The Groundswell: Consumers in Control
I’m flying back to Detroit from LA where I was attending the Forrester Marketing Forum. A very enjoyable experience it was too.
Others are describing the quality of the speakers and the insight they imparted. Here I want to concentrate on the core theme of the conference – the shift in relative power between corporations and consumers driven by the rise of digital social networks, and the impact this is beginning to have on corporate behavior and business strategy.
Obviously the concept of humans connecting and conversing with each other is not a new phenomenon. Real-world connections and relationships continue to be the core of what makes us human (thank goodness). However, what web 2.0 has done is provide a new outlet for human connectivity and self-expression. Simply put the web amplifies the opportunities for people to converse, and it makes those conversations highly visible – both to other consumers and to corporations.
The result of this has been a significant improvement in the quality and availability of information about products and services. In the past, clever, aggressive advertising could potentially drive sales even for shoddy sub-par products, because the ability for jipped consumers to tell negative stories about brand interactions was limited by the means at their disposal: a rant to friends, family or colleagues perhaps repeated a few times and slowly forgotten. A phone call or letter to the company concerned. A product returned to a retailer. Maybe a phone call to a consumer watchdog or a letter to the local newspaper.
In any event, even the most dogged complainer would only be able to influence a relatively small number of people. Companies were not punished particularly badly for permitting bad consumer experiences or selling poor products or services. The concept of delivering good customer experience was seen as something desirable, but not really a core business imperative to match putting the squeeze on a pricey supplier for example.
The market (consumers) suffered from limited information, limited communication capability and therefore limited power.
That’s all changed. Now the inherent need, desire and ability for people to communicate with each other on a national or even global scale has created what Charlene Li and Josh Bernoff at Forrester call the Groundswell
Simply put, the Groundswell is a social trend in which people use technologies to get the things they need from each other instead of from companies.
The Groundswell is not a flash in the pan. The technologies that make it work are evolving at an ever-increasing pace, but the phenomenon itself is based on people acting on their eternal desire to connect. It has created a permanent, long-lasting shift in the way the world works.
At the most macro level the Groundswell is great news for both business and consumers. The history of capitalism has been one of ferocious competition driving innovation, price declines, quality increases and disruptive business models that start the cycle of renewal all over again.
Thanks to the significant new pressure the Groundswell is placing on companies to deliver great products and services across all facets of their relationship with consumers, this process of innovation and enhancement will be expedited even further. Simply put: companies that ignore consumer opinion will suffer. Those that choose to embrace it will succeed.
The Groundswell hasn’t made corporations any less powerful, but it has certainly made them more accountable. For the first time in the history of capitalism it’s possible to argue that the interests of companies are finally aligned with their true masters. Not their shareholders. Their customers.
