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Crafting a Community
Companies can corral as many customers as they like, but any true community has to truly benefit its members—customers and companies alike.
For the rest of the June 2010 issue of CRM magazine please click here
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In June 2007, parents, grandparents, teachers, and caregivers could be found digging through toy chests, examining contents of doll houses, and throwing away seemingly perfect play items. The international recall of more than 1 million toys left families up in arms and worried that the lead-paint contamination would cause harm to children. How in the world could something as harmless as a Thomas the Tank Engine toy bear such potential harm?

Unfortunately for toy company Mattel, the majority of its products were manufactured in China, the primary source of the lead-paint contamination. Mattel’s Fisher-Price subsidiary recalled almost one million Chinese-made toys because of potential lead-based hazards, including Thomas & Friends toys and figurines from the popular Pixar animated film Cars.  

Mattel, soon after the fiasco made national news, issued a public announcement, apologizing to consumers, and promising to increase audits and testing of all its products. While the press conference might have quelled questions from the mainstream media for the moment, Mattel recognized it had another important audience to face—parents, and perhaps more imperative and intimidating, mommy bloggers. Mattel partnered with online-community vendor Communispace and, soon following the ordeal, launched The Playground, a private community of 500 moms, with the ultimate goal of listening to parent feedback to craft the company’s next step in climbing above the PR nightmare. Not only did this group of highly engaged and highly influential parents help in educating Mattel on what kind of steps to take, but they boosted the company’s reputation as an entity that listens and cares about what its customers have to say. Although it’s difficult to know whether the community was directly responsible, Mattel increased sales in the fourth quarter of 2007 by 6 percent over the previous year. And from 2009 to 2010, sales rose 8 percent.  

This may seem a dated example, but in many ways Mattel was far ahead of its time. The Playground demonstrates how effective a community can be in restoring consumer trust, fostering loyalty, and ultimately making a company more successful in the way it engages with customers. Although forums and message boards have populated the Web since the mid-’90s, enterprise use of organized communities is more nascent. Matthew Lees, a consultant and vice president at the Patricia Seybold Group, studies communities and likens their evolution to that of the Web. At the start of the dot-com boom, Lees says, it was the technology people in companies who dabbled with HTML and put up then-static sites. They may have had permission from corporate, but until companies began seeing the business value of an online presence and e-commerce, the tech-savvy employees owned the Web projects. “Little by little, companies realized, ‘Hmm, I guess I need to be there,’” Lees says. “It became imperative that you need to be in this space and there were advantages and benefits for costs savings you could achieve. There were new ways to reach customers and new ways to communicate with customers.” Now, of course, every business realizes the importance of a Web site. Lees insists the same delayed acceptance is emerging in social media, with online communities at the forefront. 

In fact, some may argue that, just as the World Wide Web turned into Web 2.0, communities are evolving as well. Because today, as the Mattel example illustrates, customer communities are capable of doing a whole lot more than simply talking about their favorite television shows or reacting to an upset in a basketball tournament. Communities connect over common ideas, but also problems, goals, and unlikely issues. 

The biggest recent transformation, according to Rob Howard, the founder and chief technology officer of online collaboration and community software company Telligent, is symptomatic of what happened in the economy. Companies want full mileage out of their solutions and they want to ensure that they are retaining customers. “There’s been a shift in the buying and thought process,” Howard says. “It’s gone from a ‘let’s kick the tires and see how this works’ and it’s becoming a part of businesses transforming how they work with customers.” 

All Together Now 

The primary sin of community, according to Erica Lee, vice president of marketing at community platform company blueKiwi, is mindlessly corral your customers into one without guidelines, goals, or a plan of action. “The first thing people do is dump [customers] into one massive community then figure out how to talk,” Lee says. “But sometimes your more-savvy customers may confuse your more-junior customers, or a short-term rather than a longer-term community is necessary.” There are different use cases, and definitely different strategies needed in the community space. From idea generation and consumer insights to marketing and customer support, Lee says she’s seen them all, but that, despite the perceived silos of these early community efforts, there’s a noticeable shift toward bringing the efforts under one umbrella—or rather on to one platform.  

