Amazon.com
It used to be that developing customer relationships in a mass-market economy didn't matter. All a successful company had to do was make products that people generally liked--build it and they would come. Patricia Seybold thinks those days are long gone. Thanks to the Internet, customers matter more than ever, and companies that don't get it simply won't make it. In The Customer Revolution she writes, "For the first time in the history of modern business, it's now cost-effective for companies to establish relationships with each and every customer who wants us to know him."
Seybold outlines the principles of the "customer economy" and looks at 14 companies, including Charles Schwab, Snap-on, and Hewlett-Packard, who are in the process of refocusing their businesses to meet customer needs and expectations by measuring and running their businesses on metrics such as customer satisfaction, acquisition, retention rates, and wallet share. In the customer economy, building brand means more than creating a clever logo--it requires creating an "experience that your customers love." She offers up a set of practices--what she calls a "Customer Flight Deck"--that allows companies to monitor and tune the success of their customer contacts. Customer relationships are so important, Seybold believes that a new metric of corporate reporting will emerge alongside profit and loss, return on assets, and P/E ratios--one she calls a "Customer Value Index" designed to give investors the means to measure a company's performance by looking at the present and future value of its customer base. As with her previous book Customers.com, The Customer Revolution should be required reading for managers at any company--old or new--who are assessing the real impact of the Internet on their businesses. Highly recommended. --Harry C. Edwards
From Booklist
Seybold heads her own "worldwide business and technology strategic consulting and research firm," and she looks to her successes with a wide range of clients for examples to illustrate her points in this follow-up to her best-selling Customers.com (1998). Her key argument is that companies should no longer be valued by traditional accounting measures. She makes the case for tracking "customer capital," which includes customer retention rates, profits per customer, growth in customers, etc. Seybold focuses on the music industry and the "free" distribution of digital music to demonstrate another of her principles--that the customer is now in control. Her third proposition is that "customer experience matters," and she details eight steps toward delivering a "great branded experience." David Rouse
Copyright © American Library Association. All rights reserved
Copyright © American Library Association. All rights reserved
From Library Journal
"Expect to change your business four times a year," Seybold advises her clients regarding today's turbulent business economy. The author and founder/CEO of her own consulting and research firm contends that traditional business strategies do not work and companies need to concentrate on the customer rather than on market share. While Seybold's previous book (Customer.Com) dealt with the use of the Internet to increase sales and improve profits, here the focus is on how to attract and retain customers. Part 1 analyzes three core principles that will create new strategies for reshaping customer relationships; Part 2 outlines her "eight steps to success" and details how to apply these strategies using examples from case studies of large and small companies that have embraced the new customer economy. With each case study, she offers suggestions for improvement and change, as well as measurement grids to assess results. The author is on target and provides sound, practical business advice; however, the material could have been abbreviated. Nonetheless, it is recommended for libraries with specialized business management collections. Bellinda Wise, Nassau Community Coll. Lib., Garden City, NY
Copyright 2001 Reed Business Information, Inc.
Copyright 2001 Reed Business Information, Inc.
Pressestimmen
"Think you're in charge of your company's future? Not so fast. Patricia Seybold proves that the wealth embedded in customer relationships is now far more important than all the capital contained in your firm's land, buildings, and bank accounts. Then she crafts a smart and solid plan for untangling the tricky puzzle of finding, attracting, and keeping the savviest buyers the world has ever seen."
-- James Daly, editor in chief, Business 2.0
"As offline and online businesses blend, the ability to build deep customer relationships equates to long-term survival. Patricia Seybold explains why and how to 'play to profit.' "
-- Chris McCann, president, 1-800-FLOWERS.com
"Wherever repeated transactions represent the core rhythm of a business, management must focus on the lifetime value of its customers and the company's programs for creating and sustaining customer loyalty. The Web simply makes this imperative even more urgent. The Customer Revolution makes great use of war stories and case examples to guide us all in seeing just how to address this critical issue."
-- Geoffrey Moore, author of Crossing the Chasm and Living on the Fault Line
"Patricia Seybold provides practical guidance on how to make customer loyalty the centerpiece of your company's strategy. She not only shares the logic, but also gives real-world examples of how to make it a reality."
-- John R. Samuel, Vice President e-Business, American Airlines
"Understanding and managing customer relationships lie at the core of how companies are defining strategy, measuring profitability, and creating competitive advantage. Patricia Seybold details how to begin doing this in your company immediately."
