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.”

TechCrunch had an interesting article yesterday on Topix. The central message was that it had quietly become the “local watering hole” for small towns, as evidenced by the total comments on the site (now in the 100 M range).  It then went on to make the claim that the reason people like myself haven’t been paying attention is, of course, that you wouldn’t unless you were in one of these small towns – like Pepper Pike – that may not have a daily local newspaper or website that makes it easy to discuss local news.

The explanation seemed to make sense, but to be honest I was just a little skeptical. So I decided to try to take a look at it through the lens of my own small hometown. But it’s not on there. So instead, since the author started the article by saying how useful Topix was for news about his own hometown (Pepper Pike), I decided to take a look at the site pretending I was from there. Having done so, I’m now very, very skeptical about many of the claims in the TechCrunch story.

The first clue something was amiss, in terms of Topix being an “online watering hole”, comes from the “Pepper Pike” homepage. As I scanned through the stories listed, every single one from the last month had the word “comment” at the bottom, with a question mark following it. The reason – nobody had commented on any of them. Hmmm. Then I looked at the list of “recent Pepper Pike discussions“. There was a little more activity on this list, but it was few and far between. Notably, from March 2009 to December 2009, there were only 4 posts. Two had one comment; one had two comments; and one had 25. That doesn’t scream watering hole to me.

I did, however, notice a bit of an explosion in activity starting in February 2010. 10 posts with comments, if you exclude the TechCrunch story itself (which is on the list). Of these, two stood out – “hundreds of teens riot outside movie theater” from March 1st had 460 comments; “JCU students demand sexual orientation protection” had 178. Three more had 20+ comments, and the rest only a couple.

So I decided to check out that first one – perhaps it represented all those Pepper Pike folks who’d just been waiting for a topic to talk about. I started scanning through the comments, and noticed the vast majority of commenters were from Cleveland – hardly a small town. Trying to figure out why this was, I looked up and saw a link to the “full story” – at WJW Fox 8 Cleveland (Cleveland’s Own!). I clicked on it. I noticed the story was about Cleveland Heights, and the word “Pepper” – let alone “Pepper Pike” – wasn’t anywhere to be found. And I noticed that I could freely post a comment, under any name I wanted, right from that site, which would roll up into Topix. Conclusion – there certainly wasn’t anything local or small town driving the commenting on that story.

So I went back to the other story – the one with 178 comments. Sure enough, it was also from WJW Fox 8 Cleveland. Sure enough, it didn’t seem to be about Pepper Pike at all – it was a story from John Carroll University in Cleveland. Now this at least led me to take a quick run at Google maps, and find out that Pepper Pike isn’t all that far outside of Cleveland (about a 12 minute drive from JCU, which as far as I can tell is in Cleveland Heights), so I can understand how these stories are relevant to that place – but the comments hardly appear to be “local watering hole” like. When I scan through, I see people from Wooster, Chicago, Lakewood, Cleveland, the United States… even “the gay next door!”, the self-identified hometown of a man from Sacremento California.

So I went back to the third story – the one with 40 comments – same source (WJW Fox 8 Cleveland), same type of variation in commenters. That seemed like a solid of enough trend line to stop the process. At least in the case of Pepper Pike, it seems that nobody is chatting about truly local issues (property taxes, etc.). Almost all of the comments that are generated are around a few, somewhat inflammatory stories (think murders, riots) from a nearby Cleveland area (as posted on “Cleveland’s own Fox 8″), and the comments – while often skewing to the city, or at least state – tend to flow from all over the place. That’s a different story, to me, then what TechCrunch was indicating.

This would also seem to help explain the “surprise” mentioned at the end of the TechCrunch article – that 75% of active commenters use iPhones, which appears odd given Topix’s focus on small towns and communities. The conclusion the article reached is that this just shows the appeal of the iPhone to the masses. My conclusion is obviously different, given I’m not at all convinced the that Topix’s comments are flowing in from small towns and communities.

And while I won’t get into it here, I find the stories that people comment on (and the type of comments given) aren’t exactly inspiring, to say the least. This isn’t topix specific by any means – I think the same on many, many sites- but wow.

I don’t have time to go check a bunch of other small towns, but my hunch is the same dynamic likely plays out over and over. If anyone would care to validate that claim – or refute it – feel free.

