Social isn’t new. We’ve been social since the Stone Age. Commerce isn’t new either. We’ve been trading since we made the first hand axe. But because of digital technology, how we behave as consumers has radically changed. Compared to any other time in history, more people have greater access to more information and individuals—by a wide margin. The result has been that we’ve entered a golden age of consumer influence.
Because socially savvy brands show us every day that social done right leads to big success the most critical business problem of the decade for the rest has fast become: How can we best adapt to the fully connected, totally empowered consumer?
The problem is, most companies try to adapt using traditional methods in a new world: acquire customers and monetize them, just as they’ve always done offline. But it’s hugely inefficient in the new world order and ignores the enormous power and benefit of re-casting social customers as agents of acquisition. In the social era, when a simple acquisition-to-monetization strategy works at all, it quickly leads to an offer-based business model of constant discounting. It’s just not sustainable.
Sustainable Adaptation with The Four Gears Model
The Four Gears model was devised by market development and technology strategist Geoffrey Moore, author of several best-selling business strategy books including Crossing the Chasm and Escape Velocity: Free Your Company’s Future from the Pull of the Past. Moore’s model provides a precise framework for adapting to today’s social marketplace—one that pursues reliable, predictable and sustainable success. What really captured my interest was its simplicity and elegance. The Four Gears model provides a unified strategic goal for all social efforts across the entire business: getting all four gears to spin continuously.
The basic idea is this: in order to drive a viral growth—a lasting influx of increasingly loyal customers—your strategy needs four gears moving together with positive feedback as follows:
Acquisition—a mechanism that enables you to attract and capture new consumers
Engagement—a process that nurtures prospects and customers, and cultivates long term loyalty
Enlistment—an environment that enables your customers to participate in the business in a whole new way—helping you to acquire new customers, support other customers and generate new product ideas
Monetization—a seamless integration to your monetization engines (e.g. your e-commerce and CRM systems) that helps you convert, deliver, satisfy and up-sell
A sustainable social strategy needs all four gears moving in concert to get that all-important viral loop spinning persistently over the long-term.
Done right, you get social customers who participate, help you to create trusted content, buy more, are willing to pay a premium for your products, stay loyal longer and recruit other customers.
Leading social brands demonstrate every day that solid attention to all four gears leads to increased sales, higher margins and lasting competitive advantage.
Content taken from Dr. Wu’s upcoming book, Science of Social 2, set to publish this summer.