Thursday, May 24, 2007

Leveraging CGM for understanding Consumer Behaviour

As consumer generated media reflects the voice of the consumer in a huge way, the study of Consumer Behaviour has now got a new source of information that can be tapped.
Wikipedia defines CGM as
"Consumer generated media (CGM) originated as a reference to posts made by consumers within online venues such as internet forums, blogs, wikis, discussion lists etc., on products that they have purchased. Shoppers who are researching products often use other consumers' opinions when making buying decisions."

As huge volumes of User generated content floats around, organisations need to sit up and take note of the voice of it's empowered consumers.As prospective consumers rely on the opinions of the already existing consumers, leveraging CGM and channelising it appropriately has become critical for organisations to understand and manage market performance.This creation of social media is now influencing consumer behaviour, affecting product positioning and driving brand reputations in such a big way, that the power of the ordinary content creator can no longer be ignored.

As per reports published by Nielson Buzzmetrics, there were as many as 25 million blogs, 90,000 Bulletin Boards & Online Review/Feedback sites, 45,000 Usenet newsgroups, in end 2006, and the huge volume of daily postage data( daily postings for blogs:1,500,000, the online sites: 3000,000 and the newsgroups: 225,000) generated by the above has made CGM a force to reckon with.

The message is clear-These new social media tools , by giving birth to CGM have changed company relationships with their consumers from a unidirectional "attract customer" strategy to a culture of participation and co-creation. As consumer voices start echoing, the need is to establish a meaningful interaction with them and use them as advocates for the company.

A miniature case study on Dell shows how CGM has started raising it's head...well the head can be ugly too at times....

Dell has a blog called Direct2Dell, which it claims is for one-to-one communications with DEll. With over 800 inbound links, the site can boast a respectable Alexa traffic rank of 72,529.

Further a Trend Result by the keyword "Dell" on Blogpulse indicates that in May'07, the word 'Dell' found place in almost 0.475 percent of total blogposts.
Also, a technorati search reveals that the total no. of blog posts about Dell is 688,024 and 3025 blogs have already written about Dell.

Sounds interesting. But is it?

Consider what this dissatisfied user posted on the Dell blog-

"I use other social networking sites with a much broader reach than most blogs... the videos, discussion groups and online postings are just as anti-dell as ever and this is creating an impression (negative at the moment) on the entire generation of purchasers dell needs to win over. Dell needs to watch carefully what is going on in those areas of the internet as well.
Me? If I am unhappy with dell and shop elsewhere, Dell will miss selling me probably 5 more computers in my lifetime, add in 5 for my wife too... (we won't calculate friends who learn of our nightmares and also choose not to shop Dell, the figures are too hard to quantify here), so no big deal in the grand scheme of things, BUT if they also lose (for example) my daughter, her friends, their friends, etc. they stand to lose a further 12 sales (for each person based on a purchase of one computer every 5 years) in their lifetime! On Facebook alone she has 162 friends! This should be setting off alarm bells across the board."

...And if this was not enough, the concerned gentleman maintains a blog called Dell Hell revisited....A quick read tells you that it is clearly a 'I Hate Dell' Blog.

To further take a look at Dell's woes, courtesy CGM, A video on Youtube, supposedly called the 'My PC is on Fire-Dell Laptop Tribute Video( Numa Numa Song) which is apparently a parody of a pop song, and is aimed at Dell has as of now attracted 229,076 views. It has 463 comments and has been favourited over 1200 times. The power of replication of data and how it travels virally across the internet is better left unsaid.

And the impact Dell is facing courtesy this negative CGM drive is eventually something that Dell needs to measure and understand. In a business universe where Customer Collaboration and Advocacy are the new found norms, it is time Dell wakes up to these new challenges to face its 'EMPOWERED CONSUMERS'.


duffrey said...

I am the "concerned gentleman" from dellhell revisited and I was most interested to read a professional viewpoint on the subject I raised in my own blog.

I agree with your description of my blog, it IS a "I hate Dell" blog, and that is the whole point.

Companies like Dell who fail to recognize and react to publicity (good or bad) at social networking sites, will eventually come to recognize that the days of running roughshod over consumers are over.

I expand on that thought with my comparison of blogs to "Samizdats" which helped to bring about the fall of the Soviet Union.

While I won't predict that blogs can cause dell to fall, I am confident they can have a substantial impact on the rise or fall of the share price.

I can cause literally millions of dollars in lost sales to Dell or other companies who mistreat me. Talk about empowered consumers!

Keep up the good work, it is fascinating to me to be able to follow the emerging trends in marketing which I am also experiencing first hand.

duff sigurdson

Anonymous said...

It was rather interesting for me to read the blog. Thanx for it. I like such themes and everything that is connected to them. I definitely want to read a bit more on that blog soon.