Microsites or Integrated Sites for Online Communities

Kaprice asks, "Can your online community be a part of your website or should it be a microsite?"

To answer this question, I did a quick review of some prominent communities:

Company	Microsite?	Linked to from home page
Dell	Yes - http://www.ideastorm.com/	Yes
Intel	Yes - http://communities.intel.com/	No
Microsoft	Yes - http://channel9.msdn.com/	No (linked to from MSDN home page, though)
Novartis	Yes	No (private community)
Starbucks	Yes - http://mystarbucksidea.force.com/	Yes
Threadless	No	Yes

Since online communities have dedicated or part-time community managers, most organizations gravitate to having these managers responsible for the entire community web presence, which naturally lends itself to a microsite.  Further, since Vovici and our competitors offer hosted communities, such communities are also most easily deployed as microsites.

Most home pages can do a better job linking to the community microsites.  Some sites bury their communities a few links in.  And, conversely, most community sites can do a better job linking back to the home site. The average community is a satellite in a distant orbit around their organization's main site.

The exception to all of this is Threadless, where the community is woven into the very fabric of the site.  Threadless.com may indicate that, in the long term, online communities will be absorbed into organization's sites, permeating the site.  For now, such community applications are highly customized and are the exception.

Idea Ownership in Research Communities

Two recent questions to me were about who owns ideas submitted to online communities.  Dionne asked, "How did Starbucks overcome the legal hurdles of idea ownership with ideas submitted through their community?"  Joyce asked, "How is the issue of intellectual property ownership typically handled if a great idea comes from a customer?"

Typically, once a community member submits an idea, they give up any rights to that idea and may not even be credited if the idea is implemented.  This is usually made clear in the Frequently Asked Questions section of the community site, as well as in the terms of use.  For instance, here's the MyStarbucksIdea FAQ:

If you implement my idea will I get credit?

If we implement your idea, we may give you credit on the site, but we won't be compensating customers if their ideas are chosen. To learn more about this, please take a look at our Terms and Conditions.

The referenced Starbucks' "Terms and Conditions of Use" covers this in a detailed and legalistic way.  See especially the eight points under SUBMISSIONS OF IDEAS.

This is about as fun as pouring a hot cup of coffee into your lap.  While the legalese is unfortunately a necessity, a good community will go out of its way to recognize and acknowledge community members who submit ideas that are acted upon.

Hope that answer helps, Dionne and Joyce.  If you have a question that you would like me to answer in the blog, feel free to comment below!

See also: When Instant Feedback is Like Instant Coffee

When Survey Results are Qualitative

Last week I talked about the difference between quantitative and qualitative research.  I wanted to clarify one point of contrast.  A dangerous shorthand people resort to when comparing qualitative research to quantitative research is to say that all research that produces numbers is quantitative.  That is not true, as surveys can be qualitative, and typically are qualitative, when used in conjunction with online communities.  For instance, in the online communities that Novartis runs, its surveys are only qualitative.  Brad Bortner of Forrester points out that most surveys in MROCs (market research online communities) are qualitative.

The word quantitative in "quantitative research" means that you can quantify the wider population based on the results from the survey.  The reasons most community surveys for open communities are not representative is because of the self-selection bias for joining the community (similar to the self-selection bias that makes many online polls unrepresentative).  Even in closed communities, those who agree to participate in communities may represent positive or negative extremes, since agreeing to participate in a community is even more time consuming than agreeing to take a survey.  Further, most community managers do not ensure that the community demographics match the overall audience demographics.

The following diagram illustrates how active community members are a small subset of the target audience.

It is hard to develop representative community surveys.  You often must achieve representativeness by reaching as far beyond the active community members as possible.  One way to do this is by using online communities in sync with enterprise feedback management, where you empanel as many members of the audience as possible, for instance, by using CRM connectors to have all the customers in the panel.  (The empanelled audience is still a subset of the target audience, since audience members can opt out of receiving emails from your organization.)

EFM systems give you the best opportunity to make all your community surveys quantitative rather than qualitative.

Research Communities are Affordable

One item I haven't focused on in my earlier posts about Brad Bortner's Forrester report, "Will Web 2.0 Transform Market Research?" is the subtitle:  "Yes - But High Cost Will Mean That Firms With Big Budgets Lead". 

While many solutions are expensive, online survey communities can be implemented affordably.  Brad's white paper refers to fully-managed communities, where you hire a firm to design the community, recruit members, monitor their interactions and manage community surveys and events.  This is the most expensive, and most comprehensive, approach to communities.  But you can minimize costs by setting up an online community with a SaaS vendor such as Vovici and by managing the community yourself.  This takes that outside expense and replaces it with the staffing cost of having an existing employee manage the community.

