Tagged: Strategy

A Perspective on Community Value (Part 1 of a Series)

This is the first of a five-part series on the topic of community value. The series is based in large part, on the output of a series of small-group working sessions and primary research that began in 2018, as well as learnings and observations from my career.

A Personal Perspective

I’ve worked with some form of community for the majority of my career. In 1999 I took a job with TechRepublic.com as “UX Program Manager” and spent 9 months helping design, build, launch and grow what would become one of the largest online communities of global IT Professionals. Community platforms, as we know them now, didn’t exist. We had to build everything from the ground up. A design for threaded discussions went from whiteboard to production over a weekend. Content editors played the roles of community managers and moderators – “community management” wasn’t a term of art yet. It seems quaint that for the first two years of TechRepublic we only cared about two numbers: uptime and membership. 

My first taste of what might be possible with communities beyond answering technical questions was volunteering to be one of the first Fast Company Company of Friends organizers in Louisville KY in 2000. The FastCo mothership gave me a list of local subscribers, a discussion guide, some facilitation guidelines and an organizer’s button. We held the first meeting in a local business conference room, and frankly, I was amazed that anyone showed up (we had 15 people at the first meeting) and also impressed that we all had so much to discuss. The central topic was about how technology -especially the Internet- was changing business.  

In 2001 I was offered the chance to move to California and work on an in-product community with Autodesk. The focus of the community was to support customer onboarding and product usage. Autodesk was the beginning of a personal journey to study the implicit and explicit value of communities to companies. That journey continued with Forum One, Dell, and now continues with Structure3C. Along the way I’ve studied and helped develop different methods and measurements for community value: the impact of forums on the support burden, the effect of community on NPS and LTV, the effect of community on purchase frequency and size, and much more.   

In my opinion, ground zero for community analytics has been measuring the value of knowledge generated in online communities, particularly in the context of customer support. Over the years different approaches have been fielded for measuring this value in support communities, including the cost savings of customer labor vs staff, the value of a call deflection, the long-term value of a qualified or accepted answer, and possible causal effects of participation on customer behavior. Several thoughtful methods have been formalized and documented by platform vendors and industry experts. This “ground zero” problem seems to have been solved, and cyclically re-solved and re-quantified to the point of diminishing returns, like a community version of the Bill Murray film Groundhog Day, we still have executives pushing back on the validity of the calculus, and the corresponding results. This is perplexing to me.

Keep in mind, the customer support scenario I describe above is arguably the most tested, proven and accepted (by community professionals) example of community value. Yet organizations continue to regularly debate this. When the conversation moves towards the value of community across customer lifecycle, and the potential value across business units our current methods, measurements and metaphors fail us.

It seems we missed something along the way in developing best practices for communities. Admittedly, it’s not a simple problem to solve, but the key problem areas seem fairly clear:

  • Community as a concept is still largely misunderstood by the extended organization;
  • Investments in social media activities have claimed large portions of budgets and resources and have been mistakenly viewed as the primary focus for community, as opposed to a component of the community ecosystem;
  • Community strategies are often independent of, and so therefore misaligned with, corporate strategy and have no clear connection to corporate goals;
  • Community as a function is separated from other customer-facing functions;
  • Well intentioned, but misguided community leaders sometimes intentionally try to keep their teams and the overall community at arms-length from the organization;
  • Community analytics and activities often don’t communicate value in the context and language of the business;
  • Because the community function is separated from the business, it is often viewed as a cost center, as extra overhead for extended teams, and is asked to quantify value and impact in unusual or extraordinary ways – often in an ongoing, and sometimes ad hoc fashion;
  • Hampered by the aforementioned factors, the final straw is that community analytics and data aren’t integrated technically or programmatically into enterprise analytics, data and reporting – a critical dimension of individual customer profiles and the ability to gain insight into entire market segments is wholly missing.

In Short: Many organizations are missing the community opportunity because of a short sighted focus on transactional value in the context of specific use cases. Growth-minded companies are fully embracing community as a concept and integrating community-building practices into the fabric of their business with great success. 

The Value of Networked Businesses & Connected Customer Experiences 

Organizations have engaged in various forms of online community development for well over 20 years, but questions central to the issues of strategy, investment priorities, performance analytics and business impact remain largely unanswered. The good news? An emerging body of research suggests that businesses that embrace community-building are more resilient and innovative, and that customers connected to a company’s community are more valuable customers. In the face of market disruption being driven primarily by exponential technologies, and in the midst of a range of business and digital transformation models intended to navigate market disruption, communities aren’t just a way to save a few million dollars in support costs – communities and networks are critical for future business success.  

Connected Customers Are More Valuable

The 1:1 relationship between a company and a customer is increasingly perishable. The customer is blessed by an abundance of choice in the market, and increasingly (especially for technology) the lifespan of a company to customer relationship can last only days, weeks or months — not years. As an example: most software companies are moving from a perpetual license to term-based licensing that can be as short as 24 hours. Creating a great customer experience and minimizing churn are key.

One key strategy is to develop customer communities where customers connect to people in the business (as hosts) as well as other customers and prospects (as peers). This creates a network of many:many connections, where bonds strengthen over time and value is exchanged in the form of knowledge, content, advice and help.

These communities translate into real value for the customer and for the host business. Companies like Autodesk have found that community members were more loyal and more likely to recommend than non-members. Autodesk was also able to quantify cost savings from their support community to be several million dollars. Similar research at Dell, uncovered the fact that IdeaStorm community members spent 50% more than non-members, and members’ purchase frequency was 33% higher than non-members. Community member ideas from IdeaStorm created $100’s of millions of dollars in revenue in the period between 2007–2011. Further, taking an account-based marketing approach, Dell was able to correlate patterns of community participation with increased purchase size and frequency on their TechCenter community for Large Enterprise customers. 


