Web 2.0 and 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.
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.

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.

Peter & Maria Hoey
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.

By 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.