While this approach isn't right for everyone (and Vovici partners with other organizations, including TNS, for customers who want managed services), it represents a very affordable path when outside budget isn't available.

As Mike Rowland wrote last week, "As we move through a downward business cycle, smart companies are moving counter-intuitively to engage more with their customers rather than decreasing their online community efforts."  Research communities represent an effective and affordable way to better understand changing market needs.

Research Communities as Buffets

Here's the money quote from Brad Bortner's Forrester report, "Will Web 2.0 Transform Market Research?":

MROCs are fundamentally changing the cost structure of qualitative research from a variable-cost, per-project basis to a fixed-cost "all you can eat" basis.

Before online communities, for qualitative research you would typically use focus groups.  Focus groups are like catered events:  elaborate and logistically challenging to pull off.  (And, hey, some focus-group facilities even have great food.)  Now MROCs are like a buffet - all you can eat, whenever you want.  You don't have to plan each trip to the buffet; if you have a hunger for answers to certain questions, go grab an empty plate and fill up with insights.

MROCs transform qualitative research from an expense to an asset.  Where a focus group is temporary, an online community is a permanent resource for your organization. 

Once you try the research-community buffet, you will realize that your organization can satisfy its appetite for market research better than ever before.

MROC = Market-Research Online Community

I've been thinking again about Brad Bortner's Forrester independent report, "Will Web 2.0 Transform Market Research?".  Abstract:

Market research online communities (MROCs) will shock the qualitative market research world. They provide cheaper, faster, and newer types of insights that today's traditional qualitative research modes, such as focus groups, don't currently provide. Today, many still confuse MROCs - dedicated online communities for qualitative market research purposes - with other online communities used for social networking or online panels used for quantitative research. Despite the confusion, MROCs are fundamentally changing the cost structure of qualitative research from a variable-cost, per-project basis to a fixed-cost "all you can eat" basis - while supporting research approaches that range from using focus groups, harvesting unmoderated conversations, and conducting ethnographic research. Use the tools that we provide in this document to assess your firm's readiness, and use our quick-start guide to kick off your MROC.

This white paper provides a great summary of the benefits that corporations and non-profits see from implementing online research communities.  Benefits versus focus groups with faster prioritization and generation of ideas. 

For Brad, MROCs are private online communities used for qualitative research. Here's how I would fit MROCs into my understanding of research communities and panels.

Open Membership	Crowdsourced Feedback Community	Research Community with EFM	Panel
Private Membership	Market Research Online Community  (MROC)	Research Community with EFM	Enterprise Feedback Management Panel
	Qualitative	Qualitative & Quantitative	Quantitative

For me, a key point that Brad makes is "MROCs are fundamentally changing the cost structure of qualitative research from a variable-cost, per-project basis to a fixed-cost ‘all you can eat' basis." More on that on Monday [Update: Research Communities as Buffets].

Quantitative and Qualitative Research: The Yin and Yang of MR

My colleague, Brian Koma, has taken to describing qualitative and quantitative research as the yin and yang of market research.   In Taoism, yin and yang are opposing forces that are nonetheless bound together and interdependent, each giving rise to the other.   For market research, many research initiatives start out as open-ended, qualitative questions.  Once enough qualitative research is gathered, it discovers sentiments that can be tested across a wide range of respondents, giving rise to quantitative research.  A survey can then be conducted to determine how representative these sentiments are of the target audience.  When that survey is done, analyzing the results will produce some surprises, with some data for which the context is missing; this will give rise to further qualitative research, prompting further questions that need to be probed in detail, qualitatively.  And so the two types of research play off of one another.

What is unique about Vovici's approach to research is the integration of online communities with enterprise feedback management.  The community portal provides the qualitative results, while the feedback management system provides the quantitative results.  The EFM system is typically integrated with an internal database of customers, employees or partners, so that random, representative samples can be drawn.  Such an approach bridges the divide that often separates quantitative and qualitative research, and provides a balanced view of key constituencies.

Unifying research with online communities and enterprise feedback management:

• Enables the best, most complementary use of quantitative and qualitative data
• Gives voice to customers and other key stakeholders
• Moves feedback from a traditional serial process to an innovative continuous process
• Supports best practices for market research
• Provides significant competitive advantage

If quantitative and qualitative research are the yin and yang of market research, then enterprise feedback management and online communities are the Tao of Vovici.

