Evan Williams of Twitter but up a post yesterday entitled “The evolving ecosystem”. Based on the title, one might expect readers to come away with new insights and stats into how vibrant the ecosystem is. However, as I read it only one thought kept coming to mind – how much does the Twitter ecosystem really matter?

I’ll highlight two key points on this front. The first comes from the chart provided. 78% of people that log into Twitter do so through the main site (www.twitter.com). They next layer down are mobile applications – m.twitter.com, SMS, Twitter for iPhone, and Twitter for Blackberry. Each is in the 7 – 14% range (the percentages sum to greater than 100% as some people use multiple apps). Each of these, I believe, are controlled by Twitter itself. So you don’t really see any “ecosystem partners” pop on the list until the next tier down – TwitPic, Tweet Deck, and Echofon, at 3-4% each.

That’s important, particularly for social media marketers that are trying to understand the real experience customers might be having. Since many of them are power users that might naturally adopt some of these more advanced tools (like TweetDeck), and that might be their main Twitter experience – but it’s not representative of what the vast, vast majority of users experience. In turn, most would be better served spending more time on www.twitter.com, and optimizing content for that experience.

The second is paragraph two, which really brings the whole ecosystem thing into question:

One major area of difficulty I highlighted was getting Twitter on your phone. We did iPhone user tests and confirmed that even though there was a plethora of third-party Twitter apps, people were having trouble finding and selecting one because none were called “Twitter.” This kept them from using Twitter at all. For this reason, we acquired Tweetie and turned it into Twitter for iPhone, complete with a new user sign-up experience. (emphasis added).

Think about that for a second. One of the key features of an ecosystem approach is to foster a wide variety of innovations, to suite a wide variety of customer needs. But what Twitter is saying is that even though there were a lot of options (and though they don’t say it, many of them were and are quite good), having these options actually prevented people from selecting any of them.

Now such findings shouldn’t be entirely surprising – numerous marketing studies in the past have shown that while a little choice is good, many customers become overwhelmed once there’s a lot of choice and end up not buying anything. This is roughly the equivalent.

So I ask – in a world where the vast majority of people access Twitter through the main site (and/or mobile extensions controlled by the main company), and Twitter found they had to make a single, easy option in order to get people to sign up for the mobile application on the iPhone (as they were overwhelmed by the options available), how much does the ecosystem really matter?

Or put another way, will simplicity continue to trump functionality?

A few weeks ago I wrote a post questioning the idea that “the customer is now in control” – a commonly heard refrain in the world of social media. The underlying premise was that if you take a deep look at what new technologies enable – particularly in terms of tracking individual behaviors – an argument can be made that companies can now be in far more control than they’ve ever been before.

I had this on my mind when I saw the recent post on how Virgin America partnered with Loopt – essentially giving away 2-for-1 flights to Cancun if you checked in at a taco truck during a certain time period. It was apparently quite successful. The number that is most jarring is that Loopt claims over 80% of the 1,300 people that checked in at a San Francisco taco truck have already bought tickets based on this promotion.

On the face of it, an 80% “conversion rate” seems absurd – marketers never get that. But there’s a slight twist here worth noting. It’s not 80% of people that heard about the offer – it’s 80% of the people that chose to check-in and take them up on the offer. In turn, it can’t really be compared to a normal conversion rate. “Checking-in”, in this case, is only done by the people that want the deal (i.e. if you don’t want it, you don’t bother, unless you REALLY wanted the two-for-one taco deal). In other words, they don’t sign in then happen to choose a deal; they sign in to get the deal. Big difference.

Why I think this is important ties directly back to the “customer is now in control” argument. In this case, a company (Virgin) chose to make a particular offer, given customers met certain conditions (go here, check in to loopt, etc.). It would appear that this offer galvanized over 1,000 people near the San Francisco taco truck alone (where any number of other things could be promoted) to go to it, check in (revealing who they are, at what time, etc.), and get it.

That indicates the company has a bit of control over the situation, and new data with which to potentially exert more control in the future, doesn’t it?

To spin it the other way, for the “customer to be in control” on these emerging location based, social networks, you’d expect that where people go would be determined primarily by where other people they know go (i.e. where your friends are, what they’re doing, etc.). But as more and more of these marketing campaigns roll out, and the reason for checking in becomes more and more driven by receiving rewards from companies, more and more “what people are doing” will be determined by “what companies want them to do” – using whatever interesting carrots they can come up with.

