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Thursday, May 22, 2008
  Are you the customer?

I referred to Apple’s current business strategy with iPods as “delighting the customer.” Not everyone agrees that their industrial design, user experience, and iTunes business model is delightful for them, but I think everyone knows I meant they are trying to make money by making people happy with their purchases.

That being said, I think Microsoft have been working aggressively to delight their customers as well. I am not placing tongue in cheek when I point you to news that tracks purchased from MSN Music cannot be reauthorized after August 30, 2008. This is not an example of Microsoft failing to delight their customers, just the opposite.

Likewise, news that Microsoft May Build a Copyright Cop Into Every Zune (followed by the denial-that-actually-doesn’t-deny-it “We have no plans or commitments to implement any new type of content filtering in the Zune devices as part of our content distribution deal with NBC.”). This does not mean Microsoft is not delighting its customers. Just the opposite.

And when I pass on a link to news that Microsoft Demos Zune Advertising Service, I am not saying they are not trying to delight their customers by finding a way to put Doritos’ logo feces on Zunes and XBOX 360s and other media they control. I am saying they are delighting their customers.

The key point is this: You are not Microsoft’s customer. You are not the person they want to delight. They want to delight big companies with big budgets. People who make money selling you music and selling you television and selling you snack foods.

It’s odd (to me) how deeply American culture has ingrained in its subjects the notion that they are first and foremost consumers.

For me, the cognitive dissonance first surfaced when I thought about television: The TV networks are the producers, the advertisers are the consumers, and the viewers are the product. TV is not primarily a means of delivering entertainment to viewers—it is a means of delivering viewers to advertisers.

It seems natural to think of ourselves as the end, but sometimes we're just the means…
Michael Dorfman on Hacker News

Not that there’s anything wrong with delighting such people, the last time I checked I think that roughly 100% of my professional revenues have come from delighting companies. And thus I have only delighted people like you and I indirectly.

Remember when Microsoft paid a fee to EMI for every Zune sold? We know they must have built that fee into their pricing structure, passing those costs onto Zune owners, essentially charging them for music they planned to steal before they even took the Zune out of the box. But maybe that’s all for the benefit of Zune owners. What’s wrong with that?

And perhaps you benefit if Microsoft delights a music label such that you can subscribe to songs that evaporate when you stop paying a monthly fee. I certainly think you benefit from having a choice in the matter. And if looking at a bag of chips lets you listen to a song for a few days before deciding whether to buy said song, what’s wrong with that?

Absolutely nothing.

In truth, it does not matter whether Apple is trying to make money by forcing the music industry to offer all tracks for one low price, or whether Microsoft is trying to make money by delighting the kind of people who think that the same track ought to cost more if you download it over 3G than over WiFi. If a byproduct of these actions is a product or service that suits you, it’s all good. Be my guest and do business with whomever makes what you want to buy, regardless of their motivation or strategy.

And don’t let anyone tell you I said Microsoft doesn’t know how to delight their customers. I’m personally impressed by what they are prepared to do to make a buck.

p.s. I’d like to think I’m trying to delight you with my shameless use of Amazon affiliate links. Maybe I am, maybe I just like getting a few books and CDs every once in a while. Either way, have you heard Murray Perahia’s recording of Bach’s Goldberg Variations? While I still love both of Glenn Gould’s interpretations, I agree with a reader who wrote to say that “Perahia redefines this opus in a way I’d never have deemed possible.” It literally sounds like like a new work in Perahia’s hands.

p.p.s. I wrote this, then went back to work. Then I thought about it, and realized how remarkably small this post is, the obvious product of small thinking. Eleanor Roosevelt once said, “Great minds discuss ideas; Average minds discuss events; Small minds discuss people.” I am leaving the post up as a reminder to myself to of the consequences of giving in to small thinking.

Comments on “Are you the customer?:
Recently, I hear the argument that the power of Web 2.0 will amplify the power of consumers (end users), and will thereby force enterprises to focus more on end user needs. Which would mean that Microsoft-style "selling to the enterprise" will be left behind by a paradigm shift. You might also wonder if the "enterprise" as a monolithic, self-obsessed money-making machine will continue to exist at all. 2.0 style social networking structures are currently transforming corporations from the inside and are blurring corporate boundaries.

I was reluctant to comment at all because your p.p.s. effectively devalues the post - "who enters this discussion enters small thinking" - but apart from the people (Microsoft) there's interesting ideas (enterprise 2.0) lurking between the lines.
The question "Are you the customer?" applies to other industries as well. Health care is a good example. In theory, we should be the customers, and if we always paid in full with cash, we would be. Since we don't, the real customers are employers, the health insurance providers, government, and possibly the pharmaceutical producers.
If you take Roosevelt at her word, you'll never read a good biography.
Microsoft is now a dinosaur, and it has been ever since Bill Gates announced his retirement.

Bill Gates was their competitive advantage, and now that he's gone it has become just another corporate beaurocracy. Seriously...what is their identity now, Steve Ballmer?

Apple, on the other hand, is still going strong but again only because Steve Jobs is at the helm. What kind of succession plan do they have?

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Reg Braithwaite

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