How to Play Social Technologies

O means objectives. Too many companies start with the technologies -- "let's do a blog" or "let's start a community" -- instead of focusing on what they actually want to accomplish. Pick an objective first -- listening to customers, talking with them, energizing them, supporting them or embracing their ideas -- and then build a strategy.

S refers to that strategy. Consider the long-term impact of these social technologies. A social application -- a community, a blog, a wiki, a Web site with customer ratings on it -- is an asset, not an ad campaign. How are you going to use it?

T is for technology. Once you've got the people, objectives and strategy figured out, decide which tools to use. Do this last, not first.

Companies are doing this. Like Procter & Gamble (PG Quote), which learned to market tampons to the most brand-resistant customers in the world -- teenage girls -- using a community called beinggirl.com, and found it four times as cost-effective as advertising. Or Adidas, which generated 4 million impressions out of every $100,000 it invested online by getting people to pass along brand messages on MySpace. Or the customer relationship management application Salesforce.com (CRM Quote), where customers now generate half of the new features in every release on a simple voting site. There are 25 case studies like this in Groundswell, every one with proof of business value.

Dell (DELL Quote) turned around a reputation for poor customer service using the groundswell. It connected with bloggers, created its own blog at direct2dell.com, built an idea community for generating new product ideas and used social technologies to connect its employees. Now Dell even has a blog about its stock at dellshares.dell.com. Its support forum, where at least one in five visitors find their own answers, saves Dell thousands of support calls at around $10 per call. Michael Dell brags that his company will benefit from 100 million customer contacts this year.

Do the companies in which you're investing even know how many customer contacts they have?

I'll leave you with this advice. Pay less attention to the big consumer-facing social applications, like Facebook and YouTube -- they're still trying to find ways to monetize the huge traffic they generate. Instead, look for companies that build corporate social applications. One is Communispace, which builds private research communities and charges its customers over $150,000 a piece -- and has to bat off prospects with a stick. Or Blast Radius, which has been snapped up by mega-agency WPP Group (WPPGY Quote). It builds social applications for marketers. Or salesforce.com, which has taken its own idea community and begun cloning it for the likes of Starbucks (SBUX Quote) (see the results at mystarbucksidea.com).

Corporate social applications are going to be big business. The people who build them will be very successful.

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