Five Techniques for Using Web 2.0 to Reinvent the Customer Relationship

I call the use of Web 2.0 for business purposes, both internal and customer-facing, Enterprise Web 2.0. At its core, Web 2.0 is about harnessing collective intelligence and most of the rest of the Web 2.0 ideas fall out from this concept. And that highlights a monumental difference between the way the Web was used in the past – and indeed is still largely used today – and the way it works best. Most Web sites still push content one way out to their visitors, don't have any means to interact with them, or even engage them in basic conversation and elicitation of contributions.

However, smart folks have recently realized that a much better way to use the Web is to have two-way connections with the people that use it. Many new sites now take this to the extreme and would have virtually no content at all if it wasn't for their visitors: Wikipedia gathers encyclopedia entries and vociferous discussion from its users, while Flickr gathers pictures, tags, comments, and more, and Digg gathers news. And there are hundreds of sites doing this now. And while they are a small minority still, they represent what's exciting, new, and so important about Web 2.0.

The theory is that applying these techniques to the enterprise would result in much more vibrant, high-value relationships with customers and even suppliers and partners. Particularly in service industries, Web 2.0's two-way conversations would provide instant feedback, rapid evolution of offerings through co-innovating with the people actually using the products, and even true symbiotic relationships where your customers are also your key suppliers. Not sure this will happen? Web 2.0 essentially describes what worked well in Web 1.0 and companies like Amazon have turned this type of two-way customer relationship into a virtual art form, providing better services to their customers as a result with things like custom product recommendations, and harnessing their users content for use by other users (ratings, reviews, etc.)

Even if you buy into all of this (and you should, the respected IT industry analyst firm Gartner thinks that all revenue generating lines of business should have a Web 2.0 architecture by 2008), extrapolating this into concrete techniques can be difficult. And so along the ways of my other popular lists of how to apply Web 2.0 (Five Great Ways to Harness Collective Intelligence, Ten Ways to Take Advantage of Web 2.0, and Thinking in Web 2.0), here is a short list of ways to apply Web 2.0 to building fuller, richer customer relationships:

Five Techniques for Using Web 2.0 to Reinvent the Customer Relationship

1. Dramatically Lower the Experience Barrier. Most traditional Web sites are still just too complex and hard to use and drive away customers to competitors or just fail to make it easy to do business. Some bad points: Use of static HTML, forcing page loads and refreshes, far too many places to click and get lost, and cluttered layouts with too much to read. My biggest observation: The most commonly used customer activities are often buried more than a click or page away, and much more. While Tim O'Reilly's famed Web 2.0 explanation only covers the Rich User Experiences in general, this fails to address what's bad about most business Web sites today. In contrast, the best Web 2.0 sites have generally turned out have extremely simple designs and are easy to figure out and use. Yes, Ajax user interfaces are terrific but with its loss of GUI conventions, use of Ajax can still result in very hard to use interfaces in the hands of inexperienced designers. 

Finally, I recently heard Google's Adam Bosworth give a great rule of thumb: The less frequently an application is used, the simpler it must be because the user will forget how it works. Bottom Line: Lower the barrier to use to absolute rock bottom. This will give you the ability to actually have customers engaged in the items below.

2. Collect User (Customer) Contributions. And make it as easy as possible to do. Your customers are almost always your very best source of information about your products. In fact, your customers likely know more about them than you do and there are also a huge number of them. So actively leverage this vast sea of knowledge and collect feedback, criticisms, tips, suggestions, preferences, conversations amongst your customers, and even conversations between you and your customer (if they approve it). These latter two, if made public, can form true communities and can let your best customers help other customers when you don't have the ability. If you're in the business of providing content, let them mark it up, improve it, and share it with others. Amazon is still the leading example here, and their database of user generated reviews and ratings is simply one of the best out there. Collecting customer contributions can be as simple as a wiki or submission form, or as sophisticated as a MySpace-style community.

3. Enable Formation of Communities. As it turns out, if your customers like what you sell they will form online communities based on this common trait, whether you provide it or not. In these online communities they'll share ideas and information, create an atmosphere of enthusiasm, help other customers, organize online events, etc.. Furthermore, this supports the trend that buyers are moving from buying products to buying overarching experiences, and community adds to this effect. Having your customers build a community somewhere else other than one that you provide and nurture is generally of less value. There is less ability to collect and reuse user generated content and provide active support of the community. Fortunately, building a good community environment is fairly easy these days. For example software support is getting extremely good and platforms like Drupal and CivicSpace are pushing the envelope of best practices in combining online communities and Web 2.0 techniques. Finally, from a cost-benefit perspective, an online community can keep your customer base more unified and self-servicing, put in front of your branding for longer, and increases opportunities for repeat business.

4. Become An Open Platform. While many companies selling material products might think they have less things to open up, you'd be surprised at how much useful, non-strategic information virtually all organizations are sitting on top of that could be opened up over the Web for both existing and new customer benefit. Even if it's just your product listings, technical support knowledge base, or what have you, you might be surprised at the ingenuity and new uses that this information can be put to by others if it's available. Monetizing this can even be of serious financial value (Amazon raked in $211 million dollars last year by doing this). Leaving mountains of potentially valuable information and services unexploited and off the open market can be a huge mistake. Study the successes here (Amazon and Salesforce), inventory your offerings, figure out how to scale and monetize, and start with a pilot, but the Global SOA is still an emerging concept that has major opportunities. Never mind that your customers will have more useful information from you, increased transparency, and the ability to innovate on top of what you provide. Even just providing RSS or ATOM feeds of your most requested information is a great place to start.

5. Provide Self-Evolving Customer Relationship Management (CRM). The social and collaborative techniques of Web 2.0 provide a malleable framework upon which to provide rich CRM services that are customized to the individual visitor and highly automated, yet become tacit interactions with a person in the loop right when it's needed. And then back to automated when it's not (read this write-up on Web 2.0 and tacit interactions as one of the last remaining bastions of major productivity gains.) While enterprise-class products that do this well are still heading to market, there are some great examples out there, including One Network, though even things like Microsoft SharePoint is a good example of the possibilites.

There are many other ways to apply Web 2.0 ideas to improving and even reconcieving the customer relationship but these are some of the primary ones. And as always, this blog is about conversations with my readers, so please contribute additional ideas below or take the ones above to task.

Please provide other ways to engage customers with Web 2.0 techniques below!