On Monday my colleague Naumi Haque sent me a link to an interesting article by Professor Francis Heylighen titled “Why is Open Access Development is so successful? Stigmergic organization and the economics of information“. It provides a great overview of open access / self-organizing systems in relation to traditional economic theory, but the part I found most interesting was in relation to the two different types of stigmergy.

I will now admit that I didn’t actually know what that word meant before reading the article. According to Wikipedia, “Stigmergy is a form of self-organization. It produces complex, apparently intelligent structures, without need for any planning, control, or even communication between the agents. As such it supports efficient collaboration between extremely simple agents, who lack any memory, intelligence or even awareness of each other.” More simply, Heylighen says “a process is stigmergic if the work done by one agent provides a stimulus that entices other agents to continue the job.”

You can start seeing the link between stigmergy, community building, and social media from that description. But to highlight the difference between direct and indirect stigmergy, Heylighen used termite and ant examples.

Direct stigmergy: exemplified by termite hill-building, it is the “work-in-progress” itself that directs subsequent contributions.

Indirect stigmergy: exemplified by the way ants create trails of pheremones that direct other ants to food sources. The trails are left as “side effects” of the actual work being performed.

I thought about these differences, and how they might relate to companies in terms of community building and social media strategies. It occurred to me that building a community is primarily driven by direct stigmergy, while the use of social media is the indirect stigmergy that draws people to you.

The reason is simple. In the termite (direct) example, the little critters go around dropping bits of mud randomly, and where the heaps are formed stimulate other termites to add to them – causing them to grow and grow. By definition, the termite can’t add to the heap without being there. So while no centrally controlled plan is needed, the community must already be there. In an organizational context, the company /moderators start by dropping little heaps of information here and there, hopefully others do to, and where the heaps “pile up” emerge as the key focal point.

The challenge (from an organization context) is, obviously, that this approach doesn’t work if you don’t have a critical mass of termites. You can drop all the heaps you want, but if no one else is there, they’re not going to grow. This is where the indirect stigmergy / social media tie comes in. Using platforms like Facebook, Twitter, WordPress, etc., organizations (and early contributors) leave “trails” that direct people back to the (in the ant case) the “food source”.

So it’s obviously a little bit awkward trying to elegantly merge the termite and ant examples together – right now I’d end up with a bunch of ants piling in to eat the Termite hills. But if you squint a bit I think you’ll see what I’m saying. Organizations need to think about direct stigmergy principles in order to build up their own community from within, and indirect stigmergy principles in order to draw people to them. It’s a subtle, but important, distinction.

Last week I wrote about the Motrin Mom fiasco, and then spent a fair bit of time thinking about the best way for a company to respond to the backlash that can so quickly emerge in the blogosphere (My favorite idea was a “You think you have a headache? You should see what we’ve had to deal with over the last week…” video response). Then at 2:24 on Friday afternoon I received an email from a reader that stated he’d seen Ryan Holiday’s post about me about a few days ago, and nicely indicated that he found it really rude and quite off-base (before sharing a really neat story I hope to write about this week).

After reaching for a Motrin myself, I decided to check out what he was talking about. The article he was referring to was this one- The Worst Thing About Blogs. In the post, Ryan lumped my recent story about Starbucks’ wikinomics-enabled marketing success story with other posts from the likes of Guy Kawaski, Hugh Macleod, Steve Rubel, and Michael Arrington, with the lead-in sentence of (The Worst Thing About Blogs) is that they never let reality get in the way of a good post. Ryan then concluded his post with the following:

If we can deduce anything from the blogs above, it also makes you 1) Sound like an idiot 2) Act like an asshole 3) Always get it wrong

So it’s fair to say he wasn’t a fan of the post. As I read through the comments (some in support of his POV, others defending the posts including my own), Ryan again highlighted my post as particularly egregious, and for good measure pointed out again that it sucked. The reason he gave is that we don’t live in a vacuum – I can’t / shouldn’t be writing about only the Starbucks marketing story when there is another huge thing going on (Starbucks’ recent report of a 97% drop in profits).

So at that point, I had to decide what to do. In turn, I thought I’d share my thought process, and what came of it, since it might be helpful for other people and companies dealing with similar situations. You can see my first comment on his post (last I checked it was 4th from the bottom).

