The Expectation Economy

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We heard about the New Economy, the Experience Economy, the Attention Economy and, according to Trendwatching, we live now in the Expectation Economy. Here’s how they define it:

“The Expectation Economy is an economy inhabited by experienced, well-informed consumers from Canada to South Korea who have a long list of high expectations that they apply to each and every good, service and experience on offer.Their expectations are based on years of self-training in hyperconsumption, and on the biblical flood of new-style, readily available information sources, curators and BS filters. Which all help them track down and expect not just basic standards of quality but the ‘best of the best’.”  

This idea has been around for a while: Luxury brands always had to deal with high expectations. If they didn’t perform they were greeted with irritation, indifference or closed wallets. Luxury brands could survive underdelivering for a certain period time since they were one of the few games in town. Since luxury brands have become ubiquitous, they need to perform on a higher level. And, even worse, the expectation benchmarks are increasing every day: Once Virgin introduced Upper Class, all domestic First Class experiences just felt cheap. How would you feel flying Virgin today when you experienced the new suites on Singapore Airlines with stand-alone beds?

The big difference from yesterday’s luxury expectations to today’s Expectation Economy is how common high expectations have become. From your 2 minutes on hold with a call center, to exploring a website or utilizing the return policy: Companies need to overdeliver every time. Or they face the wrath of the consumer. BusinessWeek calls them ‘Consumer Vigilantes’:

“Meet today’s consumer vigilantes. Even if they’re not all wielding hammers, many are arming themselves with video cameras, computer keyboards, and mobile devices to launch their own personal forms of insurrection. Frustrated by the usual fix-it options—obediently waiting on hold with Bangalore, gamely chatting online with a scripted robot—more consumers are rebelling against company-prescribed service channels. After getting nowhere with the call center, they’re sending “e-mail carpet bombs” to the C-suite, cc-ing the top layer of management with their complaints. When all else fails, a plucky few are going straight to the top after uncovering direct numbers to executive customer-service teams not easily found by mere mortals.

And of course, they’re filling up the Web with blogs and videos, leaving behind venom-spewed tales of woe. “There’s a certain degree of extremism that’s popping up, [a sense of] I’m going to get results, whatever means necessary,'” says Pete Blackshaw, executive vice-president of Nielsen Online Strategic Services, which measures consumer-generated media. “Companies can brush these off as being atypical, mutant consumers, or they can say there’s a very important insight in [their] emotions.”

Behind the guerrilla tactics is a growing disconnect between the experience companies promise and customers’ perceptions of what they actually get.”  

This cleary indicates where traditional marketing/advertising has its biggest problem today: It used to be okay to lure people with beautiful imagery and promises of a better life. People knew it was a promise nobody could deliver. They were attracted by glossy $2 million commercials and knew they would get the key in a dreary dealership. It was disappointing but, hey, what can you do?

Not anymore.

Businesses need to bridge this huge disparity through new tactics and models. In a perfect world, the make-believe world of traditional advertising  builds an emotional response. This response has to be nurtured through conversational marketing and social media tactics that draw people closer to the product and business. Allows people to express themselves, build relationships.

Businesses have to value conversations equal to transactions. Or as Mark Silver said in response to Doc Searls question “Can marketing be conversational?”

“I believe that many web-based proprietors are trying to re-engage this aspect of ‘marketing.’ But, in order to succeed, the marketer has to prize the conversation as highly as the customer does. And, the marketers has to be willing to say ‘no’ to customers, as much as customers might say ‘no’ to a merchant. This brings a sense of ease, equality and, yes, partnership to the experience.”  

