The Secret Ingredient for Customer Lifecycle Marketing? Community Management.

A recent benchmarking report from Demand Metric on Customer Lifecycle Marketing illustrates the impact of aligning marketing efforts around a customer journey model. The report also illustrates a number of blindspots that are derailing Customer Lifecycle Marketing efforts.

The missing ingredient? Community Management.

First, highlights from the report (direct quote):

The analysis of this study’s data provides these key findings:

  • The study found that less than 20% of organizations are currently marketing across the entire customer lifecycle.
  • Participants spend twice as much of their marketing budgets on acquiring new customers as on retaining existing ones. (Yet most of their revenue comes from existing customers!)
  • Almost 90% of the study participants indicate that marketing currently owns the understanding and management of the customer lifecycle.
  • Of the lifecycle stages – Awareness, Consideration, Purchase, Retention and Advocacy – Awareness enjoys the greatest clarity of ownership, with marketing owning the stage 88% of the time. Retention is most fragmented, with few organizations defining clear ownership of this stage.
  • The Awareness and Consideration stages enjoy “adequate” or “ample” levels of investment for over 70% of study participants. Retention and Advocacy both fall at the “minimal” to “none” level of funding for 55% of study participants.
  • The greatest benefit to executing a customer lifecycle marketing strategy is greater customer engagement.
  • The greatest challenge to marketing across the customer lifecycle is understanding customer content needs.
  • 72% of strategy adherents are experiencing a revenue lift from customer lifecycle marketing.
  • Over three-fourths of participants plan to increase their commitment to and investment in customer lifecycle marketing.
PardotDemandMetric-Marketing-Effectiveness-by-Journey-Stage-Dec2015
Excellent summary graph from MarketingCharts.com

Clearly Customer Lifecycle Marketing is incredibly valuable when all stages of the lifecycle are addressed. So what is the problem? Based on my direct experience and years of studying the intersection of marketing and online community, I would assert that building meaningful relationships at scale is still an undeveloped function in the majority of most organizations. Further, as the data from the report shows, the “ownership” for customer retention is scattered among many departments. Add to the mix the eternal debate about “who owns social / community” and things get even more messy.

So what is a modern marketing organization to do? Consider three things:

  1. Community Drives Customer Lifecycle
    A modern definition of online communities expands the location of “community” to be any on or offline touchpoint where customers can meet and form relationships. A modern definition also expands the concept of community management to include any form of relationship building and nurturing. Modern online communities produce a range of value for customers and businesses. Peer to peer support is the classic example, yet modern approaches include a range of deep collaboration on new product development to expansive crowdfunding campaigns – and everything in between. Community can play a valuable role in every stage of the customer lifecycle, and can often be the connective tissue to hold the entire experience together.
    Screen Shot 2016-01-07 at 6.03.39 AM
  2. Treat Engagement & Retention as a Community Management Opportunity
    The practice of building and nurturing customer relationships is a job modern community managers understand very well. In particular, Community Managers can be very effective as resources in Customer Nurture campaigns during the consideration phase. I had my community management team at Autodesk reboot a nurture campaign that supported a 30 day product trial, and the results were amazing.

    nurture
    Example Customer Nurture email from a Community Manager

    Further, Customer Advocacy programs grew (at least partially) out of Community Advocate / MVP programs. It is a relatively straightforward process to scale current Advocacy programs to include different customer types. There is also a massive opportunity to harmonize Influencer programs (which typically look outside of existing communities) with Advocacy programs. These are essentially two sides of the same coin – Advocates have typically been nurtured through a hosted community and Influencers have established their own communities and networks. A modern Community Manager treats these contexts as part of the larger community ecosystem.

    Treating engagement and retention as a community management opportunity allows the staff with the skills to manage relationships at scale do what they do best. This is a huge missed opportunity in marketing.