Ideas Prioritized, Faster than Ever

Yesterday, I described the traditional market-research process for large, corporate initiatives.  Now imagine that, instead of conducting focus groups on as needed basis, the organization invested in establishing a research community instead.   Once that community was in place, qualitative research could be conducted on an ongoing basis. 

Whenever a business owner has a question, he or she can post it to a forum in the online community and can watch results as they come in.  Additional insights can be used to help formulate questions for web surveys. 

To achieve true quantitative results (remember quantitative research provides generalizability, where qualitative research provides context), the researcher cannot send the web survey to just community members.  It needs to be sent to a representative sample of the key constituency, using either external panel or an  enterprise feedback management system.

This new feedback life cycle can generate meaningful results in days, rather than months, weaving feedback into the everyday fabric of decision making.  The Novartis case study illustrates how, once an online community is established, it can be used to “involve the customer in every decision”.

By compressing the feedback life cycle:

• You obtain deep insight into market drivers and stakeholder attitudes
• You get more timely, relevant information on trends and opportunities that are specific to your customers and prospects
• You gain ongoing competitive advantage by responding to changing market conditions more quickly
• You can precisely measure key business drivers
• You drive innovation

Tomorrow’s post: How this method unifies the yin and yang of market research.

Ideas Generated Through Traditional Research

The innovation life-cycle through traditional market research involves qualitative and quantitative research in a rich process:

Someone in a line of business has questions that they need help with.  Why are widget sales down in the West?  Engineering has an interesting new technology, what might customers do with it?  Sales in a niche channel are growing rapidly; might there be a larger opportunity here?  Initially, the questions are broad and vague.  You need to flesh out these questions.

The market-research department convenes a focus group or series of focus groups to gather together customers, prospects, distributors – whoever the key constituency is – to get their reaction to the broad questions and to brainstorm possible ideas.  “Why did you buy a competitor’s gadget instead of our widget?  What types of customers are coming through your doors, Mr. Reseller? How might you use our products if we leveraged this new technology?”

The researcher writes up the findings from the qualitative research and shares the key themes with the internal business owner.  The results provide detailed case studies and profiles of different types of respondents:  the prospect who bought the gadget instead of the widget solely based on price, the prospect who realized the gadget could do more for him than the widget, the prospect who bought because of the celebrity endorsement of Gidget, and so on!

The qualitative research results have helped the line-of-business owner focus their inquiry. They now have some clear questions that they would like to have answered.  Key for them is to understand the extent of the behaviors uncovered in the qualitative-research process.  How common are these views of price, features and endorsements?  Which features are most important?  How can the different challenges be prioritized?  The researcher develops and fields a survey instrument to answer these questions.

The survey results are in, and they help highlight the priorities for the organization:  what features are needed for widgets to better sell against gadgets, how the nontraditional distribution channel might emerge into a broader channel in the future, which features enabled by the new technology are most valuable to customers. 

A few issues emerged from the quantitative research that were a surprise, so a final round of research is in order: another focus group or some personal interviews following up with survey respondents or a subsequent survey to a subsegment of the original respondents.  This qualitative-quantitative-qualitative cycle provides the ultimate in thoroughness.

The original questions of the business staff have been rigorously evaluated to come up with the best ideas for the business.  Another successful research effort!  Now, if only it didn’t have to take three to six months to complete. 

Tomorrow’s post:  Compressing the idea-generation life cycle.

Qualitative vs. Quantitative Research

Quantitative market research provides hard data that can be extrapolated to a larger population, using proven statistical techniques.Qualitative market research, on the other hand, seeks to provide narrative, the story behind the story that illuminates the perceptions of a population.

Both techniques are complementary:qualitative research helps when first seeking to understand what might be going on with a target audience, while quantitative research helps to assess the frequency of identified attitudes or behaviors.

	Qualitative	Quantitative
Purposes	Contextualization	Generalizability
	Interpretation	Prediction
Research Questions	Vague	Precise
Project Life Cycle	Earlier in Cycle	Later in Cycle
Approach	Inductive	Deductive
	Interpretive	Measurable
	Avoids numerical analysis	Emphasizes numerical analysis
	Uses interviews	Uses fixed survey instrument
	Fusional	Analytical
Participants	Few	Many
Researcher Role	Personally involved and partial	Detached and impartial
	Subjective understanding	Objective portrayal
Traditional Methodology	Focus groups	Telephone surveys
Web Methodology	Online research communities	Web surveys

Sources:

• Qualitative versus Quantitative Research: Key Points in a Classic Debate
• Becoming Qualitative Researchers: An Introduction
• Quantitative Research vs. Qualitative Research

Disconnected Listening: An EFM Case Study

In 2003, a customer came to us reporting that web surveys had become so successful that they were now a problem!  The customer was an automotive manufacturer and had originally used Perseus SurveySolutions for conducting course-evaluation surveys.  One enterprising department then realized that they could use the software to conduct a survey of all their dealers.  This was the first emailed survey invitation sent to their dealers, and most of the dealers eagerly answered the questionnaire.  With the huge response rate, the customer was thrilled at the depth and quality of the data they gathered.