“Engaged consumers exhibit enhanced consumer loyalty, satisfaction, empowerment, connection, emotional bonding, trust and commitment.”

Brodie, Ilic, Juric, Hollebeek (2016) Consumer engagement in a virtual brand community: An exploratory analysis


Networked Companies Create More Value (and are more resilient) 

In a 2014 article from Harvard Business Review, a study between Deloitte and a team of independent researchers examined 40 years of S&P 500 data to examine how business models have evolved with emerging technologies. The study had 3 key findings, including the emergence of a distinct new business model of “Network Orchestrator”. As defined by the study:

Network Orchestrators. These companies create a network of peers in which the participants interact and share in the value creation. They may sell products or services, build relationships, share advice, give reviews, collaborate, co-create and more. Examples include eBay, Red Hat, Visa, Uber, Tripadvisor, and Alibaba.

The study also determined that fewer than 5% of the S&P 500 qualified as a Network Orchestrator. This signals both an opportunity and underscores the urgent need for transformation, as the average lifespan of the S&P 500 has sharply declined from 90 years (in 1935) to just 18 years.

Another study by NFX found that in the last 25 years (since the launch of the commercial Internet) 70% of value in tech is driven by network effects.

In other words, companies that leverage network effects have asymmetric upside. They punch above their weight. They are the Davids that beat the Goliaths, and then become the Goliaths.

NFX: 70 Percent of Value in Tech is Driven by Network Effects

What both the ’14 Deloitte study and the NFX study point to is the opportunity for businesses to accept the network contexts they are already operating in, and to evolve their businesses to cooperative models that look more like communities than the hierarchical company / customer models of the industrial age.

Value to Members

One aspect of value creation that is surprisingly overlooked is the value created for community members. At its most basic, value can take the form of questions answered in a technical community – and this is where many organizations primarily focus. This unfortunate limiting belief is holding many community programs back and preventing the community from reaching its full potential.

Leading organizations have taken a more sophisticated approach, with a focus on the “whole” customer and the potential for a career-long relationships being developed and strengthened through the community. Although more difficult to quantify, these more sophisticated approaches yield value to the members in the form of career advancement, skills development and mastery, and in the very best cases, the ability for members to discover and actualize their purpose.

Next, think about what a community might look like if the host organization was actively refining and expressing its purpose through community interactions. As an example: If a software company’s purpose is to empower the world through digital design software, you could imagine community activities going well beyond break/ fix support forums and into eduction, skills mentoring and specific efforts to reach people in the developing world and the associated technological challenges. The host organization evolves from an authoritarian role to become a responsive partner in co-development.

Purpose Will Power Future Online Communities – Bill Johnston

An Executive Mindset Shift

When most Executives think about customer communities, there is an unfortunate tendency to view them as “cost saving” vs “value producing”. This misguided thinking leads to strategies and outcomes that fail to realize the full value of customer communities. This typically manifests in the form of a myopic focus on customer support communities and an overburdening of customers taking on the role of customer support agent. In extreme examples, this sort of strategy breeds resentment with valuable customers, and leads to a dangerous dependence on an unsustainable resource. When the Executive mindset shifts to “value producing”, the aperture of community strategy widens to a rich set of possibilities: community advocacy programs, open innovation, peer to peer mentoring, complex content sharing, co-design of products and much more.

As we enter into an increasingly digital & connected era, future-state communities will be key locations where value is co-created and exchanged between companies and customers. To have any chance of long term success with customer communities, mindsets have to evolve beyond a fixation on cost savings to a more enlightened view of communities as a valuable catalyst for growth.

In order for businesses to begin defining a future state community model, they should:

  • View community building as a capability and view their extended community ecosystem as a strategic asset;
  • Explore and define what “community” means in the context of 1) the brand and 2) the customer experience;
  • Understand how community can play a meaningful role during the entire lifespan of the customer relationship;
  • Develop a community strategy that aligns with, and complements, corporate strategy as well as customer needs;
  • Understand how the community ecosystem creates value for all business functions;
  • Develop a community ecosystem – a portfolio approach versus investing only in a destination community or a social media outpost;
  • Develop community programs, goals and KPIs that tie to Business Unit goals and objectives and are translated into team, manager and individual performance goals
  • Prepare to integrate community ecosystem data, analytics and insights into enterprise analytics, communications and annual & quarterly business reviews;
  • Most importantly: Be open to the possibility that as the community develops and becomes embedded in the fabric of the organization, the community can catalyze organizational transformation.

Upcoming posts in this series will explore:

  • methods for framing and sizing your community opportunity;
  • how to develop a value-focused strategy;
  • guidance on developing goals and measurements;
  • how to evangelize community, secure funding and sustain engagement in community investments.

The best way to stay up to date when new posts come out? Subscribe to the Cohere newsletter.

The Cohere Podcast – Season 2 Update

The Cohere podcast is in its second season. In season 1 covered a range of important topics related to communities and networks, including creating connection during the COVID-19 pandemic, the impact of the next 3 billion people coming online and how to create a collaborative online future with AI.

We’re well underway with Season 2, and I say “we”, because I’m joined this season by Dr. Lauren Vargas (also a Season 1 guest). Together, we are exploring the role networks play in our lives, and the range of disciplines studying networks, and the most important research focused on the emerging field of network science.

