Avoiding the New Economy Backlash

Avoiding the New Economy Backlash:

A Reasoned Response to Web Marketing and the Dot.Com Disaster

The collapse of the dot.coms in recent months has caused a panic among U.S. companies.  Now, instead of embracing the “Don’t Think:  Act!” advice peddled by opportunistic technology companies for the past few years, executives are displaying what we at Easton refer to as New Economy Backlash:  they’re turning tail and running from web-based technology, again without thinking.  At Easton, we’re concerned that this mass flight has thrown the baby out with the bathwater:  in their Wall Street-motivated urge to avoid the complications of the Internet, they have also managed to turn a blind eye to a few hard-won lessons the dot.com companies taught us.

One of those lessons is that the web, by dropping the price of information collection to almost zero, can be used to help companies evolve from a product-centric marketing strategy to a customer-centric strategy. It’s as if executives had an army of thousands of employees just waiting to investigate the nitty-gritty details of their customers’ and business partners’ buying behaviors and product needs… and as if this army worked at the speed of light for almost no pay.  As a result, the old concept of customer-centric marketing seems passé:  whereas we were once shocked when Ford Motor Company realized that the owners of Thunderbirds were more likely to respond to an annual bouquet of flowers than the owners of their other models, we have now come to expect such things.  Now, we are satisfied with nothing less than Amazon’s automatic book recommendations, or, more impressively, their ability to map the complex correlation between fans of contemporary music and purchasers of self-help books.  It is the web’s lower costs that make these customer-centric marketing opportunities available and affordable to businesses far beyond those traditionally employing the practice.

The lesson here is not one about e-commerce, or about the necessity to have the right technology platform underpinning a web site.  The lesson is that the dot.com companies had it right:  at great expense, they forged new tools and business systems that accelerated an important trend away from product marketing based on presumed customer requirements and behaviors, and towards a highly-sensitive, data-driven understanding of customer perceptions and needs.  Amazon may fail, but many of their web-based marketing concepts will survive.  Executives in all industries should stop running and take note. 
If you would like to hear our thoughts on how the web can enhance your company’s shift from product-centric to customer-centric marketing, call and ask for a proposal.