Homework Assignment Engaging Customers and Prosumers

2

November

2012

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Hello everyone

My first article was Co-Creation: Toward a Taxonomy and an Integrated Research Perspective by Vladimir Zwass, throughout the article he examines co-creation inside out. He first starts why current marketing environment is not like as it used to be. He points out that distinction between customers and producers are no longer clear. He divides co-creation into two, sponsored and autonomous co-creation. He defines and separates every aspects of co-creation and classifies them. One of the interesting phenomenon he explained was social capital. Social capital is basically the trust level within the virtual communities and how tightly connected the community is. He believes that higher level of social capital also increases co-creation activities. Most of the things explained in the article is things we already know but what makes this article important that it creates an in debt framework for co-creation. The taxonomy he created helps to analyze the co-creation projects, and provides you the outline.

Second article was Online Social Interactions: A Natural Experiment on eWOM versus Observational Learning by Yubo Chen, Qi Wang, and Jinhong Xie. The article explains the result of the experiment that tests effects of WOM and Observational Learning (OL). I’m just gonna move directly to their results. They wanted to figure out whether OL and WOM individually have effects on sales, whether change in WOM affects OL or other way around, also for each interaction method they wanted to find out negative or positive of them have greater effect on the sales. They used Amazon.com’s data for their experiment. They found out that negative WOM has greater effect on sales than positive. However they also see that negative OL usually does not affect customer decision, at least not as much as positive OL. Their explanation for this was that, according to Cascade theory if there is no much information available we make our own decisions, but if all the people are buying one product, we feel inclined to buy that product as well. However if one product is not popular, sometimes it may not be the reason that the product is bad but it appeals to a niche market or its an advance product. They also see that OL and WOM contribute to each other, if you have both tools on your e-commerce site they will work better than having just one of them available.

My third article was “Tweet Me, Friend Me, Make Me Buy” by Barbara Giamanco and Kent Gredoire. The review tries to persuade why social media is important for businesses. They advice the managers not to be scared from social media but find ways to use it for their own benefit. One of the very catchy story they used was, people ask a robber why he robs banks, and he replies “its where the money is”.  They say since most of the customers spend most of their time in sites like twitter and Facebook  it is wise for companies to be there too. They also advice managers to encourage their employees to use social media not only marketers or sales people but everyone.

I am posting this table mainly because I believe it might come handy for if your trying to examine a company and you need a framework its good summary to provide decent outline.

Taxonomic Framework  of Factors in Co-Creation
Performers The world Anyone regardless of location and knowledge can contribute
Prequalified Individuals To be able to contribute, the contributor should meet the criteria.
Community Members In some closely bonded communities contributions will be higher
Skilled Contributors In OSS projects, contributors should be skilled in software program writing
Motivation Extrinsic External rewards, and rewards provided by others
Intrinsic Inner motivations of individuals, such as satisfying self-affiliation needs.
Governance Individual Autonomy Uncoordinated correlation
Collective Norms Collective expectations of the communities regarding their behavior to each other or to co-creation
Software Code In OSS, the rules to write the program also shape the creation and the re-use of the software.
Facilitators Found useful in opinion aggregators
Adhocracy Can be seen some successful OSS projects
Bureaucracy early  Wikipedia evolved from this kind of governance
Market mechanism Information markets, (stock market exchange rules)
Hybrid Forms Includes mixed governance models, such as Wikipedia
Task Characteristics Structural complexity The degree of complexity of structure of co-creation projects. High in OSS, really low in blogging.
Intellective Demands What the project want from the contributors? Knowledge, skills, experience, creativity or diversity.
Effort Intensity How much time should the contributors (individuals)  spent for the project being successful?
Time Frame How long it takes to successfully complete a project? For Wikipedia case infinitely many
Principal Mode of Product Aggregation Searchable Corpus Affective search engine to aggregate and classify the content, example; Technorati
Hyperlinking Generally combined with other methods, a native web method to aggregate.
Progressive Refinement Wikipedia, software coding
Statistical Rankings and Ratings Can be used to summarize or convey sentiment
Competitions and Voting Putting content in competition and by users vote deciding which project to invest
Information Markets Select an idea or options from all possible options or ideas.
Bottom-up Taxonomy(folksonomy) Classify and provide access like Flickr
Moderators, auditors, and facilitators For example Slashdot, they help selecting the business models
Economic Beneficiary The World Everyone is benefited from the project, such as Wikipedia
The Community Benefits usually with the sponsoring company
The Sponsoring Firm Sponsoring co-creation firm
The Aggregator Such as Apple App World with the contributors
The Contributors InnoCentive,  Amazon’s Mechanical Turk

My examples were MMORPG game called Tibia and Apple app World.

this table was my comparison of these two companies.

