Judy Payton spends a dozen hours or more a week going online to give advice to fellow do-it-yourselfers who wonder why their dishwashers spew water all over and how to stop toilets from flushing by themselves.
It’s much the same for Floyd Basden, only he makes suggestions to people concerned about the queer noises their pickup makes when it turns corners or why a new sedan’s brake lights stay on all the time.
Payton and Basden are part of a growing army of volunteers who answer questions and give advice to strangers who visit commercial Web sites. The only payment these online mavens receive is recognition as experts and the chance to make new online friends.
That seems to be enough to attract thousands of volunteers whose loyalty makes online communities hum.
But unlike traditional online communities where people talk about politics, hobbies or health, the communities frequented by Payton and Basden are intended to promote sales for their sponsors. Indeed, the most active participants in those communities are often the same people who spend the most money with the sponsor.
And the allure of these communities is becoming so strong that many firms are hiring outside experts such as Chicago-based Participate.com to start, manage and monitor their bulletin boards and chat spaces. One task of Participate.com is to demonstrate to clients the dollars-and-cents value that their communities bring to the business.
Differences between traditional communities and commercially focused communities are subtle and probably invisible to most participants, which is the goal of Participate.com’s managers.
Active participants like Payton, a retiree who lives in Pasadena, Md., have frequented several online communities over the years. She became a do-it-yourselfer nearly 40 years ago after paying a repairman $80 to fix her washing machine.
“He unplugged it, turned the plug over, and replugged it,” Payton recalled. “That was all it took. Ever since then I’ve hated to pay a professional to do something simple enough to do myself.”
Payton’s expertise has earned her the designation as “coach” at the OurHouse.com Web site, and nothing pleases Payton more than to get a happy reply from someone online who has profited from her advice.
The story is similar for Basden, an auto mechanic and car buff who lives in Fairfax, S.C. Basden is a member of the elite Pit Crew at Wrenchead.com, which enables him to give expert advice on the Web site and to exchange private communications with 40 or so other members of the Pit Crew.
“It’s kind of like a family,” said Basden of the Pit Crew. “Everybody knows pretty much what you’re going through.”
Basden regularly buys auto parts through Wrenchead.com and discusses plans to modify vehicles with his online pals.
People who run commercial Web sites love volunteers like Payton and Basden for their freely given expertise, but especially for their tendency to be loyal customers. “We find that people who are members of our community account for about 30 percent of our sales even though they’re only about 5 or 6 percent of our Web site visitors,” said Carl Cohen, marketing vice president for Wrenchead.com. “They just buy at a much higher rate than anyone else.”
Cohen knows the precise sales figures because that is part of the information that Participate.com regularly provides Wrenchead executives. By watching everything that’s posted on the Web site by customers, tracking their habits and surveying some customers, Participate.com tries to multiply the commercial value of its community sites to clients.
“It’s a great way to get feedback and learn quickly when you have a problem with a new product or service,” said Joe Cothrel, research vice president for Participate.com. “People will post things to peers that they might not be comfortable saying directly to the company.”
Participate.com brings an intense level of monitoring and management to the online communities it serves and will charge from $300,000 to $3 million a year for its services, depending upon their scope and scale.
Earlier this month Participate.com made a deal with Hewlett-Packard Co. to establish a community for schoolteachers to share experiences that will help them improve the way they introduce technology to their pupils.
That online community will be accessed through the HP Web site, and as in most of the communities it manages, Participate.com’s role will be all but invisible to users. The firm wants the communities to appear spontaneous while staying focused.
“What we want isn’t just chat, but rather conversations centered on topics of value,” said Jay Rainey, a business service director at Participate.com.
While most Web sites these days invite some level of interactivity, very few are managed at the level offered by Participate.com.
“A lot of firms are integrators and have the technology to set up a community,” said Alan Warms, founder of Participate.com. “They provide a valuable service. But the question is, `What do you do on Day 2, after everything’s in place?’ That’s where we’re different. That’s what we address.”
Many companies that have Web sites don’t pay much attention to them, said Richard Villars, an executive with IDC, a market research firm based in Framingham, Mass.
“A dirty secret of the Internet is that a lot of companies just ignore their Web sites,” Villars said. “People send them an e-mail and never hear back. The worst thing you can do is to give poor response to an inquiry, because a potential customer or stockholder will make a decision on your company, your services–everything–based on that one failure.
“They won’t be impressed by the pretty graphics on your Web site.”
Companies are only beginning to realize the importance of establishing online communities for customers, Villars said.
“If you sell something online, there is already an online community of your customers in place,” he said. “They only question is whether you are part of it. That community may be on Yahoo! or America Online, but it will turn up someplace.”
In fact, managing online communities is a core competency for major Internet portals like Yahoo! and AOL, but it’s something other firms may find difficult.
Cohen, the Wrenchead executive, said that his firm could set up and manage its online community, but it prefers to have Participate.com handle the community because of its broader experience that comes from managing some 40 communities.
Some companies might be uneasy outsourcing the management of their virtual communities, said Jay Farmer, a Chicago-based executive with Andersen Consulting who leads the firm’s dot-com launch center.
“The downside to outsourcing this is debatable,” he said. “There is a potential loss of control and loss of direct contact with customers. And some companies may find the information flowing back and forth is strategic and be uncomfortable having a third party handle it.
“But these issues can be handled contractually.”
A lot of companies that just now realize their need to establish and manage communities may need to outsource this function just to play catch-up, said Ford Cavallari, executive vice president with Renaissance Strategy, a Boston-based consultancy.
“In the consumer space, a company may outsource this initially, but the tendency will be to eventually bring it in-house,” Cavallari said. “That’s a challenge to be faced by companies like Participate.com.”
In the business-to-business market, third parties already have a more widely accepted role, he said. But the challenge there is that large phone companies seek to become big players in managing business-to-business communities. SBC Communications Inc., Ameritech’s parent, this year bought Sterling Communications specifically to get into that business, Cavallari said.
Several communities managed by Participate.com have no direct impact on consumers. For example, the firm manages a network used by more than 300 Ace Hardware dealers who specialize in providing products to industrial customers.
“I’ve been trying to communicate with dealers for four years,” said Tina Lopotko, department manager for Ace’s commercial and industrial supply business based in Oak Brook. “This does everything I’ve been wanting. It’s eliminated our printed newsletter and a lot of other paperwork.”
Ace dealers now communicate with each other by posting messages on a community bulletin board as well as communicating with headquarters, she said.
“That means we get help from other dealers,” Lopotko said. “We had a dealer who had a customer wanting 6-gallon plastic buckets. Nearly every vendor offers just 5-gallon buckets, but another dealer saw that and told us who has 6-gallon buckets.”
Dealers now tell each other online when one has any kind of problem with a vendor, said Paul Snyder, an Ace industrial salesman in Fleetwood, Pa.
“We exchange information on a vendor who is difficult, and we get sales and ideas and leads from each other,” Snyder said. “It’s really helpful. My only problem is that I can’t spend more time on it.”
Lopotko also said she sometimes finds it difficult to spend sufficient time at the online community, but the managers at Participate.com don’t let her stay away for long.
“They monitor the bulletin boards, and they’ll e-mail to ask why I haven’t answered something that’s popped up,” she said. “They spur me to keep paying attention.”
