Photo by adactio via flickr

Do you see new media concepts like “engaging with” and “listening to” customers as fundamentally changing the customer-vendor relationship or are these just buzzwords?

I think companies are making a much more sincere and earnest effort, on the whole, to engage customers as human beings and not just as what Jerry Michalski calls “gullets with wallets and eyeballs.” Companies also don’t have much choice, since the marketplace is now filled with increasingly capable and independent customers.

Jerry first delivered that line back in the early years of the Internet boom, when companies saw the Net as a way to increase economies of scale in dealing with many customers at once. It was only natural, at the height of the Industrial Age, to do what industry had done for 150 years, which was to look for efficiencies through treating customers as populations rather than as individuals.

On the Internet, however, customers have many more ways to assert themselves. They have far greater powers of speech, of publishing, of reaching out and engaging. This fact was overlooked back in the 1990s, at great cost: Most dot-com companies went down in flames.

Today it’s clear that companies need to engage customers as individuals. The problem is that individuals don’t yet have all the tools we need, even if companies are improving their methods and language.

Now we need to work on the demand side, by equipping customers with their own tools, and not just the exclusive ones that companies give them. (For example, with loyalty programs.)

Do you think branded content can ever be useful to customers? Even in a world where customers are in control, businesses still have to get found, don’t they?

Branded anything is fine, as long as it’s backed by substance, and “branding” as a purpose does not subordinate the hard and simple work of earning a good reputation.

The problem with branding today is that it has stretched from its original purpose – making the names, symbols and unique qualities of a company familiar – to a kind of self-aggrandizement, especially at the individual level. Bloggers, for example, are being told that they should work on their “personal brand.” This is worse than silly. Be yourself and earn a reputation for doing what you do. Let companies do the branding.

Earlier this year you published a blog post called “Brands are boring,” in which you argued that we need to think of a more human way to talk about businesses. But isn’t the term “brand” just a way of conceptualizing the values of an organization? I think of Google and “Don’t be evil,” Blackberry and “privacy” or Virgin and “fun” and these seem like very human aspirations.

Maybe it will be helpful to remember that the word “brand” comes to us from the cattle industry.

It was first popularized in the early ‘30s – when radio was becoming ubiquitous – and manufacturers would fight “shelf wars” in grocery stores by putting one kind of many different packages (each a “brand”) and pounding listeners with messages about each. (It was in this age that it was first said, “If you’ve got nothing to say, sing it.”)

Lately marketers have dusted off this old term and used it to mean something much different than it did in the first place. The associative qualities you mention are what Trout and Ries many years ago called “positions.” (Their first and best book was “Positioning: The Battle for Your Mind.”)

Google is the non-evil company. Virgin is the fun airline. Volvo is the safe car company. We can intellectualize “branding” all we want, but its position will always be anchored in its original purpose: to burn a name into the brains of consumers.

Companies are humanized only by their people. How Google or Virgin or Volvo behave with their customers is what makes them more or less human. And it is the human beings at those companies that carry the humanization burden.

Apple always comes up in discussions like this, which is itself a problem because the company is profoundly unique: an example only of itself. Yet it’s worth mentioning that Apple is humanized by its stores and its customer service.
My iPhone and my last three Mac laptops have all had problems. In every case our local Apple store took care of things, with maximum courtesy and minimum fuss. Their “geniuses” weren’t perfect but they were human and they handled my problems well.

I think Apple’s success today owes to many things, but nothing more than personal service at those stores, and on the phone. If you want to call that “branding,” fine. But I think humanization and positioning work better. They are more human and better positioned than any other company making computers or phones.

I want to ask you about privacy, which is an important part of the VRM discussion. We want businesses to recognize our past interactions and treat us in a personalized way, but we’re also a little creeped out when it happens. So how do you see people using VRM tools to navigate that line in a way that makes us feel safe and well served?

We need our own tools for controlling the way our data and other personal information is used. Some of these tools will be technical. Others will be legal. That means we will have tools for engagement that say right up front how we want our data used and respected. We can do this without changing any laws at all – just the way we engage.

As I said in The Data Bubble, the tide began to turn with the Wall Street Journal article series titled “What They Know,” which is about how companies gather and use data about us. More and more of us are going to be creeped out by assumptions made by marketers about what we might want.

This is also part of what I believe is an advertising bubble. Our tolerance of too much advertising is like the proverbial frog, boiling slowly. The difference is that the frog dies, while we’re going to jump out. Everything has its limits, and we will discover how much advertising we’re willing to suffer, especially as more of it gets too personal.

The holy grail of advertising for many decades has been personalization. If we know enough about a person, the theory goes, we can make perfect bull’s-eye messages for them. But this goal has several problems.

The first problem is that personal advertising is kind of an oxymoron. Advertising has always been something you do for populations, not individuals, even if ads show up in searches by individuals, and advertisers are looking for individual responses.

From the individual’s side, advertising shouldn’t be any more personal than a floor tile. You don’t want the floor tile in a public bathroom to speak into your pants.

In fact, we’ve never liked personalized advertising of the old conventional sort, such as direct mail. We see our name on the envelope and then toss it anyway, most of the time.

The second problem is the belief that it’s actually possible to have perfect information about somebody. It’s not. And where it gets close it gets creepy.

The third problem is that advertising is still guesswork.

We need it, to let lots of customers know what we’ve got. But there should also be more efficient ways for supply and demand to meet and get acquainted – ways in which, for example, individual customers eliminate guesswork by telling vendors exactly what they want. VRM is one answer to that need.

Project VRM was conceived as a way to fulfill the promise of the Cluetrain Manifesto that  “we are not seats or eyeballs or end users or consumers. We are human beings.” Ten years after you co-authored that book, do you think the Internet and new media have made commercial relationships more or less human?

More, for sure. But we still have a long way to go. The whole last sentence there says “We are human beings and our reach exceeds your grasp.” This was the real promise of Cluetrain (at least in the commercial domain), and it is not yet true. Our reach as customers still does not exceed the grasp of vendors. And that’s what we’re working to make happen with VRM.

Check out Part I of out interview in which Doc explains how social networking, mobile media and open-source technology can help make business more human.