What Is New Here?
Many authors have stressed the importance of focusing on customers and developing an intimacy with them.24 CRM has been offered as a methodology for building loyalty.25 These concepts should be viewed as squarely in the middle of the advocacy pyramid, but this is not enough. What is new is the top level of the pyramid. Customer advocacy draws on the past work in strategic management, but it represents a revolutionary set of principles, tools, and tactics. It is like the shift from subsonic to supersonic flight. The development of supersonic flight involved an extreme overhauling of previous assumptions about and methods of flight. Subsonic flight principles are based on laminar flow over a curved wing profile, whereas supersonic flight principles are based on turbulent airflow and impact of the mass of air on the flat wing surface. Customer advocacy requires a new set of assumptions about customers and a new theory of marketing success. So many things are new.
A New Philosophy
Relationship building is based on understanding customers and meeting their needs, but advocacy is based on maximizing the customers’ interests and partnering with customers. This goes beyond customer focus to actively representing the customers’ interests like a good friend. This philosophy is based on the realization that customers are in control, so the path to success is to help them make the best decisions possible in the complex world of buying. The philosophy is based on mutuality of interest. If the firm helps the customer, it will learn what products and services customers really want and then can provide the products that honest advice would recommend. The customer advocates for the manufacturer by telling others about the firm and developing a long-term trust and loyalty for the firm.
Although early Internet visionaries predicted that customers would gain decision alternatives and better information from its development, when the Internet bubble broke in 2000, many people rejected these notions.26 In this book, I review the new evidence that establishes that customers actually have acquired new power. It is all around you and the effects are being felt in industries like travel, autos, and health services. I spend three chapters showing how power has grown and is changing the balance from push/pull marketing to trust-based marketing.
The Need for Transparency
One tenant of the new philosophy of customer advocacy is transparency. You need to be completely honest and present full and complete information. In this book I show how you can use transparency to build trust with your customers and earn loyalty that assures profits even in turbulent times.
Advice is Required
The complexity and number of options in your product offerings are probably high. For example, if you are a bank, you may offer 25 different mortgages; if you are a computer manufacturer, you may sell eight models and 100 configurations of computers; or if you are an auto producer, you may sell four brands and 25 models for each brand. Customers need honest help and complete information in order to pick the best product for themselves—not the product that maximizes the manufacturer’s profit. The product should be the one a trusted friend would recommend. For the customer to have confidence, belief, and willingness to accept your advice, you must establish trust with a carefully instructed advisor virtually on the web or in person. A transparent and intelligent advisor who is genuinely in the corner of the customer represents advocacy for the customer across your firm’s product offerings. This need is amplified by the fact that customers want to make good decisions efficiently. They want to trust an advisor to save time and make a better decision.
Compare Yourself to Competition
It is useful to give advice across your product offerings, but true advocacy demands that you provide information and advice across all offerings in the market. You should compare yourself to competitors, even if you are not the best, because customers are doing it anyway. You need to go beyond transparency and be proactive in representing your customers’ best interests. If you do not come out on top in the honest comparison and advice you give, redesign your products so that they are the best. This may sound counterintuitive, but it is like stopping the production line if even one quality defect occurs. It is a severe reaction, but it should seldom be necessary, and quality will improve when everyone knows that you are serious about having the best products. In this book, I will tell you how you can "listen in" to this advice session, how to learn what is needed to make your product number one, and how to uncover hidden opportunities for new products.
Spend Less on Advertising and Promotion
Advertising reach and effectiveness is going down, and prices are going up (in terms of cost per thousand viewers), so the cost/ benefit ratio is decreasing and you should probably spend less in any case because of this declining productivity. But even more important in this context is that for customer advocacy, you should be concentrating on two-sided and unbiased information and advice. More money should go to Internet advisors, providing comparative product trials, and building peer communities composed of customers and your company. Promotion is a heavy-handed attempt to buy sales. With advocacy, you want to have superior products and represent them based on their value. You will not need as much price off promotion. You should allocate old advertising budgets to product improvement, communicating new products, and building new trustful communication channels.
New Tools Are Available
The good news is that a range of new tools is available to provide transparency, advice, and input to improve products. In this book, I explain how virtual advisors can be implemented on the web. These virtual personas function like a friend to provide help and honest guidance to help the buyer make the best decision for him or her. These complementary tools allow firms to build improved products based on the information customers provide about their needs and desires while talking to the persona. I also suggest methods to convert a CRM system that may be push-oriented into a CRM that fulfills the dream of a positive relationship by becoming a tool for advocacy.