-- Jeet Singh, CEO, Art Technology Group
"Patricia Seybold details the steps you and I must follow to transform customer capital into shareowner value in her compelling, convincing new book."
-- C. Patrick Garner, CEO, The Motley Fool, Inc.
-- James Daly, editor in chief, Business 2.0
"As offline and online businesses blend, the ability to build deep customer relationships equates to long-term survival. Patricia Seybold explains why and how to 'play to profit.' "
-- Chris McCann, president, 1-800-FLOWERS.com
"Wherever repeated transactions represent the core rhythm of a business, management must focus on the lifetime value of its customers and the company's programs for creating and sustaining customer loyalty. The Web simply makes this imperative even more urgent. The Customer Revolution makes great use of war stories and case examples to guide us all in seeing just how to address this critical issue."
-- Geoffrey Moore, author of Crossing the Chasm and Living on the Fault Line
"Patricia Seybold provides practical guidance on how to make customer loyalty the centerpiece of your company's strategy. She not only shares the logic, but also gives real-world examples of how to make it a reality."
-- John R. Samuel, Vice President e-Business, American Airlines
"Understanding and managing customer relationships lie at the core of how companies are defining strategy, measuring profitability, and creating competitive advantage. Patricia Seybold details how to begin doing this in your company immediately."
-- Jeet Singh, CEO, Art Technology Group
"Patricia Seybold details the steps you and I must follow to transform customer capital into shareowner value in her compelling, convincing new book."
-- C. Patrick Garner, CEO, The Motley Fool, Inc.
Kurzbeschreibung
You are no longer in control of your company's destiny . . .
It happened in the music business and it will happen in yours. It's only a matter of time. Customers actually take control of an industry and reshape it from the outside in. Customers decide that the way they want to use an industry's product doesn't fit the current business model.
Patricia Seybold, author of the influential, bestselling Customers.com would say that that's a revolution. Thanks to the Internet and to mobile wireless devices, both business and consumer customers are demanding that you change your pricing structure, distribution channels, and the way you design and deliver products and services. Your business must be transformed so that it is completely customer-centric, or you will be out of business.
Her advice to companies facing the customer revolution? You can fight it if you want, just as Don Quixote fought imaginary windmills and thought he was winning battles. But naturally he lost the war and so will you. Better, says Seybold, to practice "sweet surrender," just as the music industry has started to come to terms with Napster. In the words of one music executive, "Thirty-eight million people can't be criminals."
Many try to characterize the changes taking place as the New Economy, the Internet economy, or the information, knowledge, or bio-economy. There's a grain of truth to all of these descriptions, but they fail to get to the heart of the changes taking place. Simply put, what we now have is a customer economy and it's going to result in changes that you would not have thought possible even a few short years ago.
Patricia Seybold has been on a worldwide quest to find the companies in North America, Europe, and Asia that are developing the state-of-the-art practices that will help them win in the new era of the customer economy. They're profiled and analyzed in case studies ranging from small businesses to multinational giants and range from manufacturers to retailers, and service firms. They include financial services giant Charles Schwab, the British Vauxhall Division of General Motors, Snap-on Tools, custom backpack manufacturer Timbuk2, Hewlett-Packard, Medscape, and W.W. Grainger.
As she so ably demonstrated in Customers.com, Patricia Seybold is ahead of the curve. For most companies, the issue of customers in control is just coming onto the radar screen. In The Customer Revolution Seybold makes it plain that this can be either your biggest problem or your greatest opportunity. What she provides is not only a brilliant analysis but also a practical program for how you can make the customer revolution a profitable one. The companies that thrive in the customer revolution will be those that measure and monitor what matters to customers, in near real time.
It happened in the music business and it will happen in yours. It's only a matter of time. Customers actually take control of an industry and reshape it from the outside in. Customers decide that the way they want to use an industry's product doesn't fit the current business model.
Patricia Seybold, author of the influential, bestselling Customers.com would say that that's a revolution. Thanks to the Internet and to mobile wireless devices, both business and consumer customers are demanding that you change your pricing structure, distribution channels, and the way you design and deliver products and services. Your business must be transformed so that it is completely customer-centric, or you will be out of business.
Her advice to companies facing the customer revolution? You can fight it if you want, just as Don Quixote fought imaginary windmills and thought he was winning battles. But naturally he lost the war and so will you. Better, says Seybold, to practice "sweet surrender," just as the music industry has started to come to terms with Napster. In the words of one music executive, "Thirty-eight million people can't be criminals."