The success of that survey quickly became well known within the organization.  Many departments had needs for insights from the dealers, and web surveys became commonplace.  Some departments used Raosoft EZSurvey, some used Websurveyor or other online tools. 

Sadly, but not surprisingly, the response rates to the surveys declined, the enthusiasm of the dealers waned, and in fact dealers complained about receiving too many surveys.   Web surveys had become a victim of their own success. 

Here were the problems our customer reported:

• "We're asking more and getting less"
• Response rates to surveys are declining
• The same questions are being posed by different groups
• The results from the surveys are not being shared
• "We've lost control over timing, frequency and branding"
• No integration with the dealer information system
• "We're concerned that employees are running consumer surveys that gather data that violates our privacy policy"
• Concern about data security on low-end hosted survey systems

We later took to calling the overarching problem "disconnected listening".  Too many organizations have islands of isolated feedback, resulting in valuable information not being shared.

Based on the insights of this particular customer and others like them, we pioneered enterprise feedback management.  EFM systems solved the problems of disconnected listening for this firm:

• Centralized touch management of all dealers enabled them to start surveying random samples rather than inviting everyone to every survey, resulting in fewer surveys per dealer
• Commonly asked questions were built into dealer profiles so that they did not have to be re-asked but could be used to segment dealers
• A common workgroup provided a central virtual location for all dealer surveys, so that users could see and share other survey results before starting a new survey
• By standardizing on one system and blocking the IP addresses of low-end survey systems, the IT department eliminated its data security concerns and its concerns about privacy-policy compliance.

As a result of resolving these issues successfully, and preventing web surveys from being a victim of their own success, the auto manufacturer has renewed their annual subscription for our EFM system four times now.  Enterprise feedback management systems can transform "disconnected listening" into "connected listening".

Going Wrong by Listening to Your Customers

A month ago, on his Twitter account, Mel Webster asked, "How can you go wrong listening to your customers?"

I immediately started to compose an answer in my head, but never got around to writing it.  Shortly thereafter, Neil Davey, editor-in-chief of MyCustomer.com, interviewed me and asked the same question.  Thanks to Mel, I had an answer right at hand.  For Neil's treatment of the subject, see "Online communities: Enjoy the insight but avoid the pitfalls".

The way to go wrong by listening to customers:  hear them out and then assume that they are typical of other customers when they're not.

For one project, over 15 years ago now, a service organization commissioned us to do qualitative research with a handful of clients in the United States and Europe to determine interest in a potential new product.  The respondents were all quite interested and enthusiastically described how they could use the product to cut costs and improve quality.  Sounds like a sure-fire winner, right?

Unfortunately, we were not engaged to do the next step:  develop a quantitative market opportunity, applying the lessons learned from the qualitative research and estimating the percent of prospects that would be interested.  The service organization went ahead and developed the product, solely based on the initial qualitative research.

Alas, as it turned out, the firm's customers were not typical of the larger market.  Most prospects didn't have the same high usage and the same willingness to adopt the product as the firm's customers did.  As a result, the product sold fitfully for four years and was a market failure.

I'd like to say this is an isolated example, but it happens frequently.  Online communities and focus groups and personal interviews are great for developing ideas, but then those ideas need to be tested through quantitative research to ensure that the ideas resonate with a wider audience, an audience that is representative of the target market. 

So, to answer Mel in 140 characters or less, "Yes, you can go wrong by listening to customers, simply by incorrectly generalizing from what you hear."

Focus Groups vs. Online Communities

In a similar way that web surveys have replaced telephone surveys in many applications, feedback-oriented online communities will replace focus groups in many instances.

                                               

	1990s	2000s
Quantitative	Telephone survey	Web survey
Qualitative	Focus group	Feedback community

Focus groups are better than online communities in one key dimension:  they take place in the real world, where you can show people real products and have them interact with them, where you can look participants in the eye and get a sense of their emotions as they tell you something.  But that benefit is not enough.

