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BRITE blog
by David Rogers
The WallStreetJournal.com ran a piece this week entitled “Why Most Online Communities Fail” by Ben Worthen.
In it, he discusses a new research study of online communities run by businesses. A variety of worst practices lead to most corporate-sponsored communities becoming “virtual ghost towns.” Businesses launching online communities repeat a series of blunders. First, they have a tendency to get seduced by bells and whistles and blow their online-community budget on technology. [Study author Ed] Moran suggests that businesses spend resources identifying and reaching out to potential community members instead of investing in software that makes predictions, or even social-networking technology.
Two of the study’s lead researchers, Ed Moran (of Deloitte) and Francois Gossieaux (Beeline Labs) will be presenting their findings on Oct 16 at our BRITE Workshop on Online Communities.
Image: Andrew Dunn via Wikipedia
I was in Barcelona last month to speak at the “Brand Challenges 2008” conference, presented by our partner Center on Global Brand Leadership at ESADE business school.
The haute cuisine in Barcelona was as creative as I remembered (sea foam, flavored smoke, ice ravioli, and the like), as were Gaudi’s timeless architectural wonders in Le Eixample.
But for all their innovativeness, the Spaniards I met at the conference are grappling with the same Web 2.0 whirlwind as everyone else. Their marketers and brand managers all keenly aware of (and actively using) social networks, wikis, blogs, and the other growing new media. They just don’t know how brands should respond to this environment. “How do you control the dialogue with your consumers?” I was asked. You don’t, of course. And for many organizations, giving up the mindset of brand “control” will be the biggest challenge.
I was interviewed after my speech by the paper La Gaceta de los Negocios – who were kind enough to send me a PDF of the article. We discussed the changing models for brand building, what dialogue means for brands, how to energize brand ambassadors, and the importance of innovation. You can find the article (in Spanish) here.
(One clarification: “Si lanzas una nueva marca, es probable que sean mejores los medios tradicionales” should read “…sean mejores los medios nuevos.”)
Yuval Zuckerman spoke at the BRITE ’08 conference about social networking tools he was developing to help supercharge fundraising for the Mitt Romney campaign. Too little, too late, perhaps, for that candidacy. But online networking has been a dominant story in this year’s presidential campaign.
In particular, ever since the launch in February 2007 of MyBarackObama.com, the Democratic candidate has amazed observers with his savvy in raising money and reaching out to supporters through online social networks.
A recent article in the The Atlantic monthly focused on the role online networking has played in the astounding quarter-billion dollars raised for his campaign so far. Worth a read.
Preliminary results of a study on the use of online communities for business goals was presented by Francois Gossieaux (BRITE advisor, speaker, and blogger) recently at the Society for New Communications Research (SNCR).
The study, titled the “2008 Tribalization of Business Study” is being produced by Deloitte, Beeline Labs, and SNCR. You can see Francois’ slides below:
The findings are still preliminary, as the study is still in progress.
People involved in managing online communities for their organizations are invited to participate in the online survey, To take it, go to: http://www.communityeffectiveness.com. Final results of the survey will be shared to all who are interested. More info: francois [at] beelinelabs [dot] com.
I just picked up Clay Shirky’s book on the social impacts of networking technologies, “Here Comes Everybody: The Power of Organizing Without Organizations.” It’s a great read so far, with a keen eye for how new media are changing our definitions of privacy, communications, and professionalism. The story of Judith Moore’s jailing (for refusing to reveal a journalistic source), and the problems of creating a federal “shield law,” turn into a fascinating discussion of how the very meaning of the word “journalist” is vanishing in an age of mass amateurization. Shirky argues that
we are now in a period similar to the first 100 years of the printing press, when professional scribes continued to ply their trade side by side with the mechanical presses which had made the profession obsolete. All companies need to ask themselves: what are your own customers now better at doing than you?
There’s also a nice podcast interview of Clay here, in which he warns innovators that, in many domains, the cost of failure has now become less than the cost of planning. Ready, Fire, Aim?
-David Rogers, BRITE host
Facebook's bold move in 2007 was to open up its platform to developers, and its membership to everyone. But not everyone's happy. Some of my friends who were long-time Facebook users (from back when you had to join in college) have now declared Facebook "over" as the flood of new participants has robbed the social network of its distinctive character.
Will there be a backlash in the marketplace? Other social networks are cropping up with a very "micro" appeal. Downhill ski icon Bode Miller launched SkiSpace in December, where slopes fanatics can share videos, mobile blogs, trip planning, and equipment swaps. In its first month it only reached 10,000 members. But BusinessWeek reports that advertisers like Motorola and Sony paying to reach these users in a community they're truly passionate about. Dale Earnhardt Jr. has launched a site for NASCAR fans called Infield Parking, with 42,000 members (lots of advertiser interest there as well).