Many try to characterize the changes taking place as the New Economy, the Internet economy, or the information, knowledge, or bio-economy. There's a grain of truth to all of these descriptions, but they fail to get to the heart of the changes taking place. Simply put, what we now have is a customer economy and it's going to result in changes that you would not have thought possible even a few short years ago.
Patricia Seybold has been on a worldwide quest to find the companies in North America, Europe, and Asia that are developing the state-of-the-art practices that will help them win in the new era of the customer economy. They're profiled and analyzed in case studies ranging from small businesses to multinational giants and range from manufacturers to retailers, and service firms. They include financial services giant Charles Schwab, the British Vauxhall Division of General Motors, Snap-on Tools, custom backpack manufacturer Timbuk2, Hewlett-Packard, Medscape, and W.W. Grainger.
As she so ably demonstrated in Customers.com, Patricia Seybold is ahead of the curve. For most companies, the issue of customers in control is just coming onto the radar screen. In The Customer Revolution Seybold makes it plain that this can be either your biggest problem or your greatest opportunity. What she provides is not only a brilliant analysis but also a practical program for how you can make the customer revolution a profitable one. The companies that thrive in the customer revolution will be those that measure and monitor what matters to customers, in near real time.
Über den Autor
PATRICIA B. SEYBOLD is the author of the international bestseller Customers.com and is the founder and CEO of the Boston-based Patricia Seybold Group (www.psgroup.com). The Seybold Group specializes in helping Fortune 500 companies with their e-business strategies, best practices, and technology architecture decisions. Founded in 1978, the firm offers customized consulting services, an online strategic research service, executive workshops, and in-depth research reports.
Leseprobe. Abdruck erfolgt mit freundlicher Genehmigung der Rechteinhaber. Alle Rechte vorbehalten.
Chapter 1
Embrace the Customer Revolution and Thrive in the Customer Economy
Fasten your seatbelts! The turbulence you've been experiencing in the stock market isn't over yet. In fact, it's probably going to get worse.
Why? Because we're in the midst of a profound revolution. And it's bigger than an Internet revolution or a mobile wireless revolution. It's a customer revolution.
Customers have taken control of our companies' destinies. Customers are transforming our industries. And customers' loyalty — or lack thereof — has become increasingly important to executives and investors alike. If you try to understand the ups and downs of the current economy by focusing on technology trends and investment fads, you're going to miss the true underlying shift that's underway. Customers are in control. They're changing the face of business as we know it. And your company's value is in their hands. Your customer franchise has suddenly become the scarcest and the most crucial resource for your business.
What's more, your company is probably at risk. Unless you act now to focus on the quality and consistency of the customer experience you offer, your firm will be hopelessly lost in the turbulence. Other companies — like the ones described in this book — have quietly reorganized themselves to manage by and for customer value. They measure and monitor what matters most to customers. If you continue to operate your business using the metrics of the old economy, you're going to be left standing on the ground as your competitors take off in the customer economy.
Listen to the Beat of the Customer Revolution
Over the past year, executives in a variety of industries have begun to feel the impact of the customer revolution. Let's listen to their stories:
Arne Frager is the president of The Plant, a professional music recording studio in Sausalito, California. Arne's been in the music business for twenty-seven years and he's never seen the flow of new music dry up before:
"My recording business is off 50 percent. The whole music recording business is off 50 percent this year (2000). About half the revenues in our industry come from new acts. But the big record labels are so paralyzed by the MP3/Napster/Gnutella/Freenet free distribution of digital music that they're not signing any new acts! Without the labels paying for the production of new albums, our studio isn't recording."
Customers, taking matters into their own hands, have profoundly altered the landscape of the music industry.
Brennan Mulligan is president of Timbuk2 Designs, a U.S.-based manufacturer of backpacks and messenger bags:
"Customers love the ability to custom-design their backpacks. But there's just no way to convince retailers to take custom orders in their stores. They can't handle one-off products. So we'll go direct to the customer and do it on the Internet. Customers can design their own backpacks, we'll ship them out the next day, and if the retailers want to participate we'll set up shop on their Web sites and put kiosks in their stores, too!"
Customers want capabilities that retailers haven't been able to offer. Now manufacturers are responding to customers' desires.
