Dell’s Hearing Test

NEW YORK If you want to know something that keeps Dell CMO Mark Jarvis up at night, type “Diet Coke” into Google. The problem is right there in front of you: “Don’t Drink the Diet Coke” is the third result, directly in the middle of the screen, a blog post written about how artificial sweeteners can lead to depression. This is the same problem Dell itself faced two years ago, when consumer rage at its customer service failings and product problems clogged result pages for some of its products with unflattering commentary.

“Your home page is Google,” said Jarvis. “It becomes really important the right things are appearing on it.”

Since then, the company has embarked on a concerted effort to turn around its image online, reaching out to consumers in blogs and soliciting advice on how Dell can improve. The end goal for Jarvis is not touchy-feely: He wants to spend less, not more, money on advertising. One way is to cut down on the need for advertising altogether by having satisfied customers spread positive word of mouth.

“The Germans and British no longer believe anything you say in an ad,” he said. That makes advertising pretty pointless. You have to think of how you’re going to reach people in different ways.”

One key way to achieve this is to move as many customer interactions — Dell estimates it has over 2 billion per year — online and away from expensive distribution like catalogs.

Not coincidentally, improving customer service was deemed fundamental to fixing the company’s problems. Dell was not entirely to blame for the battery problem, but it happened at the height of a rough patch for Dell, which was founded in 1984 on the idea of letting people customize their own computers and buy them directly. Over time, though, it strayed from its customer-focused roots, treating customer service as a cost center and acting aloof from customer complaints online. In the most notorious example, popular blogger Jeff Jarvis, who is not related to the Dell CMO, lambasted the company for its poor service in a series of “Dell Hell” posts in 2006 that drew hundreds of comments from customers with similarly negative experiences. Dell couldn’t ignore how the posts touched a chord with consumers.

The numbers weren’t pretty either: The company’s own 2006 analysis of its “share of voice” online found 48 percent of chatter about Dell was negative. Its renewed focus on customer communications coincided with the rise of the social Web, as more people gathered online to share thoughts, rate products and contribute to a community Web experience.

“The company was founded on the idea of having a direct relationship with customers,” said Dell’s Jarvis. “The social media thing was a natural fit for Dell because we’ve been conversing with our customers for 24 years.”

Over the last two years, Dell has worked day by day rebuilding its ties to its customers. Its problems could not be solved by an ad campaign with a cheery message, Jarvis said, but a reorientation of its culture to solving customer problems and listening to their complaints and advice.

The searing experience of the battery recall and “Dell Hell” helped the company, believes Pete Blackshaw, evp, digital strategic services, Nielsen Online and author of the forthcoming Satisfied Customers Tell Three Friends, Angry Customers Tell 3,000.

“I do think wake-up calls matter,” he said. “I’ve seen organizations motivated in ways that surprise you by a single incident.”

Blackshaw believes social media is challenging how companies are organized, which typically splits off marketing from customer service and product. And one of Dell’s most important steps was to recognize that connecting with the social Web meant augmenting its existing structures. Dell recruited Bob Pearson, who had worked in both its communications and sales groups, to form a social media SWAT team, the communities and conversations unit, staffed with employees not just from public relations, but tech and customer support, and marketing.

Its first tentative steps were inauspicious. In 2006, Dell launched its first blog, One2One. The only problem: www.one2one.com landed users at a porn site. (The blog was housed on Dell.com.) It took a second pass, calling the site Direct2Dell at its own URL. The reaction was, to be kind, skeptical. There were doubts that Dell would use the site for anything more than marketing. But post by post, link by link Direct2Dell gained credibility from bloggers. One key reason: It didn’t censor negative comments posted about problems. A post last August about the delay in shipping new In-spiron notebooks drew hundreds of comments from frustrated and irate customers. Taking the criticism when the company screws up builds authenticity, Pearson said.

“We just deal with it,” he explained. “The point is we want to hear whatever is on customers’ minds.”

Pearson’s team had a mandate to not only communicate Dell’s viewpoint, but to help customers who are having problems. It started with figuring out who was talking about Dell. It turned out quite a lot of people were: over 15,000 posts mention the company per day. So Dell implemented blog-monitoring software from Visible Technologies. Now, when someone blogs about a problem with a Dell product, it’s routed to a member of Pearson’s team. The unit, acting as what Pearson calls “an early warning system,” can respond to as many as 100 posts in a day.

Another focus for Dell has been enlisting consumers’ help in improving the company, remaking its online community section to let people answer each other’s questions. It takes a page out of the book of social media Q&A sites like Yahoo Answers. If a user posing a question chooses another’s answer as helpful, it gets marked as an “accepted solution” to the problem. Dell now lists over 6,000 accepted solutions for a wide range of issues.

The company’s biggest leap into listening was IdeaStorm, a customer-suggestions site it rolled out in late 2006. There, visitors can post ideas for Dell to implement. It’s more than just a PR exercise, Pearson said, pointing to a Linux-based laptop that was developed in large part as a response to a popular suggestion on the site. In other ways, the customer input has been an internal catalyst company executives can point to when fighting for projects, such as the idea that Dell needs to make its packaging more environmentally friendly. In all, IdeaStorm has taken in 9,000 ideas, recorded 600,000 visitor votes and implemented 120 suggestions.

Dell still has a long way to go. While its negative share of voice is down substantially, it is still 21 percent. Many people still feel the company drops the ball too often. A recent Dell blog post about its vision for “thriving in the connected age” drew several scathing comments, insisting that its customer service is still a nightmare and the company is not listening.
“Social media is a grand experiment,” Dell’s Jarvis said. “It has a future. I don’t see it crashing down. Social interaction, communities and participation are absolutely the fabric of the Web. Our challenge is how do we leverage those best for our customers.”

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