Small data and VRM

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At last week’s IDEAS 2012 closing panel discussion, moderated by Gavin Day, panelists Rich Murnane, Phil SimonJoyce Norris-Montanari and I were asked to predict trends for 2013. In this blog post, I explain the prediction I made about Small Data and VRM.

One of the reasons that vendors are getting geeky over Big Data is because they claim that they want to use it to become more customer-centric and better understand customer behavior when, in reality, what vendors really want is to become more customer-captive and better control customer behavior.

However, the alternative to each individual vendor using Big Data to collect and manage HoardaBytes of information about multiple customers is to invert the one-vendor-to-many-customers paradigm by embracing a one-customer-to-many-vendors paradigm. Individual customers would own and manage the Small Data needed to accurately describe themselves, protect the privacy of their data and decide for themselves how their data – and how much of their data – is shared with vendors.

My lament over vendors historically not allowing us to own our own data, which I have been referring to as the Fundamental Flaw of Customer MDM since 2010, is a topic I return to on a regular basis, including my recent blog series about social MDM that received some thought-provoking commentary, among which was an excellent book recommendation made by Jean-Michel Franco.

“Over the coming years,” Doc Searls wrote in The Intention Economy: When Customers Take Charge, “customers will be emancipated from systems built to control them. They will become free and independent actors in the marketplace, equipped to tell vendors what they want, how they want it, where, and when – even how much they’d like to pay – outside of any vendor’s system of customer control. Customers will be able to form and break relationships with vendors, on customers’ own terms, and not on the take-it-or-leave-it terms that have been pro forma since the industrial revolution.”

“Customer power,” Searls continued, “will be personal, not just collective. Each customer will come to the market equipped with his or her own means for collecting and storing personal data, expressing demand, making choices, setting preferences, proffering terms of engagement, offering payments, and participating in relationships – whether those relationships are shallow or deep, and whether they last for moments or years. Those means will be standardized. No vendor will control them.”

“Demand will no longer be expressed only in the form of cash, collective appetites, or the inferences of crunched data over which the individual has little or no control. Demand will be personal. This means customers will be in charge of the personal information they share with all parties, including vendors.”

“Marketing and sales have made great efforts to become more conversational and social, but customers in too many cases are still assets to be managed. Implicit in this mentality is a belief that the best customers are captive ones and that therefore a free market for customers means your choice of captor. This twisted norm will end because free markets require free customers. The volume, variety, and relevance of information coming from customers will obsolete or repurpose the guesswork mills of marketing, fed by the crumb trails of data shed by customers’ mobile gear and Web browsers.”

The tools that will facilitate this customer emancipation and empowerment comprise a new category of capabilities called vendor relationship management (VRM) systems, the customer-side counterpart of the vendors’ customer relationship management (CRM) systems.

“Thus,” Searls concluded, “the relationship management will go both ways. Relationships between customers and vendors will be voluntary and genuine, with loyalty anchored in mutual respect and concern, rather than coercion. So, rather than targetingcapturingacquiringmanaginglocking in, and owning customers, as if they were slaves or cattle, vendors will earn the respect of customers who are now free to bring far more to the market’s table than old vendor-based systems ever contemplated, much less allowed.”

The status quo will always fight the future, but change is the only universal constant. I hope 2013 will see the beginning of the changes – almost none of which are technological in nature – needed to bring about this long overdue paradigm shift in data and customer relationship management.

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Jim Harris

Blogger-in-Chief at Obsessive-Compulsive Data Quality (OCDQ)

Jim Harris is a recognized data quality thought leader with 20 years of enterprise data management industry experience. Jim is an independent consultant, speaker, and freelance writer. Jim is the Blogger-in-Chief at Obsessive-Compulsive Data Quality, an independent blog offering a vendor-neutral perspective on data quality. Jim is the host of the popular podcast OCDQ Radio, and is very active on Twitter, where you can follow him @ocdqblog.

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