Focus groups draw from fewer participants than online communities. They are bounded by geographic restrictions that can make it hard to recruit from niche markets.  They draw from small groups of participants and therefore have much higher costs per participant than online communities.  An opinionated participant can distort discussion in a room in a way that doesn't happen in an online forum.

But the biggest advantage of online communities is that they become an asset.  Where focus groups are variable costs, online communities are fixed costs.  Where focus groups must be organized to address the issue at hand, not providing results for weeks or months, online communities are like standing focus groups that can provide answers in hours or days.  Where focus groups can only provide qualitative research, well-designed marketing-research online communities can provide qualitative and quantitative research.

                                                                                                                                                               

	Focus Group	Online Community
Medium	In person	Online
Participant Size	8-12	100s-1000s
Respondent Bias	Medium	Low
Time Frame	2 hours	Years
Turnaround Time	Weeks-Months	Hours-Days
Geography	Major Metropolitan Area	Worldwide
Cost	Variable	Fixed
Cost per Response	High	Low
Methodology	Qualitative	Qualitative & Quantitative

I always enjoyed focus-group research.  I enjoyed writing the discussion guides, moderating the events or sitting behind the glass watching the moderator, transcribing the results afterwards and preparing a report and presentation.  Heck, I even enjoyed the travel.  But I was young, and didn't realize that every city in America looked the same from a focus-group facility. 

Geez, I remember reading about a half dozen books on focus groups.  I even wrote software (Perseus FocusReports) to use to transcribe and analyze focus groups.  I partnered with a great focus-group facility.  I thought I'd always do focus groups.  But I was young.

Selling Online Surveys as ‘Green’

After attending the Gartner CRM Summit, I received a clever survey invitation in my email from Gartner:

We appreciate your feedback.

Please take the time to provide valuable feedback for Gartner Customer Relationship Management Summit 2008. By using the online version of our surveys, you're helping our Green efforts to reduce paper consumption and waste.

I hadn't seen web surveys sold as environmentally friendlier than paper surveys before, though of course they are.  Not only are you saving on paper consumption, as Gartner notes, but that paper would have been transported to and from your mail box by petroleum-powered vehicles.  So web surveys are better for the environment than paper surveys, and--like most environmentally-friendly moves taken by companies--they're more cost effective, too.

Kudos to Gartner.  This is a best practice we should all incorporate into our survey invitations. 

And for those of you looking for a "green tech" business, why not sell carbon credits for converting paper surveys to web surveys?!

The End of Consumer Surveys… as Standalone Research

A few weeks ago Ad Age ran an article "The End of Consumer Surveys?" that adds to the doom and gloom of the business world:

After issuing dire warnings about the future of consumer surveys, the two biggest advertisers and buyers of market research in the world -- Procter & Gamble and Unilever -- are linking with the Advertising Research Foundation for an industry effort to embrace online chatter and other naturally occurring feedback like never before.

"Without transforming our capabilities into approaches that are more in touch with the lifestyles of the consumers we seek to understand, the consumer-research industry as we know it today will be on life support by 2012," Kim Dedeker, VP-external capability leadership, global consumer and market knowledge at P&G, said....  "Our consumers have been sending us messages for years that they're not interested in the traditional survey process."

Dedeker is right that "the consumer-research industry as we know it today" will be gone in four years.  It's obsolete now.  Today, most of that research is done online, but with panelists recruited from a half-dozen or so leading Internet panel companies that extensively recruit people who are willing to take tediously long surveys in exchange for token incentives.  The surveys are repetitive, boring and absurdly detailed.  Any pretense of representative samples is gone.  Consumer respondents are treated callously.  The article goes on to argue that organizations need to do more text mining from social networks, online communities and retail sites.

This struck me as ironic since at the Internet Marketing Conference in Vancouver I was talking to marketers who were doing behavioral analytics and were desperate to supplement that with attitudinal research, from surveys.  They see what visitors are doing on their web sites, but don't understand why.  At the MRA show in New York, web marketers were attending so they could learn how to integrate survey research into their web analytics for the first time.

To develop a holistic view of customers, surveys were never sufficient by themselves.  Now, with consumer conversations online and public, "eavesdropping" (text mining) definitely helps round out the picture.  And with so many shopping interactions now online, behavioral analytics are now possible as well.

Surveys will always have a place, because sometimes what people are talking about isn't all you want to know, and because sometimes what they are doing doesn't make sense to you.  Surveys will always have a place, which is why it is as important as ever to take steps to shorten surveys, to thoroughly profile consumer panelists and to treat your survey takers respectfully.  Oh, and it wouldn't hurt to build a consumer community like Novartis did.

