Apple CEO Tim Cook and his management team aren’t in denial about the company’s discouraging financial performance. Consistent with the declining shipments of its new iPhone 5, it reported deflating profits in April for the first time in a century.
How did the company go wrong? It failed to listen to its customers.
One of the constructive things about social media is that it facilitates easy conversation between producers and consumers. It allows users to make comments on social networks such as Facebook (NASDAQ:FB) and Twitter that are offered genuinely and without incentive, increasing their value and accuracy.
This kind of conversation goes hand in hand with today’s most valuable marketing strategy: data-driven marketing. The technique requires companies to engage in dialogue directly with their customers, who offer up their opinions voluntarily. The outpouring of consumer feedback allows for a large sample size, and a company’s willingness to respond directly to its customers promotes more intimate and personal relationships between producer and consumer, giving customers the opportunity to recognize a company’s genuine interest in solving problems and meeting needs.
The key to data-driven marketing is listening to consumers, and that is where Fast Company argues that Apple fell short. When the company first launched the iPhone, social analysis made it clear which key elements were important to consumers: screen size, battery life, and connection speed. But Apple failed to tap into these widely-available social insights, and it’s now paying the price.
Apple’s failure to listen to its customers and and take advantage of an “always-on marketing” strategy, has led to its declining edge in the smartphone market, illustrated by Fast Company’s graphs. Conversations from two of the company’s target audiences, Baby Boomers and Generation Zers, on social channels has declined drastically from September until today. The same pattern holds true for the younger generations, Millennials and teens, whose iPhone conversations have been on the steady decent since Christmas. Purchase intent offers even more dismal figures.
And Apple isn’t the only company that needs to learn from its mistakes and develop a more directive data-driven marketing strategy. This technique is becoming necessary to any company’s survival, as there is now no room for guesswork in marketing. The information is there, the companies just have to choose to use it.
Marketers must be able to recognize the right enterprise platform, Fast Company contends, and be able to identify the difference between simple measurement versus analytics. Companies must be willing to be flexible and ready to change tactics when consumer insights require them to do so. Keeping up a conversation, listening, and responding is the new name of the game. One CEO simply imposing his tastes on the public at large is not.
Companies’ access to customers’ wants and needs is now more widespread than ever, and it is a reality they must take advantage of if they want to learn from Apple’s mistakes.