Community Building Spread by WOM is Goldmine Online Marketers

07/29/2008

The buzz created via online communities can be gold to Internet marketers – if it’s done the right way. Most online social communities become popular because word of mouth is still a powerful grassroots marketing medium.

Once these communities are established, they benefit online businesses in a number of ways. "The 2008 Tribalization of Business" study, conducted by Beeline Labs, Deloitte and the Society for New Communications Research quantified the following specific benefits:

Spread Word of Mouth Advertising: This was the greatest benefit of online communities. Online communities increase word of mouth about a product/service by 35%.

Elevate Brand Awareness: The survey found that online communities did increase brand awareness 28% of the time.

Online communities also increased customer loyalty and introduced fresh ideas into an organization at the same rate – 24%.

What Makes an Online Community Effective?

The study found that people like to connect with other like-minded people. Hence, 54% cited being able to do this was high on their list of an effective online community. Rounding out the top three, members liked to be able to help others; 43% cited this as a factor. Finally, 41% thought that focus – as in focus on a hot topic was what made an online community effective for them.

What Prohibits an Online Community’s Growth?

Perhaps not surprisingly, the study found that the biggest obstacle to growing an online community is simply moving people to act; getting them involved. This was found to be the stumbling block 51% of the time.

Technology wasn’t a factor; funding wasn’t a factor, and even management wasn’t an obstacle.

Measures Used to “Size Up” an Online Community’s Effectiveness:

The measures used to assess online communities differ. For transparency, the main business measures used were:

Awareness: 49% of businesses reported greater awareness;

New Idea Presentation: 41% said they got new ideas from the community;

Referrals: 28% of businesses reported an increase in referrals; and

Sales Increase: 26% reported an increase in sales that could be directly attributed to the online community.
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