“By means of this remarkable instrument, a man can have the Italian opera, the Federal Congress, and his favorite preacher laid on his own house.” (New York Times, 22nd March 1876, see here)

Facebook overtakes Google, the social web wins

Almost exactly 134 years later (13th March 2010 to be precise) Facebook became the most visited website in the USA, pulling in more visitors than Google.  Last week’s data from Hitwise (an online competitive intelligence agency) shows a quiet, creeping discontinuity:

The graph says  that once we used the web mostly for information; now we’re primarily social users.  So what does that have to do with the New York Times and its prediction of telephone-based home entertainment?

What disruptive technology is really for

It takes twenty years to work out what any disruptive new technology is for.  Disruptive technology has a lifecycle. It’s invented.  A thousand flowers bloom as entrepreneurs and visionaries vie to make their fortunes.  Some businesses fail.  Others succeed.  After twenty years or so the dust clears on a new consensus about what that particular technology was for.

The year 1881 was a good one for French inventor Clément Ader.  At the Paris International Electrical Exhibition, he demonstrated how his théâtrophone system would open up the vast opportunity of a French home entertainment system based on a stereo telephone line.

He wasn’t the only person thinking that way.   In 1893 Telefon Hírmondó was launched by a colleague of Alexander Bell to 60 subscribers.  It’s opening message declared:

“We greet the inhabitants of Budapest. We greet them in an unusual way from which telephone broadcasting all over the world will start its victorious journey.”

By 1907, its subscriber base was 15,000 and it only stopped broadcasting with the Second World War.

Just as we eventually found out what the telephone is really for, last week’s Hitwise data shows that we’re discovering what the web is mostly for.  If the web really is primarily social, that  has big implications for online proposition development.

Things we may need to do more of include:

1. Design based on the needs of communities, not just individuals.
2. Emphasising social functionality as much as content and transactions.
3. Building content that can travel on social networks, rather than driving traffic to your own site.

Related posts:

1. New utility customer service challenges
2. Is iPad the end of free content?
3. 10 management truths for the web age

People have dreamed of omniscience –of “knowing everything” – since the start of history.  Google brings it a big leap closer – free of charge – and gets eighty-million “Hate Google” search results for its trouble. “Hate Skype” gets an ungrateful 8.3 million and “Hate Facebook” a curmudgeonly 79 million results.

Existentially, customers may be hitting out at the utility’s reach and pervasiveness.  But there’s another profoundly controllable reason.  Customers are demanding a great service experience and that’s exactly what the new utilities struggle to provide when things go wrong.

Customer service asymmetry

The essence of the problem is the asymmetry between a massive customer base, low average revenue per user and therefore relatively tiny service resources.  For example, the generally accepted cost of taking a single call in a contact centre is about 5 times bigger than Skype’s average annual revenue per user.

This is compounded by customers’ high service expectations and the technologically-intense nature of online propositions.   The inherent risk in all of this is that a dark pool of customer angst, propagated across social networks, could undermine the sector, damaging its brands and putting a brake on monetising the user bases.  Visually, this is the calculus of the problem:

The customer service meltdown which Google experienced with the launch of its Nexus One phone is a vivid example of this problem.  See here.

The solution is to avoid customer problems, create elegant, effective self-service and then, intelligently, open up to customer contact.

Evading customer service?

Like tax, there’s a subtle but important difference between contact evasion and contact avoidance.  Evasion lands you in jail and avoidance makes you more money.  Utilities need to move away from strategies that evade customer service contact.

New utilities need to declare a zero-tolerance war on all forms of value-destroying customer problem.  If a process causes customer issues it gets redesigned; if text causes confusion it gets re-written and if technology doesn’t work it, gets replaced.

Self-service needs to be elegant, highly usable and integrated with all the other service channels so that customers have a choice.

With these approaches embedded, it should be possible to reduce like-for-like service demand by 50% a year on a repeating basis.

Achieving that begins to provide the headroom to open up to customers intelligently and without “drinking from the fire hydrant”.  Initially, this could be through premium service offerings, call back or intelligent click-to-chat utilities that match service demand to capacity.

Ultimately, the goal should be to make brilliant basic customer service available to everyone.

Related posts:

1. Five ways that customer service fails… and what to do about it
2. Contact evasion and how to avoid it
3. Bad customer service is dead