We have move away from CRM to PBRN (People Businesses Relationship Nurturing)

Because ‘Relationships – of all kinds- are like sand held in your hand. Held loosely, with an open hand, the sand remains where it is. The minute you close your hand and squeeze tightly to hold on, the sand trickles through your fingers. You may hold onto some of it, but most will be spilled. A relationship is like that. Held loosely, with respect and freedom for the other person, it is likely to remain intact. But hold too tightly, too possessively, and the relationship slips away and is lost.’ – Kaleel Jamison 

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5 responses to “The Expectation Economy

  1. For years the brands have chased consumers and tried everything and anything to engage us. Every kind of metrics for measuring methods of engagement have been developed and deployed all to justify the expense and effort behind these engagement initiatives.

    In the old days every trick of the trade was used to capture eyeballs and attention to get us to provide user information, email addressed and to create an emotional response.

    In the end we did in fact engage but only to be disappointed by the experience and sales hype that followed. Over promised and under delivered we took to blocking telemarketing calls, banner ads and spam email. Then we began to engage with each other.

    Now that we are engaging with each other companies are still trying to figure out how to engage with us the way we engage with others. The social web has become a fertile ground for more attempts to engage us. Facebook, Linkedin and every social network on the planet is supported by advertising models with text and ad graphics vying for our attention.

    Businesses are spending time and money trying to figure out how to engage customers and the mantra of the moment is “customer engagement“. Management consultants and marketing gurus are spinning and defining customer engagement as if it were yet another new phenomenon. According Wikipedia and the self appointed experts Online Customer Engagement (CE) refers to:

    1. A social phenomenon enabled by the wide adoption of the internet in the late 1990s and taking off with the technical developments in connection speed (broadband) in the decade that followed. Online CE is qualitatively different from the engagement of consumers offline.

    2. The behavior of customers that engage in online communities revolving, directly or indirectly, around product categories (cycling, sailing) and other consumption topics. It details the process that leads to a customer’s positive engagement with the company or offering, as well as the behaviors associated with different degrees of customer engagement.

    3. Marketing practices that aim to create, stimulate or influence customer behavior. Although CE-marketing efforts must be consistent both online and offline, the internet is the basis of CE-marketing.(Eisenberg & Eisenberg 2006:72,81)

    4. Metrics that measure the effectiveness of the marketing practices which seek to create, stimulate or influence CE behavior.

    Is It Really Vendor Engagement?

    Those who push the “Customer Engagement theme suggest that online customer engagement is qualitatively different from offline Customer Engagement as the nature of the customer’s interactions with a brand, company and other customers differ on the internet. Discussion forums or blogs, for example, are spaces where people can communicate and socialize in ways that cannot be replicated by any offline interactive medium.

    The reason it is different is because it is the customer who decides which vendor to engage with, not the vendor deciding for the customer. The rise of online user generated content is taking advocacy to a much higher level.

    Vendor Engagement enables people to respond to the fundamental changes in brand behavior that the internet has brought about, as well as to the increasing ineffectiveness of the traditional ‘interrupt and repeat’, broadcast model of advertising.

    Due to the fragmentation and specialization of media and audiences, as well as the proliferation of community- and user generated content, businesses are increasingly losing the power to dictate the communications agenda. Instead the customer, people, are dictating the agenda.

    Enabling the contributions of people (suppliers, employees and customers) is an important source of competitive advantage – whether through advertising, user generated product reviews, customer service FAQs, forums where people can socialize with one another or contribute to product development. However, If you want to engage people the first thing you have to do is recognize that your the vendor and the people you call customers are the ones now doing the engaging, not you.

    For traditional markets the question is no longer “how will you engage” rather “how will you respond”.

    What say you?

  2. I found your site on technorati and read a few of your other posts. Keep up the good work. I just added your RSS feed to my Google News Reader. Looking forward to reading more from you.

    Chris Tackett

  3. Pingback: Beneath the Brand » Blog Archive » People Businesses Relationship Nurturing

  4. Jay,
    I couldn’t have said it better.

    Your thoughts bear resemblance to Doc Searls’ VRM project – revolutionizing the Supply and Demand model: Customers become leaders instead of passive followers.

  5. Pingback: Don’t design Stepford Wives experiences «

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