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"Tough Love" for Business

A new Intelliseek study on consumer trust in news media and advertising -- or rather, on the lack thereof -- highlights just how dramatically corporate America will have to change in order to compete in the new world of blogs and other consumer-generated media (CGM).

Herein, some hightlights from the study:

Consumers are 50 percent more likely to be influenced by word-of-mouth recommendations from their peers than by radio/TV ads.

In fact, notes the study:

[Word of mouth and consumer-generated media] has more impact on consumer attitudes about products than either positive or negative news coverage.

In sum:

Word-of-mouth behavior among "familiars" trumps all forms of advertising and is more trusted than news or "expert commentary."

Interestingly, the study also notes that positive word-of-mouth from a personal acquaintance carries just as much impact as negative word-of-mouth. According to Intelliseek CEO Mike Nazzarro, this has "critical implications for brands that nurture evangelism, brand loyalty, and advocacy."

What's it all mean?

For starters, the study suggests that most American companies are woefully unprepared for the managerial, marketing, customer relations, and product development challenges of a new business environment in which customers trust bloggers and each other more than they do traditional corporate marketing. Unfortunately, the modern corporation is built on a solidly-hierarchical "push" model in which customers (and their friends) are at the bottom of the totem pole -- mere passive recipients of whatever the company chooses to deliver to them.

But that's going to have to change. And the change certainly won't come easily, not to a generation of executives and managers who were never trained to deal directly with customers who can now make or break their businesses.

To the next generation of business leaders, perhaps, it will no longer be unthinkable to bring trusted customer representatives into marketing and sales and R&D; meetings -- and even onto the company's board.

But in the meantime, it's going to be "tough love" for business until they learn how to deal with the new marketplace in which customers have become key decision-makers in the enterprise.


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» Blogs and Biz from Weblogsky
It's not news that consumers don't trust media and advertising, but David Kline blogs how corporate America really doesn't get "consumer-generated media."...the study suggests that most American companies are woefully unprepared for the managerial, mar... [Read More]

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» consumer generated media from infobong.com
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