If you are lucky, you will have regular interaction with 10 percent of your community. And, for a site to have the required amount of communication "liquidity," in my experience it needs at least 100 participating users. That means that your site better have 1,000 or more members (Facebook fans, Twitter followers, YouTube views, etc). Building that degree of engagement is tough, but organizations are getting creative. The airline JetBlue hit a home run with its "All-You-Can-Jet" Facebook promotion. Some progressive firms are even providing discounts to prolific bloggers and tweeters in the hopes that they will spread a good word or two about their experiences with the company.
4. Knowledge Integration
The final piece of the social media puzzle is knowledge integration. Social media provides a wealth of information about products, customer experiences, competitors and areas for improvement. It is the proverbial canary in the coal mine for many organizations. Unfortunately, many firms are still very poor at integrating and acting on the information they receive through social channels. They often lack a mechanism to filter and capture insights, and to feed these into the decision-making apparatus. Some companies take this very seriously. For example, when Starbucks learned through its social media channels that customers disliked having to throw away their paper cups, the company implemented a campaign encouraging the use of reusable containers, and offered a free cup of coffee in return.
Given its massive user base and rapid growth, social media is likely here to stay. However, organizations that want to be involved need to approach it with care. There can be benefits, but also risks. When it comes to social media, it's good to be SICK!
Michael Wade is a Professor of innovation and strategic information management at IMD, in Lausanne, Switzerland. He teaches in IMD's program Strategic Marketing in Action and can be reached at email@example.com.