The reason for the focus on networks? Complex networks are springing up everywhere, driven in large part by increasingly ubiquitous internet access. Imagine what will happen when three billion more people come online in the next five years! For organizations, a planet-wide network of logged-on human beings brings both limitless opportunities and unprecedented threats. 

As we increasingly use networked technologies to augment human experiences, the Cohere podcast asks, what’s the best path forward? What do we need to learn and understand? How might science and existing research guide us towards optimal norms and conditions? How should we navigate, evaluate, and administrate a complex technological landscape so we can protect, promote, and empower our human networks? How will we ensure that digital communities deliver on the promise of enhancing our lives, both individually and collectively? And what steps must we take to ensure our approach to community development is sustainable, equitable, and morally sound? 

The first four episodes of The Cohere Podcast – Season 2 are out now.

Ep. 1 – Why Community Leaders Need to Understand Networks – With Bill Johnston and Dr Lauren Vargas

Ep. 2 – The Golden Age of Online Communities & the WELL with Gail Ann Williams

Ep. 3 – Building Communities with Purpose and Integrity with Carrie Melissa Jones

Ep. 4 – The “Great Connecting” Continues with Jim Cashel

Look for new episodes coming in August.

You can find additional episodes of the podcast and also subscribe here:
Apple Podcasts | Spotify Podcasts

Customer Communities Are Critical For Business Transformation

The last few years have seen big brands make extraordinary investments in developing massive “digital transformation” and social media programs. On one hand, these programs have yielded moments of customer connection, advocacy and insight. Unfortunately, for the majority of programs reliant on mass social platforms like Facebook and Twitter, organic reach has dropped effectively to 0 and companies are now forced to pay to engage sporadically with the “audiences” they worked so hard to build. Companies now realize they have been renting their customer communities on social platforms.

Photo by Kipras Štreimikis

The alternative to social media campaigns and digital transformation theatrics? Developing Customer communities. Specifically, online Customer communities that companies build, host and manage. Customer communities hold the key to Customer acquisition, retention and growth. Further, communities can be a catalyst for development and innovation, and will be critical to future business models. Below I explore the opportunity for Customer community in three key Corporate areas: Brand, Product and Innovation.

Community is the Fabric of Brand

markables_relatoinship

What is the nature and value of brand in a hyper-connected world? A recent HBR article asserts that the collective value of  Customer relationships is outstripping the value of “brand.  The authors of the article nail the point that Customer relationships are incredibly valuable, but may have missed an opportunity to explore the effect of the customer community as a brand asset & catalyst — the line between brand and relationship isn’t as crisp as the authors imply. Further, I would assert that the “network” of relationships represented by the collective customer base of a company is a manifestation of brand, every bit as important and as valuable as the components of brand identity. My primary research and experience has shown connected customers (via community and social) are more valuable than those that aren’t. Third party research by Deloitte has shown that Networked companies (“Network Operators”) perform better, live longer, and are more valuable. All of these points are are vectoring towards a new opportunity and a new frontier in business: Community-Centric Customer Experience — an approach to customer experience design and business strategy that not only strengthens the Company to Customer relationship (1:1), but also strengthens and develops the Customer to Customers & Company relationship (1:Many, a.k.a. the “Community”). and considers development of the Community the primary .

Communities Will Infuse & Enhance Product Experience

Customer communities are an essential part of most technology products now. At the very least, online support forums are expected as part of the offering (more on that in a bit). Many companies are experimenting with customer communities as a means to raise product awareness, convert trial customers and retain existing customers. A radical new business opportunity is emerging where the community (both the people and the platform) are the actual product. Purchases are artifacts or a gateway into the community experience, and the real “product” is the collective experience, knowledge, content and means of collaboration with the community. There are many early examples in the gaming world, from MMOG’s like World of Warcraft to the new “build and explore” virtual worlds like Roblox. Software companies are attempting to build communities that address the “whole customer”, and focus on experiences well outside of product support. Adobe (Behance), Autodesk (Instructables, Fusion360, AREA), Salesforce (Trailblazer Community), and Sephora (Beauty Talk) are actively investing in the community space.

Communities Drive Innovation & Long-Term Value

There is an unfortunate tendency to view Customer communities as “cost saving” vs “value producing”. This thinking leads to strategies and outcomes that fail to realize the full value of customer communities, and is rooted in a long standing dependence by some companies on customer support communities. In extreme examples, this sort of strategy breeds resentment with valuable customers and leads to a dangerous dependence on an unsustainable resource. When the Corporate mindset shifts to “value producing”, the aperture of community strategy widens to a rich set of possibilities: community advocacy programs, open innovation, peer to peer mentoring, complex content sharing, customer co-design and much more.

Moving forward, Customer communities will be the medium by which value is co-created and exchanged between Companies and customers. To have any chance of long term success with Customer communities, mindsets have to evolve beyond a fixation on cost savings to a more enlightened view of communities as a valuable catalyst for innovation and growth.

The value exchange between organizations & individuals via community.

The Bottom Line:

Customer communities are the “fabric of brand”, the medium in which the network of customer & company relationships develops and thrives. Companies that create modern communities with their customers will be more innovative, realize more value and have more resilient businesses than their competitors who don’t.

Aligning Your Enterprise Community Strategy With Your Customer’s Career Journey

Use these three contexts to help create long-term value with your company’s community.

Photo by Fabio Ballasina on Unsplash

When developing or refining a community strategy, it is critical to understand the larger market and business contexts the community will exist in. This sounds obvious and straightforward, right? Yet the needed research, discussion and development of shared understanding of these contexts rarely happens. As a side note, this concept was literally hammered into my brain by a former boss at Autodesk, Moonhie Chin, who was the SVP of Digital Platform and Experience. She always had a simple question for any data she saw: “What is the denominator?” – meaning, what is the whole, or what is the largest meaningful context.

