Using research circles to develop innovative product and services for an aging baby-boomer population

This research article, Laggards as Innovators? Old Users as Designers of New Services & Service Systems,  challenges the notion that elderly users of the social web are generally laggards in this medium and, thus, not viable sources of relevant input when using service design methodologies to design products and services that meet their needs. Service design

[I]s the activity of planning and organizing people, infrastructure, communication and material components of a service in order to improve its quality and the interaction between service provider and customers. The purpose of service design methodologies is to design according to the needs of customers or participants, so that the service is user-friendly, competitive and relevant to the customers.” Wikipedia citation

“New service design” basically incorporates social networking and crowd-sourcing concepts into this process. The authors of the study found that a widespread view existed amongst service system designers that elderly or senior users were “technophobes” or technology laggards and, thus, had no relevant input when using modern service design processes. Yet, there is an under-served market with respect to the aging baby-boomer population. The researchers argue that there is a great opportunity to service this market using human-centered design processes in a variety of industries across several product classes. For example, there are several unsatisfied needs for this market that “relate to fundamental aspects of a dignified life, such as being able to buy furniture they can use in their homes, being able to stay in their neighborhood in the center of town and in generally leading as independent and normal a daily life as possible.”

The researchers offer several tips on how to involve the aging consumer segment into the design process using the concept of a “research circle”. The premise of the research circle differs from a focus group in the sense that a focus group is designed to get “get feedback from people on their attitudes towards new products, services or ideas” and is a fairly structured process. A research circle is more long term in nature, and employs a researcher who facilitates collaborative group problem solving. The figure below describes the process:

Stages applied based on research circle method and milestones
Stages applied based on research circle method and milestones

The researchers point out that the process they’ve defined is not geared towards getting aging users to adopt a new product or service. Rather, the process is to gain insights and information from this group so as to deliver innovative products and services that meet their needs.

Speaking on visionary innovation

I have the pleasure of speaking at the GIL Silicon Valley innovation and leadership summit, hosted by Frost & Sullivan. My session focuses on developing an integrated IP focused organization, which relates to fostering a culture of creativity and innovation. Here is a list of core research I’ll discuss during my session:

 

Research on visual data mining for use in sentiment analysis

Below is some recent research on visual data mining.

Mining emoticons to assess sentiment

Detection of genuine reviews of products or services using visual data mining

Using visual data mining techniques to generate interactive news flow visualization across social media streams

Proposed UI to better visualize and analyze sentiment

Visual analytics in interactive and security systems

Houzz.com survey details home improvement and remodeling factors that matter most to homeowners

I am delighted to publish this guest post by Houzz.com . The post details interesting stats relating to home remodeling and improvement. If you’re not familiar with Houzz.com, it’s a cool site that curates compelling, visually-driven content combined with advice and discussion forums. I decided to publish this submission from Houzz.com because it includes data and statistics that can help homeowners make more informed remodeling and home improvement decisions. I have not received any in-kind payment or gifts from Houzz for publishing their guest post. There are two sections to the guest post: a discussion of the Houzz.com survey data and an infographic.

Discussion:

UPDATE: In addition to the regional information originally detailed below by Houzz, they’ve included some national stats. Again, I view this information as useful data points for homeowners and real estate professionals.

Byline: Liza Hausman, Houzz.com

The recent survey of nearly 30,000 Houzz users nationwide found that homeowner priorities when it comes to remodeling and decorating are focused on improving their own quality of life rather than considering the next buyer.

Among homeowners planning to build, remodel or decorate in the next two years, 86 percent cited “improving the look and feel of the space” as an important driver for remodeling projects, while only 47 percent cited ”increasing home value.” The gap between these priorities was consistent across all income levels and demographic groups.

The study also found that 68% of homeowners get their primary ideas and advice when it comes to remodeling and decorating online.

These trends – a long-term outlook and reliance on information found online –   explain why real estate professionals’ are turning to visual technologies and tools like Houzz to help bring to life the potential or vision for a home. As one realtor noted, “If a clients tells me she’s pregnant, I create an ideabook on Houzz of nurseries. If a client is relocating to DC and concerned about space, I create an ideabook to show how to create a home office in a small space.”

In the next two years, 72 percent of homeowners surveyed plan to decorate or redecorate, 40 percent plan to remodel or construct an addition, while 10 percent are planning to build a custom home. Custom homes are particularly popular in the South. Top U.S. cities for custom home builds are Jackson, Mississippi where 21 percent of homeowners surveyed are building the home of their dreams from scratch, and Houston, TX and Little Rock, AR, which both reported 18 percent of homeowners planning to build new.

Kitchens and bathrooms are the most popular remodeling projects among Houzz users, with 48 percent of respondents planning a bathroom remodel, and 45 percent redoing a kitchen in the next two years. Midwesterners have the highest budgets for kitchen and bath remodels at $30,500 and $13,600 respectively, while the South is allocating the least at $23,800 and $11,600.

57 percent of Houzz homeowners planning to complete a project in the next two years will hire a general contractor, 35 percent a kitchen or bath professional and 32 percent will hire a carpet or flooring professional.  Thirty percent are planning to hire an architect, 26 percent an interior designer and 24 percent a landscape architect or designer.

About half — 52 percent — say they will save money by completing some projects themselves.

In fact, even upscale homeowners are taking a hands-on approach to building, remodeling and decorating projects. The survey found that while 45 percent of homeowners at upper income levels ($150,000+) are choosing to hire an architect, interior designer, general contractor or another remodeling or decorating professional to complete a project in its entirety, an equal number of them are combining professional help and DIY efforts, a proportion only slightly smaller than the 49 percent taking this combination approach in lower income brackets.

ORIGINAL HOUZZ.com GUEST-POST:

Central Virgina Homeowners Prioritize Style Over Profit

Even as new and existing home sales and prices climb, Central Virginia homeowners are prioritizing aesthetics before profit, according to a recent Houzz & Home Survey conducted among users of the Houzz app and website. Houzz is an online platform for home design and remodeling, with more than five million unique users of the site and iPad app each month

The recent survey of nearly 30,000 users nationwide found that homeowner priorities when it comes to remodeling and decorating are to improve their own quality of life. In Central Virginia and the South Atlantic specifically, 85 percent of homeowners cited “improving the look and feel of the space” as an important driver for remodeling projects, 69 percent cited “improving the flow and functionality” and only 46 percent citing ”increasing home value.”