For marketers, that’s a pretty awesome development. For years we’ve heard about the potential challenges social media platforms like Facebook will have monetizing themselves. Most of these arguments have boiled down to people don’t want advertising, or commerce, built into their social activity. I’ve always thought these arguments were way overblown (if not totally misguided). But as platforms like Loopt and FourSquare evolve, I believe we’re going to find many customers prefer having marketing and commerce not only integrated, but driving what they do on them. They can always, say, text their friend to find out what they’re doing, after they grab the discount at the local restaurant.

Couple that with how much we can know about each person, and the “holy grail” of mobile payments being integrated into these social spheres, and it really is a very new world – and one where companies, in my opinion, can exert more control than ever before.

I’ve spent the bulk of my working hours over the last two years looking at how people, and particularly brands, use social media. I also spent a lot of time reading what others (i.e. social media experts) wrote about how social media is being used. Very early on, I noticed a major disconnect between what I was seeing, and what I was reading.

The major message being sent from social media experts seemed to be around “joining the conversation”. Anything that even sniffed of being a “broadcast-type” approach was quickly condemned, because that “wasn’t what people wanted” (or the “right” way to use the new platforms). But when I went and looked at how popular people, and leading brands, were actually using it, in many cases it looked a heck of a lot like broadcasting to me. So I kept asking a very simple question – if what they were doing was “wrong”, why was it so popular? Or put another way, isn’t that popularity, by definition, an indication that they’re doing something right?

What I’ve come to believe is that many social media commentators fell into a trap – developing a belief system about how they thought social media should be used, and ignoring all other approaches (and evidence) because it didn’t fit into this new conventional wisdom. And part of the reason why this belief system might have persisted is that they, and most of the people they know, like using social media that way (particularly the early adopters).

In my opinion, if they spent more time with people that don’t live and breath social media (i.e. those busy doing other things, don’t enjoy it quite as much, late adopters, etc.) they would have found that many of them were overwhelmed and annoyed by all the conversations taking place, and were more than happy to be relatively passive recipients of information. And as the platforms continue to attract users, this latter group gets ever larger, and ever more important. Trying to engage them in conversations might prove to be not only inefficient – it might drive them away.

Which brings me to Mitch Joel, who’s had a couple of very interesting blog posts recently tied to this idea. The first was on August 11th, entitled “Brands are terrible at twitter / (brands are terrific at twitter)“. It was in reference to a BizReport news item entitled “Only 16% of brand tweets are conversational“. The vast majority of people that  I’ve seen write about this report (and other similar ones) were quick to condemn brands for doing it wrong. Mitch was one of the first that I saw who didn’t see it as all negative, and was willing to take a more balanced, thoughtful perspective. I couldn’t have agreed more with the following comment he made (in response to the first comment made on his post):

If a brand is broadcasting and people are flocking to it, who are we say that it’s not working because there is no conversation?

I responded to his post (linking back to my own from August 5th entitled “you don’t have to engage in conversations to succeed on Twitter“). He responded, and I particularly liked his last sentence (which I believe ties back to my earlier hypothesis): Maybe the conversation is only happening within the early adopter circles. I also enjoyed the rest of the discussion, and decided I’d keep checking back in to see if Mitch was further pursuing this line of thinking.

Lo and behold, yesterday I saw his new post entitled “The end of conversation in social media.” I absolutely love it. What I love the most is that he went back and did a “personal journey” re-evaluating his own blog, his favorite blogs, and social media in general. This is what he then had to say:

The net output of this research made me think one thought (and one thought only)…

There is not much conversation going on at all.

Simple, to the point, and exactly what I tend to see every time I take a good look around. While I might be biased, I really do believe that if most people did a similar “personal journey”, they’d stumble upon the same conclusion.

He then went on and provided a lot more details on what he’s seen and thinks (which you really should read on your own). The only thing I’d personally change about the post is the title (though I’m not quite sure what I’d change it to), which ties to two of his questions at the end: Are the conversations dead? Were they ever – really – alive?”

My belief lies somewhere in the middle. It’s not that conversations are dead, or that they weren’t ever alive. It’s just that for several years this “conversational media” mindset  - where anything that’s not a conversation is bad – has been distracting many people from what’s been really going on.