Some other bloggers' perspectives on this Ad Age article:

• DIY Marketing: Is it the End of Surveys?
• The Big Treetop Blog: The End of Consumer Surveys? - Commentary on Ad Age Article
• Putting People First: The end of consumer surveys?

So is it the end of consumer surveys?  No, it is just the end of business as usual when it comes to consumer studies, and the end of consumer surveys as standalone research methods.

Encouraging Honesty from Survey Respondents and Community Members

Yesterday I blogged about how Dan Ariely's research on behavioral economics can illuminate whether to structure a community using social norms or market norms (incentives).  Today, I'll apply two chapters in Predictably Irrational to online communities to develop some best practices to encourage more honest behavior from our community members and survey respondents.  The two chapters are both entitled "The Context of Our Character" (Parts I & II).  Here Dan explains some of the related studies:

Key insights from Dan's research:

• People are inclined to cheat just a little bit. They won't cheat too much, because that would interfere with their impression of themselves as basically honest.
• Increasing compensation for a task doesn't increase the extent of cheating at it; the mere presence of compensation does.
• The more abstract the compensation (e.g., the further removed it is from actual money; tokens or paper tickets are more abstract than cash), the greater the extent of cheating.
• Complete cheating is rare, when cash is on the line. Only 0.2% of participants were "total cheaters" in Dan's experiments involving cash rewards.  However, when token rewards were offered instead, that jumped to 16% of participants!
• Simply reminding participants of ethics eliminated all cheating.  The reminders took the form of asking participants to recall as many of Ten Commandments as possible or signing a simple statement agreeing to an honor code ("I understand that this study falls under the MIT honor system") .

When I wandered the exhibits at AMA MR Boston, I saw booths addressing different types of dishonest panelists, how to identify fraudulent responses and how to ensure panel quality.  Clearly, the industry is concerned about the veracity of online research results.  So let's translate Dan's conclusions to the realm of research communities and survey research:

• You can eliminate most dishonesty simply by prefacing a survey with a simple Yes/No question reminding the respondent of basic ethics.  For instance, "I agree to provide an honest answer to each question that follows."  For open-ended community research, such as online discussions, a simple reminder to be honest is sufficient.
• When offering incentives, immediate cash payments generate less dishonesty than incentive points, frequent flier miles or other more abstract rewards.
• When cash payment is on the line, it's highly unlikely that members are fabricating all their feedback or that respondents are making up every answer to a survey. 

When considering whether to structure your community around social norms or market norms, keep in mind that market norms may in fact encourage some slight cheating.  To counteract that, make sure to remind people to be honest.  But don't assume that communities based on social norms don't suffer from some cheating as well: in such communities, the motivation for cheating is simply to get through a long survey quickly, lying on some answers to finish sooner.

Oh, and if respondents answer "No" to the question "I agree to provide an honest answer to each question that follows," then branch them out of the survey immediately.  At least they were honest about being dishonest!

Social Norms and Market Norms in Online Communities

Dan Ariely is everywhere.  The Duke University behavioral economist spoke at the AMA MR Boston conference a few weeks ago.  I heard him on Marketplace a few nights ago (Why Main Street hates Wall Street).  Thursday, he won an Ig Nobel award for research that showed that patients respond better to more expensive fake medicines than to inexpensive fake medicines.  And I was in the middle of his book, Predictably Irrational: The Hidden Forces That Shape Our Decisions, before going to the AMA show.

So what does Dan have to say about behavioral economics that we should keep in mind when designing online communities?  Predictably Irrational's Chapter 4, "The Cost of Social Norms: Why We Are Happy To Do Things, but Not When We Are Paid To Do Them", is particularly relevant.  I'll let Dan summarize it:

Dan conducted a number of experiments into the world of social norms vs. the world of market norms.  In one experiment, three groups did a 5-minute task on a computer, dragging circles into a square.  One group did it as a favor to the experimenter, one group was paid $5 and the third group was paid 50 cents.  The 50-cent group was less productive than the $5 group.  But the people who did the task as a favor were the most productive of all!  In case this artificial experiment is not convincing, Dan also gave real-life examples, including military service and the pro bono work of lawyers. Perhaps a community driven by social norms will provide better insights than a community driven by market norms (incentives).

When creating a new community, it is important to determine whether the community will operate in the world of social norms or market norms.  Will you pay community members for their participation and award them for greater participation or will the only rewards be social rewards (recognition, shared insights, learning)?