  3. Get Real About Digital Transformation & Social Business
    A modern approach to online community takes into account the entire digital ecosystem, not just single online touchpoints. A modern approach to community management nurtures engagement across the digital ecosystem. So if Community Managers know how to address the key gaps illustrated in the Demand Metric report, what’s the problem? Why isn’t it happening? There are many answers, but one factor that has had a huge negative impact is the trend of Digital Transformation initiatives absorbing (or in some cases, abandoning) Social Business efforts. I expand on (and in some ways, rant about) this in my 2015 recap post. Most Digital Transformation initiatives have focused on technology at the cost of customer engagement. Many Social Leadership teams and organizations have been disbanded or fractured and embedded to the point of being ineffective. Customer Experience initiatives often focus on superficial and in the moment customer engagements at the cost of growing the life long relationship.Bottom Line: We need a new Leadership model that addresses not only the Company : Customer relationship but also the complex network of Customer : Customers :  Company  relationships.

Netting it out:

  • To create successful Customer Lifecycle Marketing initiatives, modern marketers must include online community and community managers.
  • Community Managers can help address the current engagement and retention gaps in Customer Lifecycle Marketing programs.
  •   Organizations need to renew focus and investment in Online Community Leadership to drive growth via Customer Lifecycle Marketing

I am working with a portfolio of clients on evolving their community and marketing programs (lifecycle, influencer & advocacy, community management). I am also kicking off the year by offering a complimentary consultation session (for a limited time & very limited slots). If you would like to get feedback and guidance on your 2016 plans, feel free to register for a consultation here. 

Preview of the Brands & Collaborative Economy Research Project

In March I embarked on a series of qualitative research projects to help organizations prepare for the disruption and opportunity emerging from the Collaborative Economy, and understand what resources they need to be successful. Crowds, Community & CollaborationWave 1 responses are in and the analysis is almost finished. I wanted to share a preview of the results to date. The full set of results will be published in June.

The pool of organizations that completed the survey ranged from Fortune 500 software, media and retail companies to small startups in the sharing economy space. A handful of non-profits also participated.

Key observations:

  1. A shared understanding of the Collaborative Economy is still forming.
  2. The Collaborative Economy is relevant to organizations, but the level of urgency isn’t high (yet).
  3. The most interesting sectors are Learning, Services and Corporate (“Sectors” as described by Crowd Companies Honeycomb model).
  4. Many organizations see online communities, social networks and collaboration platforms as “enablers” and areas to begin experimentation.
1. Shared Meaning & Definitions
Getting to a crisp definition and shared understanding of the Collaborative Economy is challenging because the concept describes the interplay of a number of other large trends and movements, including (but not limited to) the Sharing Economy, Sustainable Development, Digital Transformation, the Maker Movement, Internet of Things, Future of Making Things and more. In the context of this research project, when asked to describe their understanding of the Collaborative Economy, respondents mainly spoke to 3 key themes of the Collaborative Economy as:An economic model…

“A model in which the creation and exchange of value (of goods, services, knowledge, etc) occurs through human interactions versus (solely) financial transactions. Asset allocation is optimized such that resources are jointly consumed and assets rarely stand idle.”

A social movement…

“Where brands and people start thinking more cooperatively for the greater good…instead of competitively & businesses go back to being more sociable and people-focused.”

A technical platform…

“Coordination of mobile devices, cashless payment systems, reliable rating mechanisms to get value from each other as opposed to centralized corporation of assets.”

2. Relevance and Urgency
Most respondents said the Collaborative Economy was either “Somewhat Relevant” or “Very Relevant” both now and through the next 12-18 months. The fact that many respondents gave responses that indicated a relatively low level of urgency was very surprising. It is likely that most organizations:
  • Don’t understand how to formulate a strategy
  • Don’t have the necessary vision, leadership and resources to engage
  • Don’t see a burning platform of missed opportunity or competitive threat
  • Aren’t willing (yet) to make the investments in platforms, partnerships, open collaboration and the making corporate assets available.

