Toyota Prius had nothing to do with alerting me, advertising to me.
They didn't even know that I was in the market.
I didn't even know that I was in the market.
My friend is the advertiser.
Because she was a satisfied customer.
This is really the power of social media of course, as you know,
but it's also a reflection of the big change that the model doesn't indicate.
We've got friends, peers, even strangers propose customer reviews
who are in most cases, as or more influential than an advertisement.
>> What is the new model look like?
>> The new model is dynamic.
It is constantly in motion.
When anyone of these five attributes, gears really in the engine.
Anyone of them is moving, all the rest of them are moving.
It moves the entire engine.
So it might be a customer who's happy with their new car, who's talking about it.
That changes their behavior which suddenly causes a motivation in a stranger,
in my case me, to change which may result ultimately in a purchase.
Where the brand has nothing to do with it.
So it's not linear, it's dynamic, it's constantly in motion.
>> Okay, so far my consumer point of view
What are the different levels of consumer engagement that you see out there?
>> Great question.
So we've done research and we've actually found that there
are three levels of engagement and
that those three levels of engagement actually correlate to customer value,
which means the more actively and relevantly engaged you are,
the more valuable you are to the company, you spend more money.
And we found that over a number of different research efforts.
Let's start with the first one.
The first stage of engagement is just observation, some researchers call this,
the advertising effect.
I didn't know about something and now suddenly I know about.
But in the Prius example, I don't know about it from Prius or Toyota,
I know about it from my friends.
So anything that has to do with an observation.
Observing a post, observing a video.
A friend sends something to me, I read it.
An email that's about a brand, those are all observing.
And we found that people who in fact,
observe about a brand are more valuable than those that don't.
Okay.
>> However, they are not nearly as valuable
as those who are actively participating.
Participating is where I'm doing more than just reading or watching, but
I'm actually sharing myself, I'm posting, I'm tweeting.
I'm retweeting, I'm sharing with other people and that level of participation
ends up being more than twice as valuable the companies as just observing.
>> So you've got the people that are observing and moving to action, but
if I get people to actually engage, they are twice as valuable?
>> Yes. >> There are more?
>> And there are people who are even valuable than them and
those are the ones That are actively, what we call, co-creating with the brand.
So co-creation is where customers are so actively engaged
with the brand that they actually produce new products and services.
So, great example Frito Lay has a contest that they've run
where they invite their loyal customers to recommend new flavors.
And so the way they do it is, they ask them to go ahead and produce a video,
put it up on YouTube, and let the world vote on whether or
not they are compelled to agree that this particular
person's belief in a new flavor is the one that Frito Lay ought to go out and create.
And in fact, winning flavor by virtue of votes from other fans
is actually created as a new Frito Lay product.
So the people that have actually gone and
produced a video think about the incredible passion that they feel about
this brand that they're going to spend their time doing thing.
And we've found from our research that it's the co-creators
that are exponentially more valuable than the ones who are just participating.
>> Can you quantify the value of co-creation?
>> Yes.
The best recommendation for our learners is to go onto the Spiegel research center
website we've got all of the studies that we've done.
We have co-creation demonstrated a couple of them so that they can take a look and
see which one is most relevant to them.
>> Fantastic.
And we'll put the links to that as well as to your other social assets.
In the tool kits.
Thank you Tom for these great insights.
>> Thanks for having me Rick.
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