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Customer Community as Word-of-Mouth Marketing EngineThe Second Generation of Social Engagement Is Here

Savvy companies are already launching second-generation social strategies that respect new, online social norms and leverage branded customer communities to foster authentic consumer engagement — the key to driving revenue and retention. These strategies will leverage social networks as a place to “meet” new and current consumers and invite people into a branded customer community where consumers willingly engage with brands and people with similar interests.

Table of Contents

¢ First-Generation Social Media: Inserting Brands into Consumer Conversations 1New Social Norms and Spaces . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .2

¢ The Second-Generation of Social: Driving Revenue by Building Authentic Engagement with Consumers 3Traditional Customer Engagement Put Brands in Control — But Kept Consumers at a Distance . . . . . . . . . . 4

Social Media Changed Everything by Leveraging Word-of-Mouth Marketing at Every Stage of the Customer Lifecycle . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4

Customer Communities Enable Deeper, Authentic Engagement . . . . . . . . . . . . . . . . . . . . . . . . . . 6

¢ Communities Are Engines for Rich, Customer-Generated Content 8

¢ Learn More 10

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Customer Community as Word-of-Mouth Marketing EngineThe Second Generation of Social Engagement Is Here

Social networks like Facebook, Twitter, Pinterest, and LinkedIn have taken the world by storm — and for consumers and companies, nothing will ever be the same By creating platforms for consumers to connect and interact with each other and with brands, these innovations have created an entirely new channel that holds the promise of personal, one-to-one relationships that build trust and loyalty between marketers and consumers — which leads to higher revenue

You’re probably already doing social to some degree — for example, by:

•Building an audience in existing social networks like Facebook

•Listening to consumer mentions

•Responding to customers in social networks

•Experimenting with social advertising

If so, your company is not alone. According to Gartner, companies are expected to spend $8.8 billion in social advertisement in 2012 alone. The Web is now filled with Facebook and LinkedIn ads and apps, Twitter ads, contests, and gamification efforts all designed to keep customers engaged in brand-related conversations.

The problem is, many companies haven’t fully realized expected returns on their investment. According to eMarketer, U.S. companies spent more than $2.16 bil-lion last year on Facebook brand pages and social me-dia advertisements alone — and for many, the return has been universally abysmal.1” For example, Forbes noted that, “Just days before Facebook’s historic stock offering, General Motors said it plans to stop advertising on the social media site, concluding that its paid ads don’t have a big impact on consumers.”2

If this is the case for your business, it’s time to ask, “Why aren’t we getting the returns we expected?”

1 http://www emarketer com/newsroom/index php/tag/facebook/

2 GM Says Facebook Ads Don’t Work, Pulls $10 Million Account Forbes By Joann Miller 5/15/2012

A recent consumer study conducted by The Incyte Group unveils why. This study, which analyzed sur-vey responses from 1,897 qualified consumers who actively use the Internet and represent adults from all age, socio-economic, and geographic groups in the U.S., shows that consumers have clear prefer-ences regarding how they want to engage with brands online. And most companies’ social marketing strate-gies — part of the first generation of social engage-ment — are out of sync with them.

¢ First-Generation Social Media: Inserting Brands into Consumer Conversations

Over the past few years, we’ve all been a part of the first generation of social engagement. It started when consumers began to share and interact in social networks with friends, colleagues, and acquaintances — a new way to truly engage with one another about what’s important to them, including their opinions and experiences with brands and products. Companies watched, learned, and came to accept this new level of transparency — but were afraid of losing control over their brand. Marketers also saw the opportunity to engage with their customers in a new way, inserting themselves into these social networks to establish a presence and an audience—creating traditional broadcast campaigns and deploying them using new social marketing software such as Buddy Media and Vitrue.

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What resulted from these efforts? Companies suc-cessfully built long list of fans, “friends,” and followers on social media.

The problem is, according to Incyte’s research, consumers don’t participate in social networks to re-search products and services of a company or brand. Social networks, such as Facebook, are where con-sumers primarily go to interact with individuals — their friends, colleagues, acquaintances, and professional networks — not brands. In fact, the research identified a big gap between how consumers want to interact with brands on social networks and how companies are using social. (For a closer look at the study’s find-ings, view the full research paper here).

