The evolving online Community

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The power of human communities to help shape ideas, concepts, and belief systems, and drive behavior in all walks of life, is real, proven, and undeniable – and, as we’ll see, it has never been stronger or more valuable.

The Internet as a Community Enabler

From a commercial perspective, marketers have seen the role and effect of community interaction evolve from the general store cracker barrel and sewing circles to the telephone party line,

and office water cooler and coffee break.

Online communities are, arguably, the most attractive and engaging customer experience management (CEM) tool around. Why? Well, to start with, look at a key original intent of the World Wide Web. It was, simply, to facilitate easy and ongoing interaction among people of similar interests. On the Internet, where the opportunities for customer loss occur at warp speed.

Consumer Internet participation and the content they create continue on the upswing. E-commerce sites and specialty portals are leveraging the promise of the online community as a viable element of b2b and b2c customer value and experience management.

Multiple Community Values

The online community has become a pillar of marketing and brand-building, communications, and customer relationships that should be included in every program. Communities are generating increased attention by both marketers and senior corporate leaders. They have become a pivotal component of dialogue with customers and in both b2b and b2c product and service industries. Although this means that the brand image management, and brand decision-making, the pendulum has definitely (and, in all likelihood, permanently) swung from the supplier to the customer, social media’s growing strategic importance represents a real opportunity for companies to create positively differentiated customer relationships.

Online communities are all about what can best be described as “brand franchise health optimization engines.”

They help facilitate:

1. Customer familiarity with the brand

2. Placement, and strength, of brand in the consideration set

3. Customer experience and value delivery relative to promises and expectation

4. Brand credibility, image, and reputation expressed from an emotional/trust perspective

5. Customer likelihood to understand the brand message, and to share it as an advocate

The 4 Ps

Now let’s look at online communities in relation to the new marketing 4 (perhaps 5) P’s.

Today, we’re dealing with a different customer experience and value proposition landscape. The original 4 P’s of 1960;s – Product, Place, Price, and Promotion – remain important from a marketing perspective. But, the contemporary customer is more mobile, content-seeking, impatient, and independent than at any time in history. Even with all of these new decision dynamics, the fundamentals of trust and perceived value have become increasingly powerful drivers of customer loyalty and bonding.

As organizations become more customer-centric, moving from naive to natural, or from simple customer awareness, through greater sensitivity and focus, finally arriving at customer obsession, they will be well-advised to add four new P’s to their toolbox:

# Permeation – Dedication to providing optimized value must be absorbed into every nook and cranny of the organization.

Further, it must core to shared enterprise values/superordinate goals and be an essential element of its DNA.

# Proaction – Organizations can no longer be content to passively, tactically, and functionally react to customer needs and concerns. They must take the initiative in understanding what customers require as value delivery.

# Partnering – Smart and evolved companies create value in partnership with customers, and value is as likely to come from people and information/content as it is from products and services.

If companies practice ideas such as ‘creating interdependence’ and ‘building equity’ with their customers, they are strategically differentiating themselves from competitors and making it more difficult for their customers to leave and begin a relationship with a new supplier.

# Paradigm – There are, to be sure, many ways in which an exemplary, world-class organization can be defined. From my perspective, it is an enterprise which creates trust, especially in stakeholder (customer, employee, and supplier) experiences, and in reputation and image. These are critical to optimizing customer value delivery, and inherent in such cultures is the ambassadorial, trust-building behavior of employees (with customers and each other) and customer-forward processes.

The last P, Paradigm, is especially important. It speaks to making customer-centricity a paramount and lasting focus, of both a functional and an emotional relationship that exists between the enterprise and all of its stakeholders. Customer-centricity, after all, is about more than structure, strategy, and systems. It’s about the differentiation and engagement that lead to bonding between the organization and its stakeholders. It’s about giving stakeholders a personal investment in the organization and its ongoing success. It’s about the enterprise becoming more transparent and open, connecting with customers through branded, emotional experiences and sustained value delivery, resulting in its operation as a “conscious capitalist.”

Finally, Paradigm is about “being human” as an organization, not just as a buzzword to apply to customer experience optimization.

There’s actually a fifth new P.

# Personalization – That says more about the marketing mix as an extension of the customer-centric enterprise. The most valuable customers appreciate and want more personalization, a relationship, and an emotional connection. It’s up to organizations to:

a) identify the strongest emotional drivers and

b) effectively leverage them.

Successful organizations have either morphed or have begun, by placing customers’ interests ahead of the enterprise’s. They build a veritable bank account of trust; and high trust and the positive reputation and image it breeds is an enduring strategic advantage, a definite competitive differentiator. And, personalization truly optimizes the customer experience, perhaps its most important benefit.

The Marketing Power of Online Communities

Now let’s look at the horizon and beyond.

Beyond sales, and potential sales and helping organizations communicate and cement stronger strategic customer relationships, are there any other bottom-line corporate benefits of customer community? It turns out that there are plenty. Here are just three of them, and we are just beginning to see their application in these areas.

Accelerated Product/Concept Beta Testing

When companies come up with new products or concepts, they can get an early read on customer response by using their community as collaborators and jury. Customers can critique or test a proposed offering, sharing opinions and suggestions, while companies observe and mine the information. This helps companies optimize their offerings, often avoiding the missteps associated with having complete customer input prior to introduction.

Lower Customer Service Costs

Companies can save money by using community management software, enabling them to encourage customers to share information and participate in relevant discussions. The more sites can register members to a community, and get them to participate frequently, they find that money can be saved by having either online content which answers customer questions or getting another customer to answer the question. They can also benefit from mining the information from customer discussions, generating reports on customer concerns and trends.

Customer Value Research

Over the past few years, we have seen the growth of b2b and b2c market research online communities, or MROCs. Companies can conduct straight customer loyalty and customer value research by recruiting panels of forum participants. Typically, these surveys are conducted on an Intranet basis. Results are immediate, and companies using their forum participants as panelists get response rates high enough to avoid the nonresponse bias pitfalls of other, lower response, self- completion research methods. Further, companies using their communities for value and experience research can link results to projected, segmented customer profitability, a tremendous benefit.

Community utilizes all of the new marketing 5 P’s. As we’ve seen, communities expand the value of voice of customer research, supplier-stakeholder dialogue, and informal social communication. The learning and engagement role, and potential, for online communities, continues to evolve and grow.

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