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Online Community Eng
Online Community Eng
Online Community Eng
Online Community Eng
Online Community Eng
Online Community Eng
Online Community Eng
Online Community Eng
Online Community Eng
Online Community Eng
Online Community Eng
Online Community Eng
Online Community Eng
Online Community Eng
Online Community Eng
Online Community Eng
Online Community Eng
Online Community Eng
Online Community Eng
Online Community Eng
Online Community Eng
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Online Community Eng

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  • 1. Online communities are booming: ‘Time to get on board’ Woerden, 2009 Opportunities for financials with online communities
  • 2. Inhoud <ul><ul><li>Introduction </li></ul></ul><ul><ul><li>What are online communities? </li></ul></ul><ul><ul><li>How did online communities change the financial consumer? </li></ul></ul><ul><ul><li>What can financials do with online communities? </li></ul></ul><ul><ul><li>What are the drivers of success with online communities? </li></ul></ul>
  • 3. Introduction Google has bought 1.6% of the stock of Facebook for $240 million (2007) Several financials in the Netherlands have started a online community (ABN AMRO, Rabobank, Achmea) Last several years online communities have grown explosively en reach a large group of potential customers on daily basis. The impact of these communities has also exploded. The financial sector will have to deal with this phenomenon, like in the early days of the introduction of the Internet, and have to have a proper reaction. The positive side are the endless opportunities that these communities have to offer. IG&amp;H has done research in connecting online communities and financial services. This presentation will give you a overall view in the world of online communities and the highlights of the research. Source: view slide 21 The online community of LEGO© has a huge contribution in product development Hyves reaches 50% of the Dutch population (13+) at daily basis in 2008 MySpace has accumulated a total of 100 million members in 2007 The online community customer is buying 54% more than the traditional customer
  • 4. <ul><li>1. What are online communities? </li></ul>
  • 5. A online community is the platform for the interaction between members “ A online community exists of people who communicate socially or business wise on a technical platform. The community is established with a common interest, common problem, common task or common cause of the members. The interaction is based on implicit or explicit rules of conduct.” Definition ‘Online communities’ Source: view slide 21
  • 6. Online communities can be categorized in four groups <ul><ul><li>Ownership: start up realized by members or by a corporation, respectively top-down or bottom-up </li></ul></ul><ul><ul><li>and </li></ul></ul><ul><ul><li>Nature of the relations: personal or professional contacts </li></ul></ul><ul><ul><li>Throughout the world the most and the largest online communities are bottom-up established </li></ul></ul><ul><ul><li>Authenticity is the key factor in lifespan and growth of these communities (member-get-member) </li></ul></ul><ul><ul><li>Self-organization of the community enables the community to be flexible to new demands of the community and easy adoption of (new) goals </li></ul></ul>Personal Professional Top-down Bottom-up Bottom-up established communities are more likely to succeed Explanation: classification based on two axes Source: view slide 21
  • 7. Examples of online communities Source: view slide 21 est. € 1.2 billion 120 million user mainly in Brazil en India Help users to find friends and stay in touch Top-down en personal Unknown Unknown. 400 frequent participants in inquiries for product development Involve active travellers in product development Top-down en professional est. € 100 - 300 million 6,2 million (reach: 49% of the Dutch population (13+), 150 million daily page views, turnover est. € 10 million a year Help users to maintain contact with friends and make new friends Bottom-up en personal est. € 500 million (source: American tax collectors office) Market value 21 million, 570.000 in the Netherlands, est. 100-200 million daily, turnover € 20 million a year (189% growth in 2007) Number of users To let users profit from mutual business network and exchange knowledge (business opportunities, vacancies) Goal Bottom-up en professional
  • 8. <ul><li>2. How did online communities change the financial consumer? </li></ul>
  • 9. Online communities have changed the buyer behaviour drastically <ul><ul><li>Customers are looking for information via online communities like in the past with family and friends. </li></ul></ul><ul><ul><li>Inside online communities more and more experts rise and give advice to fellow-customers. Their opinion is highly appreciated. </li></ul></ul><ul><ul><li>Customers have low trust in financials and wants to compare a lot. Favourites are ratings and reviews of peers =&gt; Consumer product reviews </li></ul></ul><ul><li>Also insights in already bought products or services are increasingly used, especially transaction products like stock. </li></ul>Changes in buyer behaviour <ul><ul><li>Consumers in communities will more and more bundle to realize buyer advantages. </li></ul></ul><ul><ul><li>More often will customers buy and sell inside their network. </li></ul></ul><ul><ul><li>Information about the purchases of peers are increasingly wanted by consumers to compare other situations with their own =&gt; Peer reviews </li></ul></ul>Buying cycle Purchase Use Orientation Buying cycle Purchase Use Orientation Buying cycle Purchase Use Orientation
  • 10. Financials react on changes in buyer behaviour, especially in orientation phase Offering insight in reviews of peers. Peer reviews Compare best use &amp; ratings. Social navigation Overview of review summaries. Review snapshots Joint buying of products and services. Group-buying Compare use of bought product or service with peers. Peers-information Platform for mutual sales between members. Peer-to-peer buying Use of knowledge of the community. Expert information Buying cycle Purchase Use Orientation