So what do consumers want when interacting with brands online? As summarized in Figure 1, Incyte’s research revealed that:

•When making purchase decisions, Websites — not social networks — are the primary place consumers go to research products of a specific company.

•Over 50% of consumers show a strong preference for “Branded Customer Communities,” which are managed by companies and run separately from social networks (but have strong linkages to them).

•Social media is the preferred way of learning about a brand’s customer community — for example, through a referral by friends on Facebook.

Social Media is the door into

Brand’s Customer Community

Consumers show a strong preference for “Branded Customer

Communities”

of participants show a preference for relevant content vetted by other

consumers

50 %

of consumers have joined an internet community

based on a friend’s Facebook post

58 %

Websites, not social networks, are the primary

place consumers go to make purchase decisions

of consumers use company website

to research products

81 %

Figure 1: Key Findings from Incyte Research

New Social Norms and Spaces

One way of looking at these findings is that first-gen-eration social marketing strategies under-delivered on ROI because they broke unspoken but developing on-line social rules when they invaded the “social spaces” of consumers. These rules, which are being defined and shaped by consumers themselves, are based on

social norms in the physical world — but have real-world application in the virtual world as well. Relevant examples of “social appropriateness” with corollaries in social media might include:

•“Don’t stand too close to someone when you talk with them.” In the world of social media, companies should make sure they don’t intrude too much into their customers’

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online lives — for example, with unrelated advertisements. One of the keys to not intruding is staying relevant.

•“Listen and maintain eye contact.” In social media, if someone reaches out to a company, then the company should maintain a human connection with that customer. This means avoiding canned responses — and helping customers connect to an existing conversation about topics that the consumer sees as important.

•“Don’t monopolize the conversation.” First-generation social was mostly about brands broadcasting messages to their audience. But one-sided conversations do little to build authentic relationships — especially if the conversation is always trying to get the consumer to buy something. Companies need to let customers drive the conversation. This will lead to a more authentic and transparent relationship that builds loyalty and trust.

•“If you meet someone new and want to get to know someone better, invite them to do something.” If a consumer shows interest in your company’s products and services by “liking” your brand’s Facebook page, invite them to a company site where they can engage in open conversation with your existing customers — people who know your products well, share objective opinions, and are happy to answer questions.

If first-generation social marketing strategies inad-vertently crossed these invisible but significant lines (which in any social situation, real or virtual, inhibits people’s desire to engage fully), then the good news is, companies now have the insights needed to develop second-generation social marketing strategies. These strategies, which will respect consumers’ online social spaces and rules of engagement, have the potential to deliver higher revenue and greater business value.

But second-generation social will require new social spaces where true consumer–brand engagement is both appropriate and desired. The Inctye Group’s research shows that consumers seek deeper connec-tions with brands — but social networks are not where they want to build these connections.

Customer communities are the place where consum-ers seek to establish deeper connections with brands. Over 50% of participants in the research clearly

showed a preference for content that was vetted as “high quality” by other consumers. This is what com-munities create, so it’s no surprise that consumers in-dicated a preference for customer communities. What attracts them to these communities is the relevancy of the content, both at the point of sale and post-sale.

Customer communities are:

•Proactively managed by companies

•Have strong linkages to social networks, so they can easily share information with like-minded friends

•Full of relevant, accurate content provided by people like them, vetted for accuracy by the brand, and easily accessed so that it’s relevant to members’ changing context (shopper, new user seeking service or technical assistance, etc.)

•Designed to help them assess the trustworthiness of peer answers and comments

•Tightly integrated with the company’s website, so shoppers can easily view social conversations and opinions as they research products on the brand’s website

Consumers choose to join branded customer com-munities, where they want and expect to engage in deeper ways with brands and fellow consumers about relevant products and services. And because this level of engagement is socially acceptable within branded customer communities, it’s here that you have the greatest opportunity to build trust and loyalty, which leads to revenue.

¢ The Second-Generation of Social: Driving Revenue by Building Authentic Engagement with Consumers

Savvy companies are already launching second-generation social strategies that respect these social norms and leverage branded customer communities to foster authentic consumer engagement — the key to driving revenue and retention. These strategies will leverage social networks as a place to “meet” new and current consumers and invite people into a branded customer community where consumers willingly engage with brands and people with similar interests.

