Please take a second to let that fully sink in…

That’s right. Online reviews posted by total strangers are nearly twice as effective at influencing what a person decides to buy than whatever you’re saying in your ad campaigns.

While it may be a bitter pill to swallow, it’s high time companies come to grips with the fact consumers aren’t listening to you like they once did – they’re listening to each other.

The disruptive shifts in consumer behavior that have occurred over the last 15 years have clearly put them in control. Companies are under tremendous pressure trying to understand what happened to their profit margins due to pricing transparency, how to handle the damage control from negative online reviews, and leverage the upside from positive online reviews. The viral nature of these product reviews ‘go global’ instantaneously and a problem in Moline can fan the flames in Milan overnight. A positive review posted in Toledo one day can cause an unexpected spike in product sales in Tokyo the next.

That’s why an absolutely rock solid social media strategy is so important.

Even with this fact in mind, most organizations press on without a strategy and approach social media with an “if we build it they will come” mentality, and then are surprised and disappointed when ‘they’ didn’t show up at all.

Prior to launching a social media presence, companies must have a clear understanding of why they’re developing their presence in the first place. For instance, what’s the objective? Is it to generate more leads? Convert existing leads into sales? Measure a marketing campaign? Track brand loyalty? Keep a close eye the competition? Engage customers in meaningful dialogues? Perform market research to determine the feasibility of extending a product line or opening a new distribution center? Has the organization experienced a crisis that requires careful management?

These are just a few examples of questions that executives should have already addressed before they launched into social. If not, then there’s no time like the present to reassess their current social situation and get back to the proverbial drawing board to align social media initiatives with the organization’s strategies and objectives. There should be a social media component for each of the organizational goals.

The realization that consumers don’t want to be interrupted and are paying more attention to online reviews posted by John and Jane Doe than to clever and expensive ad campaigns is likely to bruise some creative director’s egos. But there’s no time for that while business is charging ahead at warp speed. Since consumers are listening to each other more than they’re listening to your ads, are you listening to the consumers?

They’re clearly making themselves heard, but are you really listening?

You need to be listening very closely because consumers are readily sharing what they like, what they don’t like, what they want, what they don’t want; and most importantly, what they value.

Knowing what consumers value is crucial!

That’s why it’s imperative to incorporate the best social media monitoring, data collection and mining into the strategy so companies can obtain relevant data from the social web that provides clear insights to make knowledge-driven decisions for creating value.

The enormity of the very real issues in the first few paragraphs of this article are such that companies can no longer rely on gut instinct to make decisions. Nor can they afford to take the time for ‘old school’ market research that includes developing questionnaires, waiting for the (inherently biased) data to come back, and then analyzed. By the time results from that data reach an organization’s decision makers, the very issues being researched are no longer germane. That model is too slow for the speed of today’s business.

There are huge benefits to using social media monitoring / listening platforms to collect and analyze data into relevant information. Provided the strategies are in place, having such pertinent information at the ready enables organizations to take immediate action wherever necessary.

Armed with an well planned, effective social media strategy, and data collection and mining tools, companies can obtain priceless insights to make knowledge-driven decisions that lead to value creation, competitive advantages, growth, increased revenue and earnings.

Content with your organization’s current ROI?

Now is the time to evolve and leverage the insightful knowledge you need to succeed.

Article is Copr. © by Stephen Monaco and originally published on AdvertisingIndustryNewswire.com. All rights reserved.

How do you know if your company is driven by marketing or sales?

Hint: If the title of the most popular song in the corporate hymnal is “Churn ‘em and burn ‘em,” it’s a pretty safe bet that your company is driven by sales.

Another sure sign that your company is sales driven is that the sales team can’t stop talking about their latest product or service offerings long enough to listen to customers and learn about their needs.

Companies that are driven by sales focus primarily on acquiring customers, grabbing market share, achieving immediate revenues, and controlling costs. They concentrate heavily on increasing short-term ROI which isn’t necessarily bad, since consumers always have needs that must be satisfied, and those needs create opportunities for peddlers. But organizations driven by sales grapple with finding ways to differentiate themselves from their competitors except with pricing, which turns into their key marketing tactic. While companies that operate their businesses as such may reduce short-term risk, their methods do nothing in the way of developing product lines that carry on. And that makes long-term success an uphill battle.

In contrast, companies that are genuinely market driven demonstrate an outlook that’s considerably more long-term. And they surpass their rivals by developing superior levels of ability, typically across the areas of research, pricing, product development, distribution channels, promotion, and market management.

Market driven companies have an approach which concentrates on concepts like total customer satisfaction, managing the customer experience, customer retention, and customer lifetime value. Engaging customers at a level that enables a clear understanding of their needs presumes that when customers are delighted, not only will revenues follow, but profits will escalate and growth will ensue.

Having a thorough understanding of market dynamics and consumer needs is implicit to being market driven. These companies continually gaze outside their organizations for the input necessary for developing solid strategies and making wise tactical decisions. Their outward focus makes opportunities more readily identifiable so these companies can capitalize on them.

Staying connected to their customers and cultivating those important relationships makes market driven companies better equipped than their sales driven rivals at anticipating market changes. By maintaining close links to customers – and therefore to the market, the insight gained by market driven companies provides them with competitive advantages which greatly improve their abilities to offer real value to customers.

Developing an organization that’s market driven isn’t brain surgery, but it requires tremendous commitment across the entire organization in order to be successful. Organizations that want to evolve into becoming market driven must consciously make this a priority and dedicate enough attention to the effort so it becomes the strategic objective of their company. But company executives frequently miscalculate what’s actually required to put such a dramatic change of business strategy into action. Companies get tripped up while attempting to implement market driven strategies because their organizations are poorly suited for such substantial undertakings.

Sweeping change isn’t going to happen overnight, and would be completely unrealistic to expect an internally focused organization to suddenly have close ties to the market. That would be like taking the string section from a philharmonic orchestra and expecting them to suddenly start play the horn instruments simply because they are skilled musicians. It just isn’t going to happen without plenty of reconditioning. Rethinking the whole organization and developing new competencies takes time. Executives talk about their companies becoming market driven, but really having the wherewithal to effectively make such a comprehensive transformation throughout the organization is a different story altogether.

Successfully implementing and carrying out this strategy pivots on whether the mindset becomes a central part of a company’s composition through and through – including the long-term allocation of sufficient capital and human resources, including an exceptional Chief Marketing Officer.

As one of the most vital decision makers in an organization the senior-most senior marketers must be thought-leaders, since along with CEOs, they exert considerable influence in determining the direction of their corporations. More so than any other member of the executive team, chief marketers set strategies that quite literally mold the company’s identity, drive business performance, and champion the customer’s needs. Senior marketing executives shoulder great responsibility and need considerable latitude, as their obligation to deliver is paramount.

These challenges require the qualities of outstanding leaders and the support of CEOs who willingly embrace their marketing chiefs as strategic allies. CEOs must motivate everyone throughout the entire organization to recognize the wide-ranging issues that focus directly on customer satisfaction are components which are vital to ensuring the company’s long-term success. Chief executives who don’t openly champion the endeavors of their senior marketer’s customer-centric efforts do so at their organization’s peril.

[tags]Stepen Monaco, If You Mean Business, marketing column, market driven companies, sales driven business[/tags]