Jody Petruzziello, the vice president of products at community platform provider Mzinga, agrees that enterprise understanding of communities seems to be changing. “The market is getting more educated,” Petruzziello says. “It’s gone beyond ‘What are some of these social tools?” to ‘We have common business needs across the enterprise.’” Economic conditions, she adds, are also pushing companies to consider multiple uses for technology solutions. Whereas a community might have begun in several pockets of the enterprise, now organizations are looking to make full use of the solution and bring together communities on one collaborative landscape. 

To illustrate the weaving together of different community threads, an enterprise might begin its efforts with a public-facing customer support forum. Simultaneously it might launch an internal community, enabling employees to post ideas, share content, and give feedback. With the success of the support community, the marketing team might choose to launch a branded community, gathering customer ideas around a new product design, or asking customers to contribute videos and vote on content. Wouldn’t it be great if all these communities could talk to one another and information could flow seamlessly throughout?   

Nikos Drakos, a Gartner research director, covering social software and collaboration, notes that connecting these various pools of knowledge and conversation seems to be the missing link in Community 2.0. “How do you take the interactions that may have been created in the tight community and how do you bring that information into your internal processes?” Drakos asks. “This is the opportunity: to create a software support environment that deals with all of the aspects of these domains.” The new emphasis is on supporting the whole spectrum of these conversations—and, in particular, helping customers to create and support external-facing communities. Also, there’s now pressure to link those external communities out to the public Web—in other words, “widgetize” community-created content and embed it elsewhere. 

The Technology Equation  

Drakos states that a number of vendors are beginning to blend community functions, pushing, for instance, once internal, agent-facing knowledge base material out to customers through a forum. Or, it could mean taking customer-contributed content from an idea-generation community and piping it into business processes or at least out to an internal employee-collaboration portal for review.

The competition in the community-platform space is fierce, Drakos says. Yet, it might seem counterintuitive—turning to technology to talk to customers. Isn’t this something that companies used to be good at, well, before technology? Gartner Research Vice President and Distinguished Analyst Michael Maoz makes a cogent point: “We spent 20 years stripping the voice of the customer away because we wanted to save money. Suddenly, now it’s, ‘We can’t get the voice of the customer!’” With the rise of automation and the desire to slash costs both in sales and service, enterprises cut down human interaction, Maoz explains. Now organizations are waking up to the fact that the voice of the customer does, in fact, matter. 

So who’s the crème de la crème in providing communities? That depends on what you are looking for. Although selling similar dashboard-like Web 2.0 platforms, today’s community solution providers have become specialized (for instance Communispace in private communities for market research and Lithium Technologies for B2C public forums). Certain vendors excel in blending internal collaboration with external pieces of knowledge (Jive Software, for one). And others, for instance, RightNow’s community powered by its acquisition of HiveLive, are better at readying communities for customer support. There’s a lot to consider when sifting through the vendor list, but perhaps Telligent’s Howard says it best: “Very mature companies don’t just care about the technologies.” They also care about the best practices that prop up those technologies and the integrations that propel them into other parts of the business.  

Putting Community into CRM

Maoz is brutally honest: There’s a host of community solutions to choose from and that won’t last long. “These are vendors who on their own will not make it,” he says.  The analyst predicts that CRM players will soon start gobbling up the community, monitoring, and collaboration vendors. Because, as Maoz says, communities won’t truly affect CRM until they are brought in-house, integrated, and attached to a system of record. “The view of the social graph is so vital,” Maoz states. “At the end, unless I can link that to a business objective, it’s going to be an island.”  

We are starting to see instances crop up—with RightNow’s acquisition and Salesforce.com pumping money into its Chatter product. But in terms of enterprises using CRM truly in conjunction with communities—really and truly tying together customer records with a community participant’s profile—it is still the early days. 

Community College

Today, Maoz says, the best thing companies can do when choosing a community vendor is to look for one that provides hand-holding, best practices, and guidance in finding the voice of the customer. That consulting aspect is being trumpeted by a handful of vendors, ones offering to guide businesses through every stage of the community building. Lithium Technologies, for example, launched a Community Health Index, a dashboard of best practices and benchmarking services, that helps a business chart its progress and to see where it is in comparison with other organizations of its kind. “It gives them a lot of ease of mind,” says Lyle Fong, Lithium’s CEO and cofounder. “We can tell them, ‘You are going to see growth here, and you will see a dip here.’” 