The respondents who did indicate a high level of urgency, and had active pilots, were engaging in activities ranging from: investment in or partnership with complimentary startups, development of platforms and marketplaces, evolving existing social business programs, and re-developing the value exchanges of their online communities. These pilot programs will be covered in more detail in the final report.

Relevance and Urgency

 

3. Emerging Sectors
Research participants were asked to rank certain sectors of the Collaborative Economy by level of interest. The sector categories were sourced from the  Crowd Companies Honeycomb model.
emerging_BaCC

 

4. Enablers
Survey participants were asked to rank the following systems, technologies and engagements based upon their perceived value in enabling an organization to engage in the Collaborative Economy.
Enablers_BaCC

 

The full Brands and the Collaborative Economy report will be released in June, going in to further detail on the topics above, as well as:

  • An overview of current pilot programs being conducted by the respondents;
  • Key sources of information and data about the Collaborative Economy;
  • An overview of missing or underdeveloped resources and services needed by organizations for their Collaborative Economy initiatives.

Next Up:
Wave 2 Research begins June 1st.
Wave 2 research will begin the week of June 1st, and will cover:

  • Lessons learned from early successes and failures
  • Organizational resources needed to develop and sustain pilot programs
  • Development of a simple framework for Collaborative Economy pilot programs

If you are interested in participating in the research (via survey), being interviewed or profiled for the report, or sponsoring a future report, please send me an note.

Private Briefings & Advisory Sessions
I am also doing a limited number of private briefings on the Collaborative Economy research and how a modern approach to online communities can support innovation, customer acquisition and retention.
I’m available for online session booking via Popexpert, or feel free to drop me a note.

Dr. Strangeshare or: How I Learned to Stop Worrying and Love the “Collaborative Economy”

dr_strangeloveI have a confession to make: I can become really obsessed with labels.

Back in 2008, when I was producing events and conducting research focused on Online Communities for Forum One, the word “social media” hit broad adoption. I had countless debates with my colleagues about what we should title events and new research initiatives to stay true to the intention and tradition of online community building, while including the emergent activity happening on the mass social networks that were experiencing explosive growth globally. Two years later at Dell, our centralized “Social Business” team was called “SMaC” – Social Media and Community. Many labels in play trying to describe a spectrum of concepts and activities.

Ch-ch-ch Changes
On the one hand, each new term that has been introduced introduced to describe a major shift (virtual community, online community, social media, social business…) signaled a major evolution or change in culture, driven by the twin forces of technology and culture. On the other hand, each change contained so many attributes of the last wave that it was easy to be cynical that it was change in name only, driven by consultants, analysts and authors ready to make a label stick to own a market or concept. What really happened? Honestly, I think a bit of both – as market and cultural forces gained energy, a handful of folks were able to step forward and help make meaning of what was going on and describe what possible future scenarios might come in to play. I created a simple diagram to describe what I personally saw in my career to date:

A Snapshot of the Evolution of Online Communties
(
click for a larger version)

Something’s Happening Here
Which brings us more or less up to date. When I first heard the terms “Sharing Economy” and “Collaborative Economy” hitting mainstream last summer, my immediate reaction was a cynical “here we go again”. But then I started doing research, and listening to some of the smart voices in the field signaling the change. In particular, I found Rachel Botsman’s work very helpful and insightful. Her “The Sharing Economy Lacks a Shared Definition” is an especially good overview. Jeremiah Owyang has done a lot of research and writing in the field as well, and it was his energy and insight that helped me decide to make Autodesk a founding member of his Crowd Companies brand council.

I’m convinced we are entering a new era – one that draws on the collective learning, social technology and cultural evolution to set the stage for the next act in a very long play that the Cluetrain Manifesto described in 1999:

A powerful global conversation has begun. Through the Internet, people are discovering and inventing new ways to share relevant knowledge with blinding speed. As a direct result, markets are getting smarter—and getting smarter faster than most companies.

