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intro
Communities thrive or fail based upon trust. Consumers
must have some degree of trust in the hosting brand to make
the community successful, but far more important is the trust
that consumers have in their peers.
There are two key benefits to peer-to-peer trust, each
one required for a brand community to achieve its
business objectives: Even a customer community with a million members depends
upon a fairly small number of people, typically around 1%, to
If consumers trust that their peers know what they are talking generate much of the excitement and interest. Without the
about, they are more likely to follow their advice, whether that’s peer trust created by a reputation management system, this
advice about which product to purchase or how to fix a problem 1%—the superfans—will not engage and the community will
with a product they’ve encountered. The most prolific users not achieve its business objectives. So it is vital to understand
typically create 90% of the content in a brand community, so it the dynamics of online reputation and use the best available
is vital that visitors know who among them is trustworthy. tools for managing it.
If new community members see that the community rewards Building this web of trust requires both the right technology
engagement with higher levels of status and privilege, they and an understanding of human behavior. Lithium’s approach
are more likely to invest their time and effort in making the to online reputation combines those. Our software and
community successful. In other words, the community is practices are based upon:
something like a video game—the drive to move up to the next
level compels members to higher levels of participation. Ten years of social interaction data across several hundred
communities, tens of millions of users, and 50,000
superfans—consumers whose deep engagement with brand
communities drives others to participate.
Research conducted by Lithium’s Principal Scientist, Dr.
Michael Wu, who was recently named (along with Marc
Benioff and Mark Zuckerberg) as one of the most influential
people in CRM. Lithium encourages Michael to share
his research findings in a blog, which you can find on the
Lithosphere, Lithium’s own community.
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Real-world interactions through the communities Lithium One user on Logitech’s community has posted 45,000 times
hosts for its clients, including some of the largest, brand- since May 2006, an average of almost 25 times per day! These
sponsored communities in the world at HP, AT&T, PlayStation answers to technical and purchase questions have been
Europe, and Univision. Lithium’s customer success managers viewed millions of times, giving him an effective reach larger
(CSMs) are actively engaged with our clients in designing and more lasting than the company’s advertising campaigns.
reputation and reward programs in their communities.
An effective rank and reputation system must
A well-executed reputation system delivers tremendous do the following:
return on investment by empowering the smartest, most
committed members of the community to take on much Reward members for the full range of socially beneficial
of the responsibility of managing the site and driving its behaviors. This sounds simple, but many systems do a poor
business objectives. A small minority of superfans makes the job of it. For example, simple reputation systems confer
difference between success and failure in brand communities. status upon users based purely on the number of posts they
For example: create, but this creates perverse incentives. Members post for
the sake of posting in order to “game the system” rather than
Lenovo’s award-winning customer support site is staffed by a focusing on quality posts. Moreover, some members visit the
moderation team composed entirely of customer volunteers community every day, but only post when they have something
from all over the world—US, Australia, Canada, Germany, very important to say. These members may actually be the
India, Pakistan, and Turkey. Initially, the collaboration focused glue that holds the community together, but many reputation
on the operation of the community—the policies, the rules, systems treat them poorly because they don’t post often.
and the content. But in just one year, 30 members who had
earned the trust of Lenovo and their peers helped grow Motivate members continuously through their engagement
Lenovo’s knowledge base to 1200 articles. process by progressively making succeeding levels of
achievement more difficult to attain. This concept is
English mobile telephony provider giffgaff’s remarkable sometimes known as “game mechanics,” and it is critical to
customer community is both the customer service and keeping members engaged. Some of Lithium’s long-standing
marketing arm of the company, which has fewer than 20 communities have over 150 different levels because members
employees! The average time to receive a response in the keep raising the standard.
giffgaff support forum is under three minutes, and 100% of
technical questions are answered by the community. Giffgaff Confer meaningful privileges upon superfans. Many systems
members who answer others’ questions effectively and earn display visible badges of status, and this is necessary but not
high status also receive free air-time, which they can then sufficient. While superfans are motivated by public status
give as gifts to their friends. This makes these high-status markers, long-standing members are motivated by having
users word-of-mouth marketing agents. authority, such as the ability to move or delete content, the
ability to edit or write blog or knowledgebase articles, the
ability to post comments without moderation, and the ability
to discipline members of the community who cause trouble.
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defining health
factors for online
communities
Offer multiple paths to success. A brand community is a
complex ecosystem. Some people may be experts in one
product but not in another. Some may be great at starting
discussions, others may be great answerers of questions,
and still others may be friendly and welcoming. The rules
underlying the game must be flexible enough to enable all of
these people to feel as though they are winning. If you make
a domain small enough, every man can be a king. While this
may not be entirely practical, it is an important maxim for
creating participation among diverse audiences. Lithium’s reputation system allows an unlimited number
of ranks, which are all programmable by business rules.
Lithium’s reputation system has been honed over ten years of
This means that first-time users can experience immediate
iteration in diverse and demanding environments, from online
gratification as they move up in rank after they make one or
gaming communities to the world’s largest brand community
two posts, while long-time users can be rewarded for a range
dealing with beauty. Here are some of its key features:
of behaviors.
