Digital Hand-Holding: The Impact of Communities on Commerce

Consumers are inundated with content from brands on every channel they visit but regardless of where they are, it's the content created by users like them that resonates the most, which is why communities (collaboration-driven websites where like-minded people willingly provide feedback, answer questions and develop other content for their peers) can be so effective.

In fact, 49 percent of those surveyed by Olapic say they are more likely to buy a product (across verticals) when it's endorsed by a real person - and communities take user-generated content (UGC) far beyond static rating and reviews displayed on product pages. Traditional ratings and reviews can miss the mark when it comes to connecting visitors with the right product content pre-purchase and engaging them post-purchase (often lacking relevance, images, answers to questions, ability to filter, etc.). Alternatively, communities provide a place to deliver contextual content while allowing consumers to post themselves and to self-serve to find quick answers in their moment of need provided by real users. Since the Q&A sections tend to fill up with information unavailable in product descriptions or even reviews, they're also effective for search engine optimization efforts as people tend to write how they talk and search similarly.

Communities are supported by companies such as Salesforce (Community Cloud) and SAP (Jam) or vendors like Ning or Memberful. SAP, for instance, connects buyers with peer reviews, recommendations, articles, and questions and answers on ecommerce sites - and often to great effect.

An SAP-commissioned report from Forrester, for example, found that 75 percent of companies believe that communities accelerate buying decisions, increase purchase likelihood (73 percent) and improve buyer confidence (59 percent). Similarly, 66 percent of companies surveyed expect to increase purchase satisfaction by using communities to help inform purchases.

Where SAP Jam differs from many offerings, and the reason it is particularly useful for enterprise clients, is its ability to prioritize what content displays and to whom, so the visitor is looking at a blog, an answer or a recommendation that makes sense in the context of that visit (e.g., just browsing, just purchased, etc.). Today, SAP Jam integrates with the Hybris marketing module (owned by SAP) and other marketing automation suites, which allow retailers to gather information from within their communities to inform marketing decisions like delivering a coupon to a person who performed a certain action (e.g. multiple searches without conversion) or creating content based on trending topics within the community.

Communities in Action

Check out commerce companies with very active communities at wsm.co/activetalk.

Despite the obvious power of community-type environments on commerce sites, retailers have their concerns. For retailers with some UGC-type functionality already provided within their Web presence, they are concerned with how customers will adapt to a new experience according to Stephen Hamrick, vice president of product management at SAP.

For retailers who have yet to launch community-type functionality, Hamrick suggests a common concern is what their customers will say about them. In many ways, however, commerce communities are a more controlled environment to manage compliments and criticisms than social media where customers often turn in order to voice their uncensored opinions.

Regardless of where a retailer is with its UGC efforts, communities aren't built overnight (see sidebar) but brands that realize the importance of complementing commerce with content are on the right track and to prove it, they can monitor how community members are performing desired actions, contributing, referring and conducting other behaviors that impact a company's bottom line before, during and after the sale.