Monday, October 6, 2008

Harnessing User Generated Content...In Review

This month’s Harvard Business Review features an interesting article by Scott Cook, the Cofounder and Chairman of the Executive Committee of Intuit, about how businesses have been and should be leveraging user-generated content.

Cook cited a number of examples where user contribution has literally created businesses like Amazon (user reviews and recommendations), eBay (user generated marketplace) and in some cases outperformed old established players like encyclopedia Britannica (Wikipedia).

Cook has had some experience with implementing user generated platforms. The article references a start up Intuit was playing with in 2005 called Zipingo.

Zipingo was an online local directory product that was easily accessed through Quicken. Users could add local businesses and recommendations.

The site was shut down in 2007 when Intuit realized that the site had been given the wrong kind of attention.

Scott explains the demise of Zipingo:

“We made the mistakes that stemmed from the difference between traditional products and contribution systems. User contribution is first of all about the users and their content. We failed to nurture and encourage early contributors and we got distracted creating our own content – ancillary information like business addresses for the listings”
I think a lot of businesses are making the same mistakes today. Trusting a community of users to generate useful content is difficult. Traditionally, success has come from controlled process driven environments. After all doesn’t control drive quality? Doesn’t the brand rely heavily on the company’s ability to control quality and all the media messages that are associated with that quality?

From a marketing stand point, the user generated content (UGC) phenomenon has challenged many world-class masterminds of branding. Asking these masters to relinquish their brand stewarding responsibilities and allow what was once a heavily PR ready environment to grow cultures of uncontrolled feedback and unpredictable (possibly slanderous) content is in a way, like asking them to give up their jobs.

Over the past year, I’ve had a number of conversations with marketers about the journey from the initial terror of unknown feedback to acceptance of the 2.0 world and finally to a user generating frenzy. Perhaps the most difficult part of the journey is the first step – “letting go”.

Looking back, in the mid 90’s it became popular for brands to ask consumers to “Speak to” them. Then the brands struggled to organize feedback, respond to the feedback and route the feedback to appropriate contacts within the organization. By 2000, the information became organized, routed and responded to but a few years ago brands began to realize the potential value of the aggregated data and as a result, started to focus on harnessing the data that was being collected.

Today social networking has created a macro version of the same cycle. The UGC is scattered across the web and brands are trying to re-organize the information. Software exists to scour the web for references and services will go as far as to delete unpleasant content. The latest twist however, has been in the “listening” department. Somewhere the light bulb went on and businesses started to make the connection between consumer opinion, innovation and increased revenue. This is the first step to “letting go”.

The winning strategies to date have come from companies that have basically said to their consumers “please talk amongst yourselves”.

Enabling consumers to talk about your brand and then entering the conversation appropriately (this area is still in dire need of improvement), is clearly the way to navigate this space. That's why we're seeing the explosion of micro-communities that are discreetly sponsored by Global 5000 brands.

Here’s an example of a brand that is still asking its consumers to "speak to" it:

Here's a shot of a brand encouraging interaction and contribution:

Marketing has always been about halo effects, word of mouth and viral communication. Why not capitalize on users' innate desire to share their information, status (ad nauseam) and opinions?

It'll be interesting to see the next stage develop. Brands will need to reward the content and this will lead to a nice cerebral challenge in valuating media. I can only imagine the semantics of a cost per contribution model.

I'm sure even Ms. Palin would agree to my closing statement (with a big wink) ... "Any media is good media so just let go...".

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