Gideon Sasson, executive vice president of Electronic Brokerage, Charles Schwab & Co.:
"Before the Internet, companies used to talk about how to lock the customer in. They thought about how to 'own' the customer. They incented customers. They brought them in, and then they worried about, 'How do I make a profit with these customers' and 'How do I get them to buy this product.' But companies can't afford to think that way any more. Even before the Internet, at Schwab we realized that if we do the right thing for our customers, they'll reward us. But other companies are facing a rude awakening. Before the Internet, companies could be customer-aware, but they didn't have to be customer-centric. Now they have no other choice. The Internet is forcing everyone to behave differently. What the Internet did was to move control to the customers' hands. People say, 'Your customers are only a mouse-click away from the competition.' Actually, the more important fact is that they're only a mouse-click away from other customers who will give them the real skinny!"
Customers are no longer willing to be locked in. They want great service, fair prices, and innovative offerings. If they don't get these, they'll go elsewhere, and they'll tell the world.
Sweet Surrender
You're no longer in control of your company's destiny. Your customers are. Thanks to the Internet and to mobile wireless devices, customers are now armed with new, more convenient tools with which to access our businesses (as well as those of our competitors) around the clock and around the globe. Business and consumer customers are challenging and disrupting the standard practices in virtually every industry. They're demanding that we change our pricing structures, our distribution channels, and the way we design and deliver our products and services to them. They won't be denied. They have the power and they know it. Companies that don't "get it" will be out of business soon.
Like most revolutions, this can't be stopped. We can't turn our backs on it. We have no choice but to surrender gracefully. Customers have always been the raison d'être for businesses. But now, for the first time in the history of modern business, we have the wherewithal to detect customers' needs in near-real time and to adapt quickly to their changing desires. Using the Internet, we can now reach out to new customer segments to test new offerings, innovate, and experiment more rapidly than ever before. Using the power of the 'Net, customers are inventing and refining new business models, including peer-to-peer file-sharing (Napster), open-source design communities (Linux), and self-policing marketplaces (eBay). Instead of resisting these customer-led business models, we need to embrace and extend them.
Surrendering to the customer revolution is a winning proposition. Our employees want to be customer-focused. Customer-centric companies have a much easier time attracting and retaining employees because companies that have a strong, unwavering customer-focused culture are much more fun to work in than those with warring, product-centric fiefdoms. It's much easier to make budget decisions based on customer priorities than it is to argue over product-centric goals and objectives. What's more, the companies that focus on building and sustaining relationships with customers are the most profitable companies in the world.
Welcome to the Customer Economy
This new customer economy is also spurring a new way of measuring company valuation. We have historically measured businesses on their use of investment capital, primarily through their return on fixed capital assets. High stock prices went to firms that extracted the most profit and growth from tangible assets or that owned the most valuable assets. Most general managers cut their teeth on such primary management indicators as profit and loss (P&L), return on assets (ROA), return on investment (ROI), return on capital employed (ROCE), and price-earnings (P/E) ratios. These performance disciplines are well established and important. Ignore them at your peril! Yet management is the art of the best use of scarce resources. Investment capital is no longer our scarcest resource.
In the customer economy, loyal customers have become the most precious commodity. Today the hardest thing for a company to acquire is not investment capital, products, employees, or even a brand. It's customer loyalty. Customer relationships are the fundamental source of value in the...
Embrace the Customer Revolution and Thrive in the Customer Economy
Fasten your seatbelts! The turbulence you've been experiencing in the stock market isn't over yet. In fact, it's probably going to get worse.
Why? Because we're in the midst of a profound revolution. And it's bigger than an Internet revolution or a mobile wireless revolution. It's a customer revolution.
Customers have taken control of our companies' destinies. Customers are transforming our industries. And customers' loyalty — or lack thereof — has become increasingly important to executives and investors alike. If you try to understand the ups and downs of the current economy by focusing on technology trends and investment fads, you're going to miss the true underlying shift that's underway. Customers are in control. They're changing the face of business as we know it. And your company's value is in their hands. Your customer franchise has suddenly become the scarcest and the most crucial resource for your business.
What's more, your company is probably at risk. Unless you act now to focus on the quality and consistency of the customer experience you offer, your firm will be hopelessly lost in the turbulence. Other companies — like the ones described in this book — have quietly reorganized themselves to manage by and for customer value. They measure and monitor what matters most to customers. If you continue to operate your business using the metrics of the old economy, you're going to be left standing on the ground as your competitors take off in the customer economy.
