Deriving Maximum Impact From Online Communities

This article was originally published in Direct Marketing News.

What use of online communities delivers maximum impact in terms of marketing, and why?

If my real-world behavior mirrored my Facebook behavior I’d only speak to people to wish them a happy birthday or offer up a bit of hit-and-run self-promotion. I would ignore most of the people who spoke to me. I’d complain under my breath about people who wanted to talk to me, and roll my eyes whenever they said something inane. I’d zone out, walk away from them mid-sentence, and never reciprocate when they gave me a recipe or movie recommendation. I’d be an absolute boor, not a partner or helper or advisor.

But unlike huge social media sites, small, private, online communities can be cauldrons of collaboration between consumers and brands. They’ve had a profound impact in helping marketers elicit and understand unmet consumer needs and design solutions to them, and develop and test products, packages, promotions, brand positioning, and advertising.

In short, through communities brands can enlist and collaborate with their customers in every stage of the product lifecycle and achieve better business outcomes as a result of doing so.

The term “online communities” is used loosely, referring to everything from big social marketing sites to small, private communities. Both of which offer distinct benefits.

In general, large public forums are best used to maintain some minimal level of connection between a brand and its most passionate consumers, providing a venue in which to run contests, push out promotions, enable product reviews, and conduct the occasional poll.

In contrast, private recruited communities of 300-500 people enable brands to develop an ongoing, highly engaged working relationship with a more targeted group—be it brand fans, competitors’ customers, a specific demographic or psychographic segment, etc.

How can marketers benefit most from online communities? In using online communities to drive business results, marketers are limited only by their own imaginations. Here are four examples of how to derive a big impact from an exclusive community.

Discovering unmet needs that lead to breakthroughs. On average, 70 to 80% of all new products fail. Lack of relevance or differentiation, inappropriate pricing, and muddled messaging all factor in to the struggle brands face when launching a successful new product. But while ultimate judgments on new products are made by consumers, their voice is too often absent early in the product development process; it’s here where they stand the greatest chance of generating transformative new ideas and killing bad ideas before a brand has made a significant investment in them.

For example, by engaging early with their weight-conscious consumers Kraft Foods changed course, moving from diet versions of existing products to portion-controlled versions. In so doing, its 100 Calorie Pack created an entirely new blockbuster product category.

Capturing new audiences and demographics. Private communities let brands recruit and engage people who wouldn’t normally interact with them. For instance, Charles Schwab knew that it, like most financial services companies, needed to connect with future investors while they were still young—before they had the investable income that would make them part of Schwab’s traditional client base. Charles Schwab used a community to dig deeply into the needs and habits of Gen X consumers, eventually co-creating a new product together designed to meet their needs and bring them into a relationship with the brand earlier in their lives.

Launching new products and campaigns. The speed of word of mouth is so blinding that the pressure to get it right the first time is more pronounced than ever. That’s why when GlaxoSmithKline launched the over-the-counter weight loss drug alli it used an online community to test, refine, and simulate every aspect of the launch, from teaser campaigns to packaging, and from signage to the behavioral support program at the alli website.

Managing crises and keeping your finger on the pulse of the consumer. Salmonella. Fines. Recalls. These are just some of the crises that major brands have faced in recent years, but having an online community at the ready has helped them manage through these events. Overnight, marketers can get a read on customer awareness and reaction to bad brand news, and have their customers serve as active partners in figuring out how to respond. This isn’t a minor benefit; averting a single product recall or alienating move can save manufacturers millions of dollars.

So if marketers want to get close to their customers—to understand them better, to make smarter decisions, to find the next big thing, to keep loyal customers, to outsmart the competition—an optimal mix of public social media and private online collaboration should be an essential part of their strategy.

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