The Power of Online Communities for Your Business

Building an online community isn't just about getting the word out, it can be a powerful way to elicit feedback and fine-tune your message.

Building an online community around your product or organization isn’t just about getting the word out, it can be a powerful way to elicit feedback and fine-tune your message.  When done correctly, community feedback not only provides free market research, it provides the best and most accurate input from actual customers and end users.  This basic theory is called the Wisdom of Crowds and is the simple, but incredibly effective backbone of some pretty amazing technologies like Google search results and BitTorrent–and it’s not a new idea.

In 1906 Sir Francis Galton, a British scientist and notorious elitist stumbled upon an intriguing contest at a livestock fair that changed his mind about courting the input of common people.  An ox was on display, and the villagers were invited to guess the animal’s weight after it was slaughtered and dressed. Nearly 800 gave it a go and, not surprisingly, not one hit the exact mark: 1,198 pounds. Astonishingly, however, the mean of those 800 guesses came close–very close indeed. It was 1,197 pounds.

Wisdom of Crowds theory goes something like this:  ask a group a simple question that appeals to their self-interest and they will not only provide an answer which is smarter than any individual member, they will provide an answer which is astoundingly accurate.  The secret is in appealing to as large an input group as possible and setting up simple parameters which keep feedback limited to a single task.  These limits are essential to getting the actual wisdom of the group and not letting the input degrade to discussion, which erodes its collective wisdom.

Online t-shirt retailer Threadless sells their user-submitted designs through a system where thousands of designs are voted on to narrow the selection down to popular items which will sell.  It’s a system that works because of its limits.  Designs are narrowed down to potential candidates and voted on for a set period of time.  This refinement process takes the very broad question “which t-shirts will sell?”–which if submitted to the group would lead to endless and counterproductive discussion–and instead asks the simple question “which of these shirts will sell?” which allows users to submit more focused input.

Social media provides the simple tools for building this type of online community, and many businesses are using sites like Twitter not only to broadcast their message, but perhaps more importantly to gain immediate, focused customer feedback.

More on the Wisdom of Crowds at A List Apart and Radiolab.