Among Central Virginia and South Atlantic area homeowners on Houzz, 74 percent plan to decorate or redecorate, 40 percent plan to remodel or construct an addition in the next two years, 14 percent plan to purchase a new home, and 8 percent plan to build a custom home.

Kitchen remodels and bathroom remodels are the most popular major projects among South Atlantic homeowners surveyed, with 34 percent of respondents redoing a kitchen and 36 percent planning a bathroom remodel in the next two years. Area homeowners are budgeting an average of $25,400 for a kitchen remodel and $10,700 for a bathroom remodel, 6 percent and 5 percent below the national averages respectively.

The majority of homeowners in the South Atlantic region taking on projects are hiring some help. 61 percent of area homeowners planning to complete a project in the next two years will hire a general contractor, fifty percent will hire a carpet or flooring professional, twenty-seven percent a kitchen or bath professional and twenty-seven percent also said they will hire a landscape architect or designer. 23 percent will hire an interior designer, while only nineteen percent are planning to hire an architect.  More than half — 52 percent — say they will consider saving money by completing some projects themselves.

In this economy, prioritizing livability over return on investment may seem like an irrational approach, but people today are looking at their homes as a long-term sanctuary, not a quick flip. This new rationale is also reflected in homeowners’ approach to financing.  When asked if they are planning to take a line of credit to fund their remodeling projects, 75 percent of homeowners in the Central Virginia/South Atlantic area said “No way.”  They’d rather cut back on vacations or other major purchases to make their dream home a reality.

Infographic:

 

Social CRM eLoyalty Context-Aware CRM

Below are three excellent research articles on social CRM and related topics.

This research paper (out of Australia) delves into the nexus between mobile consumerism and eLoyalty programs. A key finding is that companies can increase consumer loyalty by leveraging mobile devices (via apps, I posit) to highly personalize a consumer’s brand experience while facilitating a highly responsive and insightful customer service environment to answer questions, resolve complaints, etc.

Here’s a great nuts-and-bolts presentation by Gartner on fundamental CRM concepts. The presentation includes a vendor analysis and recommendations on implementation. But the feature I liked the best is the discussion on context-aware CRM.

This report is an excellent analysis of social CRM concepts, including an informative discussion of the risks associated with undertaking a corporate-wide social CRM initiative.

 

 

Recent research on social CRM principles

Following is a series of research articles focusing on social CRM. These articles explore different facets of the concepts underpinning social CRM.

Interactive digital advertising versus interactive community (download). This article focuses on what motivates individuals to participate in social networks and what causes these individuals to respond to social advertising.

Advertising on Facebook. This is a well-written article on Facebook advertising best practices, strategies and tactics.

Customer engagement and Facebook pages. This is an in-depth article focusing on many nuances of how to leverage Facebook business pages to increase customer loyalty.

Value-based CRM. This article explores the relationship between marketing, IT, and finance to deliver an effective CRM solution. The authors make some great recommendations as to how finance departments can work with marketing and IT departments to set proper metrics tied to corporate business objectives.

Value based CRM aligning marketing IT and finance functions

This article discusses values-based CRM concepts in regards to aligning marketing, IT, and financial functions. An interesting point made by the authors

[F]ocusing just on the ability of IT to support strategy and processes bears the risk of not utilizing the full potential of innovative technologies[.]

It’s clear there is a critical interdependence between both marketing and IT departments. As marketing seeks to “engage,” “relate with,” and “delight” customers in the continuous battle for share-of-mind and share-of-heart, relegating IT to the sidelines as bench support is not a good strategy. Rather, incorporating IT vision is a critical component in setting strategy. The complexity of consumer interactions with a firm’s brand, demands increasingly sophisticated infrastructure and data management tools to ensure that a firm can meet the needs of these consumers.

Similarly, firms ought to align financial management goals within this marketing-IT milieu. Financial concerns, in this context, center around setting proper marketing metrics to measure ROI and lifetime value of a customer. The paper points out that

[A] number of financial concepts (e.g. capital asset pricing model, portfolio theory, and real option approaches) have recently been transferred to customer portfolios…Such “marketing metrics”, based on these approaches and thus taking a future-oriented, long-term, cashflow oriented, and risk adjusted perspective, allow for an identification and measurement of the economic value contribution and the ROI of marketing[.]

To enable such penetrative insights, firms need to leverage data mining tools to create timely (i.e., near real-time) metrics to be shared across business to ensure uniform adherence to meeting clients’ expectations.

Opportunities in online lead capture and close

Here’s a short article from the Harvard Business Review on lead capture. The stats:

  • $12.5 billion in 2005 to $22.7 billion in 2009: The amount of advertising dollars spent generating leads
  • 2,241 U.S. companies: The number of companies measured in the study to test lead response time
  • 37% of the companies responded within one hour, 16% responded within one to 24 hours, 24% took more than 24 hours to respond, 23% never responded
  • 42 hours: The average response time by all companies measured
  • 7X: If you try to contact a potential customer (i.e., a “lead”) within one hour of receiving a query, you are nearly seven times as likely to qualify that customer as those individuals who wait two hours
  • 60X: By contacting a potential customer within one hour of a receiving a query, you are more than sixty times as likely to qualify that lead than individuals who wait 24 hours

Take-away: The fastest to respond wins the opportunity to serve a customer. Insight: Once you’re earned that opportunity, keep delighting that customer by remaining responsive.

Creating a culture of participation while leveraging a culture of creativity and innovation

Previously I wrote about creating a culture of creativity and innovation. The salient points to remember in such an initiative are: foster a high level interaction, discussion, debate and have a leadership team that nurtures such an idea generating ecosystem.

sideways

Related to this topic is a fascinating research article I found that focuses on creating a culture of participation (.pdf). The article discusses collaborative design projects (as in architecture, landscape design, etc), but the premises are transcendent to many industries:

  1. Creativity is an inherently collaborative and social activity and social-technical infrastructures facilitate such by organizing people around shared concerns as opposed to shared location
  2. Diversity (as facilitated by shared concerns) promotes new ideas, insights, etc, by building bridges between local knowledge sources and exploiting “conceptual collisions” (related to Von Hippel’s studies in innovation at MIT).

The article elaborates on a couple of case studies and points out the following areas for further exploration: (1) the role of curators—as supported through technological infrastructure—to organize “living information repositories” (see related article on how the BBC uses data mining principles to enable more informed curatorial choices) and (2) enhanced tagging mechanisms that support heuristic knowledge discovery activities.

Additionally, there are two blog posts that relate to the themes raised above, courtesy of Daniel Rothamel and Rob Hahn respectively, essentially “create, then debate”  and “embrace your inner auteur“.

