Sep
30
Written by:
Matt Goddard
9/30/2007 7:23 AM
In my last social networking post entitled social networking 101, we introduced the concept of risk reduction as one of the main drivers of why social networks are formed. Yes, social networks like myspace and facebook cater to a broad audience and many of the members are not really thinking risk when participating (my sisters food fight application for example). But if you have been following the explosive growth of facebook as a business to business collaboration tool the concept of risk reduction is starting to emerge for all to see. Why are these groups forming? To connect with other people so they don’t fall behind in their industry. To get advice on what products to purchase for their businesses so they don’t choose the wrong thing. To collaborate on specific topics so the best ideas come to the surface and people can avoid second guessing themselves. In other words, they are forming to reduce risk.
In most business to business social networks, people are talking and sharing information in an effort to reduce the risk of their decisions. For this post entitled social networking 201, we are going to explore the subject a little bit further and focus not on why the networks are forming, but how people in the networks are interacting with each other. The main subject of this post will be the concept of opinion leaders or tastemakers – certain people inside networks that seem to be the most credible and the ones most often turned to for risk reduction. Companies that truly understand the characteristics of opinion leaders and how they affect the dissemination of ideas will better understand how social networks operate. And more importantly, will better understand how these networks effect the purchasing decisions around their products.
Myra Gorman, the CEO of Community Analytics is an expert on social networks and how Opinion Leaders affect purchasing decisions by reducing risk. To best educate everyone during this blog I asked Myra to participate in a Q and A with R2i. This Q and A can also be seen in a video version on www.r2integrated.com/social The transcript is below.
1. What role do Opinions Leaders play in influencing purchasing decisions?
There are countless definitions out there for Opinion Leaders. I think of them as trusted advisors – the individuals you call when contemplating an issue, wrestling with a decision, solving a problem or just looking for new ideas. The role they play in purchasing decisions varies depending on the product or service involved. For instance, one of your trusted advisors relative to fitness might say to you, “Matt, you have got to join this new gym – it is the best fitness program I’ve seen and has made a huge difference in my energy level and productivity.” In this case, you may not even be in the market for a new gym, but because you trust and admire this person’s opinion on fitness, you are now excited to look into a membership. On the other hand, you probably have trusted advisors whose advice you seek for very specific decisions you are facing. For instance, I recently had to make a decision about whether Community Analytics should purchase or build a particular piece of technology. There were four people I talked with about this decision. I chose those four because I trust each of them personally and I have experienced the positive impact of their knowledge in this area before.
2. Are Opinion Leaders and Thought Leaders the same thing?
This is a great question – and an important distinction. Again, there are numerous definitions floating around out there. But the critical difference is that Thought Leaders don’t necessarily have a personal relationship with the audience who listens to them. For instance, Robert Reich would be considered a Though Leader in the area of labor economics, and I might read his writings to inform my knowledge on the subject as part of a decision-making process relative to growing the human capital at Community Analytics. But, he is not the person I will call or meet with to get advice. I would meet with three of my trusted advisors here in Baltimore about specific issues or decisions that arise as part of developing and implementing a strategic plan to achieve that growth.
3. How are these people different than everyone else in the community?
I don’t like to think of Opinion Leaders as “different” from everyone else. The truth is that different groups of individuals are Opinion Leaders for different topics/issues. And based on the topic/issue, the characteristics of the Opinion Leaders within a community vary. In our work across a variety of industries, we find that the characteristic which cuts across these diverse groups is a willingness to share knowledge and a certain intangible quality that speaks to trustworthiness and integrity.
4. Do these Opinion Leaders have certain characteristics we can look for?
I wish the answer was “yes”. The truth is that the characteristics are all over the board depending on the nature of the community as well as the topic/issue of interest. Our clients find that the real value is not merely in knowing who the Opinion Leaders are within a given community. The real value is found in understanding the relationships through which a community vets ideas, evaluates products and makes decisions. With an understanding of this existing network of trust and advice-seeking, you have the unique opportunity to become a meaningful part of the conversations and relationships that are built within the network.
5. Can businesses attract Opinion Leaders? Where are they?
I hate to be a stickler for language, but I don’t think the right approach is to try to “attract” Opinion Leaders. Rather, businesses should meet the Opinion Leaders and their communities where they are – in the context of the relationships, dialogues and information sharing activities that matter most to them. To truly grow a loyal customer base (i.e. improve customer retention) while simultaneously increasing the rate of new customer acquisition, businesses need to participate in the communities that matter most to their target audience rather than try to create an artificial network – more listening and less “telling”. As we’ve seen in the popular press, artificial networks are not as valuable as most had hoped.
6. Can you give us an example of how Opinion Leaders have influenced the dissemination of ideas for one of your clients?
Absolutely – let’s consider one of our clients in the financial services sector. This company wanted to identify and develop relationships with a larger number of investment advisors in a certain part of the country. After Community Analytics revealed the Influence Networks at work among this audience, the company was able to take both strategic and tactical measures to improve its reach and drive performance. Strategically, the Influence Networks demonstrated that this community relied heavily on academics for advice and guidance. This company had never developed relationships with the academic community, and has since started develop these relationships to positive effect. Tactically, the company has been able to develop a recruiting strategy for advisors that truly resonates with this community by soliciting the input of their Opinion Leaders and becoming part of the dialog among the community. This has led to increased recruitment and retention of advisors.
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