In some cases, conversations are good, and there will always be a place for them; but in many cases, broadcasting is good as well, and there will always be a place for that to. It’s the perspective that only conversations are good that has to die, not conversations themselves. By extension, people also have to see that broadcasting isn’t dead, it’s just evolving and adapting to fit new platforms.

Final thought on this for today: I once heard that the key to success in social media was “scaling conversations” (i.e. figuring out how to converse with more and more people). My personal belief is that conversations can’t, and won’t ever, scale particularly well. We know this in the real world – beyond a certain point (which is often just a few people), adding more and more voices to a room detracts from the actual conversation that can take place.

In the social media world we’re seeing many people make a huge number of connections. And many brands are now making millions of connections. Will there be times a brand might want to converse with one of these people (or perhaps a few of them)? Sure. But there will also be plenty of times they might want to send one, relatively common message to all of them – i.e. “we’re doing this”, or “this is on sale”, or “this is our new product”, or whatever.

When one wants to get a message to many, broadcasting is the way to go, and it always will be. If it works well, maybe some of those recipients will broadcast it out to others as well. Maybe somewhere down the chain there will be some conversations taking place, and maybe not. But from a marketing perspective, what really matters isn’t the conversation – it’s getting the message across. And not only can broadcasting often do that, it’s typically a much cheaper and easier approach than trying to “engage” everyone in conversations.

As I scan articles about the impact of social media on marketing, I commonly come some variant of the statement “the customer is now in control.” But the more I research and think about this statement, the less I believe it – and the underlying message being sent to marketers – is. So today I thought I’d explain why.

My first issue is with the word now. From my perspective, the customer has always been in control – the fate of companies providing products and services in a capitalist economy is ultimately determined by what customers choose to buy. In turn, the analysis shifts towards social media somehow giving customers slightly more control than they had before – a small, but important, distinction.

The typical argument is that as customers have connected with each other through platforms like blogs, Twitter, and Facebook, the opinions they share amongst themselves have increased in importance, while the typical “broadcast marketing” approaches have decreased in effectiveness. While I do believe there is some truth to this, there is another way to look at what’s happening.

For starters, if customers only wanted to hear each other’s opinions, they could do so without engaging companies at all – either in somewhat self-organizing fashion through Facebook and Twitter, or “neutral” services like Yelp. But many, many customers are also opting to directly connect with companies – liking, following, lurking in communities, etc. – through these very same platforms. In doing so, many are effectively asking companies to engage with them.

Second, being “in control” takes time and effort. I would argue that many customers may want to “take control” in relation to certain product and service decisions, for many others they are happy to be passive recipients of messages (and offers) from their preferred brands. For example, the #2 reason given for becoming a Facebook fan (based on a survey earlier this year) was to receive coupons. And while I don’t have time to go into it here, one of the consistent findings from my research is that customers like being “broadcast” to on social media more than many people think.

On a related point, I believe that many customers are being overwhelmed by all the brand-related conversations taking place. For example, many brands on Twitter now commonly send 30+ messages a day, responding to specific people. Many consider this to be engaging. But if you follow (say) 30 such brands, that’s over 900 messages a day – most of which will be of absolutely no interest to you. Perhaps the method will persist for many more years, but perhaps not.

Finally (at least for today), as “word of mouth” marketing has moved online, and more and more data is generated, it’s becoming ever easier for brands to monitor exactly what people are saying, thinking and feeling about various things. I personally believe that all this information points towards a world where many brands can be far more “in control” than they’ve ever been before.

Tying it all together, I’ve taken to asking what someone like Don Draper – the lead character on Mad Men – would think about the rise of social media if he was ported into 2010. Would he look at all the new tools and behaviors and say “wow, I can’t control anything here!” Or would he say “wow, I can influence, monitor and control things more than ever before!”

My sense is that it would be the latter – and many companies would be well served by taking a similar line of thinking. After all, to be in control implies having power; it is commonly said that knowledge is power; and all this information is giving companies more knowledge than ever before.

It seems that every day a new article (or blog post) comes out about how brands are using Twitter wrong. This article from yesterday delivers this message in a typical way – saying that Twitter consists “primarily of two-way conversations – marketers can be doing so much more to participate fully in this two way medium” (and the Twitter whitepaper it links to is fairly interesting). Marketers are being told to engage and converse – and to do so quite frequently.

But I have a different perspective, and believe that many brands (and companies) can succeed on Twitter without necessarily engaging in conversations, or being particularly active. Not only that, but I believe the hypothesis that customers necessarily want to be engaged in conversations with brands needs to be challenged, as I don’t think it’s true as a blanket statement.