I keep coming back to a handful of questions to help frame how the Collaborative Economy will affect my day to day practice:

  • How might this next phase of “social” enable (or force) sustainable and thriving businesses?
  • How can Brand’s fully design and engage an extended community ecosystem – inclusive of all stakeholders (customer, partners & employees), built on shared value?
  • How will reputation play a role as the marketplace becomes a mesh? How can we make data, content and associated reputation all portable across meaningful contexts?
  • How will participation and contribution will be valued, exchanged and incentivized in the near future?
  • What does the future of crowdsroucing and co-innovation really look like?IMHO, early examples, like Dell’s IdeaStorm (I designed the current incarnation) and marketplace’s like Quirky and kickstarter are all part of an interesting but humble beginning.

The net-net: for me, the time for lable-gazing is done. It’s time to learn, experiment and evolve my practice.

I’d love to hear your thoughts.

Updated 3/3/14 @ 11:55am
This morning, Jeremiah Owyang released a new report: Sharing is the New Buying, Winning in the Collaborative Economy – this is the largest study of the Collaborative Economy to date, and an informative read.

Culture, Change and Faith: Achtung Baby & Social Business Transformation

File under: slightly off topic but personally meaningful.

Disclosure: I’m not a massive U2 fan. With that said, Achtung Baby is one of my all time favorite albums. It is a transformative recording from a band that had, to date, been cast as a folksy and righteous rock and roll band from Ireland. Achtung Baby is a product of the band intentionally losing its established identity, giving themselves time and room to explore (albeit contentiously), and birthing an almost unclassifiable masterpiece and subsequent co-opting of mass, and particularly, electronic media as part of the album experience.

vertigo

In 2011, From the Sky Down was released to commemorate the 20th anniversary of the album. The film takes the band members back to Berlin to talk about the creative process of recording Achtung Baby, and in the act of creation, remaking the band.

One of the most insightful moments in the film is at the end, when Bono sums up the intention behind the Berlin sessions and the album. It is at once terrifying and inspirational:

“You have to reject one expression of the band, first, before you get to the next expression,” says Bono, “and in between you have nothing, you have to risk it all

I LOVE this. Applied personally, it is a call to action to grow, explore and transform. Faith in your instincts, talents and abilities bridge the gap between what you are and what you can become, and help hedge the risk.

It occurs to me that most organizations are in a similar state today – business models, culture, internal structure – basically most everything needs some level of transformation to thrive in the new increasingly connected and empowered market that is emerging globally.

How many will have the will to reject the “current expression” of the org?
How many will invest in the work needed for exploration and transformation?
Most importantly – how many will find the will and purpose to risk it all?

We will find out in the very near future.

ps: I was fortunate enough to spend some time in Berlin in 2011. I have to admit that I was not looking forward to the trip, but I wound up falling in love with the city and its energy- including the vibrant startup scene. I posted some of my pics from the trip here:
shots from Berlin

The Role of Brands in Online Communities

There seems to be a wave of bad advice and misguided thinking regarding where and how brands should engage with their communities. Examples include pundits advising brands to prioritize social efforts “off domain”, being passive observers in their communities instead of active hosts, and a general sentiment that hosting a brand-based online community is high effort and low return.

This is really unfortunate, as I’m convinced many organizations are missing key opportunities to realize value from online communities. The reasons for the bad advice and thinking are myriad and may include legitimate causes like: steady pressure from a slowly recovering economy, increased demands for customer attention online and competition for prioritization amongst a growing list of places to play in social media. Unfortunately, the lack of direct experience and ego play a role as well.

Stakes
So, what’s at stake? Your network of customer relationships. Said another way: you can rent this network on Facebook (along with other tenants), or you can make the investment in hosting, growing and managing the network yourself. Renting is cheaper in the short term. Building and hosting the network creates a business asset that is generative in value if managed properly.