1. Decide whether to engage or not. The blogosphere, and particularly the comment sections, is notorious for maliciousness. As a general rule, if a writer starts dropping insults like “idiot” and the aforementioned a-bomb, I tend to prefer to just stay away. But this seemed like a special case. Ryan seemed like a fairly intelligent person, who’s job appears to be in relation to PR and social media, so I was intrigued by not only the message he chose to send, but how he chose to send it. And whether I liked it or not, based on the volume of comments it seemed like a fair number of people were reading it – so there could be direct benefit from engaging in the conversation.

2. Timeliness versus “Coolheadedness”. As another general rule, I tend to prefer to “sleep on” such issues, in order to avoid a hasty response that I might later regret. However, in this situation I was also dealing with a timeliness issue – popular blog posts can fade away quite quickly, and as I mentioned it was already Friday afternoon. I knew I had neither the time nor inclination to look at this on the weekend, and a Monday response might be a little too late, so I opted for an immediate response. Always dangerous.

3. Cede the point versus defend myself. All of us make mistakes. When faced with a criticism, it is of course important to decide whether you think the complaint is valid and cede the point, or instead defend your POV – noting that sometimes you can do a little of both and find some common ground. In this case, I felt Ryan was quite off base, and decided to actively defend my POV.

4. Choose the tone of the response. When someone is directly saying you sound like an idiot and act like an asshole, it is quite easy to fall into the trap of responding in a similar manner (hence, my “sleep on it” rule of thumb). I wanted to ensure my tone was different – a little more thoughtful and respectful. However, I did start my response with “As the idiotic a-hole who wrote the blog post on wikinomics, I thought I should respond to your criticisms”, so I didn’t fully succeed on this front. But if you read the rest of my comment, I think you’ll find it fair, reasonable, and respectful.

5. Respond directly to the criticism. In this case, I re-articulated what I understood his exact complaint to be, and responded directly to that. This helps to keep the response directly on-topic, instead of meandering into a variety of other tangential subjects, and helps make sure there is a common understanding of the “topic” both people can refer to. In other words, if I misunderstood, my misunderstanding would be clear and he could respond in kind.

6. Demonstrate knowledge in the area (if applicable). In this case it was fairly easy – in a former life I worked for one of Starbucks’ prime competitors in Canada (Second Cup), know a lot about their strategy and business model, and can talk at length about them on demand. I felt that briefly demonstrating I had this knowledge helped set-up my argument for why I chose not to share it in this particular situation.

7. Ask the critic to back himself up. In this case, it was again easy. Ryan was making a direct complaint about what others wrote in their blogs, on his blog. In turn, I asked a simple question – “if you scan through you last 20 blog posts, do you believe they stand up to the bar you have set for others here? Does each one represent high-level thinking, and provide full perspective on all the issues at play?” You can tell from the question what I think the answer is, but the bigger point is that a well phrased question, on-topic, can be valuable to the response. If Ryan can’t defend his POV by using his own posts, he’s clearly got another issue to deal with here.

8. Get a peer review. This one is self-explanatory, and is particularly valuable if you pass on the “sleep on it” option. However, in this case I didn’t go through a peer review process.

I think that covers most of it. So how did it work out? Well, it’s hard to say. After I posted my response the comments section on his post was basically dead, but I can’t necessarily claim responsibility for that – the post was now several days old, and we were heading into the weekend. But it is perhaps notable that of the two comments that followed, one was from a person admitting they didn’t understand most of the blogs he referenced, and the other (perhaps picking up on my question) indicated Ryan’s post should be added to the list of posts Ryan was complaining about.

Ryan himself didn’t respond to my comment on his blog. He did, however, send me an email. This message was notable on several fronts. Perhaps most importantly, there was an absence of inflammatory terms, which either indicates a subtle shift in his thinking, or that it’s more difficult to say such things to someone directly than when referring to someone you’ve never met on a blog. He also re-affirmed being a fan of the book itself.

Ryan also generally stuck to his POV, and re-articulated it in a slightly different / better way. Notable inclusions were that my post was kind of like enthusiastically writing about Nero playing the lyre while fires raged in Rome, and that my not acknowledging the strategic decay of the company within my Starbucks story was almost negligent.

