The Rise of Information and the Risk to Brands
By Clint Chadwick-Oracle on Feb 06, 2013
Clinton Chadwick - Principal PLM Consultant – Oracle
Information Overload and Brands
A world of ever more empowered consumers means brands are simultaneously becoming more important and open to more risk. Consumers are suffering from information overload. A simple consumer question like “what is the best laptop to buy?” or “is grape juice safe for my child to drink” instantly becomes a discussion inexorably linked to brands.
When consumers try and find answers to these questions are swimming in a sea of information. Brand names are key landmarks in navigating this sea. While the details of what consumer may read on the websites, blogs and social network posts they find will fade, what remains is brands – “Brand X makes great laptops”, “Brand Y juice is safe for my child”.
Furthermore when researching products, brands are an extremely import keywords for internet searches. Without brand names, the amount of results and the ratio of useful information to noise is vanishly small.
The Risk to Brands
This unprecedented access to information greatly empowers consumers. This includes both positive information about brands and, more importantly, negative. Consumers are more likely to share their bad experiences than their positive ones so companies have come to expect many more complaints than complements.
Previously, it took a major product problem with significant impacts before the issue would come into the media spotlight. Even then, the coverage was often limited to a particular region or geographic area.
Now, it only takes a few negative consumer experiences to damage a brand. Design or quality problems that would never be large enough to gain traditional media attention are now quickly publicized by unhappy consumers via websites, chat forums and increasingly – social media.
This grassroots publicity begins impacting potential customers immediately. Consumers now often begin their purchasing process with internet research. These consumers will be impacted by the reports to unhappy customers – even if those customers’ experiences were with vastly different products.
This reality greatly amplifies the negative consequences of even the smallest design or quality problem.
How can this be prevented?
Mitigating Brand Risk
The risk comes from design and quality problems that produce a sufficient quantity of unhappy consumers that they produce an online record of the product problems for future potential customers to find.
Is it possible to prevent unhappy customers entirely? No, there will always be unhappy customers for a variety of reasons. However, savvy consumers know this already. If they see isolated bad experiences they will naturally filter these out and ignore them. It is only when many consumers confirm the same problem that potential customers sit up and take notice!
Avoiding serious design and quality problems is a matter rigorous and consistent innovation processes that include numerous checks and controls.
The innovation process is a particularly complex one as it involves virtually every part of the enterprise from marketing to R&D to procurement. However, innovation is inherently a creative process in which individuals need freedom and flexibility.
Solving the Problem with Product Lifecycle Management (PLM)
Combining the rigor and consistency with complexity and flexibility is very challenging to do manually either on paper or with Office type computer applications. Enterprise PLM applications like Oracle Agile PLM enables a consistent, auditable innovation process which still allows for creative freedom for small, mid and large organizations.
Product Lifecycle Management mitigates the problem of brand risk in a few way:
- Product Data Management. Having a single version of the truth is the best way to make sure that teams are all speaking the same product “language”. Miscommunication due to individuals or teams looking at wrong or outdated product information is source of significant potential errors.
- Project Management. One of the largest problems with innovation project is skipping steps. It is natural for a busy team to decide to skip a step and sometimes this is an appropriate decision, but often it can open the door to significant risk. Projects with PLM can still be flexible, but when a decision to accelerate a project by skipping steps (this is often a valid course of action) are made there is a record of when, who when and why.
- Approval Workflows. Making sure the appropriate checks are made is critical and automating the process is a great way to enforce these important steps.
- Automated Compliance. Compliance takes many forms depending on the industry one is working in. Some PLM solutions include automated compliance determination which can perform automatic checks on your product data to determine if the product is compliance with regulations like RoHS, REACH and even FDA regulations. With complex products, it is conceivable to miss a single non-compliant part or material with potentially disastrous implications. Automating this process is the best way to avoid this risk.