The Secrets of Marketing in a Web 2.0 World

The Secrets of Marketing in a Web 2.0 World

Consumers are flocking to blogs, social-networking sites and virtual worlds. And they are leaving a lot of marketers behind.

For marketers, Web 2.0 offers a remarkable new opportunity to engage consumers.

If only they knew how to do it.

That’s where this article aims to help. We interviewed more than 30
executives and managers in both large and small organizations that are
at the forefront of experimenting with Web 2.0 tools. From those
conversations and further research, we identified a set of emerging
principles for marketing.

For marketers, Web 2.0 offers a remarkable new opportunity to engage consumers.

If only they knew how to do it.

That’s where this article aims to help. We interviewed more than 30
executives and managers in both large and small organizations that are
at the forefront of experimenting with Web 2.0 tools. From those
conversations and further research, we identified a set of emerging
principles for marketing.

But first, a more basic question: What is Web 2.0,
anyway? Essentially, it encompasses the set of tools that allow people
to build social and business connections, share information and
collaborate on projects online. That includes blogs, wikis,
social-networking sites and other online communities, and virtual
worlds.

Millions of people have become familiar with these tools through
sites like Facebook, Wikipedia and Second Life, or by writing their own
blogs. And a growing number of marketers are using Web 2.0 tools to
collaborate with consumers on product development, service enhancement
and promotion. But most companies still don’t appear to be well versed
in this area.

So here’s a look at the principles we arrived at — and how marketers can use them to get the best results.

Don’t just talk at consumers — work with them throughout the marketing process.

A
Web site can be a marketer’s lifeline with its customers, but what
happens when it’s marred with negative reviews and comments? Bruce
Weinberg, marketing professor at Bentley University, tells WSJ’s Erin
White how to address and recover from poor feedback.

Web 2.0 tools can be used to do what traditional advertising does: persuade
consumers to buy a company’s products or services. An executive can
write a blog, for instance, that regularly talks up the company’s
goods. But that kind of approach misses the point of 2.0. Instead,
companies should use these tools to get the consumers involved, inviting them to participate in marketing-related activities from product development to feedback to customer service.

How can you do that? A leading greeting-card and gift company that
we spoke with is one of many that have set up an online community — a
site where it can talk to consumers and the consumers can talk to each
other. The company solicits opinions on various aspects of
greeting-card design and on ideas for gifts and their pricing. It also
asks the consumers to talk about their lifestyles and even upload
photos of themselves, so that it can better understand its market.

A marketing manager at the company says that, as a way to
obtain consumer feedback and ideas for product development, the online
community is much faster and cheaper than the traditional focus groups
and surveys used in the past. The conversations consumers have with
each other, he adds, result in "some of the most interesting insights,"
including gift ideas for specific occasions, such as a college
graduation, and the prices consumers are willing to pay for different
gifts.

Similarly, a large technology company uses several Web 2.0 tools to
improve collaboration with both its business partners and consumers.
Among other things, company employees have created wikis — Web sites
that allow users to add, delete and edit content — to list answers to
frequently asked questions about each product, and consumers have added
significant contributions. For instance, within days of the release of
a new piece of software by the company, consumers spotted a problem
with it and posted a way for users to deal with it. They later proposed
a way to fix the problem, which the company adopted. Having those
solutions available so quickly showed customers that the company was on
top of problems with its products.

Give consumers a reason to participate.

Consumers have to have some incentive to share their thoughts, opinions and experiences on a company Web site.

One lure is to make sure consumers can use the online community to
network among themselves on topics of their own choosing. That way the
site isn’t all about the company, it’s also about them. For instance, a
toy company that created a community of hundreds of mothers to solicit
their opinions and ideas on toys also enables them to write their own
blogs on the site, a feature that many use to discuss family issues.

Other companies provide more-direct incentives: cash rewards or
products, some of which are available only to members of the online
community. Still others offer consumers peer recognition by awarding
points each time they post comments, answer questions or contribute to
a wiki entry. Such recognition not only encourages participation, but
also has the benefit of allowing both the company and the other members
of the community to identify experts on various topics.

Many companies told us that a moderator plays a critical role in
keeping conversations going, highlighting information that’s important
to a discussion and maintaining order. That’s important because
consumers are likely to drift away if conversations peter out or if
they feel that their voices are lost in a chaotic flood of comments.
The moderator can also see to it that consumer input is seen and
responded to by the right people within the company.

Getting Sociable

  • A New Approach: Marketing these days is more about building a two-way relationship with consumers. Web 2.0 tools are a powerful way to do that.
  • The Pioneers:
    A growing number of companies are learning how to collaborate with
    consumers online on product development, service enhancement and
    promotion.
  • The Lessons: From these early
    efforts, a set of marketing principles have emerged. Among them: get
    consumers involved in all aspects of marketing, listen to and join the
    online conversation about your products outside your site, and give the
    consumers you work with plenty of leeway to express their opinions.

And,
of course, it’s important to make a site as easy to use as possible.
For instance, there should be clear, simple instructions for consumers
to set up a blog or contribute to a wiki.

