As practitioners in the customer feedback game, we are only too aware of customer voices falling on deaf ears. And with the explosion of social media the imbalance between "user generated content" vs "enterprise generated action" has become the herculean challenge. Which is why any mechanism that enables an organisation to listen more effectively is, well frankly, gold.

Hence our interest in data visualisation. It is no great surprise that despite building healthy online communities of tens or hundreds of thousands of members, or surveying customers to within an inch of their lives, big brands are sometimes lousy at listening or distilling what is being said by customers. Other than perhaps a Marketing sponsor or Community Manager who is going to take the trouble to trawl through a thread on a community forum or join the dots across polls, surveys and  ideas. Too much trouble for too little reward!

However, what if you can "dial up" your customer feedback like this. Or visualise relativities like this:

Making customer feedback data visual makes it difficult to ignore; and if it tells a story - particularly through the words of a real customer then you are tapping into something very fundamental about the way we communicate.

Stay tuned for some exciting developments in this area.

Recently we talked about the NPS-relevant study that shows how detractors (evidenced by the fact they leave as customers) influence those close in their social network to also defect. We have also discussed previously, a number of studies showing that Promoters (specifically 'influencers') promote product take-up ('diffusion' in social network speak) through recommendation.

This TED talk, Listening to Global Voices by Ethan Zuckerman is something of wake-up call. It is very easy for us - especially the digital us - to imagine that a global internet infrastructure means that we are all somehow automatically connected and gaining a broader worldview. Zuckerman illustrates that this is far from the case (we live in "filter bubbles" or worse, in a state of "imaginary cosmopolitanism") and that achieving broader connectedness requires a change in thinking - to break the human tendency to homophily ("birds of a feather flock together"). He sees a special role for people ("DJs") who are bridge builders between different worlds.     

At the level of brand conversations, it is a timely reminder of building broadly based brand communities and the strength of weak ties that we have posted on previously.

In our NPS self-improvement efforts we read a lot of literature on the intersection of social networks and marketing and especially we take note of studies that use data from mobile telephone operators. Why? 

• Defection of a network neighbour increases the likelihood of a customer's defection. By 150% in raw numbers, by 80% when allowing for tie strength and customer similarity (homophily).
• • Tie strength they measure by looking at the volume of contact between the 2 customers 
  • Homophily they measure by assigning points for each of 4 characteristics that were similar between the 2; gender, age, marketing segment, socio-economic status - it is important to control for homophily as a similar response to the same product by similar people may be mistaken for an indication of social influence when it is not.   
• 'With their feet' detractors who leave impact customers more strongly the closer they are in social network terms; "...a 1% increase in a customer's tie strength with defecting neighbours is associated with a 2% increase in that customer's hazard of defection."
• Similar customers are likely to act the same but at a much lower rate; "...1% increase in similarity between a customer and a defecting neighbour is associated with a 1.1% increase in the customer's hazard of defection..."  
• The influence of a neighbour's defection decreases markedly with the passage of time  
• A loyal customer is less likely to defect following a neighbour's defection - customer loyalty 'immunizes' against the effects of a defecting neighbour. (Loyalty was measured by an index of tenure and call volume, ARPU) 

 
An interesting study.

1. The NPS of network contacts should be considered when trying to understand and manage customer churn. This is likely to be easier in a B2B environment where network structures, the formal ones at least, are easier to discover and track. No customer is an island!
2. If we needed more urging to respond to customer defection quickly here it is, "If a firm aims to deal with this possible influence, it should act fast, as close as possible to the neighbour's defection event". If you use member-get-member programs and a referrer defects, look to his referees asap.
3. Customer loyalty has multiple benefits, making this whole 'Active NPS' endeavour worth it. Loyal customers;

• provide higher profits for longer 
• have higher social value as they influence others to adopt products AND as this study shows
• loyal customers are less likely to be affected by the defection of others   

  

 React to bad customer news quickly!

Resonate is pleased to announce the appointment of Darren Sharp as Senior Consultant, Community Management. Darren brings with him years of consulting and research experience in social media, online communities and user-led innovation. He has been particularly active most recently in the Gov 2.0 space working with a range of high-profile public sector clients on community engagement projects. Over to Darren who'd like to share his thoughts on some of the latest news related to customer co-creation activities. Jeff

The software industry and its acolytes have always fascinated me - even moreso as some of its fundamental tenets are challenged. So it was with great interest that I read Gartner's take on so-called "social software". And to be truthful, I was pleasantly surprised with the clarity of their analysis. Afterall, this is an emerging market dominated by the behaviour of that most unpredictable stakeholder - you & I - in our various social guises of customer, employee etc....