I’ve been doing a lot of research on this recently, but today I’ll just provide a few different Twitter accounts that appear to be doing very well, in terms of followers, without engaging in conversations (or doing any of the other things most people are recommending they “should” do on Twitter).

@woot:  A quick glance at their Twitter page reveals they typically post once a day (occasionally 2 or 3 times). This post is a link to a daily deal. There is simply no conversation or two-way engagement. They have over 1.6 million followers (#90 overall, between Biz Stone and Penn Gillette), and have been listed 7,000 + times. This makes woot one of the most popular brand accounts on Twitter (out of companies that actually sell stuff).

@zappos: this account is operated by CEO Tony Hsieh, and Zappos is frequently mentioned as one of the leading companies in delivering compelling customer experiences, and engaging in social media. But if you look at his actual activity, there are few signs of conversation to be found. It’s mostly some quotes he finds interesting, a few links, and some seemingly random thoughts. He also doesn’t post that often – less than once a day. He has over 1.7 million followers (#72 overall, between inStyle and Serena Williams), and has been listed almost 10,000 times.

@mashable: Mashable is the online guide to social media. If anyone was to be using Twitter “correctly”, you think it would be them – and this account is run by Pete Cashmore, the CEO. It is popular – @mashable has over 2 million followers (#45 overall, between Pete Wentz and Mandy Moore), and has been listed almost 50,000 times. But again, just look at the activity – a continuous series of links to various articles. More active then the two examples above, yes – but conversational, absolutely not.

You might think I just cherry picked these examples, and that they are the exception to the rule. But I didn’t – there are many more examples where these came from. And as for the rule, well, I think the rule is wrong.

That social media can be used to engage in conversations is absolutely true, and many people and companies are doing that effectively. I don’t dispute that. But somewhere along the way, there seems to have been a near consensus emerge that:

a) two-way conversations is the only way to use Twitter.

b) two-way conversations is what every customer wants on Twitter.

I don’t believe it. The fact that so many people seem to be interested in so many accounts that do the exact opposite is rather telling on this front. And as more and more people engage on Twitter (and other platforms), and create more and more connections, with the potential for more and more messages, I truly believe we’re going to see more and more people realize that “conversations” isn’t what it’s all about.

I’ve just been reading econsultancy’s report (based on a Nielsen study) on how people spend their time online. According to the text, “social media” was far and away the winner, which didn’t really surprise me. But what bothered me is how that term is being defined – time spent on “social networks / blogs.” I’ve seen this kind of definition a lot, and every time I think those two activities need to be separated (and by extension, we need to re-think what we call “social media”). Particularly since the terms “social media” and “social networking” are increasingly being used interchangeably, with “blogs” being considered part of the ever more confusing package.

I think of social networks and blogs as very different. In the first case, I typically go to a site (or application) and check out various short updates from an assortment of people. On Facebook, these tend to be my friends; on Twitter, these tend to be people that share interesting information in relation to my work or friends.

“Using” blogs is an entirely different animal for me – and particularly hard to distinguish from other forms of online content, as the term becomes ever more popular. For example, True Hoop is a basketball blog on the ESPN network. I check it most days. The process of doing so feels a heck of a lot more similar to simply reading an article on ESPN than it does to checking out Facebook or Twitter. Similarly, the business section of my favorite local paper – the Globe and Mail – has a markets blog section. Access to it is usually available through the main globe investor page. So if I click on one of those links, it counts as social media (apparently), but if I click on one of the other articles it doesn’t. That doesn’t make sense to me.

And the more I think about it, the more arbitrary the divisions seem, making the numbers less and less useful to me. For example, if I was to use one word to define how I use Twitter it would be “search” – it’s a medium by which I find links to useful and interesting stories. But since Twitter is commonly associated with “social media”, any and everything people do on there gets classified as “social media”, which in my mind skews the numbers a bit. and if I click on a link to an article, which happens to be on a blog, I’m (based on how it’s measured) continuing the same type of activity, even though what I’m doing has fundamentally changed.

So at a high level, I think the rise in use of “social media” is important. But I also think we’re at a point where the term itself is becoming rather meaningless. If you happen to have been on (say) Twitter, found  a link to this post, clicked on it, and then spent several minutes reading to this point, I believe you’ve engaged in two distinct activities that need to be measured separately - finding something, and reading it -  just like searching for something on Google is a separate activity from consuming what you actually find.

