The Secrets of Marketing in a Web 2.0 World

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 30executives and managers in both large and small organizations that areat the forefront of experimenting with Web 2.0 tools. From thoseconversations and further research, we identified a set of emergingprinciples for marketing.

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What potential marketing opportunitiesdo Web 2.0 applications and tools offer your company? Which Web 2.0tools have worked well for your company, and which were lesssuccessful? Share your thoughts in an online forum with Bruce Weinberg and Salvatore Parise.

But first, a more basic question: What is Web 2.0,anyway? Essentially, it encompasses the set of tools that allow peopleto build social and business connections, share information andcollaborate on projects online. That includes blogs, wikis,social-networking sites and other online communities, and virtualworlds.

Millions of people have become familiar with these tools throughsites like Facebook, Wikipedia and Second Life, or by writing their ownblogs. And a growing number of marketers are using Web 2.0 tools tocollaborate with consumers on product development, service enhancementand promotion. But most companies still don't appear to be well versedin 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.

Recovering From Negative Reviews

AWeb site can be a marketer's lifeline with its customers, but whathappens when it's marred with negative reviews and comments? BruceWeinberg, marketing professor at Bentley University, tells WSJ's ErinWhite how to address and recover from poor feedback.

Web2.0 tools can be used to do what traditional advertising does: persuadeconsumers to buy a company's products or services. An executive canwrite a blog, for instance, that regularly talks up the company'sgoods. 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 thatwe spoke with is one of many that have set up an online community -- asite where it can talk to consumers and the consumers can talk to eachother. The company solicits opinions on various aspects ofgreeting-card design and on ideas for gifts and their pricing. It alsoasks the consumers to talk about their lifestyles and even uploadphotos of themselves, so that it can better understand its market.

A marketing manager at the company says that, as a way toobtain consumer feedback and ideas for product development, the onlinecommunity is much faster and cheaper than the traditional focus groupsand surveys used in the past. The conversations consumers have witheach other, he adds, result in "some of the most interesting insights,"including gift ideas for specific occasions, such as a collegegraduation, and the prices consumers are willing to pay for differentgifts.

Similarly, a large technology company uses several Web 2.0 tools toimprove collaboration with both its business partners and consumers.Among other things, company employees have created wikis -- Web sitesthat allow users to add, delete and edit content -- to list answers tofrequently asked questions about each product, and consumers have addedsignificant contributions. For instance, within days of the release ofa new piece of software by the company, consumers spotted a problemwith it and posted a way for users to deal with it. They later proposeda way to fix the problem, which the company adopted. Having thosesolutions available so quickly showed customers that the company was ontop 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 tonetwork among themselves on topics of their own choosing. That way thesite isn't all about the company, it's also about them. For instance, atoy company that created a community of hundreds of mothers to solicittheir opinions and ideas on toys also enables them to write their ownblogs on the site, a feature that many use to discuss family issues.

Other companies provide more-direct incentives: cash rewards orproducts, some of which are available only to members of the onlinecommunity. Still others offer consumers peer recognition by awardingpoints each time they post comments, answer questions or contribute toa wiki entry. Such recognition not only encourages participation, butalso has the benefit of allowing both the company and the other membersof the community to identify experts on various topics.

Many companies told us that a moderator plays a critical role inkeeping conversations going, highlighting information that's importantto a discussion and maintaining order. That's important becauseconsumers are likely to drift away if conversations peter out or ifthey feel that their voices are lost in a chaotic flood of comments.The moderator can also see to it that consumer input is seen andresponded to by the right people within the company.

Getting Sociable

• A New Approach: Marketing these days is more about building a two-way relationship with consumers. Web 2.0 tools are a powerful way to do that.
• The Pioneers: A growing number of companies are learning how to collaborate with consumers online on product development, service enhancement and promotion.
• The Lessons: From these early efforts, a set of marketing principles have emerged. Among them: get consumers involved in all aspects of marketing, listen to and join the online conversation about your products outside your site, and give the consumers you work with plenty of leeway to express their opinions.

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 consumersto 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'smarketing pitch. And there is no shortage of opinions online.

The managers we interviewed accept that this type of content is hereto stay and are aware of its potential impact -- positive or negative-- on consumers' buying decisions. So they monitor relevant onlineconversations among consumers and, when appropriate, look foropportunities to inject themselves into a conversation or initiate apotential collaboration.

For example, a marketing manager of a leading consumer-electronicscompany monitors blogs immediately after a new-product launch in orderto understand "how customers are actually reacting to the product."Other managers keep an eye on sites like Digg.com and Del.icio.usthat track the most popular topics on the Web, to see if there's anybuzz 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 highlyof the company's brand. Just prior to launching a new product, thecompany sent the blogger a free sample, inviting him to review it withno strings attached. The end result: The blogger wrote a favorablereview and generated a flood of comments. So the company got nearlyfree publicity and feedback.

