Private Online Communities

Private Online Communities

Private Online Communitites (POCs) for co-creation  are a highly effective marketing and  market research tool, particularly in markets of intense competition or those vulnerable from changes in the economy. However, simply having a functioning community with 200 or so members occasionally interacting with the host is unlikely to generate the desired results. Creating an active, inspired and vibrant community is a process that requires long term continuous development through regular member engagement. A highly engaged community is likely to lead to more impressive results - hence, the community manager has a very  important role to play.. Member engagement also stems from being excited about the brand or the cause, feeling comfortable/safe to express themselves, interest in the community and having a sense that their opinions are being listened to.

Considering the importance of the community manager, it was surprising that a Deloitte study in 2008 found that 30% of POCs had just a part time employee in charge of the community. Underestimating the role of the community manager can be detrimental to the success of the online community. Successful POCs have demonstrated effective engagement with their members. Perks like store vouchers and free test drives by Mercedes have encouraged current POC members to encourage others to join the online communities. Also, within  the role of member engagement, the community manager must make the members feel like they are playing a part in shaping the business decisions. Hence, the reasons for any rejected ideas must be clearly communicated to the community members to demonstrate that their ideas are being seriously considered.

POCs are also an invaluable tool in identifying and capitalising on gaps in the market. Bank of America has a POC made up of young adults and college students. From this POC they identified that most students had a bank account before enrolling in college. Hence, they identified an opportunity to expand their banking operations into a market that wasn’t identified initially as a lucrative market for banking. To push their services into this market they set up a new POC made up of high school students. The result is that high school student sales have become one of the fastest growing segments in the bank.

A company should not be restricted to just one POC. Mercedes and Walt Disney are examples of companies that have split their customer base to achieve a better reflected view of the population they represent. Mercedes have opted to split their potential customer base into two demographic communities. The Generation Benz community consists of 580 members aged from 16 -33, with around 1,800 members making up the older Mercedes Benz Advisors community. The members were carefully selected, with Generation Benz members qualifying by age and “prosperity to luxury”. Offering a more rounded view, only 64% of these members are currently Mercedes customers. For Walt Disney, the community members have been categorised as Family, Early Adopters or General Entertainment Consumers, with 500 members in each community. The option for these types of communities is to target the relevant communities based on the nature of the discussion topic.

Operating and integrating a successful POC can be very beneficial to the company but the company must be aware of possible issues. When a company has employed a highly engaged and successful community, there is the danger that member feedback could be taken and applied to major business decisions of the company – before it is fully assessed by other company stakeholders. The POCs are there to push the company forward, improve brand image, get closer to the customers and provide an added advantage. The results from the community, like any business plans or ideas, should still go through vigorous examinations, especially if they could possibly shape the success of the business. Another issue that companies may overlook is the fact that the community is not  representative (in a statistically significant sense) of the entire population they are intended to represent. Ideas which require a lot of investment can be tested with quantitative online surveys.

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