I’ve been primarily focused on developing Business to Business communities during my career, and  I’ve come up with three key contexts that I think are critical to understand the opportunity for community development. 

1. Customer Career Journey

Understanding your customer’s career journey, the number of distinct journeys, and how your product / service plays a role can help determine where in the journey community may play a valuable role.

Considerations:

  • Number of distinct Customer Profiles  (~Personas)
  • Stages in Career Journey
  • Centrality of products / services to productivity & advancement at each stage

Key Questions:

  • Is product or service critical throughout career, or only at certain points? 
  • How does / could the community support development and transition?
  • Can your organization support the full Customer Career Journey, or does it make sense to partner with complimentary organizations? 

2. Criticality of Product / Service

Understanding the criticality of your product / service engagement by customer profile, can give insight into the level of effort, the specific motivations, and the needed resources customers need to master your product, and by extension, advance in their career. This understanding can guide what community experiences your offer (and what community investments you make).

Considerations:

  • Complexity of product / services
  • Effort required to attain skills / mastery
  • Amount of time spent using product / service
  • Amount of time spent in surrounding ecosystem – courses, conferences, meetups, online content, expert communities, etc.

Key Questions:

  • How much time will the customer spend mastering product / services and necessary skills?
  • How much time will the customer use the product in their work?
  • How much time is it reasonable to expect a Customer to spend participating in your community weekly?
  • What form factor and level of effort is required for quality participation?

3. Total Addressable Community & Crowd

Taking insights uncovered from the discussions in the customer career journeys and the depth of engagement categories, what do the opportunities and required investments look like at scale?

Considerations:

  • Overall Market Size
  • Current Customer Base
  • Projected growth (ideally segmented by Customer Profile)
  • Target vs Current Community Membership (again, segmented by Customer Profile)

Key Questions:

  • How big is the total addressable market?
  • What % of active customers are targeted for community engagement?
  • What business value can be realized at scale?
  • How can the community business case be optimized by extrapolating investment vs return at scale? At what point does the investment vs return reach equilibrium? Go negative?
  • How does the Customer value proposition change at scale? Is there a true Network benefit, or flat / diminishing return at a certain point in the growth arc? 

Summary

In the simplest terms, the three contexts give you:

  • Customer career journeys: Where in the journey is community valuable?
  • Depth of product / service engagement: What community experiences are valuable?
  • Total addressable community & crowd: How many people can you expect to participate in your communities?

T hese contexts are for considering an Enterprise strategy, and you can imagine similar contexts for Medium & Small Business and Consumer. This approach doesn’t replace a comprehensive strategy development exercise, but is intended to sketch out a future state and give relative sizing for future planning or assessing current efforts. 

If you would like to discuss this sizing approach, or other advanced ideas for creating a bigger and better future for you community, please reach out

Developing Communities for Collaborative Innovation

Screen Shot 2018-05-08 at 6.50.44 AMCollaborative Innovation Communities – where companies and customers collaborate on ideas for new products and services – can be one of the most valuable ways to invest in community engagement. Unfortunately, this type of community is also one of the most difficult to get right. Many companies have experimented with this type of  Open Innovation – Lego Ideas, Dell’s IdeaStorm, Starbucks’ My Starbucks Idea – and each of these companies have seen value from the communities. The bad news is that most companies fail because they lack the vision and commitment to see beyond the initial tactic of soliciting customer ideas.

With the right programs, platforms, community ecosystem design and internal alignment, Collaborative Innovation communities can produce incredible value.

Intense Pressure to Innovate

In an updated version of their famous “Creative Destruction” Report, research firm Innosight predicts that the average tenure of a company in the S&P 500 index will drop from 24 years (2016) to just 12 years by 2027. In a recent survey of Corporate Innovation Executives, research firm CB Insights found that ~41% of executives said that felt their companies were “extremely” or “very” at risk of being disrupted.

Screen Shot 2018-05-09 at 6.16.53 AM

Spectrum of Innovation Communities

In studying the types of innovation communities, we feel the range can be narrowed down to 3 categories:

  1. Brand-Hosted Communities: Where a single brand hosts an innovation community focused on the brand’s products, services or business model
  2. Project-Based Communities: Communities of experts that come together to solve problems or challenges around a particular domain.
  3. Grand Challenges: A challenge-based community that convenes a diverse ecosystem of smaller communities to solve massively complex problems.

Screen Shot 2018-05-09 at 6.22.33 AM

In practice, most corporate innovation initiatives ignore the value communities and networks can provide. The chart below is a simple illustration of how community could support different innovation types:

Screen Shot 2018-05-09 at 6.16.16 AM

Resources

The full slide deck, with examples of Brand and Project-Based communities can be found here:

The companion worksheet for planning your Collaborative Innovation initiative can be found here:
http://bit.ly/CICWORK

Screen Shot 2018-05-09 at 6.20.39 AM

The working list of Brand-based communities, Project-based communities and host platforms can be found here:
http://bit.ly/CICList

Screen Shot 2018-05-08 at 1.54.29 PM

 

Learning More

I’ve developed a workshop to help organizations learn about, ideate on and plan their Collaborative Innovation strategy. I’m also creating a small work group (mastermind style) to help non-competitive organizations share their progress and lessons learned. If you would be interested in discussing either of these, please feel free to reach out: bill@structure3c.com

Building Modern Communities #SwarmConf

Screen Shot 2017-08-31 at 5.43.07 AMI was honored to be asked to keynote the SWARM Community Managers Conference in Sydney this week, hosted by conference Co-Founders Alison Michalk and Venessa Paech. The conference featured a range of topics and an impressive group of expert practitioners sharing their views on Community building.