You'll need to determine the nature of your community up front, because once a community founded on social norms introduces any market norm (such as incentives for participation), that community now shifts to a market-norm basis.  You can't go home again, once you've been downtown.  Dan gives the example of a daycare facility that originally didn't charge parents for picking up their children late.  Introducing a late fee actually caused a jump in tardiness - where parents felt guilty about being late before (operating under social norms), now they felt having their children stay late was just a service they were purchasing (operating under market norms).  The daycare facility later removed the fees, in an effort to reduce the amount of tardiness (their goal all along), but lateness levels did not return to their prior state; the conditions of following a market-norm had been set.

The majority of online communities are purely social.  People contribute because of their passion for the topic, their devotion to the product or their loyalty to the brand.  They give feedback, suggestions and ideas because they want to see innovations that support them.  They will sometimes provide incredible detail in terms of reviews and suggestions.  A feedback community operating on social norms is a tremendous asset.

Don't damage that asset by telling people that you will pay them for certain forms of more involved participation.  Instead, send out as a surprise a token of appreciation to community members who have provided a lot of value.  Keep the community from entering market norms by recognizing past contributions, rather than framing gifts as compensation for the next contribution.

For some communities, social norms simply won't work.  Sometimes the only way to recruit members to join the community is to offer them upfront compensation-certain target audiences are simply too busy to respond to anything other than a market-based request:  doctors, lawyers and IT chiefs, for instance.  Sometimes the amount of work expected of members exceeds that of social norms:  excessively long surveys or online focus groups. 

Incentive-based research communities have their place.  One of the communities we've supported for over five years now, with over a quarter-million members, has to use a market economy for participation.  They ask members in excruciating detail about purchases - what was purchased, where it was purchased it, what the cost was, whether or not coupons were used, etc.  They ask for detailed medical histories and pharmaceutical usage.  They routinely run surveys that take 30 to 50 minutes to complete.  Clearly, this level of involvement has to be compensated.  Members are rewarded points every week, just for continuing as a member, and are given different amounts of points for completing different types of surveys.  Points can be redeemed for a variety of awards.

If you already have a community, and it offers incentives, then if you ever stop the incentives you can expect significantly lower participation.  So much so that you might want to consider launching a new, different community instead.

If you already have a community, and it sporadically offers nonmonetary incentives, then you need to determine how much "damage" to the social norm has been done.  If little or no damage, then cease using incentives.  Do provide gifts to significant contributors, simply as a thank you.  If the damage has been done, or the participation rates and recruitment rates are very low, then plan to transition to a full incentive-based community.

	Social Norms	Market Norms
New	Best option for most new online communities Provide awards not rewards Provide social value:  recognition, learning, shared insights	Use when community members are hard to recruit Use when significant demands will be made for community members' participation
Existing	If occasionally offering incentives, cease doing so and recognize through gifts instead Concentrate on providing social value	Can counteract low participation rates Once market norms are firmly established, can never phase out financial incentives

If you are planning a new community, and its target audience is plentiful or has a close relationship with your organization, then start with a community founded on social norms.  Recognize outstanding contributors, provide comparative information (how a member's response compare to the communities) and constantly share how your organization is using the feedback gathered.  If your new community is targeted to a hard-to-recruit audience, or if your requirements for community participation are significant, even onerous, then plan to offer a complete line of incentives.

Dan Ariely's dichotomy of social norms and market norms provides community managers with a powerful framework for considering the role of incentives in their online communities.

American Marketing Association 2008 Marketing Research Conference Wrapup

This is a list of my blog posts covering the AMA MR Conference: 

• Twists and Turns on 21st Century Internet Express
• What Marketing Researchers Can Learn from Polling Conducted for Candidates and the Media
• Delivering Continuous Insights: Involving Consumers in Every Decision
• From One Generation to Another: A Yankelovich MONITOR Perspective on the Resurging Marketplace Importance of Cohorts
• Dude, What's My Job? Managing Millennials in Today's Workforce

I missed the Dan Ariely keynote, getting stuck in traffic that morning, all the more disappointing to me since--by coincidence--I was already reading his book.  I will cover some of his concepts in another post, especially as they relate to social norms and online communities.

Humility and Data Analysis

Over the years, I've read lots of discussions about how to analyze data, with many explanations of statistical methods, yet never once have I read anything that encouraged  analysts to set aside their worldviews.  As we in the United States anticipate tonight's Vice Presidential debate, I can't help but recall last week's Presidential debate, where CNN showed the reaction of Republicans, Democrats and independents as each candidate spoke.  I'm sure to no one's surprise, when Obama spoke, Democrats approved and Republicans disapproved;  when McCain spoke, Republicans approved and Democracts disapproved.

