Communispace : Individual Assignment 1 by Anuraag Verma for MKT 512, Fall 2016 As a brand manager, would you use Communispace’s service? When would you use it? When wouldn't you use it? What are the advantages/disadvantages of this market research tool compared to alternative methods?
As a brand manager, I would definitely use Communispace's service. I know I can trust Communispace with mark market et rese resear arch ch beca becaus use: e: It is the market leader in creating and managing private, brand-focused online communities for major corporate clients. ❏ It has worked with high profile companies such as Best Buy, Unilever, Pepsi, Kellogg and Home Depot (according to Exhibit 1 from the case) ❏ It is known for developing great relationships with clients and community members. ❏ The pricing of their service is appealing with service prices under $10,000. ❏ It allows me to be flexible in my level of engagement with the community. I could log into the communities every day, initiate engagement activities for the members, and/or participate in forums forums or brainstorm brainstorming ing sessions. sessions. I can can also choose choose to only only receive periodi periodicc reports. reports. ❏
I would use Communispace’s service for gaining feedback on new product development or for a product in the maturity stage of its life cycle. Their service could provide valuable customer insights that can be used towards branding my product and assessing strengths and weaknesses of the competition. According to Exhibit 2, gathering insights would discuss trends, attitudes, preferences and listen to the members’ key ideas. One of the most important features Communispace offers is ‘actionable recommendations’ in their reports that could be really helpful for my product development process. I would not use Communispace’s service for marketing to communities. The case mentions that people feel empowered to speak up in these forums because they believe their voice will be heard and their opinions given importance. The way I see it, the whole point of having these communities is to make people feel included in the development of products by providing a safe place where they can discuss things freely. If I start marketing to them directly, the authenticity of the channel would be lost. Like in any marketing activity, I would have to incentivise active participants who may be willing to change their behavior in return for meeting targets. Compared to other research methods, Communispace has a niche in the research market for its service tool. It has the following advantages: ❏ Quality
Feedback: Communispace closely listens to its community members online over an extended period of time. This allows them to develop and gather quality responses from community members. ❏ Faster: It’s different from traditional market research because it doesn’t take as long to plan and to get the information back. Within 24 hours, my team can have useful information to work with. ❏ Smaller Communities: Their communities have between 300-500 members, and this range is backed by research that shows it’s the sweet spot in order to balance diversity of opinions while making members feel that their individual voices matter.
❏ Lower
Costs: Communispace offers their service for an average price between $5,000 to $10,000 per project. This is a reasonable price as some internal companies conduct a broad-based survey of several hundred or several thousand individuals which could cost from $10,000 to $100,000. And a single focus group could run upwards of $15,000. ❏ Convenience: Members do not have to leave the comfort of their homes to provide their insights and feedback. Their service tool has some disadvantages too, the most prominent being the following: ❏ Length
of Contract: A project with Communispace consists of a 12-month contract, which is a long time to wait for complete information about a product. While this does make way for deep insights and long term relationships, this setup may be unappealing to some clients desiring faster results. ❏ Limitations of Online Communities: Some concerns with online communities are the representativeness of the targeted population, gathering enough members to provide feedback and the identity of members. Respondents can make up information about themselves and provide unrelated information because there is no direct verbal or visual communication from the members. Online communities also propose the problem of continuously gathering enough respondents to keep up the inflow of insights. What is Communispace’s competitive advantage? How are they creating value?
Communispace’s competitive advantage is its strength in listening closely to and engaging members in conversations in online communities and the resulting depth of experience that it provides to its clients. The community is purpose-driven rather than profile-driven and focused on delivering feedback. Members are there to help the sponsoring brand and to help each other and this collective purpose remains the center of gravity. This is what differentiates their product from traditional consumer research, and from social networks like Facebook. Because of Communispace’s ability to create a long term relationship with consumers, the intimate environment creates a level of trust and honesty that drives deep, rich insight. They create value in the form of reports for clients that include key insights, analysis and recommendations. By building a trusted community, they are able to tap into latent consumer needs and wants that may not become apparent via other market research techniques. What do you think about Communispace’s business model? How is it different from traditional market research companies?
I believe the business model is unique and effective. It is a subscription based model that consists of creating small and private online communities to provide valuable feedback to product-based clients over an extended period of time. It incentivises participants by periodically sending them tokens of appreciation. The business is designed and developed on the internet, which allows for quicker feedback to their clients. These clients have the ability to observe current community responses by logging into their system. As technology continues to evolve, people will continue to vie for immediate and quicker feedback.
It is different from traditional market research companies because communities are not one-time projects the way surveys or focus groups are. They provide a continuous flow of information, not a snapshot in time. The level of client involvement is also interesting to note in this business model, as brands can guide conversations in communities and even get suggestions urgently on a pressing problem. The community itself feeds its interest in the brand to a large extent, something that isn’t possible in traditional market research companies. If you were Diane Hessan, would you launch a WOM product? What impact would this launch have on the company brand?
If I were Diane Hessan, I would definitely look into launching a WOM product because of the following reasons cited in the case: ❏ Clients
all over the globe had been asking Communispace to leverage its secret sauce in the consumer insights area and apply it to other marketing activities. ❏ The market for WOM campaigns had grown from $76 million in 2001 to $1 billion in 2006 and to an expected $3.7 billion in 2011. ❏ As the industry developed, its leaders had founded the “Word of Mouth Marketing Association” to create the foundation for effective and ethical word of mouth marketing, with several major corporations, such as Microsoft and Walmart, elected to join the association. ❏ Social media marketing was on the rise for most marketing managers. As brand managers were trying to understand the social media space, a one-stop shop for both community insights and WOM advertising would be appealing. ❏ Competitors were already offering this mix of services. Since there weren’t any clear market leaders yet, there was an opportunity to grab market share. ❏ By refusing to take on this new client, the company would be foregoing not only the immediate revenue from a new community, but the future revenues from additional communities for the parent company. This launch would have to be dealt with very carefully. First of all, Communispace will need to build its capabilities in providing marketing tools. With tactful marketing and strict internal monitoring, Communispace should be able to successfully conduct both listening communities and WOM campaigns. I believe the brand image of Communispace will not suffer if the product is launched in a way that provides a clear distinction from its current offerings. A new department must be made so that there’s no conflict of interests and community members must be fully informed so they don’t feel like they are being exploited and know fully well they are part of a word of mouth marketing campaign. The effect on the client’s brand should be positive in terms of brand awareness as people participating in the effort will definitely influence other people online and get them talking about it.