I’m currently reading Jaron Lanier’s manifesto called “you are not a gadget”. While I find myself nodding along with some parts, and occasionally shaking my head at others, my most common reaction to each chapter is that I’ll need several months of quiet reflection to even form a coherent opinion (which, based on what I think I’ve read, is part of the point of his book). It is unquestionably the most thought provoking body of text that I have read this year – and I hope to respond to various parts of it, if and when thoughts hit me, over the coming months.

The part I’ve been thinking about most today is “The transition” section, within the “what will money be?” chapter (page 106). The general idea is to allow people to earn from their “bits” of contributions, such as photos, music, or articles. It’s posed in response to his (very valid) concerned that society is losing its way as the value of “bits” people contribute trends towards zero in the marketplace, and all the rewards (if any) go to the people that aggregate them. If this continues, there will be fewer and fewer bits to aggregate, of worse and worse quality, in a continuous downward spiral that could have disastrous long-term consequences. He explains the consequences, and proposes a few ideas on how to avoid them – but you can read about those in the book.

Why I find this, (and Jaron’s book in general) so interesting is that it’s challenging the new orthodoxy of “the wisdom of mobs”, working in conjunction with powerful algorithms, is superior to the judgment and intelligence of individuals. At first glance, one my primary research areas – prosumer-driven innovation, or customer co-creation – we seem to be right in his line of fire. But as I’ve studied it over the years, my thinking on the subject lines up directly with Jaron more often than not (I think).

This research area was born out of the book Wikinomics by Don Tapscott and Anthony Williams. As the sub-title of the book is “how mass collaboration changes everything”, the idea is often viewed as synonymous with the “wisdom of crowds”. But I’ve went to great lengths over the years to explain how this common interpretation of this is often misguided. It’s often not about a “crowd” collaborating in any meaningful way; instead, it’s about finding the few uniquely qualified minds within the crowd that are both willing and able to make an important contribution. While not a prosumerism example per se, the first story in the book – GoldCorp – is a great example of this. Rob McEwen didn’t enable mass collaboration. He opened up the data about his property in hopes of finding those few people in the world that might know the best way to find the gold. That’s a very big difference.

Such contest models have their own problems built into them, as Lanier references regularly in his book. But at least they point towards some sort of financial compensation for the people that have the best “bits” to contribute, and have very little to do with the problem associated with the “wisdom of mobs.” This indicates a very different set of opportunities, and potential problems. The key challenge, then, is to adapt the model to instances where it’s not a “winner takes all” contest – one where a larger number of people can be rewarded for contributing “bits” to the creation of a new product or service.

I’ve been hypothesizing about this, and waiting for signs that it’s happening, for many years. While much of my research focus has recently been on marketing (which also puts me on the bad side of much of what Lanier talks about), my academic background is in economics – and I have a strong belief that financial compensation for contributors and creators is absolutely vital to the long-term success any prosumer-driven models. But examples of it actually working have been few and far between. That is why I’ve taken a relatively keen interest in Quirky – which I just recently discovered.

Quirky is a platform for social production, founded by Ben Kaufman. The core idea is fairly simple. If you have an idea for a new product, you can submit it to the site (for $99 – which presumably provides a decent “filter” for idea submissions). Each week, a winner is selected (through some combination of community votes and design team input). It then moves into the “influence” phase, where the community can weigh in on everything from specific product design to the logo representing it. Once this phase is completed, it’s handed over to Quirky’s industrial designers and mechanical engineers to create a 3D render. Next up is the pre-sell phase, where a minimum number of purchase commitments must be made before the company invests in moving it into production. If that threshold is met, it then moves into production – hopefully allowing many of the people to cash in.

Why I say “many” is that Quirky currently allocates 30% of revenue from direct sales, and 10% from indirect sales, to the community. What exactly the allocation will be is hard to say (and the company is likely still figuring out the best way to do it), but some “ingredients” include submitting the winning idea (or name, logo, etc.), making insightful comments, voting, rating, and committing to pre-sales. All of this activity is rolled up into an “influence percentage”, which is used to distribute the money. The rest goes to the company itself, which as I referenced above does a lot of the heavy lifting in actually turning an idea into a market-ready product.

