3 Basic Business Values of Customer Communities

Online, customer-facing social communities are offering more options and greater complexity than ever before.

But what are the core business values to keep in sight? To find out, CMSWire.com spoke to a software vendor and an analyst. 

Last month, San Mateo, Calif.-based DNN released the latest version of Evoq Social, an online community that complements its web content management system. The update features responsive web design to facilitate mobile use, new editing capabilities and improved performance. Let's take a deeper look.

No. 1: Taking Pressure Off Customer Support

Will Morgenweck, vice president of product management at DNN, said a key business value of a social community is “call-deflection because of crowd-sourced support.” In other words, customers don't have to contact the company for support if other customers can resolve the issue.

This is a commonly cited reason why social environments – like brand communities, Twitter and Facebook – appeal to companies’ bottom line. 

The satisfaction of helping someone else resolve an issue for a product is also rewarding for brand advocates. But how dependable is that peer-to-peer assistance, and what if another customer gives the wrong information or magnifies the issue by adding complaints about the company’s response to the same matter?

Morgenweck noted that social communities should not be left to their own devices. “The company has to be involved” in order to maintain some oversight, he said, adding that “it can’t be a free-for-all.” But Morgenweck noted that this oversight requires the right touch, because active, dynamic communities “start to take care of" themselves and users look at other users’ responses “to gauge ‘what was the best answer?’”

Vanessa Thompson, research manager for enterprise social networks and collaborative technologies at industry research firm IDC, agreed that users will “go to the answer that had the most likes or replies or votes,” a crowd-sourced vouching of relevance that maximizes the value of the community.

As verification of this value, DNN pointed to an unnamed client that took its Evoq Social community offline for a time, which DNN said led to an increase of about a third in call center volume. When the online community was restored, Morgenweck said, the call volume dropped by about the same amount.

No. 2: Feedback Based on Trust

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A feedback screen in the Evoq Social community.

In addition to taking some of the pressure off customer service, Thompson pointed to what she considers the other main advantage of social communities – obtaining direct feedback from customers who are among the most engaged with your product. Such feedback – which can be in the form of opinion-based conversations or analytics from customer data – can be extremely useful in guiding marketing campaigns, developing successor products or helping a company reinforce its marketing messages.

She added that this feedback, and the ability to acquire useful customer data, is derived from the essential value of social communities – helping to “build a trusting relationship” with customers – or with suppliers or partners, if the community is B2B. “If you have that trust,” Thompson said, “you can get more information from your customers.”

Similarly, DNN’s Morgenweck emphasizes the value of remaining “engaged with your customers,” which, like any engagement, requires trust. Engagement, word-of-mouth, brand reputation, stickiness – they are all derived from a customer’s trust in the company and its products. Even SEO enhancement from keyword rich conversations in your community – which can boost traffic, increase the number of participants and help the community become a base of knowledge – will not remain an effective feedback loop if the trust is gone.

No. 3: Lead Generation/Sales Conversions

Forrester analyst Zachary Reiss Davis recently acknowledged on CMSWire  the usefulness of community feedback and the “deflection of support calls,” but he also pointed out communities’ tangible value for new lead generation and influence on converting leads or prospects into sales.

While he was primarily talking about B2B communities, the same value applies to B2C communities. Essentially, your customers are hanging out – synchronously or not – with others who value your products, a discussion area near your main store. The trick is to offer them inside tracks on products without being too “in your face.”

Crowd-sourced support and lead generation/sales conversions can actually be rendered in before-and-after ROI terms that show specific monetary value from a customer-facing community. Feedback based on trust is harder to quantify, but, as reliable customer data becomes an even bigger driver of modern marketing and brand reputation becomes the one essential you cannot buy, their business value is growing.

The Next Generation

Online communities have finally reached a stable level of operations and value, but get ready for the model to shift emphases and values again, possibly soon. Streaming HD video, dynamic mobile communities (especially ones conducted through wearable devices like Google Glass), artificial intelligent agents and extensive product/customer data across all channels – all promise to shake the community mix radically within a few years. The thing to remember is that online communities, despite their name, aren’t settled neighborhoods but are more like meetings held to discuss your products.

The next generation of online communities could exhibit a mobility, intelligence and dynamism that seems beyond the pale right now. Don’t be surprised to see, for instance, online communities valued for their ability to generate flash mobs of customers for micro-sales events at brick-and-mortar stores.

Title image by vectoraart (Shutterstock).