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What makes branded customer communities power-ful is the fact that they can facilitate authentic custom-er engagement — which is the primary distinguishing characteristic of the next generation of social. Let’s take a closer look at what this evolution from tradi-tional customer engagement to second-generation of social will look like — and the opportunities it creates for your business.

Traditional Customer Engagement Put Brands in Control — But Kept Consumers at a Distance

Figure 2 shows the stages of the typical customer life-cycle familiar to marketers before the advent of social media. The orange arrows represent the programs and tactics marketers engaged in before social media existed.

The first phase is discovery — the first time customers are introduced to your brand, products, and services. Absent social media, they typically find out about you from ads and branding campaigns. If they are inter-ested in learning more, they evaluate your products and services. To get them to the next stage — the “buy” stage — many companies use promotions. From this point on, you are dealing with prospects, or potential customers — and once they buy, you are dealing with customers who start to “experience” your product or service. They may seek out help content to get started. And if they have positive experiences with your services and products, they begin to form a bond — and hopefully become repeat customers. This is also where customer service becomes a marketing channel for your company.

Ideally, your customers will get to the next stage: advocacy. Customer advocates provide you with free, word-of-mouth advertising by telling their friends and business colleagues about your company and introducing you to new customers. But without social media, your brand typically isn’t involved in these “backyard” and “water cooler” discussions. And advocates have a relatively limited sphere of influence confined primarily to their own social circle.

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Figure 2: Marketing Across the Customer Lifecycle Before Social Media

Social Media Changed Everything by Leveraging Word-of-Mouth Marketing at Every Stage of the Customer Lifecycle

But social media amplifies these word-of-mouth conversations for many people to see, hear, and be influenced by. As illustrated in Figure 3, it allows consumers to connect with other people at any stage of lifecycle — instantly. The volume and amplitude of these conversations has grown — first and foremost for advocates, who not only influence uninitiated consumers in the process of discovery, but also touch every other part of the lifecycle with their words and actions online.

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Figure 3: Conversations Accelerate the Customer Lifecycle

At the same time, other consumers in the lifecycle — especially existing consumers — have engaged in unprecedented volumes of conversations because of social media. This is the reality of our digital age,

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where consumers are talking around the traditional, inner-directed tactics of brands, products, and ser-vices. And as a result, these conversations are having a powerful influence on the speed and nature of the lifecycle, driving sales and new customer acquisition in completely unprecedented ways. For example:

•Advocates can introduce friends and colleagues to your products and services, prompting them to evaluate and buy your products and services.

•Customers with multiple positive experiences with your brand can introduce people to your company and prompt evaluation and buy decisions, turning into your brand advocates.

•Customers that experience just one interaction with your company can introduce friends and colleagues to your company, prompt evaluation and buying decisions, also turning into brand advocates.

Facebook, Twitter, and others help catalyze these conversations, enabling them to occur at unprec-edented volumes. Using monitoring and listening tools like Radian6 and social marketing tools such as Buddy Media and Vitrue, companies strived to be an active participant in these conversations happening on social networks. They successfully monitored and inserted themselves into these dialogues — but as Incyte’s research reveals, not in a way that consumers necessarily embrace.

Furthermore, these interactions, if left un-nurtured and trapped within the bounds of Facebook and Twit-ter, tend to be fleeting — vanishing as quickly as they started. This is true even if you use social marketing tools such as Buddy Media and Vitrue. Figure 4 — a post on the Pampers Facebook page – is an excellent example of a brand-driven tactic powered by Vitrue. It sparked a large number of interactions among Pam-pers consumers, but these interactions had a shelf life of 15 to 30 minutes at most.

010203040506070

0.25 1.25 2.25 3.25 4.25Hours Since Post

Comments per Quarter-Hour

Cummulative Comments

708090

100110120130140

0.25 1.25 2.25 3.25 4.25

Figure 4: Social Content Has a Short Half-Life

664 people liked the post and 140 commented on it. That’s a lot of interaction! But when we look closer at the timestamps associated with the comments, we see that a flurry of activity took place within a

minute. And within just 30 minutes of the post being published, there was a precipitous fall-off in interac-tion volume.The chart in Figure 4 shows how quickly

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people stopped commenting, and how fast the cumu-lative comments flattened out.

