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A lot of these figures are coming from a study conducted by Deloitte and Beelinelabs: Tribalization of Business Study

How are companies measuring success? (in order of prevalence)

  • Greater awareness (50%)
  • Number of new ideas (43%)
  • More referrals (25%)
  • Increased sales (25%)
  • Others…

Biggest obstacles to making communities work (according to survey respondents)

  • Getting people to engage
  • Finding time to manage the community

This is an interesting point emphasised by the presenters. “Getting people to engage” implies that you are trying to get them to do something you want them to do, which belies the true dynamics of communities. Finding time to manage the community is similar, in that if you are getting the funadementals right, a lot of the work in managing a community will be done by the community itself.

How companies are incorporating communities:

  • Usually managed by marketing department, not a job for interns, take it (and resource it) seriously
  • 58% of survey respondents are spending less than $50,000 on community management
  • Investment in community building is relative, $50,000 may be ample if the fundamentals are right

Takeaway #1: Communities are about delivering game-changing results

  • Communities can increase revenue per customer dramatically i.e 50%
  • Communities will increase product introduction success ratios
  • Communities amplify everything you do – increasing effectiveness and decreasing costs

Takeaway #2:

(missed this one, was too busy twittering, sorry)

Takeaway #3: The need for new management thinking

  • Mismatch between community goals and associated investments
  • Major gaps between community goals and what is being measured
  • Communities have to combine with major talent initiatives
  • Communities will transform most business processes. (You can start communities without changing the way you work, but eventually it is going to impact on the way you work)

Takeaway #3.5 : The worst practices enjoy wide adoption

  • The build it and they will come fallacy
  • The let’s keep it small so it doesn’t move the needle phenomenon
  • The not invented here syndrome (especially applicable for newspaper and magazine publishers – people already have a vibrant social network on facebook, myspace, bebo, they do not want to rebuild networks on your site. Engage people where they are.)

Early predictions

  • Many community initiatives will continue to fail
  • Communities will eventually transform the role of the the CMO
  • Early adopters will force industry-wide changes
  • Companies will find out how to build predictable communities

Prediction #1 for publishing industry: Have your community cell-phone ready
(*Based on data from Deloitte’s “State of the Media Democracy” Survey, 3rd Edition)

  • A third of US consumers are using their cell phone to entertain themselves, over half of Millennials
  • Almost 50% of consumers, 40% of Boomers, and a surprising 35% of Matures are interested in ease of access to product information via product bar code scanning on their cell phone/hand-held
  • Although a very small percentage, almost 5% of every generaiton considers cell phone advertising as being the MOST influential form of online advertising

Prediction #2 for Publishing: Media will never travel alone

  • In order to optimize subscriber and ad revenue potential, media companies must create new product development and advertising strategies
  • Package of channels around content, not separate and distinct, but integrated, convergent

Prediction #3 for Publishing: You will need to provide the full capabilities of the digital media menu

  • Customizable interface
  • Personalized content
  • Personalized recommendations
  • Extensive content selection from all sources
  • Sophisticated content search
  • Active/Passive viewing
  • Free/Ad supported option
  • Supports multiple platforms
  • Same menu on each platform
  • Transfer content license across platforms
  • Integrated cross-platform builling
  • Purchase, rental, free w/ads
  • Off-line viewing
  • Single integrated sign-on
  • High speed, real-time streaming
  • High reliability
  • [Wow, that’s a lot to be ready for!]

Key message: “Social is embedded in everything.”

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Richard Herley, in his first post on Teleread, is discussing why savvy literary agents will have new opportunities in the e-publishing market. It’s a fantastic post and you should read it and think about what he says.

However, one little aside he made caught my eye:

Let me digress a little. The reason that hardback houses hold such sway in the publishing world is that they largely control—or did control—the entry to the market. Of course, they also promote the books they publish, but, as any publisher will privately admit, even a big promotion budget is wasted on a third-rate book. Books succeed only if readers like them. Once readers know of its existence, a book is promoted principally by word of mouth.

One of the things I’m often telling emerging writers is to moderate their expectations of how many marketing dollars are invested by publishers in their books. New authors often have unrealistic ideas about how much promotional support they will receive, especially for a debut. They have visions of national publicity tours, signings, launches, displays and printed collateral. In reality, it’s more likely to be distribution of review copies, some targeted media releases and inclusion in the catalogue. Don’t get me wrong – done well, a thoughtful publicity campaign will yield just as much exposure for far smaller spend than a lavish marketing program.

But Richard’s observation has me wondering whether, secretly, one of the reasons publishers don’t bother to spend much on the marketing of (most) books is, not that they don’t have budget for it, but that they know it doesn’t really matter. In the end, reviews, interviews and ads don’t really prompt people to buy books and read them. People do. Friends and peers do. Social networks do.

Of course, if that were the case, I’d expect to see more effort (in Australia) in doing the things that might impact on word of mouth, rather than traditional above the line publicity and advertising? I’d expect to see every publisher pooling their marketing spend into building vibrant online communities. Some are – I think the social media components of HarperCollins Voyager Online have attract a really strong, if small, community. I guess I’m surprised not to see more of it, in a whole range of genres.