Now comes new science that says that the political party a person belongs to affects how they analyze information, especially how they analyze incorrect information (When Corrections Fail: The persistence of political misperceptions and The Enduring Importance of False Political Beliefs).  Partisans are less likely to believe factual criticisms of their candidate, and more likely to believe unwarranted criticisms of their opponents' candidate. Having the research to back it up is great, as it's something I've always intuitively believed. 

This is one reason why I am a political independent.  Being neither a Republican nor a Democrat has made watching the dialogue at Election.Twitter.com especially enlightening for me.  I've seen lies and half-truths championed by partisans on both sides, yet spoken by people who clearly believe what they are saying. 

How does this relate to survey research?  People-with all their biases-write surveys, and people-with all their biases-analyze surveys.  This presents many challenges for market research.  The world view of the survey author, the survey analyst and the decision maker all need to be kept in mind.

• Survey Author - In questionnaire design, obvious leading questions are easy to spot: "Mayor, which is your preferred method of stifling dissent, banning books or burning them?"   Unintentionally leading questions are harder to spot; sometimes the survey author writes a question using terms he or she considers neutral that aren't neutral.  For instance, "Are you pro-choice?", "Are you pro-life?" or "Do you support abortion rights?" are all leading questions.  Instead, look at how the Harris Poll approaches this sensitive subject:  "The two main groups in the abortion debate are the so-called pro-life group, which opposes abortion, and the so-called pro-choice group, which supports women's right to have an abortion. Which one of these groups do you tend to support more?"
• Survey Analyst - Sometimes, the results to a particular question are so surprising that the analyst can't believe them.  Occasionally, this is for good reason, because the data is wrong:  the question was ambiguous or the choices miscoded or the scales reversed or some other mistake has been made.  Frequently, though, the data is right, but surprising.  Too often, in this case, the analyst will look for reasons to explain away the data rather than embrace the insights provided by this surprise.  From early work I did with Bill Ablondi on mobile professionals, I remember being surprised that professionals with the most interest in the product concept of a PDA were not, as Apple was relentlessly championing, people who did not yet use computers.  Even though Apple was crafting its entire Newton strategy around that market, the greatest interest in fact was from people who already had computers and now wanted access to digital information from their computers in a more portable form.  In hindsight, this is obvious, but it was not obvious at the time, when I was caught up in Apple's reality distortion field (a great phrase for the corrosive effect of world views).
• Decision Maker - Nothing is more disheartening to the analyst then presenting data to the client or decision maker and having it rejected outright.  The client literally refuses to believe the data.  I recall one product-planning project where we took the respondents' reported interest in the solution at any price, multiplied that by purchase likelihood at different prices, and built it into a financial model of likely sales over time.  We were not saying launch or don't launch the product, just reporting our estimate of sales.  The client was furious that this analysis significantly underrepresented the opportunity.  We had verbatim comments to back up the analysis, and stood by it.  The client ignored the advice and built and launched the product anyway.  Its sales didn't even reach our forecast. 

All the best practices of survey research and all the proven methods of statistical analysis are useless if the survey author, analyst or decision maker lets their world view get in the way.

If many Republicans see the world through rose-colored glasses, and many Democrats see the world through blue-colored glasses, tonight, when we watch the debate, we should each try to see it from both angles.  That might help us replace a potentially two-dimensional view of the event with a richer, three-dimensional view.  Because often times the analyst is as important as the analysis.

Online Community Strategist

I've added Angela Connor's blog, Online Community Strategist, to our blogroll.  Angela Connor is the Managing Editor of User-Generated Content at WRAL.com and moderates WRAL's online community, GOLO.  That day-to-day experience of working with community members has given her some keen insights.

Two must-read blog posts from Angela:

1. Community Managers: Never Underestimate the Power of a Trinket
2. The Confederate Flag and the Thank-You Card

The second post was very moving and is the main reason I've decided to read her blog regularly.  It's a great example of what business blogging is supposed to be:  personal, human insights into our business experiences and recommendations.

Other good posts:

• Giving up on comments is the wrong thing to do
• Good community managers don't mind stroking egos
• With Community Management Comes a New Kind of Stress

I discovered Angela through the search capability of Twitter, where her alias is Communitygirl, and you can follow her there as well.  Thanks to Doug Haslam for the tip of using Twitter search in that way.  For the record, I'm JHenning at Twitter (Patsfan and EFM were both taken).

Let me know who else I should be reading and blogrolling!