Resist the temptation to sell, sell, sell.

Many marketers have been trained to bludgeon consumers withadvertising -- to sell, sell, sell anytime and anywhere consumers canbe 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'twant 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-electronicsorganization created an online community of nearly 50,000 consumers todiscuss product-development and marketing issues. One of the keyprinciples of the community, she says, was "not to do anything aboutmarketing, because we weren't about selling; we were about conversing."

In short order, community members not only identified what it wasthey were looking for in the company's products, but also suggestedinnovations to satisfy those needs. The company quickly developedprototypes based on those suggestions, and got an enthusiasticresponse: Community members asked when they would be able to buy theproducts and if they would get the first opportunity to buy them. Theydidn't have to be sold on anything.

Don't control, let it go.

In an online community, every company needs to find an effectivebalance between trying to steer the conversation about its products andallowing the conversation to flow freely. In general, though, themanagers we interviewed believe that companies are better off givingconsumers the opportunity to say whatever is on their minds, positiveor negative. Moderators can keep things running smoothly andcoherently, but they shouldn't always keep the conversation on apredetermined track. The more that consumers talk freely, the more acompany can learn about how it can improve its products and itsmarketing.

For Further Reading

See these related articles from MIT Sloan Management Review.

• Harnessing the Power of the Oh-So-Social Web

By Josh Bernoff and Charlene Li (Spring 2008)
The authors develop a strategic framework that businesses can use toimplement social applications in a number of departments, includingresearch and development, marketing, sales, customer support andoperations.
http://sloanreview.mit.edu/smr/issue/2008/spring/01/

• Enterprise 2.0: The Dawn of Emergent Collaboration

By Andrew P. McAfee (Spring 2006)
There is a new wave of business communication tools including blogs,wikis and group messaging software that allow for more spontaneous,knowledge-based collaboration.
http://sloanreview.mit.edu/smr/issue/2006/spring/06/

• Beyond Enterprise 2.0

By Erik Brynjolfsson and Andrew McAfee (Spring 2007)
The authors explore the complementary relationship between traditionalmanagerial tools and the evolving modes of collaboration andcommunication, such as wikis.
http://sloanreview.mit.edu/smr/issue/2007/spring/16/

• Systems Marketing for the Information Age

By John G. Singer (Fall 2006)
The authors suggest that companies must take a marketing ecosystemsview, which shifts away from the logic of "brand" as the primary unitfor business strategy.
http://sloanreview.mit.edu/smr/issue/2006/fall/18/

• How to Market to Generation M(obile)

By Fareena Sultan and Andrew J. Rohm (Summer 2008)
The mobile platform provides the perfect mechanism for reaching young consumers.
http://sloanreview.mit.edu/smr/issue/2008/summer/12/

One marketing executive recalled the first time she letan online community created for a client interact with very littlecontrol or moderation, resulting in an animated discussion about thelook of the company's product. The client, with great concern, asked."Who told them [the consumers] they could do this, that they could gothis far?" Of course, when this process resulted in totally newpackaging that helped boost sales, the client was ecstatic.

As another executive of a company that creates online communitiesfor clients told us: "You have to let the members drive. When communitymembers feel controlled, told how to respond and how to act, thecommunity shuts down."

Find a 'marketing technopologist.'

So who should direct a company's forays into Web 2.0 marketing? Anumber of managers identified an ideal set of skills for an executivethat go beyond those of a typical M.B.A. holder or tech expert. Wecoined the term marketing technopologist for a person who bringstogether strengths in marketing, technology and social interaction. Amanager 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 largetechnology company weighs employees' proven skills to choose writersfor blogs that are read by consumers. The company has long used blogsinternally to help employees discuss technical issues, products, andcompany and industry topics. When it decided to use blogs to raise itsprofile online, it recruited those who had shown the most skill atblogging within the company. The company currently has about 15employees who blog publicly, mostly on technology trends, and isrecruiting more the same way. Meanwhile, the bloggers plan to meetoccasionally to share the lessons learned from their experiences.

Embrace experimentation.

One Web 2.0 strategy does not fit all, and sometimes the best way tofind out what's best for a given company is to try some things out andsee what happens.

Blogs, wikis and online communities are among the tools thatcompanies are most commonly using for marketing, but there are otherways to reach consumers. Some of the companies we talked with havegotten their feet wet in the online virtual world Second Life, wheremillions of users interact with each other through avatars. Companiescan sell their goods and services and sponsor events in Second Lifejust as they do in the real world; one sponsored a contest for the bestavatar.

Others are considering new ways to use more-familiar tools. Forinstance, many companies have long used instant messaging on their Websites to allow shoppers to chat with customer-service representatives.One executive we spoke with said he would like to experiment withallowing consumers to chat with each other as they shop on hiscompany's site.