Photo: Håkan Dahlström

 

 

Decentralized online social networks, spatial properties of location based social networks, and geo-social cascades research

Three papers for your geeky enjoyment (all .pdf):

Online Social Networks: Status and Trends is a great summary of current research and opinions regarding the current and future status of social networking. Section five has an interesting discussion of decentralized online social networking services and applications.

And here’s some excellent work, creativity, and analysis from University of Cambridge, University of St. Andrews, and Imperial College London researchers:

First, Socio-spatial Properties of Online Location-based Social Networks, which is a total geek special and offers a detailed analysis of the spatial properties among users of Brightkite, Foursquare and Gowalla. Here’s a peek inside:

We provide evidence that mechanisms akin to gravity models may influence how these social connections are created over space.

[Gravity models] have long been used to model connections in spatial networks such as trade flows across countries[.]

Second, Track Globally, Deliver Locally: Improving Content Delivery Networks by Tracking Geographic Social Cascades delves into how tracking geographic social cascades could aid in the development/exploitation of…

[P]re-fetching of Web content, caching of normal HTTP traffic, datacenter design and placement and even to devise security mechanisms.

This research also relates to a better understanding of social cascades generally (i.e., understanding how information flows through links in social networks) and improving the performance of content distribution networks.

 

Research from CISCO, innovation in business intelligence services, and predictive Web data mining

Below are three articles discussing emerging analytical theories on the nexus between Web+Social+Mobile:

Executive Primer: CISCO CIO Summit (.pdf): Excellent primer on how The Cloud, generally, is affecting enterprise IT strategic direction. Two gems: Chapter 6 “Together, the Customer Is Everywhere and Everyone” and Chapter 10 “Scenario Planning: Are You Ready?”.

Business Intelligence 2.0:  Are we there yet? (.pdf): Excellent paper focusing on innovation in business intelligence; includes and excellent benefits analysis chart.

Toward Emerging Topic Detection for Business Intelligence: Predictive Analysis of ‘Meme’ Dynamics (.pdf): This is for analytical geeks only (:-D). The paper discusses the problem of monitoring the Web to spot emerging memes. Essentially, using predictive algorithms to tease out future memes, which would be useful to brand managers in terms of seeding current campaigns with flavors of the future as dictated by the algorithm. The risk is that it can get a bit tautological.

 

Research on new media social influences and context

I recently dug up predictions Gartner made in January 2010 about IT and new media (Gartner’s recent predictions are referenced here [.pdf]). The two 2010 predictions that piqued my interest are:

  • By 2012, Facebook will become the hub for social network integration and Web socialization.
  • By 2015, context will be as influential to mobile consumer services and relationships as search engines are to the Web.

social hub reverb

Following the “Facebook as hub” meme as a research concept, I came across empirical studies focusing on the Web and “socialization” of family units (i.e., new media as a “hub” within the family unit). Similarly, I wanted to see if empirical research existed that explored how “context” is defined or determined via computer science. I found two interesting studies:

Relating to tech-media “socialization”:

Media, Communication and Information Technologies in the European Family. A couple of key findings:

  • (Finding 1) Two tech-media trends contribute to familial tension. Trend one: families using emerging media to generate and reinforce communal experiences. Trend two: increasingly personalized consumption of media used in private spaces. These trends consistently collide and cause familial tension.
  • (Finding 2) Promoting media literacy (which one could extrapolate to mean “Internet literacy”) is a key policy concern given “today’s technologically convergent, globalised market” and is critical to ensuring that individuals have the means and methods to participate in all spheres of society.

Facebook—despite its autocratic set of rules—could be seen as an enabler of promoting “new media literacy”, essentially a democratizing and leveling tool regarding “Web socialization” globally.

Relating to “context”:

Context-Aware Recommender Systems is an excellent academic article exploring how a recommender system uses “context” as a primary factor to deliver relevant results. The authors distill “context” using six vectors: data mining, e-commerce personalization, ubiquitous mobile data, database management systems, effective information retrieval, marketing and management processes. Further, @briansolis authored a great post, Behaviorgraphics Humanize the Social Web, where he essentially argues that understanding behavior is a key factor in determining and understanding context, which will enable marketers to more meaningfully and relevantly communicate with individuals who are within social networks.

Photo credit: ViaMoi

 

Research on social proximity

In response to a request by @Gahlord to research the concept of “social proximity” I have found eight articles that broadly sketch the primary issues and principles related to “social proximity”.

In Towards Design Guidelines for Portable Digital Proximities A Case study with Social Net and Social Proximity (.pdf), the authors apparently introduced the concept of social proximity, which they define as:

[T]he relationships between people in space, within social networks, and through time.

In Life in the network: the coming age of computational social science, the authors discuss the rapidly changing pace of computational social science.

In To join or not to join: the illusion of privacy in social networks with mixed public and private user profiles (.pdf) the authors discuss privacy issues related to social media and the natural tension between “public” and “private” information (see also my earlier article relating to this topic).

In Inferring friendship network structure by using mobile phone data, the authors found that it’s possible to infer with 95% accuracy friendships based on mobile data.

In Bridging the Gap Between Physical Location and Online Social Networks (.pdf), the authors demonstrate how to predict friendship between two users using their respective location trails.

In Social distance, heterogeneity, and social interactions (.pdf, and I hope you’re good in mathematics to understand this article), the authors propose a new model to analyze peer group interactions.

In Connectivity Does Not Ensure Community: On Social Capital, Networks and Communities of Place (.pdf), the author proposes that the strongest online communities are those create senses of social ownership within the community.

In Semantic Grounding of Tag Relatedness in Social Bookmarking Systems (.pdf) the authors discuss how collaborative tagging systems can be used to derive a global tagging relatedness structure from an uncontrolled tagging folksonomy.

In The anatomy of a large-scale social search engine (.pdf) the authors present Aardvark, a social search engine.

Three top sources discussing collaborative and collective innovation strategies and theories

As you head into 2011, here are three sources to get your innovation game plan together:

In the research paper, Collective Intelligence for Competitive Advantage: Crowdsourcing and Open Innovation, the author–a global transition manager at Nike Inc–conducts an exhaustive analysis of current research on the topic of leveraging crowdsourcing concepts and open innovation principles to deliver innovative products and services. The author makes the following recommendations:

Recommendation # 1 – Focus on creating an innovative organizational culture, in which experimentation and failure are supported and encouraged. Use the seven lessons of innovation by Koulopoulos (2009) as the guide.