In my mind, this puts us in a much better space. I’m fine with relatively cordial disagreements and differing POVs, and even noted in my response to Ryan that based on what I can piece together about his story Don might be interested in talking to him (think Wikinomics meets Grown Up Digital). However, my POV has not changed, and to sum up this now exceedingly long post I will share three points I made as to why I felt it was not important to put the other strategic issues in perspective in my piece. If you disagree, feel free to share below – but please keep the swearing to a minimum .

The first is an issue we have to deal with regularly in our research. Often times the best examples on the “bleeding edge” of innovation are being done by companies (start-ups and old alike) that have fundamental and fatal flaws in other respects. Some of our best research comes when the rest of the world is focusing on how Rome is burning, but we manage to find a “Nero playing the lyre” that not only other companies can learn from, but they might otherwise not hear about (because everyone is focused on the fire). The challenge for the reader is then to triangulate that information with everything else they know about the situation to draw their own conclusions.

Second, it’s important to remember the context in which a particular piece is being presented. We have heard complaints from readers if/when we stray off-topic on our site – the brand “wikinomics” indicates what type of information they expect. When we write about particular companies, it is perspective on the “wikinomics” part of their strategy and initiatives that people want to hear about. If they want to read about the other aspects of (for example) Starbucks, there are literally hundreds upon hundreds of stories covering 97% drop in profits and associated issues in Google News. If I search for Starbucks Lexicon, there are three hits, and none of them are on topic. It is by telling that wikinomics-related story few others are talking about that we create value for readers and keep them coming back.

Finally, space constraints are an important consideration. The piece I wrote was a little over 300 words. When you write short pieces, as I’m sure you well know the blogosphere demands, it is generally crucial to maintain a laser focus on a fairly narrow topic – every word giving context or providing background is a word that’s not being used to describe the issue at hand. Not everything is supposed to, or can, present the “big picture”… or it would be like boiling the ocean every time you want to make a pot of spaghetti.

I had the pleasure of being on a blogger panel with Sean Moffitt last week, who (among other things) is the author of the always insightful Buzz Canuck blog – a must read for people interested in word of mouth marketing and developing “wiki brands”. I think wikinomics readers might find his May 16th post particularly interesting. In it, he discusses two German terms came across in his recent research, gemeinschaft and geshellschaft, which are sociological categories that were introduced by German sociologist Fredinand Tonnies in 1887.

Gemeinschaft is used to describe associations in which the “greater good” of the collective is of equal to or greater importance than individual self interest – often translated as “community”. Geshellschaft is the opposite – where individual self interest trumps the greater good, often “lacking the same level of share mores.” Interestingly, this is often translated as “society” or “civil society”, which might just go a long way in describing a lot of the societal issues that we face today. It is also notable that, in business usage, it is often the term for “company”.

In his post, Sean goes on to point out the challenge he often comes across in business today – companies trying to build gemeinschaft into their geshellschaft structures (it just sounds uncomfortable, doesn’t it? I think that’s why I like the terms so much). The traditional response from many companies is that it can’t be done. Sean thinks it can happen, and we agree with him – but figuring how to make it work is a great challenge.

After highlighting a few companies (Harley Davidson, Apple, etc.) that seem to be making it work, Sean provides a list of apparent success drivers. While these are of value and make a lot sense, in some ways I think they distract from the main message – the fundamental challenge of strategically integrating a gemeinschaft mindset in a for-profit company, which requires very new and different ways of thinking about one’s self-interest.

To put it another way, at the end of the day, companies can only go down the gemeinschaft road if it helps them from a geshellschaft perspective – it’s called capitalism (or if you prefer, Kapitalismus). There are very hard decisions companies have to make here. Without getting too far into the details, I would bet right now there are a lot of companies that, by staying away from gemeinschaft thinking all together, are protecting their short-term geshellschaft at the expense of the long-term. I also think I’ve now confused myself eins, zwei, drei times.

There is not a single answer here that applies to all companies, and it will be far easier for some to make progress on this front than others. Also, as Sean notes in his final question, it will be interesting to see whether companies that go down this road incubate their gemeinschaft internally, or bring it in from the outside – where it may be evolving more naturally. Feel free to hit his blog and let him know what you think!