This is a problem for marketers. Left unattended and uncultivated, this high volume of otherwise valuable interactions evaporates into the digital ether. They fail to translate into engagement, and ultimately, revenue. This is why marketers need a new kind of tool for capturing and cultivating these interactions — a cus-tomer community that transforms them into relevant, “evergreen,” customer-generated content.

Customer Communities Enable Deeper, Authentic Engagement

Customer communities are the enabler of the second generation of consumer engagement, which is all about driving real engagement with consumers and truly understanding who these fans, followers, and friends are — what do they care about, what influences their behavior, and what insights and value can they bring to companies and their fellow customers.

But this requires true community, which isn’t some-thing you rent from Facebook in the form of “fan pages.” It’s something you create within branded customer communities where you can connect and personally engage with consumers in relevant, mean-ingful ways across the entire customer lifecycle (see Figure 5).

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What’s the difference between Brand X and Brand Y?

Where can I buy it? Which version?

Here’s the best way to set up the product

I love Brand X! Make sure you get the extra spicy version.

Figure 5: There Are Opportunities to Engage Socially Across the Customer Lifecycle

In a community, your brand can participate in mem-ber conversations — usually responding publicly because the goal is to facilitate meaningful conversa-tion and dialogue that helps everyone. Customers generally drive the conversation, and you can partici-pate, as appropriate. At the same time, you can get deeper insight into who people are, what they care

about, and how they can help advocate for your brand. For example, you get a 360-degree view of conversa-tions throughout the entire customer lifecycle that are long-standing, easy to find, and relevant.

At the same time, you can:

•Build trust with customers and prospects

•Establish long-lasting connections

•Facilitate engagement

•Create entry points anywhere your customers are

•Build social content that is optimized for search

What makes all this possible is the way communi-ties enable content persistence, discoverability, and relevance.

Content Persistence: Establish Content Longevity and Business Value

A community is a destination for long-lasting content and relationships. Fleeting conversations from social channels become a persistent part of your com-munity. Customer communities enable persistence because they transform fleeting social interactions (such as the Pampers post) into long-lasting market-ing content by capturing and cataloging it within a per-manent, active customer community. When someone raises a problem with a product or service in a cus-tomer community, the issue can be addressed by the community itself or employees of the company. The content created during this exchange then becomes new community content — an “answer” for others that is easily discovered by search engines. (With a Get Satisfaction community, you can even respond back to the person in whatever social channel they used to raise the issue – all at the push of a button. Your answer can be searched, found, and consumed by other consumers.)

Organizing unstructured conversations by topic type, such as problems or praise, and encouraging ad-ditional activity around them, enables the growth of customer-generated content in a branded community. Each interaction generates new conversations, which are also cataloged and re-published back onto the social web for further visibility. This virtuous circle makes otherwise fleeting social content much more persistent.

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Furthermore, these topics generate more activity over time, which can:

•Be used for word-of-mouth testimonials in marketing campaigns and ecommerce sites

•Become part of your knowledge base to support customers

•Help drive product direction by crowdsourcing development

Discoverability: SEO Content Lets Customers Find You — and Relevant Conversations

Customer communities are highly indexed by search engines, making the content SEO optimized and much more discoverable using channels consumers prefer (compared to platforms like Facebook, which

is optimized for interaction, not searchability). Once customers discover content, they can easily see popular topics and community activity. Ideally, topics have a “me too” function; customers can share topics via social channels, helping the community become part of their social networks.

To better understand the importance of discoverabil-ity, let’s consider a real-world example of a company that runs its customer community on Get Satisfac-tion’s community platform (accessible at www.getsat-isfaction.com/pampers). Imagine that a new mother does a Google search on one of the “Frequently Asked Questions” in the Pampers community. In this exam-ple, she asks, “How can my child model for Pampers?” Of the 7.9 million results Google reports, the com-munity topic page for this question is at the top of the list – ahead of Pampers’ own blog post on the subject, which is result #2.

Optimized URL Structure

Community Activity

Social Sharing

Figure 6: Content Discovery and SEO Are Keys to Success

The branded look and feel of the Pampers Get Satis-faction site is important, since it dovetails nicely with the aesthetic of the official Pampers Website. But it’s really the optimized URL structure of this page, com-bined with opportunities for topic activity within the community (like stars and me-too’s), and the ability

for social sharing of the topic outside the community that optimizes its page rank. These topic pages are discoverable by design, which is why they rank so well in Google and Bing searches; and once people land on the page, they engage with it, further improving the page rank. This same topic page content can also

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be embedded directly into a brand’s Website, which ensures content relevance for shoppers.

