EU Choking on its Own Consumer Law

Having committed rather too late to the principles of "better regulation", it's only right that the European Commission should now seem to be choking on the dog's breakfast of consumer laws it has served up over the past 13 years (bearing in mind it takes 5 years to pass an EU directive).

Officials are reforming a plethora of electronic communications directives, and reviewing the 8 directives that make up what is (weirdly) known as the "Consumer Acquis" (which for some reason excludes the constant review of the E-commerce Directive). And, of course, it's overseeing the implementation of the Audio Visual Media Services Directive which overhauled EU television regulation in December '07.

With any luck, the Commission might realise how truly gargantuan a meal this has been for the average European citizen or small business to digest, let alone for the lawyers who have to produce bite size summaries for the busy executive's bin.

Has all this amounted to the catalyst for a cross-border consumer market that the Commission hyped, sorry, hoped? Not according to the Commission's own research. Nor could it, for the practical reasons previously mentioned. There is a facilitative role that the Commission can play, but that involves understanding the problems, their root causes and potential solutions before regulating.

More in this vein next Monday/Tuesday at the SCL's Annual Policy Forum!

UK Govt Backs Phorm PR Effort

It's one thing for the UK Government to support Phorm's challenge to personal privacy at EU level while defending its position in the face of European Commission concerns.

But it's quite another to be seen to selectively release to the media the portions of its letter to the European Commission that list the ways in which officials believe Phorm to be a good thing.

Bad Phorm, in fact.

It would seem that the authorities may have something to lose if Phorm isn't a success...

Enable Best Customers to Create Financial Services

All vendors and platform operators feel an obligation to look after their best customers. But to what extent are those customers really allowed to influence product development?

In the course of researching a presentation on the long tail of payments services for GikIII (a two day workshop on the intersections between law, technology and popular culture), I've been struck by how these observations combine to emphasise the same point:

• There is value in marketing "long tail" products if adding selection is cheap (as it is online): Anderson;
• Compared with heavy users of online retail services, light users much prefer better selling products; both prefer “hit” products more than those in the tail; but it is the heavy users who venture into the tail: Elberse;
• Successful Web 2.0 businesses are those that facilitate an 'architecture of participation': O’Reilly;
• "Lead-user product development can be a far more effective means of innovation than conventional product development in a closed system": Sheahan (citing von Hippel, of course) and giving various illustrations of the same concept in Threadless, Jones Soda, LEGO's Mindstorms Users Panel, and of course Linux.

Suggestions that even "excellent retailers" have run out of ways to improve the online shopping experience, and the only scope for real innovation is on the buy-side, are way overdone. But it must be true that improved tools for buyers as well as, e.g. 'power sellers', are an important set of features in the overall consumer experience mix. And it should also follow that enabling your prolific buyers to add to the range of products available for all buyers is a powerful step to take. Some of those products might even prove to be popular enough to work their way up the 'tail'.

In the payments context, it's interesting that recent research by Datamonitor suggests financial institutions are too mired in last century's anxieties to let their online customers loose with a bunch of web-based tools.

Seems my 2008 predictions for the SCL are still holding up nicely!

Turn Complaints Into Fixes, Features and Products - Welcome to Web 2.0

Ever since GE required me to get my Six Sigma greenbelt, I've been convinced that complaints can have a significant positive effect on costs and revenues. But only when you're prepared to painstakingly work from identifying the critical expressions of dissatisfaction to implementing the fix, feature and maybe eventually the product, that might logically result.

That isn't to say every business problem can't be solved without an enterprise-wide investment in Six Sigma, LEAN or some other problem-solving methodology. After all, an expression of dissatisfaction suggests a desire by the customer to improve his or her experience. And the process of capturing those expressions and resolving the issues creates the "architecture of participation" that is the very essence of successful Web 2.0 businesses.

Simply implementing a process for accurately classifying customers' initial expression of dissatisfaction from the customer's standpoint will get you going along the right path. It's then pretty much common sense to identify the most common issues, figure out their scale or value, and spend a proportionate amount in resources to find their root cause, the best fix for the money and a trigger that tells you if and when the problem resurfaces.

This is not a "customer service" issue. It's a business in itself.

Allowing all functions to see and contribute to the complaint resolution process will ensure that bad stuff doesn't get hidden, blame goes out the window (it could be you next!) and the organisation takes a holistic, realistic view of significant problems and the resources available to put them right for good.

Interestingly, the European Commission is currently consulting on a plan to harmonise the classification of complaints to third party agencies to ensure that "policy makers will be able to get a better picture of collective consumer detriment in various sectors". Ironically, that may in fact slow the pace of EU consumer regulation, as lack of transparency and consultation on the actual basis for regulating has long been a criticism leveled at the Commission.

BMW Should Help Pimp My Ride

I'm having an interesting discussion with BMW in the context of my efforts to reduce the wind noise on my R1150 GS.

It's been quite tough to find all the information on steps you can take to reduce wind noise. Most of it involves products offered in the after-market and no one seemed to have gathered the data together. So rather than waste my effort, I blogged it all and sent the link to BMW and MotorcycleNews.

While BMW were pleased to see the blog and its subsequent publication on MCN, they said "we are unlikely to link this to our website as it mentions other companies that we do not endorse or have any links with".

Now that's exactly the sort of standard corporate guff that I expected. Although I must say that I'm grateful BMW even took the time to respond, let alone say they liked the blog.

But in my view BMW is missing a few tricks by not facilitating its customers' efforts to personalise their bikes, notwithstanding their World of BMW off-road training courses, holidays and other efforts to encourage riding.

First, it would enable BMW to maintain a positive relationship with people who'd recently bought a bike. That relationship would help in the event there were any problems with the bike - and BMW recently admitted some quality control problems as demand for their bikes increases. Perhaps it was that admission which emboldened some owners to publicise their dissatisfaction, but those owners might not have felt so frustrated or inclined to publicise their concerns if their issues were swept up in the course of positive discussions about after-market features.

Second, BMW could profit from the after-market, both in terms of selling their own accessories as well as perhaps a revenue share on the sale of others' kit, e.g. via ad revenue on an owners' community website.

Third, well-facilitated personalisation options may make the bikes more attractive. Look at the Toyota's customisable Scion. The ability to personalise the car itself, drew praise in Peter Sheahan’s book, Flip. And according to the entry in Wikipedia:

"Scion offers about 40 different accessories; other after-market companies through the Optomize Scion program offer to add other accessories, as well. For example, one can add a subwoofer as well as different types of decals. The tC now offers an optional supercharger to increase power from 161 to 200 hp (120 to 150 kW). All accessories are sold individually, and do not require special packages. However, some options, such as Ground Effects, do prevent other accessories (such as mud flaps) from being installed. Companies that participate in the Optomize Scion program include GReddy, OBX, RÄZO, a few car detailing companies, and others."

So, what's to stop BMW facilitating its customers' efforts to personalise their bikes?

Nothing except BMW itself.