Why Your Customers Want To Join Your Tribe

May 3, 2012 Comments
Why Your Customers Want To Join Your Tribe

I wrote earlier this month about the financial benefits of  a community that allows your customers to talk to one another regularly.  Having users interacting with each other can earn the host company 19% extra per user in revenue.

It’s never a bad thing to have additional research banging home this point, and in this case the research in question comes from Michigan State University.

The study has recently been published in the Journal of Retailing and is one of the first of its kind to examine how other customers influence customer loyalty.

They conducted their study in the offline world, taking in a clothes store, a theme park and a restaurant.  They found that customer loyalty increased when the participants viewed other customers as similar to themselves.

“We’re sizing up other customers all the time,” says Voorhees, assistant professor of marketing in the Broad College of Business. “Customers want to be around people they relate to, and the effect that the image of other customers has on loyalty was surprisingly dramatic.”

So customers want to feel like they’re part of a tribe with their fellow customer.

“Basically, do I feel like they’re the same type of person as me?” says Voorhees. “Do they look good? Do they behave? These factors increase the likelihood of people returning to the store.”

They suggest that if a company incorporates these kind of factors into their marketing efforts then they can increase loyalty by as much as 30%.

All of which may sound obvious to readers of this site.  After all, we are very much part of the choir when it comes to the value of social to your business, and many of you will already be trying to establish communities around your business, be they online or off, that allow customers to be a part of your tribe.  Alas it seems that many Chief Marketing Officers are not of like mind.

Forrester released some research this week that looked at how B2B marketers were spending their money.  Whilst in general the trend was positive, in that spending was rising, for social business professionals the news was not so positive, as it was revealed that spending on community management had dropped by nearly 7% in the last year.

B2B marketing spend

I argued last year that community management was set to become a key skill for all employees, as exposure to customers becomes something that happens to everyone rather than just those in the marketing or sales departments.  Only if community management skills become widespread will we have truly social businesses.

If that is all a bit ‘blue sky’ for the average marketing executive however, hopefully my earlier post will provide some help for those of you that need to convince your boss that community management is crucial to their business.

  • jeremywoolf

    Great post Adi. Any idea if the decline in community management spend Forrester highlights relates to marketers spending in other areas – or other business functions taking this cost into their budgets?  

  • http://reelseo.com/about/grant Grant Crowell

    Adi, do you know of actual cases, of online video being successfully integrated into community management so that customers are encouraged to talk with each other? Do you have any ideas for how this could be done effectively? I agree that community management is an essential component for social business, and I do believe that video can be very effective at triggering an emotional response and building rapport and trust with customers.

  • http://www.adigaskell.org/blog Adi

    Hi both,

    Thanks for the comments. 

    Grant Crowell  I haven’t come across many companies that allow customers to engage with each other via video.  Chat Roulette is an infamous example and I dare say an example that puts many off providing this kind of service.  I think a 1-to-1 video chat works best when you have high trust between each party, and in most cases that doesn’t exist in a customer-to-customer relationship because it’s unlikely that they’ll know each other very well.

    jeremywoolf I think a problem with many communities is that few have a clear purpose when they’re created.  All communities should have a social purpose, ie a problem they exist to solve, and then a business purpose that places financial value onto each successful social resolution.  If you do that then it makes determining the ROI of your community much easier and you can stand your ground in the face of budget threats.  If you don’t have that though a community can be an easy area to cut budgets because the impacts are often quite fuzzy, with budgets allocated instead to areas that are easier to measure.  I think that’s certainly what was the case in the Forrester research.

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