Social analytics is a major trend right now, according to Gartner’s Drakos. And the analytics comprises two parts. One is on the customer or community participant’s end in using analytics to discover, navigate, and collaborate to find the best answers. The other component is, of course, on the business side in understanding what the community is saying via sentiment analysis. 

What Howard has seen in watching the community space over the years is that companies often get lost when it comes to metrics. “These technologies allow you to track everything,” he points out. “But the struggle is, when they approach this from a technology point of view, they get lost in the weeds and instead of keeping track of metrics, they keep track of no metrics.” 

Howard recommends that enterprises work closely with their vendors and consultants and approach it more from a strategic view of what you are trying to accomplish. “It’s interesting how people thought about Web analytics as a page view,” Howard says. “Companies are recognizing now, with a combination of [voice-of-the-customer] products, [that] they can do a lot more to understand the customer in depth and move away from page views as a value and put more value on what [their] customers are actually saying.”

Sidebar: 8 Characteristics of True Community

It's been more than 20 years since the late M. Scott Peck wrote The Different Drum: Community Making and Peace. But the eight aspects of a successful community he laid out are no less applicable today—and no less applicable in an age of social media.

  • Inclusivity, commitment, and consensus: Members accept and embrace each other, celebrating their individuality and transcending their differences. They commit themselves to the effort and the people involved. They make decisions and reconcile their differences through consensus.
  • Realism: Members bring together multiple perspectives to better understand the whole context of the situation. Decisions are more well-rounded and humble, rather than one-sided and arrogant.
  • Contemplation: Members examine themselves. They are individually and collectively self-aware of the world outside themselves, the world inside themselves, and the relationship between the two.
  • A safe place: Members allow others to share their vulnerability, heal themselves, and express who they truly are.
  • A laboratory for personal disarmament: Members experientially discover the rules for peacemaking and embrace its virtues. They feel and express compassion and respect for each other as fellow human beings.
  • A group that can fight gracefully: Members resolve conflicts with wisdom and grace. They listen and understand, respect each other’s gifts, accept each other’s limitations, celebrate their differences, and commit to a struggle together rather than against each other.
  • A group of all leaders: Members harness the “flow of leadership” to make decisions and set a course of action. It is the spirit of community itself that leads and not any single individual.
  • A spirit: The true spirit of community is the spirit of peace, love, wisdom, and power. Members may view the source of this spirit as an outgrowth of the collective self or as the manifestation of a Higher Will.

Source: M. Scott Peck, The Different Drum: Community Making and Peace (Simon & Schuster, 1987)

Sidebar: Measuring the Membership

Sure here are metrics currently available for gauging a community’s level of success—but they each come with a caveat. 

  • Community growth: How many members are added per month, or per week? What is this number in comparison with forum posts or ratings? Lyle Fong, CEO and cofounder of Lithium Technologies, says you can benchmark growth to determine the future liveliness of a community. Caveat: This may work for communities with a standard purpose, such as idea generation, but in a support situation, emergencies may spike user activity, making this prediction futile.  
  • Content ratings: Companies can measure how effective an article or post was based on “thumbs up” or “like” reviews by users. Caveat: Customers might not always take the time to “like” a post that helped them. “Was this helpful?” or “Did this solve your problem?” may be more accurate questions to pose in a support environment.  
  • Traffic: Although page-view metrics are going out of style, it’s good to analyze where the traffic is coming from. Caveat: Be careful of bot traffic. It might seem like your page views are multiplying, but look more closely.  
  • Call deflection: In support instances, if customers are forthcoming enough to say if a community-driven solution helped, you can deflect that from a traditional phone call. Caveat: Sometimes customers view community support sites for questions they would never have called into a contact center about.  
  • Sentiment: Vendors are working on algorithms to determine how pleasant or negative a conversation is. Although this could save companies a lot of time in sifting through social content, the general consensus is that sentiment analysis has a long way to go to be fully automated and accurate. Caveat: Arguably the hardest-to-measure item on this list. The technology is young and a fair amount of manual intervention is still required. 

Associate Editor Lauren McKay can be reached at lmckay@destinationCRM.com.

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To contact the editors, please email editor@destinationCRM.com
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