My keynote focused on the need for a modern approach to community building in response to the accelerating change and disruption driven by exponential technologies. I’ve summarized the talk below and included the full deck at the bottom of the post.

Exponential Technologies and the Missing Human Dimension

Exponential Technologies are defined as technologies that are on a growth curve of power and speed are doubling annually, or the cost is dropping in half annually. Further, these technologies interact in a combinatorial way to create disruptive change and opportunity. Futurists Frank Diana and Gerd Leonhard do an amazing job of unpacking this concept on this recent podcast.

Screen Shot 2017-08-31 at 4.38.39 AM

Image Source & Concept: Frank Diana

Online Communities are poised to have a break through moment if we, as community builders, can blaze the trail.

There are several trends converging to support this approach:

  • Many organizations are experiencing a social media hangover and are actively exploring the possibilities of hosting their networks and communities;
  • Research is showing that network-building and platform building activities are a path for organizations towards resilience and growth;
  • We know online communities can generate significant and varied forms of value, and that connected customers are typically more valuable.

A New Approach to Community Building

A new and comprehensive approach to online communities can create a path forward through the change being driven by exponential technologies. The key factors, as I see them:

  1. Leadership that prioritizes learning over labor;
  2. Community experiences that are powered by purpose;
  3. A move beyond destinations to community ecosystems;
  4. Community presence across contextual interfaces;

1. Shifting Leadership Mindsets
To create the environment for Communities to be successful, leaders within organizations have to shift from a primary focus on Scalable Efficiency (Fixed Mindset) to a focus on Scalable Learning (Growth Mindset). Scalable efficiency is all about defined roles, repeatable processes and limited experimentation. This works well in a static environment but works poorly in a dynamic one. A focus on experimentation, learning and evolution creates the opportunity to adapt to changing conditions and shifts the role of community from one of cost-savings to one of value-creation.

screen-shot-2017-08-30-at-4-14-01-pm.png

2. Purpose-powered Communities

As Community Builders, we’ve always known that we needed to define a community’s purpose as part of strategic development, but we generally haven’t paid much attention to the role of purpose for community participants. Further, an emerging body of research (including my own primary research) has shown that helping community members discover, refine and actualize their purpose can create truly extraordinary outcomes and high levels of engagement.
screen-shot-2017-08-30-at-4-14-22-pm.png

3. Developing Community Ecosystems

Developing a community ecosystem, to date, has typically involved bolting on a handful of social channels to a hosted community strategy. A number of new opportunities have emerged to explore in-person experiences, community partnerships and mastermind-style engagements (to name a few).
Screen Shot 2017-08-30 at 4.14.49 PM

4. Interfaces into Community
Perhaps one of the most interesting opportunities is to think about the expression of your community across a range of interfaces. In-product experiences are going to be particularly valuable. As an example, Aatif Awan, VP of Growth at LinkedIn stated that “Product integrations with Microsoft are the biggest growth opportunity” for LinkedIn.

Community Interfaces

Community Builders as Architects of the Exponential Experience

Screen Shot 2017-08-30 at 4.15.25 PM

Full slide deck here:

The Customer Community

Screen Shot 2017-03-30 at 10.32.39 AM
Image © Leigh Prather

The last few years have seen big brands make extraordinary investments in developing massive “digital transformation” and social media programs. On one hand, these programs have yielded moments of customer connection, advocacy and insight. Unfortunately, for the majority of programs reliant on mass social platforms like facebook and twitter, organic reach has dropped effectively to 0 and companies are now forced to pay to engage sporadically with the “audiences” they worked so hard to build. Companies now realize they have been renting their customer communities on social platforms.
 
The alternative to social media campaigns and digital transformation theatrics? Developing Customer communities. Specifically, online Customer communities that companies build, host and manage. Customer communities hold the key to Customer acquisition, retention and growth. Further, communities can be a catalyst for development and innovation, and will be critical to future business models. Below I explore the opportunity for Customer community in three key Corporate areas: Brand, Product and Strategy.

Community is the Fabric of Brand

What is the nature and value of brand in a hyper-connected world? A recent HBR article asserts that the collective value of  Customer relationships is outstripping the value of “brand. markables_relatoinship The authors of the article nail the point that Customer relationships are incredibly valuable, but may have missed an opportunity to explore the effect of the customer community as a brand asset & catalyst — the line between brand and relationship isn’t as crisp as the authors imply. Further, I would assert that the “network” of relationships represented by the collective customer base of a company is a manifestation of brand, every bit as important and as valuable as the components of brand identity. My primary research and experience has shown connected customers (via community and social) are more valuable than those that aren’t. Third party research by Deloitte has shown that Networked companies (“Network Operators”) perform better, live longer, and are more valuable. All of these points are are vectoring towards a new opportunity and a new frontier in business: Community-Centric Customer Experience — an approach to customer experience design and business strategy that not only strengthens the Company to Customer relationship (1:1), but also strengthens and develops the Customer to Customers & Company relationship (1:Many, a.k.a. the “Community”). and considers development of the Community the primary .