Recommendation # 2 – Create a collective intelligence (CI) system by answering the four primary questions: Who is performing the task? Why are they doing it? What is being accomplished? How is it being done?

Recommendation # 3 – Focus on the utilization of an open innovation business model by developing a plan for and defining the primary tenets of the model, to include (a) value proposition, (b) market segmentation, (c) value chain, (d) revenue generation, and (e) competitive strategy.

Recommendation # 4 – Map out the four types of innovation: 1) Neutral, 2) Positive, 3) Negative, and 4) Open. An organization should operate in all 4 quadrants, but for market leadership open innovation is the most critical (Koulopoulos, 2009).

Recommendation # 5 – Understand how the CI system can be deployed into the value chain where internal and external knowledge is leveraged. Define how the CI system will integrate with the current value chain and which parts exist to support the system and which elements need to be developed.

In the paper, Organizing Innovation: Complementarities between Cross-Functional Teams (.pdf), researchers found that deploying cross-functional teams across new product/systems development processes yields positive gains for consumers and companies. The researchers also found that marketing departments are critical components of an innovative-driven cross-functional team because of the customer-centric views customarily espoused by such departments.

In the Harvard Business Review podcast, The Economics of Mass Collaboration (~ 15 min) the commentator, Don Tapscott, author of Macrowikinomics: Rebooting Business and the World, discusses the concepts of how companies can harness mass collaboration to deliver innovative products and services.

Influence in the social web and social commerce

http://www.web-strategist.com/blog/2010/11/02/altimeter-report-social-commerce-how-brands-are-generating-revenue-by-lcecere/
http://www.briansolis.com/2010/11/the-rise-of-the-social-consumer
http://www.fastcompany.com/magazine/150/the-new-influentials.html
http://citeseerx.ist.psu.edu/viewdoc/download?doi=10.1.1.156.8795&rep=rep1&type=pdf
This article on social media New Influentialshttp://www.fastcompany.com/magazine/150/the-new-influentials.html raises an interesting question regarding “incluence” on the social web: what’s the core driver of influence in the social web when it comes to commerce, a person, her community, or both? The article profiles six individuals who have variously used YouTube, corporate resources, quasi-anarchist tactics, and curation to attract dedicated audiences to their brand (whether personal or corporate). Indeed, the question of “what constitutes influence in a social network” has captured the interest of researches, as is evidenced by the articles “A model of influence in a social network”http://halshs.archives-ouvertes.fr/docs/00/49/65/60/PDF/td08.pdf and “Learning Influence Probabilities In Social Networks”http://citeseerx.ist.psu.edu/viewdoc/download?doi=10.1.1.156.8795&rep=rep1&type=pdf. Similarly, Brian Solis has written an excellent post on the genesis of the social consumerhttp://www.briansolis.com/2010/11/the-rise-of-the-social-consumer. According to Solis:
When a brand does its job right, it creates an emotional connection. The affinity it engenders contributes to who we are as individuals and how others perceive us. In the social web, sharing our purchases and experiences serve as social objects which are essentially catalysts for sparking conversations. At the center of this discussion is the product. Experiences, impressions, and perceptions cast bridges that link us together. As the conversation unfolds, the hub connects the product to individuals who not only respond, but also consume, where information directly or indirectly influences behavior and opinion. This form of subconscious empowerment seemingly builds confidence according to some new research. As social capital factors into the equation, these conversations represent touchpoints where positive experiences take the shape of endorsements and ultimately c0ntribute to the overall branding process.
Solis’ sentiments are echoed by a recent Altimeter Reporthttp://www.slideshare.net/loracecere/rise-of-socialcommercefinal (also accessed her on Jeremiah Owyang’s bloghttp://www.web-strategist.com/blog/2010/11/02/altimeter-report-social-commerce-how-brands-are-generating-revenue-by-lcecere/:
<div style=”width:477px” id=”__ss_5637236″><strong style=”display:block;margin:12px 0 4px”><a href=”http://www.slideshare.net/loracecere/rise-of-socialcommercefinal” title=”Rise of social_commerce_final”>Rise of social_commerce_final</a></strong><object id=”__sse5637236″ width=”477″ height=”510″><param name=”movie” value=”http://static.slidesharecdn.com/swf/doc_player.swf?doc=riseofsocialcommercefinal-101101160620-phpapp02&stripped_title=rise-of-socialcommercefinal&userName=loracecere” /><param name=”allowFullScreen” value=”true”/><param name=”allowScriptAccess” value=”always”/><embed name=”__sse5637236″ src=”http://static.slidesharecdn.com/swf/doc_player.swf?doc=riseofsocialcommercefinal-101101160620-phpapp02&stripped_title=rise-of-socialcommercefinal&userName=loracecere” type=”application/x-shockwave-flash” allowscriptaccess=”always” allowfullscreen=”true” width=”477″ height=”510″></embed></object><div style=”padding:5px 0 12px”>View more <a href=”http://www.slideshare.net/”>documents</a> from <a href=”http://www.slideshare.net/loracecere”>lora cecere</a>.</div></div>
Going back to the original question I posited, I’ll say “influence” is a combination of both a brand (personal or corporate) and respect and empowerment of one’s community, but community is the main driver. Solis describes how American Express empowers its community by facilitating conversations along with promoting commerce (and doesn’t this remind you of fundamental concepts discussed in the Cluetrain Manifestohttp://www.amazon.com/Cluetrain-Manifesto-End-Business-Usual/dp/0738204315, particularly chapter four?). But for an empassioned–and spending–community, American Express would not necessarily be influential. Thus, the core question of what defines influence hinges on how committed you are to your community, what value you bring to your community, and how well you are developing and fostering that community.

This article on social media New Influentials raises an interesting question regarding “influence” in the social web and in social commerce: what’s the core driver of influence?  A person? Her community? Or both? The article profiles six individuals who have variously used YouTube, corporate resources, quasi-anarchist tactics, and curating to attract and sustain dedicated communities. Indeed, the question of “what constitutes influence in a social network” has captured the interest of researches, as is evidenced by the articles “A model of influence in a social network” and “Learning Influence Probabilities In Social Networks“. Similarly, Brian Solis has written an excellent post on the genesis of the social consumer. According to Solis:

When a brand does its job right, it creates an emotional connection. The affinity it engenders contributes to who we are as individuals and how others perceive us. In the social web, sharing our purchases and experiences serve as social objects which are essentially catalysts for sparking conversations. At the center of this discussion is the product. Experiences, impressions, and perceptions cast bridges that link us together. As the conversation unfolds, the hub connects the product to individuals who not only respond, but also consume, where information directly or indirectly influences behavior and opinion. This form of subconscious empowerment seemingly builds confidence according to some new research. As social capital factors into the equation, these conversations represent touchpoints where positive experiences take the shape of endorsements and ultimately c0ntribute to the overall branding process.