Now whether Quirky itself will succeed, I (nor anyone, in my opinion) can really say. I think the biggest challenge comes in terms of scale. As one might expect, the examples provided on the site (to show how much money can be made) typically involve two key assumptions – lots of products are sold, and your individual influencer percentage is high. The end result is lots of money for your effort. Obviously not everyone’s influencer percentage can be high. As (hopefully, for the company) more and more people engage, each individual’s potential influencer percentage might decline further still (in relation to effort applied). If the percentages are small, the potential rewards are low – and thus much of the incentive to engage evaporates.

But at minimum, it’s an interesting idea, and I believe such experiments are critically important to the evolution of web enabled, and prosumer driven, business models. Someday, someone is going to figure it out. And what I find most intriguing is that, at its core, Quirky appears to be trying to find a way to reward individuals for their “bits” of contribution – which I think is absolutely key to making this web-enabled world work, and appears to be something that Lanier might approve of. But the process by which they are figuring out how to do it, which will likely involve layering some sort of algorithm on top of what looks like a “winner takes all” competition platform, seems to be tie directly to approaches he typically disproves of (or not – I’m sure there’s many nuances in the book I’ll have to re-read to capture).

So I’ll personally wait and see – and perhaps even engage in the community to get a real feel for how it works, and whether my own mind is uniquely qualified enough to add value anywhere. But in the end, I’m hoping both Lanier and Kaufman are right – there are ways to reward people for the bits they contribute, and this can be done within the context of a social production model.

That “customers are now in control” has become an increasingly common refrain in the marketing world. To be honest, I think I’ve used it a time or two myself. But the more that I think about, particularly in relation to social media, the less convinced I am that it’s actually true. In turn, I’ve been researching a very different hypothesis – that social media allows brands to have more control than ever before.

This hypothesis is at the centre of a webinar I’m doing in a few weeks – contact me if you’d like to check it out. It builds on one of the key research projects I’ve been working on – The incredibly shrinking marcom expense line – which looks at ways that marketers can use social media to reduce marcom expense, while at least maintaining current levels of impact. And what led me to the counter-hypothesis, in terms of control, were some fairly simple thoughts and questions.

In my mind, that customers are in control is not new – they always have been. What they choose to buy, or not buy, has been and always will be the ultimate determinant of success. What they say to each other has been of known importance for some time. So that leads to the question of which way the needle moves because of social media… which led me to jump into my time machine.

Go back in time ten years, and pretend you are a marketer. Somebody tells you that, in 2010, tools will be available that let you directly connect with a large, and growing, percentage of your customers, for free (or at a very low cost). Not only will the tools let you do that, but many customers will opt to allow you to do just that (often enthusiastically). Those that aren’t passionate enough about your brand to evangelize for you can opt to simply “like” you – in full visibility of their friends. At the same time, you can “eavesdrop” on many other conversations being had about your brand, and inject yourself when and where you see fit. Some customers will even co-create with you – sharing ideas for new products and services, or collaborating on new ones all together. And all of this will be happening on a variety of platforms where you can get a pretty accurate picture, increasingly in real-time, of what exactly is going on.

Would you have reacted to this by saying “wow, that’s giving up a lot of control?” Or would you have reacted with something more like “wow, that gives me the opportunity to control far more than I can today?”

I believe there’s elements of truth to both answers – but I personally think I would have fallen in the second camp. Social media offers an extraordinary number of opportunities to marketers, and taking advantage of them, in my mind, isn’t neccesarily synonymous with “giving up control”. And as my research gets into (and future blog posts will cover), I think a lot of brands that have “given up control” might find that many of their customers want them to take it back…

I spend a LOT of time reading about how companies are using social media to build their brands. In most cases, while the language varies widely, it tends to focus on engaging customers in conversations, within a community setting. And more often than not, a lot of attention is centered on getting customers to co-create, and turning them into evangelists (or ambassadors) for the brand.

I’m not opposed to any of this – in fact, I’ve spent a great deal of time studying customer co-creation strategies (what I typically refer to as prosumerism, as defined in Wikinomics), and think that most brands could benefit from adopting them on some level. But at the same time, I have a growing sense that this focus neglects a huge, and important, part of many brands’ customer bases – those that aren’t particularly interested in “engaging” in any meaningful way, but might still like to purchase your products or services.

