Product information, broadcasted via different methods and encountered by different means, is processed by potential buyers and creates certain expectations in our minds.

Functionality:

There are multiple “channels” by which an interest in buying a product creeps into our mind, but it is often a desire to experience functions and features of this product, and a promise of making our lives better, that makes us consider to part with our money. Hence if our expectations are not met by actual product experience, we often feel cheated and express dissatisfaction with the product. Sometimes it’s caused by actual and intentional misrepresentation of a product’s functionality, but more often it is misinterpretation of marketing messages associated with the product by a Customer.

Reliability:

No person decides to purchase a product expecting it to be “dead on arrival”, but it happens more often than you think. There is no way to know what is the expectation of every Customer for longevity of a product, but I can bet  that at a minimum it is at least 1 day longer that the length of the product’s warranty.  However, longevity is only one parameter of the Customer Reliability expectation. The other one is availability of the product for use or experience. Consider an example where a product breaks (i.e. is not available for use) during its reasonable life expectancy, and the Customer has to send it in for replacement or repair. Even more troubling are the instances when the loss of use is accompanied by associated damages or losses of perishable products, data, reputation or business opportunities, etc.

I consider Reliability reputation the single most important factor in my personal purchasing decisions as a failure to consider it very carefully can result in the most damage and unhappiness.

Support:

While there are ambiguities of Customer misinterpretations of Functionality messages, and a factor of Customer inexperience that may lead to negative Reliability experiences, there is no excuse for creating negative Support experiences. A Customer, rightfully, expects delivery at the stated time, respect for promised exchange and refund policies, and most importantly knowledgeable help from people who are genuinely interested in helping out. Unfortunately many companies treat Customer Support as the cost factor to be reduced, instead of an opportunity to learn and correct potential shortcomings in the product’s design and its messaging. This unwise strategy leads to commoditization of their markets, destruction of their brand value and profit margins as the Customer starts to look at their products as “disposable”.

Reputation is one of the most valuable assets of any company – It takes significant time and effort to build a good reputation.  Great company reputation provides an opportunity for higher profit margins, as trust in your product improves, and allows less discounting and advertising expense compared to less reputable competition.

Higher sales becomes a result of Confidence in your product’s quality, reliability and support – as opposed to its price.

The only way to build Reputation is to provide your Customers with Experiences that consistently exceed their Expectations.

The positive effects of Word of Mouth references in customer acquisition (btw I hate that term) are very well documented.  Often I see the term “peer to peer” marketing being used in the same context interchangeably, however not being a marketing professional I am not sure if there is a difference or if they are really synonymous. Wikipedia defines WoM Marketing as

Word-of-mouth marketing, which encompasses a variety of subcategories, including buzz, blog, viral, grassroots, cause influencers and social media marketing, as well as ambassador programs, work with consumer-generated media and more, can be highly valued by product marketers. Because of the personal nature of the communications between individuals, it is believed that product information communicated in this way has an added layer of credibility. Research points to individuals being more inclined to believe WOMM than more formal forms of promotion methods; the receiver of word-of-mouth referrals tends to believe that the communicator is speaking honestly and is unlikely to have an ulterior motive (i.e. they are not receiving an incentive for their referrals).^[2]

Customer Reviews, describing personal experiences, opinions and recommendations of individual customers, are one of the best examples of WOMM. Amazon pioneered the approach and now there are many retailers like NewEgg, Best Buy and others, with technologies from BazaarVoice and PowerReviews that collect, manage and publish Customer Reviews.  I have both contributed and used them as guidance for my purchases for many years, and even though I understand that the reviews sometimes tell more about the reviewer than the product reviewed, I still find them the best tool for reduction of purchasing decision uncertainty. I know some tech pros and gadget mavens, who’s advice is sought and respected by many, to use customer reviews as an important part of their product evaluation process.

Consumers have no squabbles over paying for independent advice and recommendation, often called unbiased which is incorrect as such a thing does not exist IMHO. The Consumer Report was a very successful example and provided great service to generations of shoppers who subscribed to their magazine and its online version, however their model has difficulties to cover an ever expanding breadth of the products offered, and it does not really deal with customer experiences. The point however is that their approach is not misleading – you, the customer, pay them to learn their opinion and recommendation and thus the only incentive is to provide you with good and honest information.

I want to make very clear that I am not attacking profit motives or the marketing profession. I love profits when they are honestly earned by providing quality customer experiences, and I love marketing that helps me find providers of such experiences. The problems arise when some people or companies decide to focus on deception instead. Many years ago, one of my good friends shared with me her great admiration for Amway products. I was very grateful for her zeal to “help” me find a good product, until I realized the concealed motivation. Needless to say, we are no longer good friends, just acquaintances and I would never buy anything associated with the Amway brand. That is not to say that Word Of Mouth Marketing cannot be incentivised, just that marketers have to understand that it could become a double-edged sword and can easily create unintended adverse consequences. It also creates a challenge for us, at Amplified Analytics, to develop an effective approach to weigh authenticity of reviews we analyze for producing Product Reputation metrics.

There has been a lot written lately about the rising power of customer recommendation within the Marketing paradigm. Here is just one of many examples and a reference to an interesting study:

Advertisers are courting social-networking users because their opinions matter. More than 65 percent of 112,000 people surveyed said they were more likely to purchase products or services that they learned about in social-networking services, according to Powered Inc., an Austin-based company that helps Sony Corp. and Hewlett-Packard Co. with their social-media strategies.

