, and different combinations or lengths of time yield different results,’” says Koh Aoki, an engineer who lives in Tokyo.

You know when engineers start talking like this, we have a problem. So is there a market for Apple’s simpler IPhone in Japan? If simplicity wins, then there is an appetite. Apple has long traded on its simple message of creative innovation.

Nokia has long been the Toyota of the mobile industry - the reliable manufacturer. Vodafone also has great international consumer visibility. Yet, moving forward what do these two brands have in terms of brand clarity for the next generation of young consumers? Operators for example have long associated portfolio branding with going MVNO which is not necessarily the only available option - services can be sub-branded without splitting out the expensive billing and operational aspects.

One reason why mobile companies continue to struggle with engaging young consumers is because of lack of clarity. What exactly does this brand mean to youth? If you need proof, go watch the on-the-street mobileYouth videos we made particularly the ones where we asked youth to provide us with word associations with well known brands:

Nokia “reliable”, Apple “Trendy”, Nike “good company”, Vodafone “hmmm….”, Motorola “rubbish…”

Whether we agree or not is relevant, this is how the next generation of consumers see it. If we are to change, we need to consider how Toyota is creating relevance and “remarkability” (ie something to talk about to your peers) across their mass market and import the concepts that work into our own.

Sliced bread is universally accepted as a good idea. It’s not the best idea - it doesn’t fulfil the ever complicated needs of those consumers who want to slice their own, or require that rye organic granary stoneground sprouted seed experience… but it works. Housewives and schoolkids love it.

And there is our industry’s challenge in a nutshell. Because it’s such a good idea, we think it can sell. What was, after all, the best thing before sliced bread? Otto Frederick Rohwedder (inset) is credited with having invented sliced bread in 1912. But it wasn’t until a Chillicothe baker, who was on the verge of bankruptcy, took a chance on his invention on July 7th 1928 by putting the first loaves of sliced bread ever made on the shelves that the idea translated into a realistic consumer offering. That’s 15 years in the making - why?

Because, without understanding consumer need and meeting that need with marketing, sliced bread would have become yet another idea confined to the scrap heap of invention.

It’s often hard for us to comprehend that we as an industry are merely a tiny speck on the radar of our consumers. Youth in particular do not understand nor care about concepts such as ARPU, churn, “killer apps” (whatever they are), Android or Web 2.0

Take a break from the telecoms industry for a minute and make yourself a cup of coffee. As author Jim Rohn says, however, “be careful of what your ‘friends’ put in your coffee”. And in the same context, in an industry awash with information, we need to be careful about the received wisdom we take for granted.

Here are just a few of those pearls that help keep sliced bread on the shelves

• “this product will take off… when the price comes down to $X”
• “this is the killer application youth have been waiting for”
• “and now for my next slide… a value chain”
• “it’s a Google widgetamething…. it’s Google, kids will love it”
• “it’s disruptive… the world is run by disruptive innovation… if it disrupts the market, people want it”

You see, the thing is…consumers don’t care about us. The really don’t. Nor do they care about our technology. Take the student market for example. No student ever woke up in the middle of the night worrying about Orange, Cingular, Android or Web 2.0. 

All they care about is:

• is it cheap?
• do my friends use it?
• will it help me get laid?

If you can push these buttons, you can pretty much forget about Android, i-whatever, Web 2 and the like.

If you need proof, check out our on-the-street videos of what youth really think.

Time to Put The Ugly Value Chain to bed

Here’s an example of what our industry is up against - people pushing visualizations that have more semblance with the warehousing operations of a 19th Century industry model than an open value creation network we require in a consensual industry such as telecoms.

The “value chain” in its ugliest manifestation (courtesy of Ajit Jaokar). As the apocraphyl Zen tale recalls “If you see the Buddha on the road…kill him”. I think what the monk Lin Chi may have been eluding to was the need to pull the conference presentation trapdoor on experts who talk about “value chains” and “customer needs” in one breath.

Is it possible to refer to customer needsd and “end consumers” in the same context? Obviously not… one cannot meet the needs of demanding consumer when factoring them into the “end” of our equations. Time to start reformatting our mental models of how we operate and looking at the value network models proposed by Toyota and Tesco amongst others.

When you consider Toyota as a case study - consider how they have focused heavily on understanding the consumer rather than pushing technological innovation onto the market. Yes, consumers want hybrids and parktronic, but most want reliable and safe. Consider how they have neatly compartmentalized their brand message into Toyota, Lexus, Crown and Scion… some of which you may never have heard of before. This cradle-to-grave brand approach works… and delivers profitability despite a receding market, weak dollar and upward pressure on commodities. Why? Because fundamentally Toyota doesn’t get caught up in the sliced bread - and doesn’t see itself as sitting in a value chain shunting cars onto consumers. For years, GM tried this and failed miserably.

I’ve seen countless “value chains” roll out in presentations. No one has ever questioned the rationale. The “value chain” is based on industrial manufacturing processes where intermediary warehousing fulfills underpins the logistical infrastructure of a “build it and they will come” model. The factory makes the widget and shunts it onto the market. True, Porter’s advocacy of the value chain model was a key factor in its adoption, but he only proposed the value chain as processes within the company, not as an industry in general.

Technology again

As long as we wax lyrical over technology, we’ll never get it. When the US government tried to stop the production of sliced bread during WWII in order to ease the strain on steel supplies, the American Housewife wouldn’t let them - why? Because, the machines saved them time and created material social benefits for the consumer.

So whether card, mobile phones or sliced bread even… it’s easy to be persuaded by the voices out there that this technology is the answer. But if it’s the same voice that refers to the buyers as “end customers” or in the context of a “value chain”, then proceed with caution. Rohwedder’s invention would still be lying in a Michigan basement covered in dust if the idea alone was the only prerequisite of market adoption.

Claude pretty much summarizes the key themes of the day:

• Monetizing free-content with new business models
• User profiling driving relevance and protecting privacy
• Trusted social dialogue between brands and consumers

Claude features some of the speakers and delegates in his post:

• Matthew Snyder
• Ged Carroll
• Damien Saunders
• Helen Keegan
• Dominic Sparkes

Both companies have experienced their share of problems. Last week, Virgin Mobile said it had added nearly 18,000 net new customers in the first quarter, a dramatic drop from the 310,000 customers it signed up in the first quarter a year ago. Its revenue fell 3.7% to $326.8 million, while net income plunged 75% as the company faces intense competition in the prepaid market.