Communities Will Infuse Product

Customer communities are an essential part of most technology products now. At the very least, online support forums are expected as part of the offering (more on that in a bit). Many companies are experimenting with customer communities as a means to raise product awareness, convert trial customers and retain existing customers. A radical new business opportunity is emerging where the community (both the people and the platform) are the actual product. Purchases are artifacts or a gateway into the community experience, and the real “product” is the collective experience, knowledge, content and means of collaboration with the community. There are many early examples in the gaming world, from MMOG’s like World of Warcraft to the new “build and explore” virtual worlds like Roblox. Software companies are attempting to build communities that address the “whole customer”, and focus on experiences well outside of product support. Adobe (Behance), Autodesk (Instructables, Fusion360, AREA), Intuit (OWN It) and Sephora (Beauty Talk) are actively investing in the community space.

Opening the Aperture on Strategy

There is an unfortunate tendency to view Customer communities as “cost saving” vs “value producing”. This thinking leads to strategies and outcomes that fail to realize the full value of customer communities, and is rooted in a long standing dependence by some companies on customer support communities. In extreme examples, this sort of strategy breeds resentment with valuable customers and leads to a dangerous dependence on an unsustainable resource. When the Corporate mindset shifts to “value producing”, the aperture of community strategy widens to a rich set of possibilities: community advocacy programs, open innovation, peer to peer mentoring, complex content sharing, customer co-design and much more.

Moving forward, Customer communities will be the medium by which value is co-created and exchanged between Companies and customers. To have any chance of long term success with Customer communities, mindsets have to evolve beyond a fixation on cost savings to a more enlightened view of communities as a valuable catalyst for innovation and growth.

The Bottom Line:

Customer communities are the “fabric of brand”, the medium in which the network of customer & company relationships develops and thrives. Companies that create modern communities with their customers will be more innovative, realize more value and have more resilient businesses than their competitors who don’t.

Purpose Will Power Future Online Communities

IMG_0097

Purpose
“…people’s identification of, and intention to pursue, particular highly valued, overarching life goals.” (Steger & Dik, 2010).

a.k.a. “Your reason for getting up in the morning.”
Bryan Dik PhD – Professor of Psychology at Colorado State & Cofounder of Jobzology

The Fine Line Between Engagement & Manipulation

Growthhacking, gamification, content snacks and personalization. Your feed is overflowing with tricks, hacks and best practices to “drive engagement”. The best of these techniques tap into a member’s intrinsic motivation to trigger participation, the worst rely on psychological tricks and negative emotional responses.

What if there was a way to create sustained engagement in communities and collaborative experiences that harnessed genuine motivation and strove for positive outcomes for participants? Through my work as a Fellow with Life Reimagined, I have (with my team of Fellows) developed an approach that taps into the power of purpose to drive community engagement.

Purpose-Driven Communities

As Community Architects (and Builders, Managers, Hosts, etc), we’ve always known that we needed to define a community’s purpose as part of strategic development, but we generally haven’t paid much attention to the role of purpose for community participants. Tactical goals in the context of a community experience, yes. Thinking about the community member as a “whole person” with a life beyond your community? Let’s be honest – rarely.

Our community experiences today are largely designed around the limitations of the platform we choose to grow our communities on. Content (posts and messages) is typically the most dynamic element, followed by algorithmically-driven “streams”. Reputation elements develop over time and are helpful to make judgements about the value of content and contributors, but it is hard to say any given community experience truly evolves.  On the whole, the Community experiences are surprisingly static.

There is opportunity for improvement here. Looking at Communities through the lens of Maslow’s Hierarchy of Needs, you can make a case that online communities support many of the needs that Abraham Maslow describes in his model, especially 1.) Belonging (through social connections), and 2.) Esteem (through participation and the advancement through reputation system). The missing ingredient has been the proverbial top of the pyramid: Self-Actualization.

What might happen if the community and collaborative experiences we designed supported the discovery, refinement and actualization of a person’s purpose?

 

Screen Shot 2016-05-09 at 3.32.29 PMNext, think about what a community might look like if the host organization was actively refining and expressing its purpose through community interactions. As an example: If a software company’s purpose is to empower the world through digital design software, you could imagine community activities going well beyond break/ fix support forums and into eduction, skills mentoring and specific efforts to reach people in the developing world and the associated technological challenges. The host organization evolves from an authoritarian role to become a responsive partner in co-development.

Early Development of the Purpose Model – In Flight Now

In November of 2015, I was honored to be chosen as part of the inaugural Rand Fellows with the Life Reimagined Institute.  I was asked to be team leader and had the opportunity to work with Bryan Dik, Brooke Erol and Roberta Taylor on my team. Our team was mentored by an amazing group of thought leaders, including Richard Leider, Alan Weber (co-founder of Fast Company) and Dr. Janet Taylor. The goal of my team was to create community-based programs that help people discover, refine and express their purpose. My team of fellows is in the middle of a pilot and research project that lasts through the end of July to study the best ways to help our community of participants discover, refine and express purpose through their work. Our team took the Life Reimagined process (shown in the graphic below) and mapped community activities to each stage to come up with the needed content and features for our pilot community program.

Screen Shot 2016-05-04 at 6.58.16 AM

Meaningful Results Beyond Engagement

One of the most incredible outcomes of our pilot program was that we saw significant improvement in 12 of 20 psychosocial variables that we measured in our participants. Specifically, we saw large gains in feelings of Happiness, Resilience, Presence of Meaning, and Career Decision Self-Efficacy. We also saw reductions in feelings of Loneliness and Depression in participants.

screen-shot-2016-11-23-at-8-57-32-am

Implications

We are in the early days of developing a model for Purpose-Driven Communities but we are already seeing impactful results from our studies. The Purpose-based model I’ve described doesn’t exist in the wild (yet), but the time to consider the implications and possibilities is now if you want your organization’s community to evolve beyond static growth, low engagement and specious results & impact . There are many positive and disruptive implications of the model – I’ve highlighted a few below.