  • 11. Expanding group of ‘online-community-consumers’ shops longer, visits more often, buying more and is more loyal Online-community- members Community users visit nine times more often than non-community users . Community users spend 54% more than non-community users . 56% percent of online community members log in once a day or more . Customers report good experiences in forums more than twice as often as they do via calls or mail. Community users remain customers 50% longer than non-community users . User numbers of online communities is doubled in 3 years. More than 71% thinks their community is very important to them. Cost per interaction in customers support averages € 8 via the contact center versus € 0.10 via self-service options. Source: view slide 21
  • 12. <ul><li>3. What can financials do with online communities ? </li></ul>
  • 13. Conceivable objectives of financials with online communities Occasionally Often Degree of usage Reach specific target groups, Reach large target groups, Generate mouth-to-mouth advertisement, Create strong bond with customers, PR, Free advertisement, Product reviews, Web care Expert opinion, Marketing Product &amp; Operations Sales Learning environment, Sell products , Sell online service Offering online service , Product development in cooperation with customer, Test environment
  • 14. How do I start a online community: Join, Buy or Make? Low High High Join Make Buy Middle High (initial) Low Low High High Influence on Success rate Investment <ul><ul><li>Reasons for choosing one of the options ‘Join’, ‘Buy’ of ‘Make’ is different for every organisation but successful examples within the financial sector are rare for the options ‘Join’ of ‘Buy’. </li></ul></ul><ul><ul><li>The factor in common for all options is the embedding of the target group in mission/vision/policy since the start up of the online community </li></ul></ul><ul><ul><li>Pro: </li></ul></ul><ul><li>Existing target group , </li></ul><ul><li>Authentic character </li></ul><ul><ul><li>Con: </li></ul></ul><ul><li>No influence on policy </li></ul><ul><ul><li>Pro: </li></ul></ul><ul><li>Target group within quick reach </li></ul><ul><ul><li>Influence on policy </li></ul></ul><ul><ul><li>Con: </li></ul></ul><ul><li>Loss of authenticity </li></ul><ul><ul><li>Pro: </li></ul></ul><ul><li>Strong influence on policy &amp; management </li></ul><ul><ul><li>Con: </li></ul></ul><ul><ul><li>Few authenticity </li></ul></ul><ul><li>Slow start of community </li></ul>
  • 15. “ Make”-examples of online communities within financial sector aren’t very successful Forum, expert vision, etc. Meeting point for active 55+ and offering experts opinions in specific themes Goedenwel.nl Offering information about starting a enterprise and offering access a network of peers Service Regional platform for target group starting entrepreneurs Goal Rabobank Starterscommunity Facilitate exchange of information, network and possibility for to trade between members Meeting point for entrepreneurs Flametree <ul><li>Communities of financials facilitate interaction for members but also serve their own goals </li></ul><ul><ul><li>Offer online platform for members </li></ul></ul><ul><ul><li>Reach out to specific target groups, cheap marketing, collecting buyer information, learning in online environments </li></ul></ul><ul><ul><li>Sales and servicing (life-events customers) </li></ul></ul><ul><li>General disadvantage is the lack of authenticity in top-down communities </li></ul>Source: view slide 21
  • 16. <ul><li>4. What are the drivers of success with online communities ? </li></ul>
  • 17. What are the drivers of success with online communities ? Focus <ul><li>Look for common interest within a group; provide focus on target group or common interest </li></ul><ul><li>Keep on updating your community to developments and connect with demands of members (over-commercialisation) </li></ul>Authenticity <ul><li>Self-organisation of the community; the community will be flexible and authentic </li></ul><ul><li>Include members in policy making, planning and implementing of the community policy </li></ul><ul><li>Authorise long and frequent user </li></ul><ul><ul><li>Impulse for growth from within community; ‘member get member’ </li></ul></ul><ul><li>Organise preconditions for user-generated-content </li></ul><ul><li>Connect to expected ‘look en feel’ of target group </li></ul>Usability <ul><li>Optimalize the technical aspects of the platform </li></ul><ul><li>Good and quick routing on the platform </li></ul>Dimensions Key Points
  • 18. What to do next? <ul><ul><li>To successfully adopt online communities every organisation has to develop a fitting approach. The questions below will help to determine a organisation specific vision. </li></ul></ul><ul><ul><ul><li>How do the developments of online communities influence my organisation? </li></ul></ul></ul><ul><ul><ul><li>Which online strategy has a fit with my organisation? </li></ul></ul></ul><ul><ul><ul><li>In which manner can a online community influence my business? </li></ul></ul></ul><ul><ul><ul><li>Which goals can my organisation reach with a online community? </li></ul></ul></ul><ul><ul><ul><li>How do I make / join a online community? What are my specific drivers for success? </li></ul></ul></ul>
  • 19. Want to know more? <ul><li>Do you want to know more of the vision of IG&amp;H Consulting &amp; Interim about online communities within the financial sector, please contact Floris van Ommeren, [email_address] . </li></ul>
  • 20. © IG&amp;H Management Consultants B.V. Woerden, 2009
  • 21. Sources <ul><li>Slide 3 Financieel Dagblad (2008); www.Google.com (2008); www.Marketingfacts.nl (2008) </li></ul><ul><li>Slide 5 Research Leimestier &amp; Kremar (2004) </li></ul><ul><li>Slide 6 Porter (2004); A typology of virtual communities; Markus (2002); Characterizing the virtual community </li></ul><ul><li>Slide 7 www.hyped.nl (2008’); Financieel Dagblad (2008); www.Wikipedia.com (2008); www.Google.com (2008); www.Hyves.nl (2008); www.Orkut.com (2008); www.KLM.nl (2008); www.Linkedin.com (2008); www.Marketingfacts.nl (2008) </li></ul><ul><li>Slide 11 Research Forrester (2006); Research AT&amp;T (2002); Research University of Southern California (2008); EBay (2006); Research Annenberg (2007); JupiterResearch (2006) </li></ul><ul><li>Slide 15 Slide 15 Interview IG&amp;H met Flametree (2008); www.Flametree.nl (2008); www.Goedenwel.nl (2008); www.RabobankStarterscommunity.nl (2008) </li></ul>

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