Written by Lykke Parbo
Individualizing consumers in large international companies sounds almost impossible. But when you rephrase the word to customization it sounds more familiar. The online presence of companies makes interaction and data extraction more accessible. Extracting individual data from consumers enables you to customize your content and your future interaction. It’s a full circle starting with among other things interaction to gain knowledge/data for the purpose of customizing future interactions. What I want to highlight by this post is the value created by viewing the consumers as individual identities and how this can help you interact using social medias.
Individualization
The increased interaction has made the consumers co-creating moderators in developing the brand story (Gensler et al. 2013). Each individual consumer has an identity, which somehow relates to the brand. The personality of the consumer is easily expressed in an informal and personal tone using social media. By using social platforms you are able to manage the consumer relationships on an individual level and extract personal data from the consumer.
The 90-9-1 Rule
Extracting data from the consumer can be done in various ways through the Internet. Sometimes the consumers are aware of the monitoring and sometimes they are not. Deighton & Kornfeld (2009) introduces five interactive marketing paradigms: Thought tracing, Activity tracing, Property exchange, Social exchange and cultural exchange. Referring to social media, activity tracing and social exchange are the most relevant. Farber (2005) emphasizes the “always-on” concept. The consumer is always available and always an audience and their activities can always be traced when being online. Referring to the concept of viewing the consumers as individual identities, Farber (2005) speaks of the social exchange paradigm. When thinking of social exchange you might refer this to engaging online communities and highly expressive discussion forums. But this might not be the case. Nielsen (2006) presents three types of interaction with a percentage to follow: 1 % is heavy contributors and account for most of the contribution, 9 % intermittent contributors and contributes from time to time and 90 % are lurkers and only observes. If you turn this around it reflects that: 90 % of the
postings are from 1 % of the users, 10 % of the postings come from 9 % of the users and the last 90 % of the users do not create any postings. This is called the 90-9-1 Rule. The social media enables the consumers “watch” others. Interaction can thereby both be active or passive. But how do you co-create content with a passive audience?
Is the 90-9-1 Rule dead?
Many companies are still basing their online decisions on the survey. But made in 2006, is it still valid? The metaphor of bowling vs. pinball approach used by Hennig-Thurau et al. (2010) illustrates the shift from the traditional one-way marketing to the chaotic and interactive way of social media marketing. Hennig-Thurau et al. (2013) reflects on the pinball approach and emphasizes the rising consumer power, co-creation of brands and social-CRM as a part of the increased interaction developed by the use of social media. This view is supported by Schneider (2011) introducing a survey resulting in a 70-20-10 Rule (same principle as the 90- 9-1 Rule). The percentage of lurkers is still very high, but though decreasing. Ernst & Young (2012) supports the increasing interactivity and individuality of consumers advising today’s companies to turn consumer relationships into collaborative partnerships to keep track of the changing consumer behaviours. “To engage with consumers effectively, organizations need to use language and content that truly connects with them” continuing “consumers want customization more than ever” (Ernst & Young, 2012; 23). These statements truly emphasize the need for viewing the consumers as individual identities.
How to succeed – P&G
An example of a company using online data to understand and interact with consumers is Procter & Gamble (P&G) (McKinsey, 2011). P&G scans the Internet for commentaries relating to the company, sorts them and sends them to the relevant brand manager to take action. The digital workforce behind this runs the comments through a system, which enables them to locate repetitions, known sources/consumers, negative comments etc. By doing this P&G can i.e. spot lead users. This digital workforce enables P&G to view the consumers as individuals and to do segmentation.
Conclusion
As the social medias evolve the consumers are becoming more interactive. For some the 90-9- 1 Rule still applies, but for most companies it is dead. The consumer interaction and need for customization pressures the companies to make use of all data available online to individualize the consumers and track their behaviours. The social media universe opens up countless possibilities to get to know your customers, but it also demands that you react and response quickly to the trends and behaviours by extracting knowledge of the consumers. Knowing the consumers on an more or less individual level will help you interact and create the right content and presence on social media.
This post has been focused on the trends of interaction and individualization has evolved. But how should the companies react to this in terms of their brand value? A question for further research could be: if the brand should embrace the consumers’ identities and let their values shine through in the brand or if the brand should stick to their own brand values and let the consumer embrace them?
Reference list:
Deighton, John & Kornfeld, Leora (2009), “Interactivity's Unanticipated Consequences for Marketers and Marketing”, Journal of Interactive Marketing 23, p.4–10
Ernst & Young (2012), publication:“This time it’s personal: from consumer to co-creator”, EYGM Limited, extracted from: www.ey.com on February 12, 2015.
Farber, Dan (2005), “Getting a piece of the action: The attention eco-
nomy", http://www.zdnet.com/article/getting-a-piece-of-the-action-the-attention-economy/, (accessed February 10, 2015),
Gensler, Sonja;Völckner, Franziska ; Liu-Thompkins, Yuping &Wiertz, Caroline (2013), “Managing Brands in the Social Media Environment,” Journal of Interactive Marketing, 27, 4, p.242–56.
Hennig-Thurau, Thorsten; C. Malthouse, Edward; Friege, Christian; Gensler, Sonja; Lobschat, Lara; Rangaswamy, Arwind & Skiera, Bernd (2010), “The Impact of New Media on Customer Relationships,” Journal of Service Research 13, 3, p.311–30.
Hennig-Thurau, Thorsten; Hofacker, Charles & Bloching, Björn (2013), “Marketing the Pinball Way: Understanding How Social Media Change the Generation of Value for Consumers and Companies”, Journal of Interactive Marketing 27 (2013) 237–241
McKinsey (2011), ”Inside P&G’s digital revolution”, McKinsey Quarterly, November 2011. http://www.mckinsey.com/insights/consumer_and_retail/inside_p_and_ampgs_digital_revol ution (accessed February 11, 2015)
Nielsen, Jakob (2006), “Participation Inequality: Encouraging More Users to Contribute”, Blog: http://www.nngroup.com/articles/participation-inequality/ , (accessed February 10, 2015),
Schneider, Paul (2011),” Is the 90-9-1 Rule for Online Community Engagement Dead? [Data]”, blog: http://blog.socious.com/bid/40350/Is-the-90-9-1-Rule-for-Online-Community- Engagement-Dead-Data, (accessed February 11, 2015)