Review of Satisfied Customers Tell Three Friends, Angry Customers Tell 3,000: Running a Business in Today's Consumer-Driven World

Part of what we want to do with the ChatterBox blog is comment on new developments and ideas on word of mouth and advocacy. We're certainly not going to be able to touch on all of them, but we would like to comment when we can.

Our first post on this is to review an upcoming book by Pete Blackshaw titled Satisfied Customers Tell Three Friends, Angry Customers Tell 3,000: Running a Business in Today's Consumer-Driven World. I had a chance to read an advance copy on a flight back to the States and it kept my interest the whole time. The reason why I'm reviewing this is because our position at ChatThreads is that word of mouth is a "strategic imperative" for companies. And even though ChatThreads goes about measuring WOM differently than how Pete's company, Nielsen Online, goes about it, there is a lot of alignment on the point that WOM needs to be central to how companies organize themselves.

Pete's primary thesis, based on my reading, is that the silos among consumer affairs or customer service and the rest of the organization (like marketing, PR, product development, human resources, etc.), need to be broken down and all these divisions need to be better aligned based on the insights from consumer-to-consumer conversations -- that is, word of mouth. Relatedly, Pete maintains that a treasure trove of insight can be culled from the conversations that leave their digital trail in discussion boards, review sites, blogs, and other forms of consumer generated media (CGM), a term Pete coined some years ago, or through inbound calls to consumer affairs and other, more traditional feedback mechanisms.

Pete provides a number of practical points that will help people, especially those trying to get a handle on word of mouth and advocacy, in their professional lives:

- How to monitor and learn from online word of mouth using do-it-yourself tools, like Technorati blog search, Google blog search, Nielsen Online's BlogPulse, YouTube video search, Flickr photo search, etc.. He also points out where these tools fall short and it may be necessary, for more sophisticated and larger-scale analyses, to employ the services his company, Nielsen Online, or their competitors in the space, offer). With my ChatThreads hat on I would just add that you can gain a great deal of insight from understanding how conversations spread from person to person, especially in venues that are not publicly available and where these tools cannot access;

- To assist the uninitiated, he provides a really helpful table that shows the key metrics used when monitoring CGM and what each can tell you. These metrics are Volume, Reach, Issue, Sentiment, Emotion, Dispersion, Source, and Author;

- "Credibility Quadrant": Pete argues that CEO credibility is key to a company's success. The "credibility quadrant" is a new tool that Pete developed to help companies, especially CEOs, understand the marketing tools and tactics companies have available to them and how each impacts CGM. The 2x2 quadrant maps various marketing strategies in terms of two dimensions: how credible they are in the eyes of consumers and how much control a company or brand has over each. For example, brand web sites and product quality are high in company control and also consumer acceptance. Organic ratings and reviews are high in consumer acceptance but the company doesn't have a lot of control over these (indirectly they do, of course, through product quality). Phone solicitation is high in company control but low in consumer acceptance.

Pete walks CEOs through questions they should ask in order to promote a culture of credibility and break down organizational silos, such as "What drives the conversation, hence reputation, about my organization?" and "What departments or divisions of my company are implicated in the CGM?". These are important questions, and I applaud Pete for articulating them so clearly, but I would have liked Pete to elaborate more by giving a case study on how a real or hypothetical CEO actually answered the questions and made concrete organizational changes as a result.

What's the most important point in book? I've saved this for last to discuss, and it is the tension between authenticity and growth. What happens when the CEO has to manage competing demands to generate revenue but still maintain authenticity (for example, Pete cited the example of Starbucks removing the original espresso machines that were instrumental early on to a more authentic customer experience but over time, consumers became impatient with how long it took to get their coffee and so Starbucks ended up replacing them with more efficient machines, but in effect, watering down the customer experience)?

At Northeastern University I teach a class on Organizational Communication and Advocacy where we talk about how many companies fall prey to the mantra of "fasterbettercheaper" and how this often compromises organizational integrity and ethical decision making. I think it's key that Pete discusses this point because if he hadn't he wouldn't have done justice to the reality and complexity of what organizational actors have to address in their day-to-day decision making.

But this is also the trickiest part of the book and an area that deserves some more consideration and discussion. As mentioned above, Pete writes that as demands for growth increase it can become increasingly more difficult to be authentic. He then writes "The CEO needs to figure out how to pursue operational and fiduciary imperatives of growth while still appearing real, sincere, and credible" (my emphasis). Later he writes about how Bob Lutz [the CEO of GM who contributes to the GM FastLane blog] "manages to sustain an image of authenticity" (again, my emphasis). I found these statements -- "appearing real, sincere and creible" and "sustain an image of authenticity" -- to undermine the credibility of the other excellent points he was building in the book.

While I don't think Pete meant for this section to be interpreted in the following way I'm wondering if some will take it as: "Yeah, all this authenticity stuff is cool and all, but when it really gets down to it we know we can't sustain it, and so in these situations it's OK to just give off the impression that we're being authentic but without really doing so."

It's kind of like a term I coined a few years ago called "synthetic transparency" or in this case, "synthetic authenticity": doing things that appear to be transparent or authentic, but really it's just a particular stylized form of communication that makes people seem "as if" they are being authentic.

Now, perhaps it's naïve to think that companies would behave otherwise in a capitalistic society where demands for growth can be intense, but it seems such a position would end up creating more cynicism on the part of consumers (and it's because of this cynicism that the credibility Pete talks about is so important). It seems to contradict the position that companies really should be more ethical and authentic with their stakeholders.

What in my mind is the way to address this tension between authenticity and "fasterbettercheaper"? I would say that that in some situations an organizational actor might be faced with the decision to make radical changes, blow the whistle, resign, or otherwise resist if the organization doesn't have a culture that can sustain a truly authentic stance. This is easy to say but very hard to do. But I believe making a point something along these lines would be more consistent with the important arguments that Pete is advocating for in the rest of the book.

Overall, I definitely recommend reading Pete's book. It makes the essential point of elevating customer-centricity and feedback to the highest levels of the organization and provides some practical steps for doing so. I think the tension that seems to inevitably emerge between growth and authenticity in the life cycle of a company is terrifically complex so I hope others will chime in on how they would address this.

Comments

[Michael Cayley]

I illustrate in "Introducing Social Capital Value Add" how social media exposes brands to new risks. A new valuation method is required to understand the authentic sources of stable earnings in a corporation's future, i.e. a method designed to measure social capital. You can see a high level illustration of this arguement here: http://tinyurl.com/3tr82f The Canadian Marketing Association posted an appeal in favour of SCVA on Friday, that you can read here: http://tinyurl.com/5cr8lb Please express your support for this idea at www.changethis.com/proposals A few weeks ago, I sent "Introducing Social Capital Value Add" around to a few experts for their reviews. One turned out to be a co-founder of www.changethis.com who suggested submitting it to their editorial board. I did and ChangeThis has posted the idea, along with 15 others selected for this month. ChangeThis is sort of like a www.digg.com, only you vote for ideas instead of news stories. The top ideas on June 19th get distributed to more than 20,000 so-called influencers … editors, journalists, academics, authors, bloggers, etc. ChangeThis has helped spread ideas by well know authors like Richard Florida, Chris Anderson, Seth Godin, Guy Kawasaki, Tom Peters and Malcolm Gladwell. I am a first time author, so I would really appreciate the support of ChatterBox through an appeal to your social connections.

[Michael Cayley]

The ChangeThis manifesto was published today:

http://www.changethis.com/50.05.SocialCapital