The Lithium platform tracks over 70 behavioral metrics that
Lithium’s reputation system is linked to its role system, which
can be factored into the reputation system, with more factors
has over 100 different permissions. As a result, members who
added as new features are built into the system. Moreover,
have earned the trust of their peers can be empowered to
Lithium can import factors from external user directories, so
moderate the community, can have their content ratings count
customers can be rewarded for loyalty or purchase behaviors
more, and can even make badges displaying their status that
in addition to their actions within the community. No similar
carry over into other sites such as Twitter or Wordpress.
system is as flexible or extensible.
Lithium’s reputation system is granular within the
community, so members can have an “overall” reputation in
the community at large, but a particularly high status within a
specific area of the community. This gives product specialists
or people who are prone to submitting particularly valuable
ideas a higher level of visibility than they might otherwise be
able to achieve.
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Lithium’s Customer Intelligence Center uses algorithms to surface to community managers the most important members
in terms of the centrality of their connections with other members, the members who are emerging as extremely prolific posters,
and members whose participation is beginning to wane. The value of a superfan is so great that Lithium recommends that
companies proactively reach out to members whose participation is declining, and the Customer Intelligence Center gives them
the tools to do that.
our insights our gaming science our insights
allow us to identify social uses a sophisticated allow us to counsel our
influencers today and predict reputation engine to clients on engaging
who will be one tomorrow. inspire influencers to get influencers and bringing better
deeply involved results to their company
At Lithium, we have focused on the management of superfans In the whole, respondents rated their communities as more
because all of our experience and data has shown us that if successful than Facebook at activities that require trust:
you take care of the most important users, the rest will follow, peer-to-peer engagement and providing pre-and-post sales
while the converse is not true. We work with each one of our purchase support; Facebook was seen as more successful in
customers to understand their business objectives and create disseminating marketing messages.
a reputation structure that works for them. This is a primary
The two channels were seen as roughly equal in their ability
reason why Lithium communities are more vibrant and
to create brand awareness. Clients who have initiated brand
successful than our competitors’.
communities see awareness benefits as particularly salient
in the first year, suggesting that “newness” of an engagement
channel is in itself a big driver of awareness.
The ability for customers to submit and discuss ideas for product
or service improvement is the biggest downstream benefit of
social customer engagement for clients who have developed
brand communities. Clients who consider their Facebook efforts
less successful are particularly interested in bringing this
capability to Facebook in a more structured fashion.
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after peak
Facebook
As Facebook itself approaches full penetration of its core answer product questions
markets and its members start to regularize their behavior, 51.4%
historic growth rates for participation in corporate Facebook 50%
pages will slow. Call it “peak Facebook.” Recent surveys
display status or achievements
have also shown that existing consumers’ engagement with
42.9%
corporate Facebook pages may be tenuous and fading. For 8.3%
example, 81% of those who have become fans of a brand
have abandoned at least one such relationship because of submit ideas for service/product improvements
“irrelevant, voluminous, or boring” marketing messages. 62.9%
50%
This suggests that marketers who are committed to using
Facebook to foster relationships with social customers will search our knowledge base
need to invent or adopt sophisticated long-term strategies for 60%
customer engagement. Fortunately, many of the techniques 66.7%
learned in brand communities can carry over into Facebook.
see the best/most useful content that others have submitted
60%
58.3%
identify other customers with similar backgrounds or needs
42.9%
50%
find products their friends or colleagues have recommended
60%
50%
mentions by respondents who rate their Facebook pages as less successful
mentions by respondents who rate their Facebook pages as successful
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what is online answer product questions
47.6%
community? 56%
display status or achievements
52.4%
20%
submit ideas for service/product improvements
One of the first questions we see from brands developing
57.1%
a social customer strategy is, “Do I need both a brand 64%
community and Facebook, and if so, what role does each
one play?” search our knowledge base
57.1%
The answer to this question always depends on circumstances 64%
and business requirements, but given that our audience has
experience with both venues, we have a very good sense of the see the best/most useful content that others have submitted
role that each one plays. 57.1%
60%
Figure 1: Overall effectiveness of Facebook and brand
identify other customers with similar backgrounds or needs
community. Figure 1 compares the brand community’s
38.1%
perceived effectiveness with the Facebook page’s perceived
52%
effectiveness in 10 different areas.
find products their friends or colleagues have recommended
The first thing to note is that the one area where Facebook
47.6%
shines is in outbound messaging. Because Facebook offers 64%
outstanding reach and many brands use it as a publishing
platform for periodic updates, its prowess as a vehicle for
mentions by respondents who rate their communities as less successful
disseminating marketing messages is not surprising. Social
media marketing vendor Vitrue has computed that a fan mentions by respondents who rate their communities as successful
base of 1 million translates into $3.6 million in equivalent
media per year, and brands such as Coca-Cola already see
more unique visitors to their Facebook page than they do viral features, one might have expected higher scores for
to their company web site. In these situations, Facebook Facebook’s ability to increase brand awareness, but there are
represents a means of message dissemination that compares several reasons why the scores may be lower than expected:
favorably to advertising on a cost-per-impression basis.
