Strip-mining customers is no way to behave

I've always felt that too many businesses see customers as a resource to be exploited. So I'm pleased to find that RightNow Technologies CEO Greg Gianforte has come up with a great new analogy for this attitude: he calls it 'strip-mining' customers.

Every so often, Greg sends out an opinion piece by email. His usual theme is to contrast the customer-focused innovation of leading on-demand vendors such as RightNow with the outdated attitudes and operations of conventional software vendors. The latest missive is no exception [with my emphasis added]:

"Traditional CRM platforms encourage this same [strip-mining] approach to customers. They're designed to help companies squeeze as much revenue out of their customers as possible. These platforms simply accelerate the process by which companies strip-mine and then lose their customers forcing them to constantly find new victims.

"... The flaw in the strip-mining CRM mentality is obvious. Old Order CRM vendors want you to believe that, with the right data and analytics, you can more effectively manage, control and sell to your customers. But customers don't want to be managed, controlled or sold to. They want to be understood, have their needs met, and receive value. The back-office, sales-driven CRM platforms of the past don't do that because they're designed for strip-mining customers, rather than pleasing them."

Although what Greg says is targeted against his company's rivals in the CRM market, I think his warning is equally applicable to the Web 2.0 environment. I see far too many business plans being hatched in that market based on harnessing user content, data-mining user activity, harvesting user clicks, and so on. Dan Farber this morning highlights the flaw in this kind of thinking:

"... there is a substantial risk of alienating users/customers, who are looking for the best customer 'service,' not a rapacious company prying into their Web trails without permission or preventing users from accessing and owning that same data."

Collaboration is the defining characteristic of the on-demand world, whether it's SaaS or Web 2.0, and that works both ways. It means customers now expect vendors to empower them rather than exploit them. Back to Greg's email:

"This kind of exceptional customer experience requires greater intelligence across the frontlines of your business — including service, marketing and sales. It requires the ability to respond in real time to your customers' explicit requests and implicit behaviors. And it requires technology that empowers customers as much as it empowers back-office tacticians. [It requires] experience-enhancing, relationship-sustaining technology.

"It's about treating customers like the renewable resources they actually are."

Amen to that.