The Role of Host
When I say “host”, I am specifically talking about on-domain, brand-hosted communities that are built on a community platform (like Lithium or Jive) and housed under the brand’s domain. Examples include Autodesk’s AREASAP’s Community Network , Dell’s TechCenter and Lego’s CUUSO . The value of these communities is multi-dimensional, but hosted brand communities are generally a “clean, well-lit place” for a company to:

  • offer customers peer to peer support, lowering support costs and increasing customer satisfaction;
  •  co-develop product and service ideas with customers, lowering research costs and creating products with a built in market;
  • give special access to and content from insiders (like product developers) in the company, increasing the value of the community for members;
  • share special content to enhance the use of (or use in) the products;
  • discuss improvements or extensions to products and services;
  • facilitate niche communities of practice around specializations;

to name just a few in the long list of possible activities that produce value for both the brand and community members.

Being a Good Host

“if you talked to people” by Hugh MacLeod @gapingvoid

The web is littered with failed attempts by brands trying to kickstart communities. Many remind me of the famous Bette Midler quote “but enough about me… what do YOU think about me”. Many early failures hit the wall simply because they made the simple mistake of being selfish. Brands need to be able to come up with a simple value equation as part of the strategic development process for community that accounts for both their business needs as well as that of the community member. If both parties can’t win, there is really no sense in playing. I offer the examples I gave earlier as proof that this can be done – Lego, Autodesk, Dell and others have been and are successful in their efforts. A few reminders on etiquette for being a good host (and there are many others):

  • Be present and attentive
    Ensure that staff are available to participate, answer questions and respond to feedback.
  • Be engaged
    Actively manage the community, ensuring basic moderation is happening and that there is a regular cadence of content and activity.
  • Be respectful
    Ensure that communications, content and activities are geared towards shared value, vs one-sided discussions about the host organization. Being respectful goes beyond generally being civil and includes the expectation that the community hosts will form relationships with members and support the community over the lang haul.

Brands as Networks
One definition of brand is “the collectively held perceptions about an organization shared amongst its stakeholders”. I find this fascinating because the statement implies that a brand can’t manifest unless it is in a networked environment. Brands need networks in order to exist. Online (and offline) Communities are a living, breathing expression of a brand.

The Net:

  • Online Communities should be a focal point of brands social strategy, and a “center of gravity” for social presence;
  • Brands should not shy away from the role of active community host – it’s not an option, it’s a responsibility
  • To be a good Community host, approach the task with the attitude that *everybody can win* instead of a zero sum game of Brand vs Customers

Thoughts on Managing Your Social Vendor Relationships

Let’s face it – the vendors you rely on for social media & community platforms, services and advice have you outnumbered and surrounded. Between account reps, sales reps, relationship managers, executive success partners and the rest of the cast, most vendors have a veritable army of skilled professionals whose primary purpose is to maximize revenue derived from their relationship with you. I’m not saying that this is all bad (profitable vendors = sustainable vendors, after all) and that these relationships can’t be mutually beneficial. What I am saying is that the sides of the social vendor relationship game aren’t evenly matched. For social executives, it’s time to step up our game and more proactively manage these vendor relationships.

What’s at stake? Ultimately, the long term success of your social programs. Have you ever been through an Online Community platform migration? It sucks –  from a technical perspective, let alone a community management perspective. Ever had to buy an additional social listening package because your primary  did a bad job of  influencer identification? Ever had analysts completely contradict each other on best practices for rolling out a Reputation Management system in back to back briefings? Issues with vendors as isolated incidents are painful and expensive. Issues with some or all of your vendors simultaneously can  kill social programs.

