Pre-Commerce: How Companies and Customers Are Transforming Business….Together
By Bob Pearson
Chief Technology and Media Officer, WCG
Since its birth in 1995, the age of e-commerce has been centered on the transaction. However, we spend less than one percent of our time online involved in a transaction. On the other hand, 99 percent of our time online is spent learning, browsing, socializing and seeking support. Now, we are entering the era of Pre-Commerce where customers make their own decision to buy or support your brand before the transaction. Companies that develop excellence in pre-commerce will be the ones to drive e-commerce success in the years ahead.
Consider that an average of 500,000 people go online everyday for the first time in their lives, 21 of the world’s top 25 newspapers are not in English and you have to work in 10 languages to reach 82.6% of the online population of 2 billion people. With these stats it’s fair to say that the landscape is different than it was a few years ago. And that’s just the big picture.
We are consuming content and learning about brands on our own time and in different ways. It is normal for teenagers to consume content, simultaneously, from three different channels. The most important language in the world today is not Chinese or English. It is actually short-form language that we use for texting and Twitter.
Why is Pre-Commerce a Game Changer?
The exploding use of social media channels has fundamentally changed the way customers go about making their purchasing decisions, how they educate themselves and why they choose to support certain brands above others. Social media has turned peer influence on its head. That one never-satisfied customer now can influence hundreds, thousands or millions of potential customers. Not only do 90 percent of consumers online trust recommendations from people they know, according to a July 2009 poll by Econsultancy, but a remarkable 70 percent of the respondents said they trust opinions from users they don’t know. In my observations over the past five years, I’ve found that at least three-quarters of e-commerce customers turn to peer reviews, blogs, forums and other social media channels before completing an online transaction.
There are many tectonic shifts occurring that will transform how we work. For example, approximately 65 percent of people prefer to learn visually. How many brands are able to tell their full story visually without text? Not many. Individuals who have great content are becoming media properties in their own right, often with wider reach than the majority of print publications that we know today. How many of these emerging media properties do you know as well as you know someone at a news outlet?
Few companies have recognized and reacted to this remarkable shift in influence. More and more, your customers will arrive at your door or come to your Web site with their minds already made up. And if you have no way of reaching them while they’re making their decision, you’ve already missed the sale.
Tomorrow’s leaders will learn how to become a “relevant peer” in the communities of their customers. Those who embrace pre-commerce will learn new ways to market, recruit and retain employees, shape the reputation of brands and much more. In many respects, we’re all just getting started in our journey to redefine how we all work together. Fortune 500 executives and other business leaders from a variety of industries have understood this and have actively embraced new strategies to engage customers. Leaders such as Ray Kerins, VP of Global Communications, Pfizer; David Witt, Director, Global Brand Public Relations and Consumer Engagement, The Hershey Company; Becky Brown, Director of Social Media, Intel; Herman De Prins, CIO, UCB, and Yann Gourvennac, Head of Social Media and Web, Orange have set the pace.
We all grew up learning E. Jerome McCarthy’s famous 4 P’s model of price, product, place and promotion. Now, we can complement this with our 4As model – awareness, assessment, action and ambassadors. The 4P model is a corporate-driven model, since every decision can be made in your conference room without customer input. The 4As is customer-driven. The customer will decide when they listen, what they’ll discuss on the Internet, where they’ll research their purchases and where they’ll make them. Brand loyalty will come from persistent, positive interaction between a company, its brand and its customers.
The 4A’s Model
- Awareness – A company must understand when and how to penetrate the market’s noise to reach customers and create awareness for its brand. This only can happen effectively with active listening to what customers say online. You want to raise awareness with the right influencers in the right sites using the right content at the right time.
- Assessment – The customer is not on board yet, but they are committed to learning more. A company must supply content that customers can download, view, read and act upon, and it needs to provide that content where customers will access it.
- Action – Simply put, the point at which the customer is making a decision that shows they are on board, ranging from the most obvious, a purchasing decision, to a surrogate, e.g. clicking on a coupon to print out.
- Assessment – No social media interaction is perfect. A company has to review and re-assess its approach to identify potential improvements and understand your share of conversation that is pro, con and neutral. Measuring positive share of conversation is easy. Negative share of conversation is diluting your message. And neutral or flat experiences can actually be the death of a brand. You need to understand the dynamics for all three.
- Ambassadors – Every business has customers who are uncommonly loyal to its brand. A company has to know and build relationships with these loyalists, keep them informed and give them every opportunity to help spread the word. These are folks who write a few thousand forum posts a year, write 100 blog posts or do 50 videos. They live for your brand.
Leaders have a fundamental choice to make in today’s marketplace.
They can allow their customers to decide on their own if they prefer your brand or they can become a relevant part of their customer’s community and build a relationship unlike any other built in the past few decades. Leaders will understand that the entire C-Suite is changing and become students of how to engage more effectively with employees and customers worldwide. They realize every function will evolve, not just communications or marketing. Followers will pontificate on this topic, then go back to the same models that worked last year. The only difference today is that the two groups are about to separate faster than we’ve seen in many years. Innovation never waits for us……
Bob Pearson serves as Chief Technology and Media Officer for WCG (http://www.wcgworld.com/), a leading independent global communications company focused on the integrated corporate and product marketing and communications needs of the world’s leading companies. Founded by Chairman and CEO Jim Weiss ten years ago, WCG serves clients in offices in San Francisco, New York, Chicago, Washington, D.C., Austin and London. Bob is the author of Pre-Commerce, which offers a step-by-step process for leaders to apply this knowledge to begin transforming their companies. He is a blogger, columnist and frequent speaker to C-Suite audiences in the Fortune 1000. You can reach Bob on twitter at www.twitter.com/bobpearson1845