By UTPAL M. DHOLAKIA And SILVIA VIANELLO
Social Web sites that focus on products and brands have taken off in recent years. In these "brand communities," customers or would-be customers can learn more about the products, discuss problems and potential solutions—or simply communicate with others about their shared passion.
Trouble is, this online world is divided into haves and have-nots.
The Journal Report
See the complete Business Insight report.
The haves are the sites where visitors like to hang out, exchanging ideas and information, chatting freely about the product or company—or about the weather, if they prefer. These Web sites have rich potential for marketing insights and for strengthening bonds between the product makers and their customers.
The have-nots, not so much. These sites tightly control what visitors can discuss—often, the product only—and offer few ways for them to interact. These communities are so drab, so uninviting, that many visitors never return after a brief first visit.
But here's the really sad part: Most of these have-not communities are run by the companies themselves. The more-successful communities are usually run by enthusiasts and customers of the brands and products.
In other words, in their efforts to set up brand communities, companies are missing out on a marketing tool with huge potential, particularly in this weak economy. At a fraction of the cost of traditional marketing programs, a well-designed brand community can be used to conduct market research with very quick turn-around; generate and test ideas for product innovations; deliver prompt and high-quality service to customers with a problem; strengthen the attachments that existing customers feel toward the brand; and increase good publicity through word-of-mouth.
For all of these reasons and more, companies need to make their online brand communities more like those created by the fans.
Here are four things companies can do to turn a tired and rigid brand community into a powerful market-research lab, early-warning system and customer-loyalty builder, all rolled into one.
1. Stop controlling everything.
Most company-run communities host discussions about products and services—and little else. Some explicitly prohibit posting personal information; others forbid comments about anything unrelated to the products.
Ford Motor Co., for instance, has a brand community, syncmyride.com, for its Sync product, a voice-activated entertainment and communication system for Ford, Lincoln and Mercury vehicles. But rules on the message board limit discussions to Sync itself: "Grandma's muffin recipe may win blue ribbons," the terms and conditions say, "but because it's not related to a SYNC topic, please don't submit it."
But allowing discussion and activities like networking and socializing leads visitors to participate in the site for emotional and social reasons. It keeps them coming back, and thus strengthens the bond between them and the company.
Part of giving up control is also giving visitors the freedom to complain and criticize the brand, or to wax lyrical about a competitor, to their heart's content.
If a company's brand community restricts discussions, unhappy customers will simply go to one of dozens (and for many brands, hundreds) of enthusiast-run communities and vent just as much. The company loses the opportunity to gain insight from customers with potentially valuable criticisms.
Allowing customers to post criticisms and complaints is a good way to spot small problems before they become big ones. The company can respond both on the forums and by taking concrete steps to correct legitimate problems such as service issues or faulty product features.
When customers are free to say whatever they want about the brand, and draw comparisons with competitors without restrictions, this freedom results in greater degrees of credibility and trust in the information found in the community. Also, when complaints are handled well, customer satisfaction and loyalty skyrocket.
Companies, like Facebook, Yahoo Inc. and eBay Inc. actively seek both positive and negative customer feedback through their own brand communities. A few years ago, eBay retracted fee increases for professional sellers on the auction site largely based on extremely angry discussions and mobilization among forum members in its community. The company also has sought feedback from its forum users on auction tools and the pricing of Paypal, its online-payment service. The company did not respond to requests for comment.
2. Welcome diversity.
Too many company-run communities seek out visitors who fit the profile of the brand or product's typical customers. This is mainly because they think of their brand communities as extensions of their long-held marketing objectives.
Nintendo of Europe, a subsidiary of Japan's Nintendo Co., restricts membership in its Italian brand community (at www.nintendo.it; click on "Club Nintendo"), and other European versions of Club Nintendo, to customers. A product code is required to join.
Community Organizing
- The Situation: Online brand communities, where people can hang out, chat and learn about specific products and brands, offer companies rich potential for marketing insights.
- The Problem: Many companies are too controlling of their brand communities, or are unaware of what they can learn from independent Web sites that fans and customers of their products have created.
- The Solution: Companies should make their brand communities more like those created by their fans—freewheeling forums with lots of opportunity for interaction, discussion and insights that can lead to innovations and new markets.
But limiting a community to customers only can prevent a company from discovering attractive new market segments it hasn't considered before. Nintendo could be missing out on opportunities in Italy for marketing its consoles and games to other promising consumer segments that have not yet purchased its products but are interested in doing so.
A Nintendo of Europe spokesman says the company feels it is providing a service "for an already wide community that has a common interest." Potential customers, he adds, can sign up for two newsletters without registering for Club Nintendo. The newsletters include product news and links to a variety of Nintendo content.
Another reason to welcome diversity: When a community's members are too much alike, they tend to think alike. Diversity, by contrast, encourages creativity and innovative thinking in brand communities.
