Stakeholders, Shareholders, and CGC

I don’t know if what I’ve been seeing lately is some sort of personally biased observation or it is an actual trend that is occurring, but nevertheless, I am interested in what I see as the shift from Shareholder Accountability to Stakeholder Responsibility and how this fits into the Consumer Generated Content (CGC) trend.  

It’s always helpful when using loaded, ambiguous terms to start off with some context and definition.  It seems that as time has progressed (especially recently), that many corporations are starting to shift from solely pleasing their shareholders to taking a more holistic, stake-holder centric point of view.  This larger point of view is more encompassing and takes into account supplier/developer relationships, community impact, and environmental impact when making decisions.  I think we have started to see the beginning of such a trend emerging.  For example, this innovative company, B Corporation, independently verifies companies allowing them to become B Corporations (see the website for more detail) – essentially, granting such a designation to companies meeting comprehensive and transparent social and environmental performance standards.

 The contemporary consumer seems to be demanding to know the impact of business on the environment, where and how things are supplied/manufactured, and the meme of creating change through purchasing “better” is starting to spread.  The confluence of these trends can be seen, for example, by the growth of the organic market, both food and otherwise.  Organic food sales are anticipated to increase an average of 18 percent each year from 2007 to 2010 while organic non-food sales grew 26 percent in 2006.  Any recent trip to the supermarket can tell you that organic foods are significantly more expensive than their non-organic counterparts (same goes for clothing made from non-organic fibers).  The growth of the relatively more expensive organic market during a time of rampant food inflation and depressed consumer spending in general certainly says something.  

What does this all mean for the seemingly unrelated world of consumer generated content?  If consumers creating content are also attempting to create change through purchasing, it isn’t hard to do the math from there.  I think, ultimately, that companies who embrace this connection will see themselves portrayed in a more favorable light on non-traditional media outlets like the ubiquitous blogosphere and YouTube, whereas companies who deny such a connection exists will become increasingly critiqued through these mediums and will be (negatively) compared to their more holistic competitors.  Only time will tell, a lot of this is my opinion and a bit subjective, but that is how I see it.  

-Mike

Pete Blackshaw’s New Book

In “Satisfied Customers Tell Three Friends, Angry Customers Tell 3,000,” (buy it here) through what interactive marke­ting ­expert Pete Bla­ckshaw­ calls “consumer-­generated media”—blogs, s­oci­al networking pages, message boards, product review site­s—ev­en a single disgruntled cus­tomer can broadc­ast his complaints to an audience of millions. This provides both challenges and opportunities – unprecedented in both directions; by not listening to online brand or company conversation, this can create enormous liabilities, while by listening to and acting upon conversation, this can create a distinct competitive advantage. The more time that passes that companies do not realize the duality of the situation, the more opportunity is lost, and the more the potential liability builds.

Pete outlines upfront three truths that inform the entire book:

• Businesses no longer hold absolute sway over the decisions and behavior of consumers
• The longer companies refuse to accept the influence of consumer-to-consumer communication a­nd perpetuate old ways of doing business, the more they will alienate and drive away their customers
• To succeed in a world where consumers now control the conversation, and w­here satisfied customers tell three friends, while angry customers tell 3000, companies must achieve credibility on every front.

How do you create authentic messages, maintain credibility, and synthesize the fact that businesses no longer have absolute sway over decisions? By listening to, and acting on conversations that are happening on the web, businesses can accomplish all three. Companies that chose to ignore this important raw conversation will be left in the dust by more progressive firms who capitalize on the opportunities presented to them by simply paying attention to how the online space perceives their brand or company.

The important aspect of this conversation is that it is often “unfiltered.” It is not subject to biases that may be present in formal focus groups – it is simply raw perception. If there seems to be a disconnect between what execs believe their message is and what the online space is saying their message is – companies better listen. Unfortunately, (or fortunately for companies that use it to it’s advantage), perception is reality.

-Mike

Fox is Next to Tap the Masses

This Just In:

Fox Broadcasting Company, yes the same Fox that brought us classic shows such as the Simpson’s, 24, and the Tick (well maybe not the latter), has partnered with crowdsourcing firm Passenger to build an on-line community around Fox shows and to help executives make more informed programming and marketing decisions.  Passenger will help Fox to analyze public response of pilot episodes, plot direction, character ratings throughout the development process.  This is not the first project Passenger has worked on with an entertainment studio.  They played a huge roll in helping LOST big wigs Damon Lindelof and Carton Cuse select which episodes would be submitted to Emmy voters.  Fox is hoping that Passenger can begin by helping to collect feedback on their upcoming fall schedule. 

Some studios have been reluctant to take the crowdsourcing route because of the constant monitoring of feedback required.  Lately however, many have been turning a corner so-to-speak, and recognizing that a focus group here in and there is simply not enough to gauge the public opinion.  Who knows, maybe with a little luck they’ll listen to this blogger’s voice and bring Elisha Cuthbert back on 24. 

 

-Paul B.

First Post

Hello!

We are three young professionals trying to understand, learn more, and further develop the concepts concerning consumer generated media, crowdsourcing, consumer defined brand messages, bottom-up marketing, and other relevant topics concerning “new media” (for lack of a more all-encompassing word).

We hope to use this as a forum to post news, thoughts, original articles, and most importantly, share and observe others opinions about this very relevant societal phenomenon.

What do these new trends mean? Do they mean anything, and to whom? Who will benefit, who will lose? Can these trends be monetized? Where is the ROI for companies who use such methods?

We hope to address these, and many more questions as the dynamic trends surrounding CGM continue to evolve.

Thank you for reading,

-Mike