Solis’ sentiments are echoed by a recent Altimeter Report (also accessed here on Jeremiah Owyang’s blog:

Going back to the original question I posited, I’ll say “influence” is a combination of brand (personal or corporate) and respect and empowerment of one’s community, but where community is the main driver. Solis describes how American Express empowers its community by facilitating conversations along with promoting commerce (and doesn’t this remind you of fundamental concepts discussed in the Cluetrain Manifesto, particularly chapter four?). But for an empassioned–and spending–community, American Express would not necessarily be influential. Thus, the core question of what defines “influence” hinges on how committed you are to your community, what value you bring to your community, and how well you are developing and fostering that community.

Social cues, social responses, humans know when a computer is engaging them

This research paper from Nokia Research Center, Stanford, and Queens University implies that humans can ascertain with an uncanny degree of certainty when a social message is sent from a computer versus a human. Social responses to communication technologies theory (SRCT)  predicts that humans cannot reliably ascertain such nuances. This research contradicts this premise.

The research team, using prior research in SRCT theories, tested whether humans could discern whether a text message was sent via a human or computer when flattery was an element of the message. They found that humans reliably discern the originator of the message apparently because certain social cues were missing in the computer-generated messages.

Why this is relevant research: SRCT theories could be used by software designers to create computer programs to engage social network users with the goal of getting them to increase self-disclosure under the guise of an interaction seemingly being conducted with a human. With the FTC recently considering allowing people to opt-out of behavioral targeting on the Web, the issue of nudging people towards more self-disclosure is timely given all the issues surrounding privacy and use of PII in social networks, especially if a user discloses such PII under the assumption they’re interacting with a human. This is a very interesting article and quick read (four pages).

Persuasive design principles and website user behavior

Motivation, ability, and triggers influence users’ website behavior, according to this research paper by Stanford researcher BJ Fogg. This is important if you’re targeting specific behavioral action (e.g., filling out a lead form). Before a user takes a desired action, she must be sufficiently motivated to perform the desired action, have the ability to do so, and be appropriately triggered to take action.

Fogg’s model is fairly easy to digest. For example, let’s say you want to drive more listing appointments (the target behavior), there is a trade-off between motivation and ability. In this scenario, a user’s motivation is somewhat variable (either they are interested in the property or not). Thus, as website designer you should concentrate on the “ability” side of the equation: do you make it a simple fill-in-your-email-address form, or do you make users fill out more detailed information prior to submitting their request? On this issue, Fogg concludes:

The implication for designers is clear: Increasing motivation is not always the solution. Often increasing ability (making the behavior simpler) is the path for increasing behavior performance.

Contemplating appropriate triggers is where it gets really interesting for website designers. According to Fogg, without an appropriate trigger, targeted behavior will not occur even if motivation and ability is high. There are three elements of a successful trigger: the trigger must be noticed, the trigger is associated with the targeted behavior, and the trigger occurs WHEN we are both motivated and able to perform the targeted behavior. Fogg argues that timing is THE critical element and is often missing:

In fact, this element is so important the ancient Greeks had a name for it: kairos – the opportune moment to persuade. As I see it, the opportune moment for behavior performance is any time motivation and ability put people above the behavior activation threshold.

Poorly-timed triggers (e.g., pop-ups) generally do not drive a user to take a targeted action and can even cause a negative emotion. Thus, Fogg argues that proper triggers will align with collaborative CRM concepts (which I earlier discussed), functioning mostly as “signals” or “facilitators”. I encourage you to read Fogg’s research paper (all 7 pages) as he further details the discreet elements under motivation, ability, and triggers that influence website behavior.

Photo credit: ell brown (off to Italy)

New media innovation issues and risks

This research paper, Power, media culture and new media, delves into social justice issues surrounding the democratizing effects of new media. The paper points out that new media benefits (e.g., easier access to information through widespread platforms like mobile devices) are not equally shared or distributed across class, race, or national origin. The paper also implicitly points out that the use of mash-ups along with the increasing diversity of media outlets could create a “ripe” environment for effective government-sanctioned propaganda campaigns.

Similarly, the new media environment where essentially everyone can be a “content producer” offers unprecedented opportunities for government surveillance and ultimate suppression and/or obfuscation of speech by using new media outlets as viral engines to discredit speech that’s counter to government views or objectives. The author does point out some positive reverberations from new media harmonics; and this is the alignment of human rights initiatives with new media (as embodied in such organizations like Mothers Fighting for Others). Nevertheless, the paper ends with a caution that discriminatory (and by implication, repressive) actions can re-emerge in new media, despite the overarching democratizing effects of the medium.

Does this paper relate to real estate? Not directly. It’s simply a great education piece on the broader implications of our new media economy and society.

Using play-scripting as a means to develop effective corporate strategies

Writing a “playscript” is an incredibly powerful way to conduct a competitive business review, according to this Harvard Business Review article (subscription required). The article advocates writing a “playscript” using characters and character analysis to define your company and competitive landscape for use as a foundational element in corporate strategy development.

The article argues that “traditional” strategy tools like five forces maps and blue ocean thinking are outdated because they assume a static competitive environment as opposed to a rapidly evolving one. The article argues that by drafting a “playscript”, companies are in a much better position to map the landscape and anticipate emergent competitive forces.

In developing a playscript, the article suggests focusing on the following:

1) Draft a current playsript: Broadly describe the setting in which you operate by identifying the other characters, their motivations, what role your company plays, how this role is perceived by others; it’s important to view your role as critically as you can through the eyes of others (i.e., perception is reality); map the links among all the actors and the rules that govern them; give voice to the value your organization adds.

2) Rewrite your playscript: the goal here is to rewrite your playscript and, if possible, reinvent the playscript for an entire sector by answering such questions like “Can my organization attract new alliances to my sector where I can then leverage these alliances to add to an existing link or create a new link in a customer-centered value chain?”; determine where there’s a value need and fill this need (the article cites Intrawest as an example of a company that filled a value need by creating alliances with partners that deliver an exceptional destination living experience which has allowed Intrawest to emerge as a dominant player in managing experiential destination resorts, whereas before its focus was on developing these types of properties).