Listen to the Beat of the Customer Revolution
Over the past year, executives in a variety of industries have begun to feel the impact of the customer revolution. Let's listen to their stories:
Arne Frager is the president of The Plant, a professional music recording studio in Sausalito, California. Arne's been in the music business for twenty-seven years and he's never seen the flow of new music dry up before:
"My recording business is off 50 percent. The whole music recording business is off 50 percent this year (2000). About half the revenues in our industry come from new acts. But the big record labels are so paralyzed by the MP3/Napster/Gnutella/Freenet free distribution of digital music that they're not signing any new acts! Without the labels paying for the production of new albums, our studio isn't recording."
Customers, taking matters into their own hands, have profoundly altered the landscape of the music industry.
Brennan Mulligan is president of Timbuk2 Designs, a U.S.-based manufacturer of backpacks and messenger bags:
"Customers love the ability to custom-design their backpacks. But there's just no way to convince retailers to take custom orders in their stores. They can't handle one-off products. So we'll go direct to the customer and do it on the Internet. Customers can design their own backpacks, we'll ship them out the next day, and if the retailers want to participate we'll set up shop on their Web sites and put kiosks in their stores, too!"
Customers want capabilities that retailers haven't been able to offer. Now manufacturers are responding to customers' desires.
Gideon Sasson, executive vice president of Electronic Brokerage, Charles Schwab & Co.:
"Before the Internet, companies used to talk about how to lock the customer in. They thought about how to 'own' the customer. They incented customers. They brought them in, and then they worried about, 'How do I make a profit with these customers' and 'How do I get them to buy this product.' But companies can't afford to think that way any more. Even before the Internet, at Schwab we realized that if we do the right thing for our customers, they'll reward us. But other companies are facing a rude awakening. Before the Internet, companies could be customer-aware, but they didn't have to be customer-centric. Now they have no other choice. The Internet is forcing everyone to behave differently. What the Internet did was to move control to the customers' hands. People say, 'Your customers are only a mouse-click away from the competition.' Actually, the more important fact is that they're only a mouse-click away from other customers who will give them the real skinny!"
Customers are no longer willing to be locked in. They want great service, fair prices, and innovative offerings. If they don't get these, they'll go elsewhere, and they'll tell the world.
Sweet Surrender
You're no longer in control of your company's destiny. Your customers are. Thanks to the Internet and to mobile wireless devices, customers are now armed with new, more convenient tools with which to access our businesses (as well as those of our competitors) around the clock and around the globe. Business and consumer customers are challenging and disrupting the standard practices in virtually every industry. They're demanding that we change our pricing structures, our distribution channels, and the way we design and deliver our products and services to them. They won't be denied. They have the power and they know it. Companies that don't "get it" will be out of business soon.
Like most revolutions, this can't be stopped. We can't turn our backs on it. We have no choice but to surrender gracefully. Customers have always been the raison d'être for businesses. But now, for the first time in the history of modern business, we have the wherewithal to detect customers' needs in near-real time and to adapt quickly to their changing desires. Using the Internet, we can now reach out to new customer segments to test new offerings, innovate, and experiment more rapidly than ever before. Using the power of the 'Net, customers are inventing and refining new business models, including peer-to-peer file-sharing (Napster), open-source design communities (Linux), and self-policing marketplaces (eBay). Instead of resisting these customer-led business models, we need to embrace and extend them.
Surrendering to the customer revolution is a winning proposition. Our employees want to be customer-focused. Customer-centric companies have a much easier time attracting and retaining employees because companies that have a strong, unwavering customer-focused culture are much more fun to work in than those with warring, product-centric fiefdoms. It's much easier to make budget decisions based on customer priorities than it is to argue over product-centric goals and objectives. What's more, the companies that focus on building and sustaining relationships with customers are the most profitable companies in the world.
Welcome to the Customer Economy
This new customer economy is also spurring a new way of measuring company valuation. We have historically measured businesses on their use of investment capital, primarily through their return on fixed capital assets. High stock prices went to firms that extracted the most profit and growth from tangible assets or that owned the most valuable assets. Most general managers cut their teeth on such primary management indicators as profit and loss (P&L), return on assets (ROA), return on investment (ROI), return on capital employed (ROCE), and price-earnings (P/E) ratios. These performance disciplines are well established and important. Ignore them at your peril! Yet management is the art of the best use of scarce resources. Investment capital is no longer our scarcest resource.
In the customer economy, loyal customers have become the most precious commodity. Today the hardest thing for a company to acquire is not investment capital, products, employees, or even a brand. It's customer loyalty. Customer relationships are the fundamental source of value in the...