Brand awareness is still largely campaign driven, and a
Interestingly, however, Facebook was not cited as significantly
Facebook page alone does not constitute a campaign.
more effective than a brand community in creating brand
awareness, or creating goodwill for the brand in social Even when campaigns drive users to Facebook pages
channels. Given the Facebook platform’s reach and and increase the brand’s fan base, there is no guarantee
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that these people were new to the brand. Most users who As it turns out, brand communities annuitize exceptionally
associate with a brand page probably have a prior affinity for well. Peer-to-peer engagement and an environment where
that brand. users answer one another’s questions emerge as a corps of
devoted users forms and mobilizes. Indeed, scores rise in
Finally, as we have seen through social media monitoring
these areas as communities move into their second and third
studies, “buzz” around brands spikes during successful
years, suggesting that communities hold their users’ interest
campaigns, but typically returns to a steady state after
over the long haul.
campaigns end.
Figure 2: Anticipated benefits versus realized benefits.
One further explanation may be that our community clients
Peer-to-peer buying advice and customer ideation were
report that brand awareness benefits peak during the first
two benefits exceeding client expectations. The survey tells
year, even as other benefits increase over time. If this holds
us that benefits clients anticipated when embarking upon a
true across other social channels, it is possible that the
social customer program are not always the same benefits
fact of starting a new program in and of itself is responsible
that emerge over time. This is particularly true in two areas:
for increased awareness—probably because that program
idea development, and peer-to-peer pre-sales consulting.
involves an introductory campaign. When the shock of the
Customer feedback/ideation was listed as an original purpose of
new wears off, what is left?
a community 46% of the time, but a realized benefit 78% of the
time. Peer-to-peer pre-sales consulting was an original purpose
13.5% of the time but a realized benefit 27% of the time.
Both of these “downstream” benefits are most likely to
emerge as byproducts of trust among members of a
community. Brands tend to be more willing to harvest and
discuss rand communities.
The ability to find products or services recommended by
friends or colleagues is also seen as a potential area of
improvement by those who are not particularly satisfied with
their Facebook efforts.
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organizational
ownership
If we see a coming convergence between the way people
interact on Facebook and the way they interact in a
brand community, it is worth asking who will lead that
convergence and how it will take place. Enterprises vary
in their determination of who owns social customer
initiatives. In some organizations, social customer initiatives
are owned by customer support or customer experience
Figure 7: Largest challenge with social customer programs,
teams. Increasingly, however, they fall under the purview of
by program ownership Marketing-led organizations’ biggest
marketing or corporate communications functions.
concern with social customer programs is how to scale them.
Figure 6: Additional requirements from Facebook by Figure 7 shows the chief concern as scaling initiatives with
social program ownership. As we can see from Figure 6, (relatively) less concern about coordination across teams
organizations where marketing owns social initiatives are and departments. 44% of marketing-led organizations cited
demanding less of Facebook in terms of new modes of “resources to scale our efforts” as the biggest challenge, as
customer engagement. In fact, ownership by marketing is against 34.4% of everyone and (9/34 - 26%) of non-marketing
more important than the perceived success of a company’s led organizations. This suggests that one reason marketers
Facebook page in determining whether a company is are less aggressively pursuing “deeper” engagement through
interested in customers engaging through Facebook in more Facebook is that, unlike support or customer experience
involved ways. Customer support and customer experience organizations, they lack human resources—like contact
groups continue to be more interested in the exchange of centers—that are perceived to be required to ensure that
ideas and the answering of product questions. social customers get the satisfaction they require from
engagement through Facebook. Better, perhaps, not to hold
out the promise of a sustained dialog with customers if an
organization cannot make good on that promise.
The survey shows that marketers and customer experience
are equally committed to responding to customers in brand
communities and through Facebook and Twitter. However,
it would not be surprising if Facebook’s reach threatens to
become overwhelming if customer actions on Facebook
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called for a response. Indeed, perhaps one thing that
marketers have learned with online communities that they
have not (yet) learned with Facebook is that customers
themselves can be the solution—not just the cause—of the
scaling problem. Time and again, we have seen that larger
communities with a devoted core of superfans actually
require less intervention from companies than fledgling
communities. The “downstream” trust benefits pay dividends.
There is no reason why this shouldn’t be so on Facebook, but
many organizations are in earlier stages of their experience
with Facebook.
Figure 8: Requirement for ROI measurement by channel and
program ownership. A final area in which brand communities
differ from other channels for marketing-led organizations
is in the need to prove themselves through ROI metrics.
As we can see from Figure 8, marketing-led organizations
generally have higher demands for ROI, but this is particularly
true for brand communities. We suspect this is a function of
the perception that Facebook engagement is free because
a Facebook page is itself free, but also of the maturity level
of Facebook as a technology and a marketing venue. As we
see increasing convergence of social channels, we should
also expect to see demands for more sophisticated Facebook
measurement tools, and growing demands for Facebook to
prove its value.
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