  1. Shared Purpose of Community 
    • Hosts will have to clearly state the purpose of their community, as well as help individual community members define, refine and express their purpose in the community experience. The development of a “Purpose Model” is required.
  2. Purpose Expressed in Community Leadership and Actions (Member)
    • Once the “Purpose Model” is created, more effective Member journeys, reputation and roles can be developed that align near term activities with longer-term accomplishments.
  3. Evolving Role of Community Manager
    • Once the language of Purpose is understood in a community, and once members and hosts can share their purpose (via statements / profile), the Community Manager can play a critical role of connecting members with the content, people and activities they need to actualize the member’s purpose.
  4. A New System of Context & Feedback Loops (Platform)
    • New tools will need to be developed to facilitate purpose discovery, and to drive the community experience through context (activity streams, member matching & networking, journey models)  and feedback loops (based on activity).
  5. Federated Communities
    • The expression of an individual’s purpose is a large and complex topic. It is unlikely that any one community or organization can fully support the breadth of an individual’s need. Complimentary communities have an opportunity to partner around customer types and segments to offer experiences that support purpose. We will begin to see examples of Federated Communities as an alternative to mass social networks in the next 12-24. Powering these Community Federations with Purpose will be a game changer.

In Summary

Creating a Purpose-driven model for communities will be a break through in performance, engagement and impact for many organizations. This new model will create the canvas for life-long relationships that are based on mutually beneficial outcomes for the host and member. Community platforms, programs and roles will need to evolve to realize the full value of the model.

About Structure3C
I will continue to research and write about the Purpose-driven Community Model as part of my ongoing #NetworkThinking series. To stay up to date, subscribe to my newsletter here.

I’m currently working a select list of clients to build amazing communities. If you would like to schedule some time to talk about how I can help, bill@structure3c.com.

 

 

My First Year as a Consultant and what 2016 Holds for Online Communities (I hope)

Sonoma Sunrise

Sonoma Sunrise in honor of the dawn of 2016

Honestly, I wasn’t going to do this. I’m already rolling eyes at all the “prediction” posts. And there are way too many 2015 retrospectives to look back on… but I’m feeling optimistic and inspired! You are taking the time to read this – THANK YOU! I have had an incredible amount of support for my first year of Structure3C. Thank you for being part of it.

This is a long-ish post – the short version is a list of personal highlights from 2015, and a look ahead to 3 big ideas and aspirations for 2016.

A Look back at the first year of Structure3C

Thank you for letting me take a moment to reflect on a few key accomplishments from this year.

  • Launching Structure3C on February 4, 2015 to help brands create successful customer communities and crowdsourcing initiatives
  • Chairing the inaugural Collaborative Economy conference in San Francisco in March
  • Conducting the first research study on Brands & The Collaborative Economy – exploring a range of organizations level of knowledge, interest, priority and current activities in the Collaborative Economy
  • Having a number of prominent speaking engagements, including SxSWi, Social Business Forum 2015 (Milan), The Silicon Valley Boomer Business Summit and Crowdsourcing Week Europe (Brussels) 
  • Helping a growing portfolio of brand and startup clients with briefings, crowdsourcing strategy, online community development and product design
  • Being interviewed by Virgin Entrepreneur on Crowdsourcing
  • Holding the closing workshop at the Crowd Companies 2015 Main Event in SF – (you can download my custom workbook from the event)
  • Being honored as one of the inaugural A. Barry Rand Fellows for the Life Reimagined Institute
  • And on a personal note: I made a commitment to my family to be present more throughout the year – one lagging indicator of success is the number of pancakes and pieces of french toast made in 2015 numbers just shy of 1,000! (disclaimer: back of the napkin calculation)

3 Big Ideas for 2016:

1.) Beyond “Digital Transformation” 

In 2015, it seemed like Digital Transformation ate the business world. Almost overnight, the big consultancies dropped “Social Business” and began to sell Digital Transformation strategies. Thought leaders and former champions of social published articles and books about establishing, then disrupting “Digital Business”. Former Social Centers of Excellence were abandoned or repurposed for the “new” digital business journey.

In some ways, this is completely logical. Big consultancies need to keep clients anxious and their armies of consultants employed. Thought leaders need a constant stream of new terms, concepts and frames to stay relevant and top of mind. Executives need to frame annual objectives in ways that are novel and show progress year over year.

And, let’s face it: Social, Community, Customer Collaboration are all hard. Really hard.

Getting Real
Obviously, technology plays a critical role in modern business. The problem with many Digital Transformation efforts is a hyperfocus on the technology at the cost strategy and customer relationships.

Further, the definition of “Social Business” was always somewhat nebulous, and the internal culture shift and alignment needed to be successful was an arduous task. Pursuing a primarily technology-driven agenda likely seems more attainable, and “Digital” is an easier sell – both the perceived value and anticipated results.

What is lost in the shift from social to digital is the opportunity to fully realize the business value of connected customer relationships at scale. Realized specifically through strategies based on networks, communities and deep collaboration. Sound nebulous? I’ve shaped and seen first hand the value of social and community in the form of increased direct revenue, increased loyalty, crowd driven products and early market dominance based on building communities in parallel with products. Examples: The quantified value of Dell’s IdeaStorm was in the hundred’s of millions of dollars, Dell’s TechCenter community had billions of dollars in impact on Large Enterprise sales, Autodesk’s support community saves the company millions of dollars a year… I could go on.

