Sunday, June 18, 2006

How Oblivious Is Your Company? Developing A Six Phase Model to Characterize A Company’s Level of Involvement and Engagement in the WOM/CGM Space

I recently developed a model to characterize where a company was in terms of their level of involvement and engagement with understanding stakeholder word-of-mouth and consumer generated media. I can’t say this is an entirely original model since I have attended a number of presentations where people have talked about how to get involved in the “conversation” that takes place among consumers. So if I’ve inadvertently plagiarized this from anyone just let me know.

And I should also say that it’s not my original model since I initially presented it to my students a couple weeks ago in class and they provided incredible feedback, and in fact proposed some new levels.

All that aside, I believe all companies can be placed along a continuum for each of these six phases. They might not go through these in a linear fashion and it’s not necessarily the case that the final phases are more evolved than the earlier stages (though you’ll probably detect a bias in the model for companies to strive towards the later phases). Different companies need to pick a level of involvement that’s suitable for their culture and their industry. However it is generally the case that early phases are more “passive” while later phases are more “active.”

Phase I – Oblivious

This label sounds a bit harsh but it amazes me how many companies don’t realize that people talk about them. They don’t think to pay attention to what consumers have to say and don’t benefit at all from any of their insights or ideas. Companies are in this phase because they might not know any better or have been trained to focus too much on a “control” mentality where they “push” the message out to a target audience. Ignorance, however, is not bliss.

Phase II – Indifference or Neglect

Phase II is not necessary to pass through, but it is an option that some companies take. In this phase the company is aware that consumers are talking about them but are indifferent and don’t care about what they have to say, or simply neglect to pay attention to it. This too is probably the result of the control-push dynamic.

Phase III – Monitoring

In Phase III, a company is aware that people are talking about them and consider it important enough to pay attention to. A lot of monitoring right now is taking place online and the reason some people first monitor the online space is because they realize there is the potential for widespread distribution of the message and impact. A few other interesting things to note about this phase: a) some companies only monitor the online space because they could care less if just a few people are saying in offline or private conversations because they don’t think that WOM has an impact (this can be a dangerous strategy since it represents a form of indifference); b) some companies are monitoring the space because they see it as a form of “competitive intelligence” with no motivation to engage in the dialogue (again, probably more of the control-push mindset); and c) other companies may be at the monitoring phase because they are cautiously dipping their toe in the WOM/CGM space to try and figure out what’s going on.

Phase IV – Listening

In this phase a company is not only monitoring the WOM/CGM but doing so with an intent to move towards more engagement. It’s a subtle but important distinction, and represents a key difference between “monitoring” and “listening”. Thus, in Phase IV, a company is listening for insight but also for understanding as a move towards dialogue (contrast this with some companies in Phase III who are just monitoring the space to make sure nothing bad gets said about them). Laurent Flores has talked a great deal about this (and later phases) on his blog. My colleague Lois Kelly has written an excellent book called Beyond Buzz about this topic as well. Listening involves a more active (even proactive) and attentive orientation and represents a crucial preliminary step to the final two phases: responding and joining in.

Phase V – Responding

In this phase a company takes the next step and responds to consumer WOM/CGM. Responding is a crucial element of acting on feedback provided to the company from consumers. This can also take the form of outreach to their stakeholders, and increasingly in the online world this takes the form of blogger outreach. This can be a delicate matter since the company doesn’t want to appear as being invasive or “interrupting” the conversations already going on. Jim Nail from Cymfony recently gave an excellent talk to my class about if and how to respond to negative WOM. In some ways, though, responding might be a little reactive because a company might be waiting for something to happen before they respond, but if a company is thoroughly committed to the fourth phase of listening, then responding becomes an extension of that proactive strategy.

Phase VI – Joining In

This represents the most active, committed, and dialogic phase. Here the company is an active, perhaps even passionate, contributor to the dialogue about their brand, products, and services, as well as general issues that face their category and industry, and even more broadly, the company demonstrates concern about topics that are of interest to their consumers. A company at this phase acts in accordance with the dialogic principles of co-creation of meaning making. You can identify companies in this phase by some of the following indicators: the company is seen as a well-respected thought leader in a topic of concern to its stakeholders; the company hosts and sponsors events of importance to its customer community; it supports or hosts forums on those important topics in online or offline venues such as blogs, message boards, events, and mini-conferences; it has a strong reputation of listening and being responsive to customer suggestions and complaints; it proactively seeks out feedback and critical scrutiny of its actions; it has a high Net Promoter Score (more people who actively promote and recommend it than detract from the company); and/or it has a reputation for being clear and transparent in its communication practices.

In summary, all companies can be placed on this continuum of passive to active involvement and engagement with their stakeholders. Companies can use this tool to identify where they are on the continuum and reflect on whether or not this is the best place to be for their corporate culture and industry.

As I mentioned above I don’t think this model is completely original, and there are probably others out there with their own existing models, but I’d love to hear feedback on this one and/or for you to share your own models that you’ve come up with. Thanks again to my students for co-creating this model with me!

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