3) Future-proof your playscript: consider how changes in your customer needs will affect your company by finding the correlation between who your customers are, what they want, and how they get the things they want (the article cites IKEA as a company that’s done this well by foreseeing high volatility in the prices governing the wood it uses to make its products so it purchased forests in Poland and the Baltic states to help stabilize prices, thus allowing it to confidently focus on dominating the low cost segment of the “lifestyle furnishings” market).

Since 2005, we’ve seen many playscripts written and re-written in the real estate industry with the advent of Trulia, Zillow, Redfin, etc. Since 2007, we’ve seen new marketing and customer acquisition playscripts written and re-written via the explosion of social media and social networking. And currently we’re seeing playscripts written and re-written with the emergence of mobile applications and augmented reality. What’s your playscript that will allow you to position your firm as a dominate player in your market? How do you plan to adapt to the changing needs of your clients and customers, especially in terms of mobile solutions? Who are the dominate characters in your company, your competitors, and the industry at large? Who’d you cast as Othello, Brutas, Caesar, Puck, Mr. White, Mr. Pink, Mr. Blonde?

Photo: tanakawho

Social Web resources 12-11-2009

Very well drafted and inciteful list of predictions for 2010. The author, Ravit Lichtenberg, delves into what will impact innovation, while opining that mobile become even more central, integrated/social search relevancy will begin to trump search aggregators like Google, and marketers will demand ROI.

Excellent discussion on measurment tactics for Google AdWords campaigns. Discusses basics of setting up a custom report in Google Analytics to tips on interpreting data.

This research paper (pdf link) explores the “viral effect” in Flickr (used as a model of social networks in general) and found that the viral effect generally stays within close proximity of the original uploaders, social links are the dominant method to share and spread a message, and popularity of pictures grows over years. The paper is not a “gentle” read, but worth your time if you want to dig in deep on data analytical methodology.

List of social Web resources 09-19-2009

Social media monitoring
Here’s a great list of conversation monitoring tools. The article points out some very interesting and straight-forward tips; I especially like the tip on this social media monitoring wiki.

Search use up, email use down
The Online Publishers Association released a study showing that consumers are spending more and more time on search  and content centered sites while dropping their use of email and instant messaging.

Social network use by mobile device
This study by AdMod shows that social networking is the most used application of iPhone and smartphones users and that Facebook is the number one accessed social networking site.

Innovation in a competitive marketplace

Target, 1958, oil and collage on canvas by Jasper Johns
Target, 1958, oil and collage on canvas by Jasper Johns

Perfectly Competitive Innovation is a fascinating article on what drives innovation. The authors argue against the notion that patents and copyrights promote innovation. Rather, its a rich competitive environment that drives innovation.

In other words, regardless of copyright law, movies will continue to be produced as long as first run theatrical profits are sufficient to cover production costs; music will continue to be produced as long as profits from live performances are sufficient to cover production costs, books will continue to be produced as long as initial hardcover sales are sufficient to cover production costs, and financial and medical innovations will take place as long as the additional rents accruing to the first comer compensate for the R&D costs.

This sentiment was echoed by MIT Professor Eric von Hippel in a lecture where he discussed innovation occurring in kite surfing where practitioners put their innovations under a creative commons licensing scheme to thwart an attempt by manufacturers to exploit their innovations under traditional intellectual property rights law. Perfectly Competitive Innovation similarly points to many case studies and scenarios demonstrating that innovation does not necessarily need the traditional intellectual property rights rubric to thrive and survive.

Photo credit: cliff1066

Innovation driven by extreme user communities

According to MIT Professor Eric von Hippel’s lecture, Democratizing Innovation, manufacturers traditionally look to the center of the market to drive innovation; that is, with their penetrative questions to and analysis of this market, manufacturers think they can discern what to do in terms of innovative product development initiatives that meet consumers’ needs. What Professor von Hippel actually found is that innovation does not come from the center of the market, it comes from an extreme market fringe driven by localized users and early adopter user communities pushing the limits of an original device or prototype. As an example of this, about 22 minutes into the video, von Hippel discusses how these types of communities quickly drove up sales of Lego’s Mindstorm product, while morphing Lego’s original concepts of the product. And about 28 minutes into the video, von Hippel goes into how user groups drove innovative design in the kite surfing market while putting their design innovations under a creative commons licensing scheme which hobbled manufacturers’ attempts to exploit these innovations. This video runs a little over one hour.

Crowdsourcing with Rob Hahn

Crowdsourcing is an important concept in the viability, pertinence, and relevancy of the social web.

A recent crowdsourcing search odyssey of mine (really a two hour drop down the Google search rabbit hole) began with a fairly innocuous @robhahn tweet:

I read recently that a 2-person combat team is four times as effective as a single shooter… anyone have any references to study of this?

This tweet intrigued me, as I thought it likely had something to do with Mr. Hahn’s insurgent marketing in real estate series. @PatrickHealy immediately stepped up to the plate:

@robhahn this should give you what you need: http://bit.ly/15eqQ4

Shortly thereafter I weighed in with this research article. But alas, Mr. Hahn was not satisfied:

@PatrickHealy close… but i’m looking for research showing 2 man team vs. 1 man ops

@ericbryn actually, wanted to see just how much more effective a 2-man fireteam is vs. solo shooter; maybe applies to agents…

Thus, inspired, I began a more substantive series of searches, which yielded these tasty tidbits, but nothing directly on point:

Discussion of information needs assessment and power of teams in edge organizations – Relevant to the insurgency series because the article discusses the shift from top-down command and control decision making to empowering teams and individuals to make relevant decisions based on timely and accurate information. Edge organizations promote a structure comprised of agile distributed networked units, which favors insurgent marketers.

How the information age has affected command decisions in USAF from Desert Storm to 2005 – Relevant to the insurgency series because the author analyzes the USAF shift from centralized to decentralized decision making. Decentralized decision making is key to enabling insurgent marketers to exploit the command and control decision making process that’s sometimes endemic with larger competitors.

Theories about net centric warfare – Relevant to the insurgency series because the article discusses how shared information resources contribute to cohesive mental models of the battlefield that results in increase combat effectiveness. Shared knowledge shared quickly enables insurgent marketers to exploit weaknesses in larger competitors’ information flow.

Discussion of basis for combat operations going to a STRYKER protocol – Relevant to the insurgency series because the report discusses how STRYKER forces are geared to respond anywhere in the world within 96 hours, stressing tactical mobility, lethality, and survivability. Insurgent marketers must strike quickly and with precision to weaken their competitors.

