Monday, May 21, 2012

When is a Customer Not a Customer?

It has been a while since The Customer Institute has published a blog. This one is a little different. There is an article on the Opinion page of the WSJ May 21, 2012. The title is "Will Regulators Unfriend Facebook?" It was written by L. Gordon Crovitz.

Mr. Crovitz makes an interesting point about customers that may change the perspective of what is a customer. He offers up a truism "if you're not paying for something, then you're not the customer, you're the product being sold." He is making the point that "customers" who are on Facebook are not really customers, they are the product that Facebook is selling. Facebook sells access to customer information. Of course Google also does the same thing as do many other websites.

When you go onto a website to browse you are essentially building inventory for the website. In this sense we, the "customers", have become inventory. Intelligent but inventory nevertheless. We are no longer customers in this sense. We have lost the power of the customer.

As noted in the article, Mr. Douglas Rushkoff spoke to Betaworks, an internet company in New York: "In the boardroom at Facebook, people are not asking, "How can we find Johnny more friends online?" They are asking "How do we make more money off of Johnny's social graph?"

The playing field for eCommerce is not the same playing field we have become accustomed to in the brick-and-mortar world. It is going to take some time to understand the full ramifications and unintended consequences of this new world of commerce.

The bottom line is that the world of eCommerce is not the same place as the brick-and-mortal world we have known. With the growth rate that we see in eCommerce, it is fast becoming the dominant market place and we must learn how to use it.

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