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March 18, 2013

Building Customer Communities Is the Key to Creating Value

by keerliu

This is an interesting article about how to use customers to create value for company. It is very true that peer’s recommendation is far more effective than advertisement in persuading us to buy products. But the question is: how to take advantage of these peer influences?

 

To answer the above question, the author first divides customer-company relationship into 4 levels. The first level is that buyers perceive you as the supplier of a commodity. In this level, customers do not think your products are better than others, and there is no emotional association. The second level is that buyers perceive you as helping them get a job done, which means in some ways you make your products stand out, and the basic emotional connection is built. At Level 3, you engage the customer emotionally, which strengthens loyalty and retention. However, this relationship can fade over time, so companies need to move to next level. At Level 4, you’re helping customers build their social capital — that is, helping them to build and expand valuable support groups and communities. And then, the author lists some specific ways that can help companies to reach level 4.

 

I think most successful company today only reach and stay at level 3. They have loyal customers and some customers may recommend the products voluntarily. But it does not mean that the company has already made full use of its loyal customers. If those successful companies can reach level 4, they will be more successful. 

 

http://blogs.hbr.org/cs/2013/02/building_customer_communities.html

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