Marketing in Real Time
by Regis McKenna

Most executives willingly admit that customer loyalty is critical to competitive advantage in a real-time culture.

Real time is associated with high-speed computers capable of assimilating information and responding almost simultaneously. Almost everything we encounter — food, clothing, transportation, communications, entertainment, work — has significantly changed in the way it is produced and delivered through the application of information technology.

The effect of Real Time is that consumers now experience — and have come to demand — instant satisfaction when they make a request or touch a button. This ubiquitous technology is progressing very quickly, with thousands of "smart" new products entering the market every year, either alone or embedded in familiar appliances. This new medium — digital technology embedded in silicon chips — is essentially the oil or electricity of our age, and its effects will be as transparent and far-reaching.

Real Time will also make information increasingly disposable. Everything we need to know (or occasionally want to know) is available anywhere, anytime at our fingertips — so why keep it on store shelves, in our heads, or in files? Information in a computer and on a network never gets old or inaccessible. Real Time is affecting how every business operates. Businesses must become capable of servicing this "never satisfied customer." They will have to prepare, in essence, for the eventuality of anything. My definition of perfection in service is customers serving themselves so effortlessly — through "transparent" technological intermediaries — that they are hardly aware of doing so. For the businesses catering to these consumers, the stakes are high — either they will operate in Real Time or they will not survive.

Every company needs to attend to the implications of a Real-Time world to be competitive. There are virtually no non-tech companies in the Real-Time world. All retailers, for example, will use inventory management, just-in-time ordering, customer credit card payment systems, and customized coupon printouts, as well as customer databases and credit verification systems. When a business ties together technology, speed and service, customers take notice. Companies can either compete, or be left behind.

Real-Time technologies like the Internet offer individuals more freedom and control. The new infrastructure of technology currently being put in place is based on communications and networks of people and businesses. Networks offer the constant flow of interactive, two-way information. Traditional geographic, sovereign, and psychological boundaries collapse with the wireless and Internet-type technologies. Access replaces broadcast. In the interactive world, the individual controls the flow of information. At the very least, the individual becomes a participant in the ebb and flow of opinion, ideas, knowledge, and dissent.

In a Real-Time environment, the concept of brand will change rapidly. Traditionally, brand was closely tied to a name and good distribution. Brand today is much more a result of the consumer's experience with the product; the service relationship with the company, retailer, or salesperson; and the sustaining interactivity of the relationship. As businesses adopt a service orientation, using the new tools of interactivity, a new concept of brand will emerge reinforced by the producers' actions in the marketplace.

Further, because choice has replaced brand as the primary consumer value, consumer brand loyalty is fleeting. To maintain customer loyalty and sustain attention and interaction, services must extend the value of any brand by engaging the customer in a service-like relationship and dialogue. Brand in the new context is service, access, and the immediate response to the consumer anytime, anywhere.

Every Company Is a Service Company

Every product company will in some way become a service company. Information turns every business into a service business. Today, information is used to offer customized services and goods, to offer new choices to the customer. And with increased choice, the individual is in the driver's seat. Producers are desperately trying to find out what you want in order to customize solutions to your every need. Buyers have access to far more information about the products and services they buy and are demanding more of the producers because they now have the power to do so. Today's consumer has the power of choice.

Modern communications technologies, particularly networks, allow the needs and wants of any customer to be shared with engineering or manufacturing. Service and support people can share their daily customer concerns with engineering or manufacturing. Corporations in the future will use their networks to develop the infrastructure and communities of interest necessary for sustaining customer loyalty and brand equity. They will do this by maximizing three spheres of corporate communications:

1) the intranet, linking vital resources within the company and protected by an information firewall;

2) the extranet, linking an enterprise's extended family of suppliers, distributors, retailers, and partners; and

3) the Internet, an open, free-ranging array of millions of computer hosts providing information on competitors, government activity, the media, and academia.

This will require a fundamental change in how business is done. Technology adoption leads naturally to a change in the company's culture. I define culture as the things we learn to do to survive in a particular environment. Organizations that live by e-mail are better equipped to deal with change. Busy, mobile executives can elaborate, exchange ideas, hold meetings, bring up items for immediate attention, share proposals and databases anywhere, anytime. In a world where competitors and customers will not wait for a business to get its act together or make a decision on their schedule, this network is the only way to achieve world-class customer satisfaction and competitiveness.

Real-Time systems will be essential for a company to compete. Real-Time customer satisfaction is not easy to deploy. Business leaders must first know what to do and then how to do it. We face many hurdles to becoming Real-Time organizations. We still love our factories more than we love our customers. The biggest competitive battle that corporations face is sustaining the loyalty and attention of their customers. New tools of technology are rapidly changing the game, and executives will have to change their priorities from price and delivery to access and service.

This Real-Time message has been difficult for some businesses to swallow. Most sense the increased demand for speed in product development, design cycles, inventory turns, and competitive response. Where most fall short is in developing interactive marketing systems and creating a unique customer interface and rapid response system.

Regis McKenna, chairman of the McKenna Group, in Palo Alto, Calif., is the author of Real Time: Preparing for the Age of the Never Satisfied Customer.

Copyright © 2001 Executive Excellence Publishing

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