In Gartner's framework, social software has matured enough to support at least three distinct software markets:

• Externally facing social software: general purpose products that support communities outside the enterprise
• Social software in the workplace: which focuses on the market for products that support social networking within an enterprises
• Social CRM: that extend customer relationship management (CRM) processes into external communities to support sales, service and marketing 

In my humble opinion, Gartner astutely observe that organisations selecting external facing social software should not apply the same processes as they would for classic enterprise software purchases. The need is different: innovation is more important than integration or standards; capabilities that add unique value matter more than the best or most complete functions. Gleaning real-time insight from your more passionate customers in a large customer community (the fuzzy front-end!) is as much art (content!) as science - that's certainly our experience...

Again in my opinion, the Social CRM market will however ultimately become the elephant in the room - the inexorable grind for a clear business case will make sure of this.  

Gartner: Social CRM comprises applications with very different approaches for supporting communities of internal users, customers, partners and other stakeholders to assist with sales, marketing and customer service processes for the mutual benefit off enterprises and their customers. The main subcategories of social CRM applications include social monitoring, customer- and partner-hosted communities, enterprise feedback management (EFM), product reviews and sales contacts.

As the market for these types of applications mature, Gartner predicts (accurately I believe) that vendors will find it harder to gain an advantage by providing unique core functions for social CRM.

Differentiators will then become:

• The ability to seamlessly interoperate between public social networks and private communities
• The ability to integrate processes with traditional operational CRM applications
• The ability to prove the ROI of the social CRM application
• Partnerships with global systems integrators, or digital or interactive agencies and consultants, to promote and deploy the application

The last point is interesting as these social applications are way more dependent on domain expertise and content than traditional transactional systems and you do wonder whether this is a blind spot in the traditional Gartner approach - where flogging licenses unfettered by services or (or business outcomes!) has been the name of the game. Refer CRM  v1.0.

If you can put this big qualification to one side, the Gartner analysis of functional needs and emerging markets is very interesting and informative. 

We initially got involved in conversational marketing through our work with an Australian Rules Football team. No lack of passion and emotional involvement with the product there! Customers almost pushed us out of the way to participate and contribute to the buzz of the online community.

One phenomenon that no longer surprises us (though it still puzzles us in some product categories) is the considerable effort that some people will put into an online community that interests them.

 

For those of us involved in building healthy online communities, or indeed anyone just curious of where the social web will go, the emerging science of social networks is fascinating. Tim touched on an aspect of this his last post and as practitioners we are all learning - both from academia (see Duncan Watts Six Degrees - the Science of Connected Age) and from real lessons on the ground.

The relative value of strong and weak ties is a critical aspect of this emerging science and it has some surprises.

The value of strong ties is understandably in the relationship itself. Online communities need a sufficient number of strong ties to sustain engagement and the  embeddedness of the most valuable contributors - so critical to growing a community. However, strong ties on their own are not enough - particularly in recruitment or periodic regeneration phases. Tim touched on this talking about the tendency to homophily in strongly connected groups; basically the danger of a small self-selected conversational gene pool talking about the same thing over and over...  

Gavin Heaton summarises some research going back to 1973 - the key findings being that the weakest ties are the most powerful in terms of disseminating information and in facilitating the move from first adopters to early adopters. A characteristic of innovators or first adopters is that they are often marginal or isolated with very small social networks; but have one-to-one or bridge relationships to larger groups. Early adopters, on the other hand, are keen to form such bridging relationships and to amplify their reputation in a broader social network.

The value of weak ties is not the (superficial) nature of the relationship but in their sheer number and diversity. Think about searching for a job. Your close friends are likely to go to great lengths to help you but their efforts are insignificant in terms of reach and effectiveness when compared with a broad set of weak ties - particularly when the internet has just lowered the threshold on taking action (how hard is it to forward a CV...). As Michael Wu points out, having a large number of weak ties enables us to crowdsource our weak ties for help.

My takeout: understand the value of both strong and weak ties in building and sustaining your online community    

A popular way of constructing social media / Word of Mouth marketing campaigns is to first seek out and recruit consumers with large social networks. The implicit assumption seems to be that someone with 500 Facebook friends will spread your marketing message more effectively than someone with 100.

 
 * Quote from Sam the Social Media Guru