Listen to — and join — the conversation outside your site.

Consumers tend to trust one another’s opinions more than a company’s
marketing pitch. And there is no shortage of opinions online.

The managers we interviewed accept that this type of content is here
to stay and are aware of its potential impact — positive or negative
— on consumers’ buying decisions. So they monitor relevant online
conversations among consumers and, when appropriate, look for
opportunities to inject themselves into a conversation or initiate a
potential collaboration.

For example, a marketing manager of a leading consumer-electronics
company monitors blogs immediately after a new-product launch in order
to understand "how customers are actually reacting to the product."
Other managers keep an eye on sites like Digg.com and Del.icio.us
that track the most popular topics on the Web, to see if there’s any
buzz around their new products, and whether they should be adjusting,
say, features or prices.

In one case, a company found a popular blogger who had spoken highly
of the company’s brand. Just prior to launching a new product, the
company sent the blogger a free sample, inviting him to review it with
no strings attached. The end result: The blogger wrote a favorable
review and generated a flood of comments. So the company got nearly
free publicity and feedback.

Resist the temptation to sell, sell, sell.

Many marketers have been trained to bludgeon consumers with
advertising — to sell, sell, sell anytime and anywhere consumers can
be found. In an online community, it pays to resist that temptation.

When consumers are invited to participate in online communities,
they expect marketers to listen and to consider their ideas. They don’t
want to feel like they’re simply a captive audience for advertising,
and if they do they’re likely to abandon the community.

The head of consumer research for a leading consumer-electronics
organization created an online community of nearly 50,000 consumers to
discuss product-development and marketing issues. One of the key
principles of the community, she says, was "not to do anything about
marketing, because we weren’t about selling; we were about conversing."

In short order, community members not only identified what it was
they were looking for in the company’s products, but also suggested
innovations to satisfy those needs. The company quickly developed
prototypes based on those suggestions, and got an enthusiastic
response: Community members asked when they would be able to buy the
products and if they would get the first opportunity to buy them. They
didn’t have to be sold on anything.

Don’t control, let it go.

In an online community, every company needs to find an effective
balance between trying to steer the conversation about its products and
allowing the conversation to flow freely. In general, though, the
managers we interviewed believe that companies are better off giving
consumers the opportunity to say whatever is on their minds, positive
or negative. Moderators can keep things running smoothly and
coherently, but they shouldn’t always keep the conversation on a
predetermined track. The more that consumers talk freely, the more a
company can learn about how it can improve its products and its
marketing.

One marketing executive recalled the first time she let
an online community created for a client interact with very little
control or moderation, resulting in an animated discussion about the
look of the company’s product. The client, with great concern, asked.
"Who told them [the consumers] they could do this, that they could go
this far?" Of course, when this process resulted in totally new
packaging that helped boost sales, the client was ecstatic.

As another executive of a company that creates online communities
for clients told us: "You have to let the members drive. When community
members feel controlled, told how to respond and how to act, the
community shuts down."

Find a ‘marketing technopologist.’

So who should direct a company’s forays into Web 2.0 marketing? A
number of managers identified an ideal set of skills for an executive
that go beyond those of a typical M.B.A. holder or tech expert. We
coined the term marketing technopologist for a person who brings
together strengths in marketing, technology and social interaction. A
manager said, "I’d want to see someone with the usual M.B.A.
consultant’s background, strong interest in psychology and sociology,
and good social-networking skills throughout the organization."

Foot soldiers need to be carefully selected as well. One large
technology company weighs employees’ proven skills to choose writers
for blogs that are read by consumers. The company has long used blogs
internally to help employees discuss technical issues, products, and
company and industry topics. When it decided to use blogs to raise its
profile online, it recruited those who had shown the most skill at
blogging within the company. The company currently has about 15
employees who blog publicly, mostly on technology trends, and is
recruiting more the same way. Meanwhile, the bloggers plan to meet
occasionally to share the lessons learned from their experiences.

Embrace experimentation.

One Web 2.0 strategy does not fit all, and sometimes the best way to
find out what’s best for a given company is to try some things out and
see what happens.

Blogs, wikis and online communities are among the tools that
companies are most commonly using for marketing, but there are other
ways to reach consumers. Some of the companies we talked with have
gotten their feet wet in the online virtual world Second Life, where
millions of users interact with each other through avatars. Companies
can sell their goods and services and sponsor events in Second Life
just as they do in the real world; one sponsored a contest for the best
avatar.

Others are considering new ways to use more-familiar tools. For
instance, many companies have long used instant messaging on their Web
sites to allow shoppers to chat with customer-service representatives.
One executive we spoke with said he would like to experiment with
allowing consumers to chat with each other as they shop on his
company’s site.

—Dr. Parise is an assistant professor of
technology, operations and information management at Babson College in
Wellesley, Mass. Dr. Guinan is an associate professor of technology,
operations and information management at Babson College. Dr. Weinberg
is chairman of the marketing department and an associate professor of
marketing and e-commerce at Bentley University in Waltham, Mass. They
can be reached at reports@wsj.com.

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