Businesses which focus all their efforts on improving customer relationships in order to induce them to buy more stuff are missing out on the most valuable part of the customer relationship, according to Bill Lee in his book The Hidden Wealth of Customers: Realizing the Untapped Value of Your Most Important Asset. Instead, they should be focusing on a new type of value proposition, which involves transforming customers into advocates, influencers and contributors.
So, how does this work, and why would customers be interested in becoming unpaid sales representatives for your business? The reality is that your customers will typically: understand more about their needs than you do; have more credibility with other potential customers than you do, when speaking about your business; and would prefer to associate with their peers (your other customers) than with you. Thus you can provide more value to your customers if you can find ways of letting them design the products and services that you provide to them, and if you can create forums for them to interact with other customers. In return, you can coach them to become advocates and influencers.
To illustrate this new type of value proposition the author gives a number of examples, including:
Although the use of social media features heavily, this is not a book about social media. Social media is merely one of the tools which can be used to enhance the new type of customer value proposition. Does the author’s approach to marketing work for everyone? I am not sure. Some customers are going to be better advocates, influencers and contributors than others. Some fields of business may be too complex for customers to be able to make a significant contribution. But nearly everyone who runs a business will get some benefit from considering the author’s ideas.