Companies Use Online Communities to Grow

Online communities?news groups, chats or threaded message boards in which like-minded people congregate to share ideas, solve problems or work on projects?were once thought to be the Web’s killer app. The Web, its visionaries believed, could bring an unlimited number of people together no matter how geographically far-flung. And once all those people were gathered around the cyberhearth, their collective influence and buying power would dwarf anything the unmediated physical world could offer.

Well, yes and no.

At first, yes. Sort of. The fact that people could write their own reviews, post them and then discuss them with other book lovers certainly gave Amazon.com a first-mover advantage that translated, at least initially, into a cultlike popularity. Observers watched the online bookseller’s popularity skyrocket due to the frenzy of activity and sales generated by this unique feature. And so, hoping an online community would have the same effect on their company as it seemed to be having on Amazon.com, companies building websites, including brick-and-mortar establishments, made adding online forums a top priority. Community, after all, was an obvious way to leverage the Web’s essence: interactivity.

The question of whether encouraging site visitors to interact with one another actually had anything to do with the business was rarely asked. Everyone knew that hosting an online forum would make your site stickier. Sticky meant more eyeballs. More eyeballs meant profits?from sales or advertising revenues?beyond the dreams of avarice.

But somehow, for some reason, eyeballs didn’t always turn into money. The most successful online communities weren’t for profit, such as The Well, which, with a VAX computer and a rack of modems in an office in Northern California began in 1985 as a text- only discussion group for Web enthusiasts, activists and techies (and is now owned by the struggling Salon. com). GeoCities, which launched in 1994 with the goal of connecting millions through personal webpages, hasn’t fulfilled its mission; instead of a bustling virtual community, it has become a simple provider of disk space. Even Amazon.com’s initial advantage diminished over time, and the bookseller has yet to declare a profit. The online communities other companies established during those heady days of Internet experimentation often languished, becoming ghostly haunts visited by the occasional crank. Instead of generating value in the form of increased revenues or even customer loyalty, they just sucked up the resources of employees who could be deployed on other Web projects and used money that could be spent on other applications. The investment in community became increasingly difficult to justify because sites couldn’t articulate, let alone measure, the value it added.

Web Business 50 winner REI.com doesn’t see any correlation between its sales performance and the threaded bulletin boards on its site. The message boards are "not hurting anything, not helping anything," says Joan Broughton, vice president of online and direct sales for Kent, Wash.-based REI. "If I had to put more money into it, I wouldn’t," she says bluntly. "But I don’t have to."

Companies that have had little tangible business success with their online communities generally rushed to put them on their sites without evaluating whether they were really appropriate for their company, establishing a business goal or objective for them, or realizing that it actually takes effort to get visitors to participate.

Some companies, however, did community right and reaped the rewards, such as:

  • Insight into customers’ preferences, habits and attitudes
  • Ideas for new products and services
  • Increased customer loyalty
  • Fewer calls to service departments
  • Increased sales

A few of the websites being honored as this year’s Web Business 50?tech book publisher O’Reilly & Associates (www.oreilly.com); ski, skate, bike and snowboard manufacturer K2 (www.k2skis. com) and the American Cancer Society (www.cancer.org)?cater to distinct communities and have gone to varying lengths to reach them. Each Web Business 50 winner possesses insights and best practices to share.

Eight Million Ways to Get Involved: OReilly.com

The technology books that Sebastopol, Calif.-based O’Reilly & Associates publish (the ones with the cute animal drawings on their covers) are geared toward a very specific group?software developers. So it would make sense for O’Reilly to have some sort of community forum on its 8 million-page site. Or would it?

"There are already great forums existing on the Web for developers?Usenet News, for example," says Allen Noren, director of Web services. "It’s not worth our effort to try to replicate those." So instead of supporting a chat room or a bulletin board, O’Reilly takes a different approach to building a community on its site: It takes on political issues.

For example, about two years ago, Tim O’Reilly, founder of the company, spoke out against the lawsuit Amazon.com filed against Barnesandnoble.com for using a feature similar to Amazon.com’s patented one-click ordering tool. O’Reilly didn’t think it was fair for Amazon.com to patent open-source tools that it acquired only because those tools were freely available in the first place.

On Feb. 28, 2000, he posted an open letter to Amazon.com on OReilly.com. At the end of the letter, O’Reilly invited site visitors who opposed the patenting of software applications to type their name onto a petition. O’Reilly says the petition accumulated 10,000 signatures in 60 hours and persuaded Amazon.com CEO Jeff Bezos to rethink his company’s strategy. And although that admission didn’t stop Amazon.com from pursuing its suit (which was decided in its favor), according to O’Reilly, Amazon.com ceased trying to patent other applications and business processes.

O’Reilly’s letter also led Bezos to accompany him to Washington, D.C., in an effort to educate legislators about software patents. That meeting may have discouraged other companies from maliciously enforcing software patents.