The opportunities at hand are to gain the most value from your vendor relationships ideally by:

  • Gaining access to and influencing product roadmap
  • Guiding the vendor into partnership & integration discussions with other vendors that you use
  • Staying abreast of best practice and useful case studies from other customers of the vendor
  • Understanding if you and the vendor are on paralell or divergent paths long term

SWGD? (So Watcha Gonna Do?)
I offer the following tactics and suggestions in the spirit of SWGD :

1. Host an Annual Social Vendor Summit
Ask your vendors to come onsite for an annual Social Vendor Summit. I hosted one of these at Dell in January of this year, and had all of our community, social media, listening, social CRM, social marketing, analytics and touchpoint partners in for a day of shared briefings. The briefing format was dead-simple-  each vendor had 30 minuts to share 3 slides: 1) An overview of current state and feature usage, 2) Suggestions on how we could improve use and effectiveness of their offering and 3) Anything else they wanted to tell us. They sessions were a great way to get the internal team on the same page and also to spur brainstorming and collaboration amongst the vendor partners.

2. Conduct Quarterly Business Reviews
These reviews are likely common as an internal practice in your organization, so why not expect them of your vendors? Reviewing product roadmap updates, strategy updates, progress on key programs and any interesting new customer examples or case studies is a few hours well spent in the quarter. This is a much deeper and more exclusive dive than the Summit mentioned above, and is really intended to be a frank feedback sharing and strategy session. Are some of your vendors not willing to spend the time to do this? Great segway to my next suggestion…

3. Stay in Touch With Competitive Vendors
Competitive social vendors are likely calling you anyway – make the best of it! I was generally willing to take a call or briefing with a competitive vendor at Dell if I was sure about our internal position on the incumbent vendor (favorable or not) and I would always let the competitive vendor know if there was any chance of them winning the business prior to the briefing.

4. Understand & Influence Product Roadmap
Your social vendors with product roadmaps should be more than willing to share fairly long-term (at least 18 mos) roadmaps with you. They will be caveated to the Nth degree and be bookended by safe harbor statements… but they should be shareable. You should feel empowered to have a discussion about the planned features and you should generally feel like your priorities are taken into account. If not, this should be a huge red flag (and see previous point re: Competitors).

5. Build Your Peer Network
It is critical to have a network of peers in similar positions to compare notes with and to seek advice from. Analysts are great for general snapshots of the social landscape and directional advice, but being able to have a conversation with a peer sitting in *your* seat in another organization is invaluable. Your social vendors will likely have conferences and events that will offer great networking opportunities. Vendors can also make intros for you. There are also many great networking organizations like The Community Roundtable and SocialMedia.org. To put a fine point on it: build your network before you need it.

6. Get Personal
Along the lines of building a peer network, get to know the key players working for your vendors as well. Invest the time in building one to one relationships outside of the conference room. Personal relationships often make the difference  in getting a heads up on a feature change, getting a feature request into a release or getting a little extra help with a configuration.

The Net-net: a little extra effort put into elevating your relationships with your key social vendors to a *true* partnership will likely pay back valuable dividends in the form of better platforms, more effective social programs and higher return  on your social investments.

Do you agree that spending more time managing your social vendor relationships could create value? Do you have additional suggestions on why and how to manage these relationships? I’d love to hear your thoughts and any stories or suggestions you could share.

Developing a Social Strategy: Research Project Open for Participation

note: this is cross-posted from the Online Community Report blog.

The next Online Community Research Network project is open for participation. In January, OCRN members discussed and prioritized a long list of topics, and the issue that made top of the list was “Developing Social a Strategy”.
The OCRN chose to study how social media strategy is developed, communicated and implemented because, frankly, so many organizations are actively struggling with the topic. We hope that by getting real-world feedback, advice and experiences from practitioners (read: the folks ACTUALLY doing the work), we can all gain insight in to this important topic.
If you are involved in the development of your organizations Social Media and Community strategy, I would encourage you to participate in a short survey here:
The topics we are exploring in this project include:
  • The definition of social media strategy;
  • The current scope of community and social media efforts;
  • The current state of strategy development;
  • The process organizations are using to develop strategy;
  • Ownership and governance of social strategy;
  • The biggest challenges that executives and teams are facing
I would ask that you please complete the survey by next <strong>Friday, 3/12</strong>. All participants will get a copy of the results.
The tag for this research project is: #socstrat