When Lego Group set out to develop Mindstorms NXT, the latest version of its game for building programmable robots, it enlisted help from a group of adult enthusiasts whom it found on Lugnet.com, the largest unofficial community of Lego fans. While the marketing target for Mindstorms is mainly teenage boys, the people that Lego reached out to were a group of men in their 40s and 50s who knew each other from communicating and working together on elaborate Lego projects on Lugnet.com.
The group's members, according to a Lego spokesman, contributed "incredibly valuable insights" in hardware, software, design and usability based on their own experiences. The company credits the group with helping to make Mindstorms NXT appeal both to adults and "a new, younger generation of robotics enthusiasts."
3. Give visitors ways of interacting.
Lots of company-run communities are good at putting visitors in touch with a company representative, or at helping them find solutions to problems. But many of these sites don't let visitors talk to each other. Where is the community in that?
For Further Reading
See these related articles from MIT Sloan Management Review.
- Building Stronger Brands Through Online Communities
By Gil McWilliam (Spring 2000)
Consumer brand companies need new management skills, and brand managers must understand online behavior if they wish to develop strong, sustainable and beneficial online communities around their brands.
http://sloanreview.mit.edu/x/4133- Innovation by User Communities: Learning From Open-Source Software
By Eric von Hippel (Summer 2001)
Creating complex products with limited manufacturer involvement is a growing phenomenon occurring in markets as diverse as windsurfing gear and open-source software.
http://sloanreview.mit.edu/x/4248- Don't Confuse Reputation With Brand
By Richard Ettenson and Jonathan Knowles (Winter 2008)
Corporate reputation and brand are not one and the same, and confusing them can lead to costly mistakes.
http://sloanreview.mit.edu/x/49213- Viewing Brands in Multiple Dimensions
By Pierre Berthon, Morris B. Holbrook, James M. Hulbert and Leyland Pitt (Winter 2007)
The concept of a "brand manifold" helps managers understand that a brand's impact varies according to who is valuing it, in what context and at what time.
http://sloanreview.mit.edu/x/48210- Four Smart Ways to Run Online Communities
By Ruth L. Williams and Joseph Cothrel (Summer 2000)
Kaiser Permanente, About.com, Sun Microsystems and Ford have created four kinds of innovative online communities. Their experience shows not only how to manage communities, but also how to manage today's work force.
http://sloanreview.mit.edu/x/4146Participants in poor company-run communities have superficial relationships, if any, with one another. Once their product-related problem is solved, they tend to leave the forum. The result: The community has to keep recruiting new members to replace those who have left, and remains anemic—often little more than a site providing customer support.
Most fan-run communities, by contrast, encourage a variety of social interactions. Visitors frequently network, flirt and joke with each other. Off-topic conversations are common, though so are rules against personal attacks, pornography and other types of offensive postings.
Some of the features that customer-run sites use to encourage interaction: the ability to chat with other members in real time; forums for discussions unrelated to the brand or product; the ability to post personal history, pictures, and videos; ways to announce and conduct online and offline social events; and reputation tools, or ratings by fellow users, that suggest the quality and quantity of a member's participation in the community.
At Oraclecommunity.net, a site for people interested in Oracle Corp.'s database and software products, members share personal stories, pictures, videos and birthdays. They can create blogs on the site, form groups around themes and build networks of designated friends. Members can also schedule meetings and events both online and in person.
Letting visitors talk and interact makes them feel that they are part of a special group, which reinforces their support of the brand and fuels resistance to rival brands. Shared rituals and traditions also arise, such as narratives of the brand's origins and history, celebrations, and unique jargon. These types of cultural underpinnings help tighten bonds between customers and company, too.
4. If you can’t be like the fan sites, at least monitor and support them.
Many companies have no systematic programs in place to monitor and support unofficial brand communities. Some are not even aware of their existence. Others are naturally ambivalent because of the presence of outspoken, demanding and fiercely independent customers in enthusiast-run communities, and their lack of control over these groups.
But systematically tracking and engaging these communities opens up a host of potential benefits for companies. Not only will marketers gain access to some of their most devoted and influential fans here, but they will also find more ideas for innovations; sharper criticisms of existing product problems, along with ideas for fixing them; and more sincere providers of customer service.
Some companies, like Microsoft Corp., have begun to engage their enthusiast-run communities. In Brazil, which is home to one of the largest independent forums for players of the Xbox game console, www.portalxbox.com.br , the company has invited forum members to events at which promotional items and advance looks at new products are featured.
A Microsoft spokesman says such events not only help the company spread news about new products but "garner feedback and input on existing and upcoming offerings."
--Dr. Dholakia is an associate professor of marketing at Rice University in Houston. Dr. Vianello is an assistant professor of marketing at SDA Bocconi School of Management, Milan, Italy. They can be reached at reports@wsj.com.
![[FANSITES]](http://sg.wsj.net/public/resources/images/BI-AA276_FANSIT_NS_20090812174536.gif)
I've worked with Utpal and Silvia on community research for eBay. They've done a great job in analyzing community behavior. Interesting learnings from this report.