Noren believes that such grassroots initiatives make developers more loyal to O’Reilly’s brand and therefore more inclined, for example, to pick up O’Reilly’s book on Java instead of a competitor’s.

"[In July] we had almost 1.8 million unique visitors. An unbelievable number of people come two to three times a week," says Noren, crediting the site’s activism for the traffic. "If you can get people coming two to three times a week, and consistently, you can bet that a lot of people are buying our books."

Not only do IT professionals buy O’Reilly’s books, but they also offer ideas for new ones. Two years ago, a few visitors to OReilly.com began asking for a book on Exim, an open-source-based agent similar to Sendmail that is responsible for routing and delivering e-mail. O’Reilly polled site visitors, asking them if they would be interested in a book on Exim. They said yes. Now the problem was, who was going to write it? Then Philip Hazel, the man who began building Exim in 1995, stepped forward, virtually-speaking, and Exim: The Mail Transfer Agent hit the shelves in July.

OReilly.com’s success is a result of the company finding a different way to approach community, one that differentiates the publisher from the countless websites offering chats and bulletin boards to serve software engineers.

"Online communities can get an issue on the table. The Internet allows broad communities of people to form and act in concert," says O’Reilly.

The Trouble with Chat: K2

Like O’Reilly, the folks at K2 get ideas for new products from people posting messages on their various websites’ bulletin boards (the company operates more than 10 different sites). The board on K2’s ski site (www.k2skis.com) has been hugely successful, in part because the company makes it easy for people to use. Unlike many sites, K2 doesn’t require a lengthy registration process.

The bulletin board on Web Business 50 winning site K2skis.com accumulates as many as 800 new postings a day during peak season. Its bicycle site, K2bikes.com, hums along with a few hundred postings per day during peak season. Managing such popular forums presents challenges, the most pressing of which is to what extent K2 should monitor content. The lessons the company has learned have made it a Web Business 50 winner.

When the Vashon Island, Wash.-based manufacturer launched its bike site in 1997, it also built a threaded bulletin board known as the Tech Forum where customers could ask questions and get answers about their bikes from other owners. Instead of listening to Muzak while on hold, customers could simply sign in to the message board and type their question. K2 customers took to the application like boots to bindings. The problem was, bike owners weren’t always getting the best advice.

"We have problems with people going in [to the forums] and thinking the advice is coming from a [K2] technical rep when in fact it might have come from a 13-year-old," says Ali Wise, Internet services manager at K2. She worries that if a customer gets bad advice on the bulletin board, he will quickly become a former customer.

Employees in the marketing department read the postings when they had time. They addressed bad advice by starting new threads. But this was very labor intensive.

K2 put a disclaimer on the sign-in page reminding users that they were not getting information from K2 representatives. But now K2 is going further, accepting the fact that it has to be more careful both with the information customers glean from the board and with its effect on K2’s brand.

The Tech Forum still exists, but in a different form. It’s now an archive of troubleshooting guides, instructions and technical FAQs all in PDF format that owners can print out or save on their hard drive. Customers can e-mail questions not listed in the archive directly to the company. To make it easier for the marketing and customer service departments to handle all the inquiries, Wise implemented a Web-based CRM application. The application routes customers’ e-mail inquiries to the proper department, does keyword searches through a database of possible answers and then automatically composes a response that a K2 employee can customize.

Wise has temporarily shut down the bulletin board while she implements this new CRM system. She says the company intends to relaunch the board in the first quarter of 2002 as a forum where people can share their experiences on K2 bikes and where the company can promote new products and demos.

Wise believes that the key to getting people to buy K2’s merchandise is to provide them with good service.

"If someone is riding K2 skates, they might be inclined to buy a snowboard if they felt like they had support directly from us," she says. Finding a way to manage its online community has allowed K2 to provide that support more efficiently and convert K2 skiers to K2 bikers.

When Community Is the Product: American Cancer Society

For the Atlanta-based American Cancer Society (ACS), fostering a sense of community among cancer patients, survivors, their families, and ACS’s donors and volunteers is an implicit part of the nonprofit organization’s mission. For ACS, community is about more than Web-based tools; it’s about helping people cope and survive.

What’s special about ACS’s website, Cancer.org, is how its design leads users to community. When the ACS undertook the redesign of its website last summer (see "Healing Channels," Page 96), it analyzed what community meant to the organization and its constituents. It also explored how the idea of community should manifest itself on the site, and it mapped how visitors move through the site to find applications that connect them to others.

Before the redesign, message boards and other interactive community forums were located in just one area, on a separate subsite of Cancer.org. James Miller, ACS’s director of Internet strategy, says that community was such an important aspect of Cancer.org that ACS wanted to weave community features throughout the site. No matter where someone affected by cancer was on Cancer.org, she could easily find her way to a chat room or message board.

Related:
1 2 Page 1
Page 1 of 2
Discover what your peers are reading. Sign up for our FREE email newsletters today!