Other online developers are so grumpy that they've launched "anti-social" networking sites, like Enemybook and Snubster. Steve Johnson, Internet critic for the Chicago Tribune talked about the culture of Enemybook on NPR's Weekend Edition on Saturday.
-David Rogers
Tis the season for sharing one's blessing with others, and make your charitable contributions before the end of tax year.
The most appreciated gift I gave this year was a donation in my father's name to a charity called Kiva.org.
Kiva aims to help families in the developing world by using microcredit
loans, of the kind championed by Nobel Laureates Muhammad Yunus and
Grameen Bank. These go to individuals around the world to support
their own entrepreneurial efforts to build sustainable jobs,
businesses, and education for themselves and their families.
What Kiva does is provide an online open platform to post and choose
such projects. So when my father logged in to his account, he was able
to browse loan requests from families and small businesses all over the
world (a water buffalo for a farmer here, sewing machines for a tailors
shop there). He could see what the project was, how much money was
needed, what percent was already raised, and decide if he wanted to
contribute his piece of support there. Because it's a loan, when the
money is repaid, he will be notified that it has been repaid to his
account, and he can browse for another project to re-invest the same
money in. Peer-to-peer platforms meets micro-credit. What a bold and
innovative idea.
Speaking of bold ideas, I have to recommend Muhammad Yunus' new book
which I got for Christmas, that proposes a new model for
socially-engaged businesses: Creating a World Without Poverty: Social Business and the Future of Capitalism.
-David Rogers
Facebook (another of our nominees for the BRITE 2007 Big Thinker Award) is turning a segment of its 58 million active users into subjects for new academic research into human relationships. (In most cases, users are aware they are participating). A recent article in the NY Times describes how scientists at several universities are testing theories about "identity, self-esteem, popularity, [and] collective action."
Our own Prof. Paul Ingram of Columbia Business School will be presenting findings from his own research on social networking on Feb 8 at BRITE. Tracking participants behavior at a mixer (using RFID tags), he and Prof. Michael Morris found that participants unconsciously pursued a different set of objectives than their stated networking aims. You can read about their paper at Columbia's Ideas at Work site.
 We are very pleased to announce a Silver Level sponsorship by Spotme of BRITE '08. All participants at the conference and CMO summit will get to explore this cutting-edge new device for social networking at event.
Our own Bernd Schmitt wrote recently about the device on his blog, after experiencing it at a Siemens business leadership conference in Berlin: Spotme keeps the conference audience up-to-date in real time about the agenda and presentations. It also allows you to send messages and exchange business cards electronically. Its coolest feature is this: at the start of the event, you can choose who you would like to meet from the list of attendees. Then, throughout the event, whenever one of these people comes nearby to you, the Spotme device spots the person, and you get a vibrating alarm sound, with their picture. Love it!
Last week the virtual world of Second Life experienced its first ever bank
run. It seems that while the new Federal Reserve discount
rate brought relief to the financial crisis in the real world, Ben S. Bernanke’s surprising move has yet to bring calm in virtual reality. Even the Economist magazine ran a story this week of the impending financial
crisis in Second Life. Perhaps the virtual world really does
mirror the real world?
Or maybe not. Second Life’s financial problems began when
increasing scandals led to a FBI probe into Second Life’s most profitable
industry: gambling. Turns out the
easiest solution for Linden Labs (Second Life's owners) was simply
to ban
gambling outright. This move has proved to be a big mistake: gambling was one
of only two attractions that had any visitors on an otherwise deserted
Second Life (the other is virtual sex shops, still operating).
Shortly after the ban was announced, gambling-loving
electronic alter-egos attempted to cash-out so many Linden dollars from Second Life that it
forced one of the largest banks, Ginko
Financial, to cease operations and declare insolvency, meaning it will be
unable to repay U.S. $750,000 to its investors. Amazingly, the bank is still
taking deposits.
But that’s not the whole story. The thousands of angry
avatars lining up in front of virtual teller machines were shocked to learn
that Ginko Financial, an unregulated,
unaudited virtual bank promising
a hefty 44% annual return and run by a faceless owner (whose identity
remains a mystery even in the light of all this controversy), might in fact be
a pyramid scheme.
Weeks ago, at the Economics of
Second Life & Virtual Worlds Conference at Columbia Business School,
Linden Labs’ John Lester (a.k.a. “Pathfinder Linden”) described the
three dimensional virtual world of Second Life
as a self-regulating entity. Wistfully, Lester spoke of a lawless Utopian
society where simply by virtue of good intentions users are able to define
their own sets of rules and regulations. Not too surprisingly, it looks like
this fantasy has all but come to an end.
This raises the question, will Ben Bernanke offer a discount rate to struggling Second Lifers?
-Dina Shapiro
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