Relevance: Expose Relevant Content to Drive Conversion

Relevance means that conversations are in context and provide assistance and answers to customers about the topics they are interested in — exactly when they want them. For example, in the evaluation stage of the customer lifecycle, social conversations help consumers determine if a product is the right choice for them. And during buying decisions, they provide contextual content to reduce cart abandonment.

One important way of leveraging community-generated content is by inserting relevant customer conversations about a product into appropriate brand Web pages. For example, you can put relevant prod-

uct reviews right next to a product on your Website and eCommerce site. Once these conversations are embedded in your Website, they can be found faster using search engines. In addition, you can use conver-sations as testimonials on your Website — a powerful way to market your company, products, and services. When used as “advocate content,” these conversa-tions also establish trust.

For instance, consider the following product page on the Kiddicare.com Website, which is complemented by embedded community content just below the buy button (see Figure 7). When you look at this content, note the questions that are most commonly asked about this product within the community. They start rather generic (for instance, “Will this fit in my car?” and then they get extremely specific (for example, “Will this fit in the middle position in an Audi Q7 2009?”).

Figure 7: Relevant Content Drives Conversion

This kind of specificity enables the product page to anticipate consumer questions and answer them before customers even need to ask. At Get Satisfac-tion, we’ve conducted research that indicates that answering questions measurably improves consumer satisfaction and purchase intent by 30-50%. So we know that anticipating consumer questions with em-bedded, relevant content doesn’t just make for a more satisfying Web experience, but it leads to more sales transactions with more satisfied consumers.

¢ Communities Are Engines for Rich, Customer-Generated Content

Ultimately, branded customer communities fuel a powerful engine of conversation creation, capture, discovery, and cultivation for brands — and in a way that consumers embrace because it respects social media norms for brands (see Figure 8).

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•It starts by making fleeting social content more persistent by capturing it, organizing it by topic type and product, and adding it to branded customer community content so it has an “evergreen” life (compared to fleeting conversations in social networks).

•A customer community then makes those conversations highly discoverable by design, as communities are highly indexed by search engines and can be easily found using organic search.

•It culminates on brand Websites themselves where you can easily embed relevant conversations next to each product on the Website or eCommerce site. This, in turn improves your website SEO and helps drive sales.

But these are just the consumer-facing aspects of customer communities. Communities also plug in seamlessly to the existing activities and systems used by brand managers and consumer relations already managing the brand’s social media presence and site content. For example, this engine can be used to bring social conversations from Facebook and Twitter into your community where they can be captured and brought into your CRM system. Once here, this con-tent enhances your customer information to support better marketing, lead management, and case man-agement. In essence, customer communities, such as those build on Get Satisfaction’s platform, are the bridge between social networks and corporate CRM systems. And when coupled with easy-to-use tools for community management and moderation, the engine is further fueled, driving more engagement across all consumer-facing experiences.

Consumer-facing experiences

Internal processes

Social Networks Company Website & Product

Social Media Management

Customer Communities

Organic Search

Your Employees

Community Moderation

CRM / Marketing

Figure 8: Community as a Social Engagement Engine

Get Satisfaction is an engine for generating “long-tail marketing content,” and its SEO power makes it a magnet for customer acquisition.

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Branded customer communities are the connective tissue that enables brands to align social strategy, organic search, and brand site content with consumer activities and internal processes — and do so in a way that is socially accepted by consumers. When sup-

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ported by branded customer communities, brands can improve service experiences, create better prod-ucts, foster meaningful conversations, and ultimately generate more sales.

Get Satisfaction is the leading customer engagement platform powering 70,000 customer communities to help companies build better relationships with their customers. Get Satisfaction is used by leading brands

such as Gilt, Intuit, Kellogg’s, Procter & Gamble, Microsoft, and Sonos for social marketing, support, product feedback, and commerce solutions. Engage with your customers anywhere they are: on your web-site, social media, via organic search, and on mobile devices.

For a free trial, visit www.getsatisfaction.com.

To learn more, call (877) 339-3997 or visit us online at www.getsatisfaction.com.