0600 How do Web-savvy marketer use brand-interaction to steal customers from competitors?

So, how do Web-savvy brands compete and win?

I submit that they do a better job marshalling what I call brand-interaction resources.

This figure depicts a conceptual inventory of these resources and, later, calls attention to the fact that most of these resources exist in the Web ecosystem as added-value capabilities or services of potential partners.

Moving from the left to right, first we have federated search and search optimization. Oh, so you say, “Big deal. We’ve already got that covered.”

Sure, most companies have some dumb keyword or full-text search function, you know let’s throw some google sauce on our pile of digital spaghetti. But most firms have not really thought through how they create contextual consumption of content.

Now I just used a new buzzword. But it really means something important. How do we sift through, organize, categorize, and tag hundreds of thousands or millions of pages of text, many of them with very useful graphic images, downloadable documents, and streaming media. How do you take all that stuff and organize in ways that satisfy users.

At the end of the day, it’s a text mining and XML tagging problem.

Done well, you can give users faceted search, increase session times with deeply satisfying information - answers and new insights - increased conversion and opt-in rates, etc.

This leads to the second category of brand-interaction resources: Traffic Lead-Conversion that addresses the question, “How do we get people to opt in and identify themselves as a potential buyer or returning customer?”

In many case, this will require a smart promotions platform from which to provision daily puzzle, contests, award points, multi-round tournaments, auctions, e-coupons, digital collectibles, and trading groups - a lot of brand interactions that collect truthful information from consumers through out the entire consumer-brand engagement life cycle. That’s way beyond CRM which requires that some form of transaction and an exchange of money.

Other aspects of Traffic Lead-Conversion include animated concepts ad models, guided tours, immersive buying-decision interactions, and so.

However, the foundation of Traffic Lead-Conversion constitutes a specialized subscription management capability - content-subscription management system. This system enables users to subscribe to very specific categories of information, insights, and answers - most of which will not exist until a sufficient number of people subscribe to these information consumption categories. Later we will examine the content supply chain for this function.

The third category of brand-interaction resources brings us all kinds of fun stuff. Social media.

Now rather than going through the list - much of it familiar; much of it still not used well - I’d like to focus on a few really interesting ones: virtual communities. I love telling this story.

We worked with Amway in developing a global strategy for its marketing content and digital assets. In particular, I met a really fascinating guy, Terry, who at the time served as the Chief Communications Officer for Amway Japan.

Last year, Terry White told me that he had become Chief Innovation Officer for Amway and, in particular, had the charter of developing an enterprise social media strategy.

Amway’s a really interesting company. It’s an $8.5 billion a year firm. They’re one of the world’s largest, if not largest, manufacturer of herbal supplements — $1.5 billion a year just in herbal supplements. They’re the world’s largest manufacturer of organic cosmetics and personal care products. Also, the largest green manufacturer of organic, biodegradable detergents - hell, they were green 30 years ago when nobody cared or understood it. Finally, they’re one of the world’s largest manufacturers of water and air purifiers.

They sell all of this through one very large, very global social network comprised of what they call IBOs — independent business owners.

In Japan alone, they sell over a billion dollars of stuff to about a million customers; 600 million of it is through online and half of that, 300 million, through mobile phones. God, $300 million revenue channel through mobile phones.

In terms of having to think through brand interaction, Terry is kind of like, “Way out there.” He’s a Major Tom. He’s so way out there in terms of adoption of digital stuff, he also blows the top of my head off with whatever he’s up to.

So I asked him, “What does it mean to be Chief Innovation Officer for Amway?” I said, “What does that mean”?

“Well, for starters, I am on team that will come up with a social media strategy.” I said, “Tell me more.”

He said, “Well, it’s all about a conversation.” I said, “Terry, wait, you and I both know that’s nonesense, and it’s not about a conversation. Companies don’t have conversations. Companies have a position and an agenda. Companies have a very well-defined point of view: ‘Buy our stuff. What can we say or do to persuade you to buy more of our stuff?’

“You and I know that it’s about a civil argument. It’s about argumentation. It’s about how to engage in a way that you’ll continue to opt in, share, and buy stuff. It’s about persuading you about the value of my brand and the value of my proposition. And, ultimately, it’s about engaging in a way that the consumer says, ‘Wow. I should sell this great stuff, make a good living, and do good things - good works - in the process.’

He said, “Well, you’ve got a point.”

I said, “What else are you doing?”

He said, “Well, I spend about 2 hours a day in Second Life.” Now how many here people are not familiar with Second Life?” Okday, well second Life is an online user-generated world. People create representations of the selves called avatars. Sometimes they’re pretty lifelike representations of themselves. Sometimes they’re completely phantasmagorical characters. Sometimes they look like little chalk sticks. Sometimes they look like a stuff animals called fuzzies.

In user-generated worlds, unlike multi-user games, the users create everything: buildings, plants, furniture, roads, etc. It’s all user-generated.

It’s also a triple opt-in. First, you have to opt-in by creating an avatar. Second, you opt-in by putting yourself some where: a park, disco, whatever. Third, you opt-in to social interaction with others around you - just like if you were on the street, in bar, or whatever.

If I don’t like a particular interaction, you can opt out by ignoring someone or just fly away as if teleporting in Star Trek.

I emphasize this triple opt-in social dynamic because in Second Life, you cannot promote or market without annoying and disaffiliating 99 percent of the folks.

I said, “What do you do in Second Life?” He said, “First of all, promotion. Traditional corporate communication and promotion doesn’t work in Second Life.” People just opt out of it. They’re just gone. Disappear.

He said, “We’ve created an Amway Experience Center. Well, remember the Amway brand is all about healthy living. Remember green, biodegradable detergents and organic cosmetics herbal supplements and so on. It’s really about is engaging the customer in the core values of the brand, and inducing them to have a relationship with Amway, without them necessarily buying anything else.

“In this Amway Experience Center, we sell air chuggers. In Second Life, they’ve got a micro-payment system based on Linden Dollars. So about 550 Linden Dollars equals about two dollars US.

By the way - as a footnote — Linden Dollars has become the first de facto universal micro payment and currency-exchange system in the world. So if you want somebody to create an avatar and the guy’s in China, I will take out my credit card — my PayPal or Amex — and I’ll go buy so many Linden Dollars. I’ll have this digital craftsman/woman in China create my little avatar. I will pay him or her in Linden Dollars, and then he or she will instantly convert those Linden Dollars into Renminbi — the currency denomination of China.