Another company to experience the flame of Australian bloggers last year was the US online auction site eBay. Users were hostile to planned changes that would make eBay's PayPal service the only method available for settling transactions. They vented their anger on discussion boards and blogs and called for an ACCC investigation.
eBay Australia spokesperson Daniel Feiler says the company has subsequently created systems to ensure that it is more consultative, and engages in a greater number of face-to-face meetings.
When it does discuss issues online it chooses to keep the conversations within its own discussion boards, rather than engaging on blogs, to help control the conversation.
"The internet has shown that if people are going to complain they've got plenty of ways to do it," Feiler says. "And whereas once the lobbying that took place was potentially localised, it's now for all the world to see. So companies need to make a decision of - do they want to engage in that, and if they do, then they need to engage on the platforms that the people are complaining from; or to create their own environment and make sure they are using that regularly to communicate.
"If you choose not to do that then you run the risk of your story being told by people who are really outside of your control, and you have no opportunity to influence that conversation at all."
Get involved
The chief executive of the Adelaide-based internet service provider Internode, Simon Hackett, says he spends roughly 10 hours a week on the Whirlpool site posting comments and answering questions. He says his motivation comes from genuinely wanting to be there to participate in conversations that affect his business.
"By side effect of my involvement, Internode's business is also enhanced by increasing its credibility," Hackett says. "By being accessible to our customers, in this open and honest way, we gain huge benefits out of the resulting two-way street."
He says the company has been able to find and fix a huge number of minor bugs in its service thanks to customers pointing them out, as well as implementing suggestions for new services. Internode now has the highest customer satisfaction ratings in the entire Australian broadband industry, according to a survey last year by Roy Morgan Research.
One of the most prominent examples of a company being trashed online happened to the US computer manufacturer Dell. Poor customer service led to prominent blogger Jeff Jarvis posting his experience online in 2005. That theme was quickly picked up by other bloggers. The resulting discussion was subsequently referred to as "Dell hell".
According to Dell's small and medium business marketing director Jay Turner, his company has implemented a comprehensive social media strategy, including communicating directly with bloggers, creating its own blogs, and soliciting feedback directly via the web. Turner says Dell also launched a local version of its "Small Business 360" advice service, and has invested more than 90 local articles to it. He is also keen to start local blogging.
"As we are moving towards the blogging and the social media space, we are finding that it's a real efficiency driver and a benefit to Dell," Turner says. "It's resulting in hundreds of thousands of call reductions to Dell, and speeding up people being able to get specific resolutions from questions that they have."
That has meant savings of more than $5 million for the company, while improving customer satisfaction.
"We've seen a 30% decline in negative commentary," Turner says. "And the feedback we are getting is fantastic."
How to monitor online chatter
The senior account manager and social media expert at Edelman Digital in Melbourne, Con Frantzeskos, says numerous tools are available to help companies track what is being said about them, from free tools such as Google Alerts to numerous paid services such as BuzzMetrics by Nielsen Online.
Once you know what is being said, and where, it is worthwhile to stop and listen for a while.
"We'd suggest what we would call ‘building factors for engagement'," Frantzeskos says. "In plain English, what are the issues you want to talk about? What are the main spaces you want to talk in? And then what is the actual process to get out there."
Only then should they engage in the conversation.
Turner says Dell also uses tools for tracking what is being said about it and topics that relate to its business online, and tracks about 5000 conversations each day.
"If something does turn up on a blog that's quite beneficial for us, because it ends up straight back with the centralised team and we are informed quickly that a customer has an issue," Turner says. "Because if someone has gone to the trouble to make a positive comment or has an issue, they have it regardless of whether we know about it or not - and we'd prefer to know about it."
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written by Fiona Adler, April 29, 2009
As one of the founders of www.womow.com.au (Word Of Mouth On the Web), I can tell you that over 90% of our business ratings are positive – and many businesses are growing dramatically thanks to the broadcasting of their reputation online. Likewise on eBay, the feedback is overwhelmingly positive, giving consumers the confidence to conduct millions of transactions with parties they know little or nothing about.
The internet has truly changed the playing field for businesses – it now provides a means for businesses to promote themselves based on merit, rather than the size of their advertising budget.
For instance, Lee Davies, the proprietor of Salon Lavan, says that her business is growing thanks to the feedback her customers have written on the web. This small hairdressing salon is fielding calls and acquiring new customers from all over Melbourne - simply because people have heard that they provide a brilliant service. Based in Elsternwick, Salon Lavan is getting calls from Essendon, Emerald, Keilor, Croydon and even further afield. Who’d have thought that people would travel 40km and more just for a haircut! But this business demonstrates just how powerful word-of-mouth - and the promise of a good haircut - can be.
Davies says to us that; “The best advertising comes from my customers – they write what they think of my services and suddenly I’m getting enquiries from all over town! I’ve built this business on word-of-mouth with WOMOW. ” Having customer ratings at an independent source is extremely convincing for people that value good service. These days she says the salon is averaging 12 new clients a week that find them on www.womow.com.au.
There’s also plenty of research to back up Salon Lavan’s experience with word-of-mouth marketing. One study showed that almost two-thirds (62%) of consumers read consumer-written reviews on the internet to make purchase decisions (Deloitte & Touche, 2007). While another showed that 78% of people trust other consumers’ recommendations above all other types of advertising and marketing (Nielsen, 2007). That’s pretty powerful stuff – especially when you consider that the cost is almost nothing.
Another case is Misty’s Diner in Prahran. Misty says that "In one night alone, new customers from WOMOW accounted for almost a third of our revenue! It gives me goosebumps when I read some of the great things our customers are saying about us." (And isn’t that why business owners get into business in the first place?!)
Many businesses think it’s a bit scary to have customers out there discussing your brand in an uncontrolled way, but the reality is that these conversations have been happening long before everything went digital. With the internet and social networking sites in particular, it means that there are some key differences about the conversations customers have;
1. Now businesses can tell what’s being said about them (making it easier to find out about customer issues and address them)
2. Customer comments are reaching much larger audiences
3. The comments are permanent and searchable records of how your business stacks up
The result is that the impact is much greater – but more often it’s amplifying positive sentiment rather than negative. Businesses that genuinely provide good service and value their customers have absolutely nothing to worry about. Yes, it’s true that every business has unhappy customers from time to time, but the questions that viewers (potential customers) ask are;
a) How does the business react when something does go wrong?
b) What is the weight of customer opinion? One bad comment in ten good ones is really nothing to be concerned about and can actually give your feedback more credibility.
The only businesses that have real cause for concern about the affects of customers sharing their experiences online are those businesses that are out-of-touch with their customers, or worse, have been able to ignore poor feedback (often, but not always, the larger corporate are guilty of this).
Online forums provide a fantastic opportunity to gain market-share by leveraging your good-will and letting your customers become the best possible sales force. What can be more convincing than a happy customer?
I feel for those that are attacked over an illigitimate complaint but if they operate honestly and professionally the criticism will fade unlike the much of the real damage reported when rogues operate.
The Senate is now conducting an Inquiry into Access to Justice. Let us hope they can accomplish more than Mr Emerson will allow following the Franchising Inquiry.