While this has been a recurring theme on this blog recently, I was reminded of it again when I re-read a report Sean Moffitt wrote for my company (nGenera Insight) last year called “It takes a community – not a campaign – to raise a brand.” It’s a truly excellent piece of work from start to finish. But the chart on page 15 is what got my hamster wheel churning today. It defined nine different types of community members, ranging from “lurkers” – people who merely visit and consume content – to “ambassadors” – people who are immersed to the point they are pseudo employees. Most importantly, he included estimates of what percentage of community members fall in each group that seem about right.

According to the chart, only 40% of community members are at the level he called “socializers” – those that might post a full profile and an occasional message. Only 20% will put in so much effort as to answer a poll. Only 10% will originate content. And less than 0.5% will become true “ambassadors”.

So to me, that says somewhere between 60 and 80% of community members aren’t really “engaged” in any meaningful way – they’re more or less just visiting. That’s a pretty big number. And while I’ve heard many people talk about strategies (using various terminology) to try to increase the “engagement level”, my sense is that most of them will fail. Quite simply, many people just don’t want to connect with brands like that – or at least to all the brands they might use like that.

I think companies need to think deeply about satisfying the needs of this huge group of customers – which is where the title of this post came from. It’s not uncommon to hear story after story about success in building a small network of ambassadors (or co-creators), but it’s rare to hear someone talk about their success in delivering value to, say, lurkers – even though they’re a much larger group. In some cases, doing the first automatically does the second, but in other cases it does not.

Yelp is a classic example of the first case. A small percentage of people  create the vast majority of reviews on the site. By doing so, they collectively create the service that all the other users enjoy. So in that case, Yelp focusing most of their efforts on engaging (and growing) this relatively small group of people makes absolutely perfect sense. Similarly, when Starbucks sources an idea from MyStarbucksIdea.com, the benefits (in terms of new products, services, etc.) should not only accrue to their more passive (from a social media perspective) customers, but also those that might not engage on the web at all.

But other cases are not so clear cut. Whether it’s a company-controlled community, Facebook Fan (or Like) page, Twitter, MySpace, or what and wherever, there’s a very realistic chance that many of the people that come there are not interested in engaging, and not interested in what the other people are saying (or doing) either. But they might want, say, a coupon. Delivering one might not sound as 2.0 as engaging them in a two-way conversation, but it might be more effective (and profitable).

In the traditional media world, this was a very frustrating group of customers – extremely hard to reach, and the cost of doing so often led to a negative ROI if you even bothered to try. But I think those dynamics are changing dramatically, as the cost of connecting with some of them trends towards zero. Not only that, but I believe that some of these customers might turn into the most profitable ones you can have – if you don’t alienate them by focusing all of your efforts on getting them to “engage.”

As I’ve been researching the incredibly shrinking marcom expense line, one of the recurring themes I keep coming back to is that the term”social media” leads many companies down to wrong path. More often than not, it’s defined in relation to broadcast media, which leads everyone to focus on two-way conversations, trying to deepen connections with customers, build a community, etc.

While I think that’s an important part of social media strategy, I also believe that it doesn’t paint a complete picture. Just because the new tools enable two-way communications and conversations, doesn’t mean that is what every – or even most – customers want. There are ways to effectively use the tools that, when stripped down to their bare essence, looks a heck of a lot more like “traditional” broadcast media than is commonly believed.

In turn, I had great interest in a survey that came out last week about why people become Facebook fans. The most interesting chart, to me, is the following:

As you can see, the #1 reason is simple – to let friends know about which products somebody supports. #2 is to get coupons and special offers. Learning about new offerings, or the company, was ranked lower; meeting people with similar interests (i.e. what might look like community building) is lower still.

This type of data is important for companies, and particularly marketers, to keep in mind. If, for example, it turns out the #1 reason a customer becomes a fan of your company on Facebook is to get special offers, not only is a strategy designed around engaging them in conversations (and building community) potentially wrong, it could prove destructive. Quite simply, if all you want is a coupon, having someone pester you over and over to chat can prove annoying.

On a related note, these types of “shallow connections” should be highly valued by companies. In the traditional marketing world, it was typically assumed that only a subset of your most loyal customers would ever “evangelize” for you. But now, it’s possible to connect with a broader group of people who might not “love” your brand – but are more than happy to stay connected, check out offers, and share them with their friends. Making it easy for them to do so is one of the best ways to capitalize on the incredibly shrinking marcom expense line opportunity, because the costs associated with doing so are becoming quite low indeed.