Uses of misinformation in war gaming operations – Relevant to the insurgency series because this article touches on how too much information causes humans to focus on the technical aspects of how the information is delivered rather than the context of the information and how this phenomenon leads to misinformation. An insurgent marketer can exploit this nuance in the sense of releasing highly relevant, highly targeted communications that are in direct contrast to a competitor that focuses on broadcast messaging. Here’s a nice quote from this article:

The gold lies in human thought—assisted by modern communication and computers, not distracted by them.

The reason why I’ve detailed this search odyssey is because I think it’s an interesting exercise in crowdsourcing and thought leadership. Mr. Hahn is a thought-leader in the real estate industry (recently securing a columnist slot within the Inman tribe). But this, in and of itself, is not enough to motivate me to spend a couple of hours helping Mr. Hahn. So what did? Yes my motivation was driven partly out of friendship. But it also has to do with sharing in the learning experience. That is, I enjoy the way he thinks through issues, the cogent arguments he makes for whatever position into which he plows his sword. Part of the way to enrich this experience–a more personal experience with his thought-leadership–is to participate in the germination of an idea. And that, I think, is at the heart of crowdsourcing–the act of helping give birth to a knew idea. The core of crowdsourcing is, essentially, the core of the social web: willingly sharing knowledge, participating in the expansion and distribution of this knowledge, and taking leaps forward together as change agents and innovation artists. Rob, happy reading.

Photo credit: rp72

List of social web resources 5-21-2009

Metrics
Here is a great primer on RFM analysis, which I believe has applicability to social media marketing. The foundation of RFM is something that can drive the establishment of engagement metrics as well as allowing marketers to do a better job at managing the social media marketing channel.

Social media
Scoop44, an online “newspaper” founded by college students, received a two-year grant from the John S. and James L. Knight Foundation (nice to see the support of online journalism pure-plays; eventually we likely will not even make the distinction). This site is a nice blend between traditional reporting and new media functionality.

General coolness
Anyone interested in exploring and discussing graphic design issues should consider visiting this site. It’s an excellent compendium of thought-provoking topics and trends related to graphic design. Cutting through social media chatter will depend more and more on effective design to engage people once they’ve stepped past the social media veneer.

List of social web resources 5-1-2009

Social media coolness
Henry Jenkins, Director of the MIT Comparative Media Studies Program and the Peter de Florez Professor of Humanities, has contributed to a seminal eight part series whitepaper on redefining theories underlying how information spreads across the globe. This series’ concepts are particularly important to brand management practices employing the social web as a strategic messaging tool.

This is an interesting research paper compiling a list of research about online communities. The article details the social, psychological, and emotional benefits people derive from online communities. The article relates these benefits to organizations and defines success metrics for online communities. This is one of the best research articles I’ve found in recent months concerning social web communities and organizations.

Here’s a short article describing how federal chief information officer, Vivek Kundra, is launching a new site, data.gov, which purportedly will allow for the development of more public-facing applications using raw data feeds from government sources. The article also discusses some very innovative uses of Washington D.C. government data that developers submitted for a contest called Applications For Democracy that Kundra directed while he was chief technology officer for Washington, D.C.

List of social web resources 4-24-2009

Blogging:

Here’s a good history of SEO since 1999, which is valuable to understand how things have changed over the last 10 years. Change is a constant with the Internet and SEO…what “worked” yesterday may not “work” today. Thus, focus on passionate, relevant, and niche content as a way to ground your SEO efforts on a solid foundation. My opinion: relevant, niche content will remain king for SEO.

Social networks:

According to comScore, Twitter gained the most visitor traction in March 2009 (9,313,000 unique visitors), a 131% growth over February 2009 (4,033,000 unique visitors).

Social media coolness:

UC Berkeley’s Opinion Space allows you to visualize your opinions relative to others. This article gives a good overview of the process.

Here’s a nifty resource on topics related to setting up Key Performance Indicators for your webiste. KPIs allow you to measure the success and effectiveness of your website.

Mashable has a Social Media Hub series and has compiled a list of the social media scene in New York City.

List of social web resources 4-17-2009

I’m starting something new this week. My goal is to compile a weekly short list of quality resources about blogging, social networks, and social media coolness.

Blogging:
The FutureBuzz is one of the finest blogs I’ve found discussing how to market your blog and blog posts. Adam Singer, really takes the time to dig deep into issues. His posts take some time to read and digest, but you’ll be a better blogger for taking that time.

This post on the Conversation Agent blog has 50 tips on content ideas that generate buzz. Similar to the FutureBuzz blog, I encourage you to peruse this blog, as it really challenges you to think through issues, like this post that digs into the future of the press and its historical role as the “Fourth Estate”.

Facebook:
This post discusses a new Facebook app that lets you choose which Twitter updates to sync to Facebook. TweetDeck also has a nifty feature that lets you do the same. Both are easy to use; the former app, however, requires you to add the hashtag “#fb” to any post you wanted synced to Facebook (useful if you want to add your posts to the “#fb stream” that’s searchable)

The Huffington Post has a page devoted to Facebook. It’s a nice compendium of Facebook-related information.

Twitter:
Sending photos to Twitter is fun. Currently, the leading app for this is TwitPic. A competitor to TwitPic is on the horizon. TwitGoo has quietly launched a competitive service. I have not tried this yet, but it seems well-positioned to give TwitPic some competition.

Random social media coolness:
One of the hottest topics in social web is “crowdsourcing“. The issue is meaty because if the concept plays out favorably, brands conceivably will begin releasing more engaging and consumer centric products and services. This article discusses the broader concept as to whether creativity itself can be crowdsourced. For a previous discussion of creativity and innovation see my earlier post.

Photo credit: .Martin.

Foreclosure Searches on the Rise

Hitwise and Google show that foreclosure searches are creeping up on “traditional” searches regarding properties for sale. UPDATE: RealtyTrac reports a 6% rise in foreclosures in February 2009 over January 2009, with a 30% increase over February 2008. On March 12, 2009, Hitwise reported that foreclosure searches are on the rise.