Edelman Trust Report finds that trust in a recommendation, based on a personal experience of “a person like me”, has grown from 22% to 58% in just 6 years. AdAge reports that

77% of U.S. consumers trust businesses less than they did a year ago; consumers trust their peers’ opinions online more than any other source.

So what is the meaning of “peer” or “a person like me” in an environment where most recommendations are anonymous, and the privacy of the recommenders is carefully protected? We all are too well aware of unscrupulous, and not too smart, marketers who tried to game the system with widely publicized failures. However that very publicity seems to give us even more confidence in our “peers”, as it makes us believe that the sheer number of reviews and recommendations of the authors, and the transparency of the Internet, will protect us from being manipulated.

Sometimes positive recommendations of people I know, will cause me not to buy the recommended product, as I am aware in our taste or skills difference. So how can we rely on the experiences of people we don’t know at all? I suppose there is a lesser of the two “evils” compared to the traditional advertising or “unbiased” review by paid experts.

As we have been working on mining Consumer Insight from unstructured and untagged data, I have been thinking of ways to algorithmically weight and/or score the “Authenticity” and “Authority” of authors in context of their product reviews and recommendations.

I believe that when someone (I hope that is me) manages to figure how to do it, it would bring even more value and meaning to the market. It would enable us to make more personalized choices.

Another thought, related to peer2peer marketing, came to me while I was exploring Cloud Expo grounds of the Dreamforce 2009. Not a single Dreamforce exhibitor with “Marketing” in their name, was demonstrating any functionality or service focused on learning and/or managing Customer Experience. I suppose to most people “Marketing” is still “Shouting”.

As a shopper for an all-in-one printer, comparing these two printers below on a retail site, the Epson Workforce is the easy choice – as customers on Amazon rate it at 4 out of 5 stars as opposed to the HP printer at 2.5 stars out of 5. Given the similar price and supply availability, this decision is a “no brainer”.

However, as a product marketing manager, responsible for the HP C4280, I would really want to understand the nature of  its  failure to earn a better reputation with its customers, before giving up on it and returning to the drawing board for the next model.

From the graphic above, a screen shot of our V2P Accelerator, the most noticeable diversions in reputation for these two competitors are in Functionality and Support scores, while customers expressed disappointment with the Reliability of both machines.

45 of 83 reviews (54%) explicitly addressing the functionality of the HP printer, expressed a negative sentiment about it. What’s even more telling is the intensity of the sentiment expressed – these customers’ negative sentiment intensity is an average of 0.073 which is nearly unacceptable. My hypothesis is the HP marketing organization has created unattainable expectations through its marketing communications. Let’s look more closely at what is causing this uproar:

Many customers point at software compatibility issues. I will only quote reviews from those authors who have identified themselves.

“This product does not work with VISTA. Their software upgrade that is supposed to fix it also does not work. ” nitropolo13;

“This is printer is a money pit. It constantly prints documents in color, no matter how I configure the software.” mcduck_rules;

“The software does not work and is not fit for purpose. If you have more than one user on xp it will insist on installing multiple copies of printers, each time corrupting you initial installation requiring the lengthy install and uninstall.” andrewmanly2;

“the software keeps trying to reinstall itself repeatedly! I have to keep task manager open to keep stopping the installs.” lequiqui;

“The c4280 is an exercise in frustration, at least with Windows Vista. Vista keeps forgetting the printer and then HP reinstalls the printer automatically so you end up with multiple copies in your “Printers” list. Prepare to spend lots of time waiting for HP to reinstall the c4280 several times a week. Oh, and HP installs all kinds of software on your machine — just nothing to resolve this problem.” dtfroats;

The software issue is, statistically, the most acute cause of “pain” to customers. Product managers should be able to produce a downloadable “fix” to remedy the problem and if the availability of such a fix is well communicated to the HP support organization and to existing customers, the reputation of the printer could improve significantly. In my view this is a low hanging fruit – fixable, low cost of distribution and a very high impact on Product Functionality Reputation.

Reviews related to the HP’s Product Support damages this product’s reputation even further – 16% of all customer reviews explicitly complain about their support experience:

“Spent an entire day with HP tech help trying to get the drivers installed correctly and when I did get them installed the print options menu was incomplete — I spent another day dealing with HP on the phone — it’s as if I don’t have better things to do – by massthreat”

“HP’s customer service is a disgrace. – by robert_walsh@condenast.com”.

“HP tech support is non-existent, I have spoken with customer reps in Canada, Philippines, and India and none of these people have used the printer or have a clue about the problem. The web tech support is also useless.This is the last Hp product I will own. – mcduck_rules”.

“I spent over 6 hours on customer support to try and fix the problem and I was told it wasn’t fixable. I climbed the customer service ladder and was finally able to speak to an English speaking “Case Manager” who clearly told me that “. . scan functions on any printer have a tendency to malfunction for various reasons. .- by philbechtel

“I called HP – and they have the worst customer service department I’ve ever dealt with. I spent hours and hours on the phone with them, and all they knew how to do was read instructions out of a book. – by nbasile”

It is hard to come up with any specific conclusions except that the cost of supporting this printer must be horrendous. I would love to run our analysis engine over the transcripts of the service calls and the email communications to extract the roots of the problems and recommend possible solutions, but these transcripts are not available to us.

By the way it took me about 15 minutes to conduct this analysis using our V2P Accelerator.