The future of publishing: Why ebooks failed in 2000, and what it means for 2010

This post is adapted from a speech I gave at the O’Reilly Tools of Change publishing industry conference in February. It’s a great time for ebooks. There are at least six ebook reader devices on the market or in preparation….

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Marsha Keeffer

Harvard Business Publishing: Umair Haque - What Apple Knows That Facebook Doesn’t

Too often, we don’t recognize the power of platforms - even in Silicon Valley. Nilofer Merchant, Rubicon’s CEO, writes frequently on the topic and ties it together with strategy. The piece below by Umair Haque, draws an interesting difference between…

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Nilofer Merchant's Blog RSS

Nilofer Merchant's Blog Archives

Canon Gets It

I was looking at digital cameras on the web the other day, and Canon stopped me in my tracks. They have user reviews just like many resellers, but very few manufacturers. Reviews are prominently featured just below the fold on the initial page for each camera model. More than that, they collect the most common comments at the top and list them under “Pro” and “Con” sections. You read that correctly—Canon prominently lists top consumer complaints on their web site. Things like “poor low light performance,” “complicated to use controls/menu,” and “difficult to use.” Were the marketing people completely cut out of the loop?

What we are seeing is evidence of major changes within Canon and how they relate to consumers. The old model for customer relationships—that is, the one still used by most companies today—is built around a buying funnel that progresses from awareness to consideration to purchase to loyalty. Fundamentally, this is an information model where companies provide the information and customers consume it. The old model is very transactional.

This model worked for many years because in a one-way media environment companies’ dominant share-of-voice allowed them to control the information flow and messaging, directing customers through the linear steps of the classic funnel: awareness, consideration, purchase, and loyalty. TV, radio, newspapers, billboards, direct mail are all representative of the old media environment where the buying funnel was king. In this model, the last thing you want to do is to provide information that might sow doubt in the mind of a potential customer.

The buying funnel is a luxury that no longer works in an environment now centered on two-way and unstructured communications. To understand what is going on, we need a new model. The Lifetime Opportunity Value Equation (LOVE model) departs from the buying funnel by viewing consumer relationships as an evolving set of bi-directional interactions. These relationships grow from in five steps from an introductory stage where neither party knows much about the other all the way to co-creation. Each step applies equally to the consumer and the vendor.

Romance — Focus is on possibilities and getting to know each other, rather than securing commitments.

Power struggle — The power struggle isn’t adversarial, but is a mutual effort to learn how both parties in the relationship are going to fit together. After all, there needs to be balance if a relationship is going to last for the long term.

Stability — At the point where no major mis-match of status between the parties exists, a relationship enters the third phase, Stability.

Commitment — Commitment comes when the relationship advances from stability to a shared outcome. While loyalty in a predominantly one-way, transactional exchange is fragile, commitment in a stable, bi-directional relationship is far more robust and makes you more likely to stay in relationship through the ups and downs the market inevitably deals you.

Co-creation — At this level the relationship is about co-creating value and co-ownership of a common vision rather than merely sharing in the outcome. With this type of relationship, a customer is no longer merely making a purchase, but is supporting a preferred business. The benefits of co-creation are huge, and reach into every corner of a business and are reflected in both top line revenue and bottom line costs.

You can read more about the LOVE model here, here, and here.

The LOVE model can be applied to any online relationship, not just to customer acquisition and purchase. Likewise, the benefits of the LOVE model framework extend far beyond social media and other marketing campaigns making it of particular value to CEOs seeking to drive change throughout their organizations. The LOVE model drives long-term value in areas as diverse as customer support, product development, and thought leadership.

The LOVE model is designed to drive revolutionary change in organizations rather than evolutionary improvements to the buying funnel. The value of making your business success a shared goal draws customers closer to your company in ways that a transactional outlook simply cannot. Embracing the LOVE model framework embarks your organization on a journey of discovery which leads to quantifiable results, long-term value, and enhanced competitiveness.

Rubicon Consulting has no business relationship with Canon. You can read more from Bruce La Fetra at brucelafetra.com.

Categories: Business Strategies, Consumer Behavior / Markets, Emerging Business Models, Marketing

Tags: camera , Canon , la fetra , lafetra , LOVE