Why online social communities can be such effective marketing tools

In my last post I talked about how both business environments and online social communities can be classified as complex adaptive systems and the fact that both are inherently unpredictable in nature. Taking this into account, let’s look at why online social communities can be so effective for mitigating the complexities of highly competitive business environments, especially within the context of marketing.

Even though business environments are unpredictable, there are still many measures that can be taken that will make these volatile systems more manageable. In any complex system, the more information you have to apply to decision making, the better off you are. So, the main objective in dealing with a complex adaptive system (e.g. business environment, online social community or otherwise) should be to increase the information flow among agents (e.g. people) in order to enhance the learning abilities and relationships among the agents. These enhanced learnings and relationships will make it easier to navigate unforseen complexities and the potential negative effects of these situations. For instance, you can probably imagine how a basketball team (or any team for that matter) of best friends would be more effective at improvising a fast-break down the court than a team of strangers. There are an infinite number of scenarios that might play out during a five to ten second fast-break play but the team whose members are more familiar with each other (i.e. can best anticipate each others actions) will be the more succesful team in this case. These strong relationships can be considered extra information that can be used to make better decisions. Michael Lewis wrote a recent NY Times article that talks about how Shane Battier of the Houston Rockets uses extra information about opponents’ behavior in order to decrease complexity and increase his team’s chances of success on the basketball court.

Let’s extend this concept to online social communities and why they’re effective marketing tools. Here are some related reasons why online social communities, if well implemented, can go a long way towards helping a business succeed in an uncertain world:

  • Increased volume of information – Online social communities foster increased participation among the sponsor company and its customers (current and prospective) which increases the quality and quantity of information available to make decisions.
  • Communal learning – Succesful online social communities provide a “speaking up” culture which encourages questions, interactions and information flow among members. As member become more and more comfortable participating, the communal learning increases.
  • Diverse inputs – Successful online communities engage a wide variety of members (e.g. happy customers, disgruntled customers, potential customers, competitors, etc.) which results in an information flow that is diverse and more thorough.
  • Mitigation of power differences – Online communities allow consumers like you and me to potentially converse directly with high status company representatives. This results in an environment without status hierarchies and a forum where people feel free to speak their minds.
  • Searchable information – The fact that all of this great information is digitized makes it easy to search through to glean important insights.
  • Sensemaking - The continuous learning that these communities provide helps its members to make sense of their environment. The sponsor company can get a better handle on consumer behavior and the competitive landscape, and the consumer gets a better understanding of the company and its behavior. Collectively, this results in a more intimate connection between the company and consumer and breeds customer loyalty.
  • Adaptability - As the quantity and quality of information flow increases, the sponsor company increases its ability to improvise (i.e. quickly react and develop strategies) in the face of evolving and surprising business situations.
  • Better relationships – Perhaps the most important result of a successful online social community is the enhanced relationships that are forged between the company and consumers through transparent, trustworthy interactions.

These are just a few (admittedly academic) reasons why online social communities can be so effective in an online marketing context. These points may seem obvious on the surface but I think that these core principles often get lost in the mix when companies are trying to figure out objectives and technical strategies for their online community. At a time where so many online communities are competing for a slice of their consumers’ valuable time, keeping these points in mind just might uncover valuable insights that will lead to unique and compelling community features. In my next post, I’ll offer some distinct strategies to follow that will ensure your online social community has the best chance for success.

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