Hitwise: Forclosure Searches on the Rise
Hitwise: Forclosure Searches on the Rise

For fun I ran the top five Hitwise searches in Google Trends to see the differences between the search reporting engines. Google had slightly different data.

free foreclosure listings, foreclosure listings, foreclosure homes, foreclosure, foreclosure.com

Foreclosure searches: Google vs Hitwise

Next I compared the search term “foreclosures” against search terms “homes for sale” and “real estate for sale” over a 12 month period. Here’s what I found:

foreclosures, homes for sale, real estate for sale, US, Last 12 months
Google searches: foreclosure, homes for sale, real estate for saleThen I focused on Nevada for the same search phrases: forclosures, homes for sale, real estate for sale, NV, Last 12 months
Google searches: NV foreclosures, homes for sale, real estate for saleFinally, I narrowed the searches down to Las Vegas: foreclosures, homes for sale, real estate for sale, LAS VEGAS, NV, Last 12 months

Google searches: Las Vegas foreclosures, homes for sale, real estate for sale

Innovation considerations for real estate firms

Real estate professionals looking for sources of inspiration should consider the following quip from the book Chasing Cool:

The next time someone says they want to be the iPod of their industry, ask them this: before he came up with the iPod, did Steve Jobs walk around telling people he wanted to be the Sony Walkman of his industry?

The Chasing Cool book goes on to explain that innovators have a knack at assessing where a potential market “is” and what this potential market wants or needs, even though this potential market may be incognizant of such, because innovators employ various forms of focus groups (from the traditional, to the mostly non-traditional) along with intuitive insights.

Following this thread, in the paper Permanently Beta: Responsive Organization in the Internet Era, researchers point out that continual testing is a way to gauge user feedback and gain invaluable break-throughs in product innovation (the development of Linux is an example of this). Nevertheless, this article (abstract) looked at software company start-up success and found that prolonged beta phases and collaborations with universities delay product launch but that team tenure and experience favor faster product development and launch. This finding corroborates a premise in Chasing Cool that looking within rather than without (i.e., consultants) often drives true insight and innovation.

What does this mean for real estate firms striving for innovation? Perform a 365 degree analysis on your team and products and services. Analyze your company through the eyes of a competitor to better understand your weaknesses. Quit strategically as Seth Godin admonishes in the book The Dip.

Revenue considerations of social networks

This paper points out that social network sites such as MySpace and Facebook have huge potential for high advertising revenue gains because “the cost of gaining new customers is practically nothing [since] users join voluntarily and provide their own content through their profiles. In addition, the cost of running the sites’ web servers is relatively low.”

The authors do point out, however, that significant revenue gains might be limited because these sites must constantly innovate to retain and attract new “customers”, it’s easy to launch rival social networks, and consumers have lots of choices as to which social networks to use.

Web 2.0 Digest 2008/1/2

When bloggers attack, has some great tips on how to respond to blogger swarm attacks. Many real estate firms are leery of bloggers and allowing their agents to blog; this post has some thought-provoking ideas on how to respond.

Interview with Jordan Behan explains how Web2.0 consumers are more informed in real estate search.

Another great post by MineThatData describes the difference basic differences between web analytics and multichannel analysis. The latter analysis lends itself to looking at the life time value of real estate consumers under the multi-generational marketing rubric rather than as one-off buyers that are forgotten as soon as a deal closes.

Here is a great post on how to build / support brands using Web 2.0 tools.

Engagement is the heart of any website. Occam’s Razor has an excellent post on the issues pertaining to creating a viable engagement metric or index.

(repost of 10/07/2007 entry)

11/12/2007 Research

The link-prediction problem for social networks

Link prediction and link detection in sequences of large social networks using temporal and local metrics.

Multiplicative latent factor models for description and prediction of social networks

Modeling Trust and Influence on Blogosphere using Link Polarity

Detecting invisible relevant persons in a homogeneous social network (.ppt here)

Direct / social media marketing research 9.04.2007

Below is some fairly recent research on motivating and behavior factors underlying social networks. The theme of this set of research is to explore how the “echo boomer” or “millennial” generation uses social media. Since real estate is an engagement-oriented Internet based service, firms should study the motivations underlying their potential recruits and future customers to ensure they are well-positioned to serve them in the future.

Applying Common Identity and Bond Theory to Design of Online Communities

Mobile Text Messaging and Connectedness within Close Interpersonal Relationships

Leveraging Social Networks To Motivate Individuals to Reduce their Ecological Footprint (interesting analysis as to how a social structure nurtures affinity, loyalty, and evangelism).

Digital Relationships in the ‘MySpace’ Generation: Results From a Qualitative Study

Direct / social media marketing research 8.28.2007

McKinsey Web2.0 survey

Visual analysis of blog content

Web site semantic analysis

Emperical basis for social networks

Identifying brand influencers in social networks

Impact of trust in social networks

Target marketing in social networks

Correlation between LinkedIn and Facebook

Correlation between LinkedIn and Gmail, YahooMail, and HotMail

Trust indicators in social network marketing

Jeremiah Owyang explains the concepts and value of social networks from a marketing perspective in an easily digestible manner. Yang et al (registration required), Battiston et al, and Hill et al discuss the scientific underpinnings of these topics. Juxtaposing these discussions against one another leads to some interesting insights with respect to social media marketing.

Yang notes that in 1967, Stanley Milgram demonstrated that mutual acquaintances drive social network strength. As Yang elaborates:

“[T]he probability that two of someone’s friends know one another is much greater than than the probability that two people chosen randomly from the population know one another.”

Yang illustrates the concept of this theory by pointing to the success of Hotmail, which grew from 0 to 12 million users in 18 months.

Battiston explores how “trust” factors between actors in a social network affect the dynamics of recommendations in that social network.

“Trust plays a crucial role in the functioning of such socio-economic networks, not only by supporting the security of contracts [sic?] between agents, but also because agents rely on the expertise of other trusted agents in their decision-making.”

What Battiston drives towards is that trust-based modes of recommendation have an inverse relationship to traditional modes of recommendation, which are primarily based on the volume of recommendations as opposed to the value of recommendations. Battiston argues that trust-based (or value-based) recommendations are inherently better at promoting more satisfying results to actors within a social network.

This, in turn, promotes the propogation of sub-group cultures to form within the social network. And as non-trustworthy agents drop out of the network (because prior recommendations did not fulfill specific trust elements as dictated by the requesting actor), the sub-group refines itself overtime. As more sub-groups are defined within a social network, “network neighbors” emerge amongst members of these sub-groups, where these network neighbors operate as conduits between different sub-groups.

Yang demonstrates that sub-group performance, in terms of marketing results, out-performs all others (this was measured in terms of traditional transaction response rate metrics).

Accordingly, marketers must seek out sub-group network neighbors. These individuals are the brand influencers and advocates within a social network. Jerimiah Owyang has an excellent post on the visual display of this information. Leverage Software has developed a product which likely can visually display these sub-group cross-over individuals, thus making the selection of influencers and advocates easier. Perhaps these individuals would be great focus group candidates, “real time” collaborators in product development initiatives, etc?