The Customer Peers BackCorporate integrity is a more valuable asset now that the world is more transparent. With abundant and free information, customers can now discern the true value of vendors and their goods and services. Business policies and processes — and the systems in which they manifest — should embrace this transparency rather than fight it.
by Don Tapscott & David Ticoll Continued from Page 1 In the past, consumers were isolated. A few joined quaint consumer groups, others talked to neighbors about products they might buy, or read the main source of objective advice, Consumer Reports. Today, they self-organize. They get other readers' book reviews on Amazon's Web site from their home, workplace, or coffee shop — even from a screen in a competing bookstore. To learn what others think about a car, movie, camera, garden tool, office product, restaurant, or wine, they can consult numerous sites, such as Epinions.com Access to information has created power struggles in many markets. Sellers see customers commoditizing them, going to Wal-Mart and Internet merchants to challenge their prices and profit margins, and ready to launch a class action suit at the least provocation. Consumers see sellers ripping them off, providing bad service, and invading their privacy. Notable exceptions exist, but nastiness rules in many industries, especially big-ticket ones like auto, travel, financial services, healthcare, pharmaceuticals, and telecom. Meanwhile, values-oriented activist consumers have agendas that go beyond personal benefit. They probe deep into a company's supply chain to expose environmental and human rights practices, then demand and force change. In 1996, such activists publicized the fact that Wal-Mart's Kathie Lee Gifford celebrity collection of clothing was being stitched by Honduran children who often worked 24-hour days for wages as low as 31 cents an hour. Gifford broke into tears on national television when confronted by the evidence. The consumer reaction soon led not only Wal-Mart, but also eventually Nike, Gap, Disney, and others to revise labor practices in their supply chains. Consumers have inspired Starbucks to sell Fair Trade coffee and led retailers such as Home Depot and Ikea to stop using virgin timber. In the United Kingdom, France, and other European countries, consumers and farmers forced their governments to halt the sale of genetically modified foods, leading to the near-collapse of Monsanto Company. Transparency and the NetThe pervasiveness of the broadcast media alone creates a culture of transparency; people expect that they can know anything instantaneously. We are bathed in broadcast news and information. In case we missed the TV clip or print article, we can go to the Internet to catch up on the newspaper, TV channel, or financial information service of our choice. Too much of it is one dimensional, but alternative points of view do seep through — easy to find for those who care to look. The Internet raises transparency to a whole new level. Broadcast media are one-way channels that are centrally controlled. The multidirectional Internet is just the opposite. Anyone can use it to originate messages from any location, any time. You can find any point of view you want if you care to look. And no central authority controls its content. The Internet, as the saying goes, "routes itself around obstacles" — it's virtually impossible to block it. The Net has boundless versatility: simple person-to-person communications, fancy and complex informational Web sites, the instant personal soapboxes known as weblogs, real-time activity coordination (business, personal, and political), financial transactions, information capture, long-term archiving — the list goes on. All these are new and powerful tools for transparency. Throughout the economy, the transparency-opacity battle rages on. Food companies resist labeling their products as genetically modified. Old-style firms hide product inadequacies. Companies with high price structures work to keep customers ignorant. But the forces of opacity are in retreat. And smart businesses know this. Customer PowerCustomers have a growing sense of power. Most people in G20 countries feel empowered as consumers according to a 2001 survey by Environics International. Two-thirds of those surveyed believed that consumers have the power to protect themselves against unfair or dishonest practices by a company. People aged 65 and higher tended to feel less able to protect themselves. Seven in 10 people do not hesitate to complain to companies that produce or sell the products that they use. More than one-third of respondents are adamant about this aspect of their consumer behavior. Better-educated people, those with higher levels of income, and Internet users are more likely than others to be ready to take companies to task. Consumers feel empowered because they have increased access to knowledge about products and services and they can discern true value more easily.
|
 |
Most Popular This Week
IE Weekly Newsletter
Subscribe to the newsletter
| |
| ||||||||||||||||||||||||||||||||