2.) Digital / Social Business reframed as Business, Networked

Based on my experience building online communities and collaborative experiences, as well as research I’ve conducted, I’m convinced that a new and comprehensive approach to online communities is the way forward.

An approach where:

  • What we thought of as “social” is really the networked marketplace
  • Your market is synonymous with your crowd
  • Online communities build lasting relationships amongst your customers, prospects, employees and partners and
  • Collaboration looks like a true partnership with customers, not an internal social network no one really uses.

Market as a Network

 

 

 

In order to begin exploring business opportunities in the networked economy, businesses need to shift their mindset to think about markets as networks. Their total addressable market(s), connected via platforms & social networks.

There are three important contexts to think about in the Network Marketplace:

  • Crowd: A group within a Market Network that has:
    • A shared interest or goal
    • The ability and assets to participate in a shared marketplace, task or activity via common platforms
  • Community A connected & hosted group within a Market Network that has:
    • 1 or more shared interests or goals, leading to shared identity & purpose
    • The ability, motivation and assets to work towards a common purpose over time
    • A host with intention to support & manage community over time
  • Collaborative Organization Collaboration amongst organizations, partners and customers essentially functioning as one organization:
    • Shared IP & Common resources
    • Shared vision of activities and outcomes
    • Shared risks and equitable outcomes

3.) Radical New Leadership

To truly make progress in the evolving online community strategy we need new leadership, and evolved (not incremental) vision. This requires a shift from quarterly-driven decision making by businesses and a “sell what we have” mentality from our collective social vendors. Specifically:

Corporations

  • A new function that owns customer experience across every touchpoint – and further – owns developing the 1:Many relationships in the market network, not just 1:1
  • A new Executive to lead this function
  • Integration of platforms, systems and customer data that create internal efficiencies, better customer experiences, and put the customer in control of their experience, relationships and data
  • A new point of view on value, and specifically, the value of customer engagement and participation. The days of customers supporting other customers without compensation are coming to an end.

Vendors

  • We need a bolder vision for online community platforms and social media & network tools. Platforms now are: 1) optimized around specific functions, like peer to peer support 2) are incredibly hard to customize and 3) are incredibly hard to integrate. We need better from you.
  • Reign in sales-driven organizations that over-promise and under-deliver on community quality and outcomes.
  • We need vendors to come together on feature & data standards and interoperability. Just to pick a specific example: The current disconnect between CRM, Marketing Automation and Community Platforms (even from the SAME vendor) is unbelievable. Invest in fixing it.

Thought Leaders

  • You need something new to talk about and sell. I get it. I humbly ask:
    • Connect the dots between your concepts, especially when retiring an old concept for a new one.
    • Talk to your peers in the industry when selling new ideas so clients aren’t dealing with 10 flavors of the same burning platform concept.
    • Show your source data when you have it.
    • Attribution is appreciated. Especially for concepts you are essentially recycling.

Industry Organizers

  • Show you really care about the future of the industry by cooperating on standard definitions, benchmarks and training
  • Try to coordinate conference data and overarching themes
  • When collecting practice data you intend to use for consulting or products, please provide a disclaimer at point of collection.

Do you agree? What would you add to this list?

With that said, 2016 is shaping up to be even more fun.

A preview includes:

  • An upcoming announcement for a series of Crowd Economy “Rapid Orientation Workshops”
  • Select speaking engagements focused on describing a Modern Approach to Online Community Building by developing Market Networks
  • Ongoing research into how Brands continue to evolve their Crowd and Community business strategies
  • An expanded set of consulting offerings, including modules for leadership & team development, value / ROI analysis and scorecard development. 

Should we talk? I’m offering a limited number of free introductory consultations (via phone). I’d love to learn more about your community & crowd plans for 2016, and I promise your will take away new ideas from our call.

Book a call here. 

In the spirit of the New Year, I wish you a peaceful and epic 2016. Thank you for helping make Structure3C ‘s first year a success!

Announcing a New Online Workshop: The Collaborative Economy Kickstart

Every organization in the world is being impacted by the Collaborative Economy in some way. Smart organizations are engaging now by addressing emerging threats and identifying business opportunities.

I created the Collaborative Economy Kickstart as a companion to our longer-form workshops. In 2.5 hours, participants will get a briefing on the Collaborative Economy, a facilitated exercise to guide ideation and action planning and 30 minutes of group coaching to begin their journey in the Collaborative Economy.

Register (and get more info) by clicking on the “Get Tickets” button below.
Collaborative Economy Kickstart

The purpose of the Collaborative Economy Kickstart Workshop is to help Executives quickly understand how the Collaborative Economy will impact their business, and what new business and product opportunities the Collaborative Economy represents.

In the first hour Participants will be given an overview of the Collaborative Economy, including:

  • The key elements of the Collaborative Economy;
  • The three C’s of a Crowd-powered business: Crowd, Community and Collaborative Organization;
  • Case studies and examples of Crowd-powered businesses;
  • A method for identifying opportunities for, and threats to, a Participant’s business;
  • A framework for developing a Crowd-powered business model.

During the second hour Participants will then be guided through an Ideation & Action Planning exercise that helps them:

  • Explore the dimensions of the Collaborative Economy that are relevant to their business and market;
  • Assess the biggest threats and opportunities;
  • Learn to do an asset inventory;
  • Explore opportunities via the Ideation Canvas tool;
  • Create an action plan to more forward immediately after the session.

The workshop will end with 30 minutes of group coaching to explore topics that have surfaced during the overview and action planning sessions.

Participants will leave the session with a better understanding of the Collaborative Economy, an action plan draft and exclusive templates to use within their organization to kickstart their Collaborative Economy journey.