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Three Reasons Social Benchmarking Makes Management Happy

Lithium Alumni (Retired) Lithium Alumni (Retired)
Lithium Alumni (Retired)

MatthewT.jpgMatthew Thomson is a Senior Product Manager at Lithium Technologies and all round cool guy.

 

You can follow him on Twitter at @daddymention and on Lithosphere he is MatthewT. Don't even try to take one of his Foursquare mayorships.

 


 

Last Friday, Phil gave us a great overview of why it's just so important to know where you stand when you build an online community of any kind. In essence, benchmarking is of the utmost importance in helping our customers determine how their community is doing today vs. other communities. More importantly, we can tell our customers within a month of launching their community what their community is likely to look like six months from now. This helps manage your managment's expectations and show them that a social strategy need not be so risky. (Nothing like having some hard numbers behind your forecast.) In addition, Benchmarks provide the following:

 

  1. A good set of benchmarks let you understand how you stack up against the competition. You may be doing well...but are you doing as well as you should be? You might as well get a feel for how well your community really is doing, once you remove seasonality and macro factors.

  2. Quite converse to the first point, your community may not be doing as well as you'd hoped...but does that mean that you're not doing well? It helps when you can tell management that, despite the fact that you're not hitting your stated goals, you're certainly blowing the doors off everyone else in your category.

  3. Benchmarking lets you focus on areas of improvement. Maybe it's a mixed bag for your online, social presence. You do well in some aspects but not in others. For example, you drive a ton page views but other sites with less page views do much better with their customers' engagement. Don't you want to know where you can pull yourself up?

 

But enough of the benefits, let me discuss in the remaining time what Lithium has put together to help you realize these three points. In the case of benchmarking communities, we had an interesting problem that we needed to circumvent. As a SaaS company, we have all of our customer data in a single area. We can compare two communities head-to-head. And some customers would absolutely love that. Alas, we are also a very security-conscious company and our privacy restrictions simply don't allow such a thing. So we looked for the next best thing.

 

We're always interested in taking a look at what the more successful consumer companies are doing these days to make difficult concepts easy for customers to divine. And, further, how are sophisticated companies using multiple forms of data to make the most meaningful comparisons? For our benchmarks, we used concepts like "similar homes" used in home-buying sites like trulia.com and recommendation engine approaches most commonly associated with amazon.com.

 

The result is a clustering algorithm (concocted, of course, by our own inimitable Dr. Michael Wu) that assigns a set of similar communities to each Lithium community. The performance of these similar communities becomes the benchmark. Dr. Wu uses the following facets to create the list of similar communities: 

 

  • Age - How old is the community.
  • Size - How big is the community.
  • Type - What is the focus of the community (Support, Marketing, Innovation, or some mix of the three).
  • Audience - Is the community B2B, B2C, internal, external.
  • Industry - What industry does the community's parent company play in?

 

Dr. Wu blends this information up in different ways to come up with two types of benchmarks:

 

  1. Date-Based - What does your community look like today against the average of the similar set of communites.

  2. Age-Based - What does your community look like against the average of the similar set of communities when they were the same age in weeks? So, for example, how many registered users did your benchmark set have, on average, when they were 20 weeks old?

 

These benchmarks appear as blue line-graph components throughout are available in the Lithium Engagement Center for the following community metrics:

 

  • CHI Score
  • Searches
  • Registrations
  • Posts
  • Page Views
  • User Sessions
  • Unique Posters
  • Average Time to Response

 

Benchmarks.png

 

And, believe it or now, there are benchmarks available for even more metrics in our Custom Reporting module. More data = more better. As always, please let us know what you think and how we can improve our products.