The following is a guest column by Kevin O’Connor, the president of User Insight, a user experience strategy firm.

The idea of putting customers first is not a new one. In fact, it was the start of the 20th century when Harry Gordon Selfridge coined the phrase “The customer is always right.”

But customers have never been as powerful as they are today in the social media age.

The potential damage that can be done to a reputation on social media raises the stakes higher than they’ve ever been. A new era means new ways to collaborate with and serve valuable customers. It’s time for companies to stretch beyond customer satisfaction surveys and stop relying on demographic research to determine how their brands should interact with their customers. It’s time to start talking to customers, one on one, in order to understand who they are and how to wow them with a product or service.

Today, more and more companies realize they must spend time and effort to really get to know their customers. If one person has a bad experience, news travels at lightning-fast speed. They will post their woes to their friends, contacts and Twitter followers.

“If we knew someone had 50,000 Twitter followers, our call centers would escalate their call for support,” someone once told me.

That’s certainly understanding the power of social media, but the goal should be larger: to make sure the customer experience is as good as it can possibly be to avoid all complaints in the first place, whether public or private.

the case of Qwikster

Netflix clearly underestimated its customers last year when it announced it would rename its DVD-distribution service Qwikster. Creating separate charges for DVDs and streaming video would almost double prices. Plus, a high schooler already owned the Twitter handle @Qwikster, indicating even worse foresight.

The day Netflix announced Qwikster, online conversations spiked almost 300 percent. Seventy percent of the chatter was negative when emotion was tied to the posts. Netflix stock dropped 20 percent. $2 billion in value evaporated in eight hours. Hundreds of thousands of subscribers canceled their service. The customers had spoken — Netflix abandoned the idea, and the CEO apologized.

On the flip side, if consumers love a product, store, brand or experience, they will shout it out into their vast digital networks. Take for example, musician Tommee Profitt, whose love for Target led him to record a music video using his iPhone 4S.

A new take on ‘user experience’

Since today’s customer truly is king, with powerful communication tools right at their fingertips, companies have to pay more attention to the overall “user experiences” they are creating for people. User experience, or UX, is a broad term used to describe all aspects of a person’s experience with a system or brand.

User experience research and testing helps companies “put the customer first” in all aspects of their businesses.

In today’s many-to-many world, consumers group themselves, especially online, largely based on values, interests and aspirations — not by sex, race and age. In this scenario, companies must understand their consumers’ behaviors and motivators — the why behind their actions.

An example: A company in the financial services industry came to my firm, User Insight, to get to know its customers better. Based on the demographic and segmentation information, this client believed that people chose banks according to life stage. After spending hours one on one, in consumers’ homes, interviewing them on how they choose a bank, we discovered that it wasn’t about their sex, age, race or stage of life at all. Instead, we found three groups based on values and behaviors: customers who preferred to bank online, those who like a branch nearby, and those who want a banker who knows them by name and handles their complex finances.

Getting insights from the customers who will actually use the product at the end of the day allows a company to focus on the core experience these customers are looking for. It’s not about “if” someone can use a product; it’s about “will” they use the product. The key today is serving up the right content at the right time in the right way. Consumers have many ways to interact with a brand; understanding how they want to do that will make the brand successful.

Smart companies should be willing to seek out and accept the tough love they need to serve consumers and manage change well. They also need the right people to guide them who are passionate, pleasant and collaborative. Putting time and effort into quality user experience research can mean healthier businesses, happier customers, and fewer reputation-flaying diatribes online. Because in today’s social media age, user experience matters.

Kevin O’Connor is president of User Insight, a user experience strategy firm providing research and consulting to more than 300 clients in 25 different industries. User Insight, an Inc. 5000 firm, is headquartered in Atlanta, Ga.

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