Comparison criteria of co-creation Apple App World Tibia –MMORPG (CIP)
Autonomous or Sponsored? Sponsored Both, some value creation activities for the VC not supported by the company
Performers Skilled Contributors The World
Motivation Mostly extrinsic Mostly intrinsic
Governance Software Code Hybrid Forms both Collective Norms, Software Code and Bureaucracy
Structural complexity Relatively high Low, and in some cases high –such highly complex contests
Intellective Demands creativity and diversity Knowledge, skills, experience, creativity, and  diversity –depending on the project
Effort Intensity High Vide ranged –depending on the contest or contribution
Time Frame Varies from application to application Varies from contest to contest but usually less than 1 month
Economic Beneficiary Both sponsor and contributor only CIP

Sources

Zwass, V. 2010. Co-Creation: Toward a Taxonomy and an Integrated Research Perspective. International Journal of Electronic Commerce 15(1) 11-48.

Chen, Y., Wang, Q., and Xie, J. 2011. Online Social Interactions: A Natural Experiment on eWOM versus Observational Learning. Journal of Marketing Research 48(2) 238-254.

Giamanco, B., and Gregoire, K. 2012. Tweet me, friend me, make me buy, Harvard Business Review 90(7/8) 88-93.

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Social Trading

31

October

2012

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There are brokers who work for banks or big companies, there are hedge fund people who trade for their funds and such. Yet still out there are a lot of successful traders like you and me without any big wall-street title. To leverage this opportunity, the idea of social investment network came up. There are companies who offer you to pick people on their network, and copy their behavior of investment. They can be referred as social investment networks.

One of the big site is called eToro. According to them “At eToro, the world’s leading social investment network, you can tap into the wisdom of the crowds to help you make smarter investment decisions.”

here is a small video about how it works.

http://youtu.be/ANbvxww-vjo

Fingers crossed, the company is doing great so far. They manage to raise incredible amount of money to support their system. On your profile you have copiers, like followers in twitter. If your making consistent positive gains, the chances are that you more copiers is higher. The so called gurus (people who actually own profiles) are encouraged to trade better and gain more copiers because on top of what you earn from your investment, you gain more according to how many unique copiers you have.

eToro is recognized as one of the leading online investment network. (2M users and 140 countries). They also provide you the opportunity to play with virtual money.

and I found this blog post interesting if you want to do further reading on this subject: http://techcrunch.com/2012/03/13/social-investment-network-etoro-is-picking-up-another-15-million-from-spark-others/

This entry is made merely to inform about social investment networks, no advertising intended.

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social network apps “Spooky Halloween Edition”

31

October

2012

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Nowadays we have all kinds of apps make our lives easier. But since we are all doomed to die, some entrepreneurs exploited the social networks by their so-called “after-death” applications.

I will be introducing 2 applications/websites today, I hope you find them a bit spooky =)

First one is http://yes.thatcan.be/my/next/tweet/

Basically what this application does, it analyzes your previous tweet posts, and try to get a sense of what your next tweet will be about. I tried it a few times; it doesn’t seem to work brilliantly. But, the algorithms that can analyze tweets and tell us what they are about evolving as I am writing this blog post. Who knows what future will bring? Maybe we’ll have a built-in small window on our twitter pages that tells us a few things that we might say in our next tweet with 95% accuracy. That would definitely save us sometime, but… Wouldn’t it be scary?

The next application I’m going to talk about is if-i-die

You might have heard about this one but yet lets watch this small funny introduction video

It might be nice to see someone’s last thoughts but i think it might also create some drama or bigger problems between friends. (Not to forget, it would be a great way to prank others. Lets say one of your best friends is using this app and his trustees are two of your closest friends. You report back to the app saying that your friend died, and their farewell message is up. ) Lets hope this app won’t fail as hard as Facebook beacon did.

Some people say we will have holograms of our loved ones in our houses walking around and talking like as if they are not dead. Some people say your twitter and Facebook page might live long after your gone, and post things themselves as if they have their own minds. Some of these improvements in social media are really making me question about where all these are going.

HAPPY HALLOWEEN!!!!

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Social entrepreneurship that uses e-commerce/ social commerce

29

October

2012

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A few years back, I was taking entrepreneurship course back in my university. My professor asked us to come up with a business of our choice. I would like to promote and introduce my business idea.

A little background about women’s position in Turkey.

Even though western part of the Turkish land is really similar to European life-style, women’s economic independence in the middle and east Anatolia is still a big problem. Most women in these regions are unemployed. The rate of violence towards women is higher as well.

The Business Idea

So my idea was, if these women find means to increase their income, they won’t have to put up with their husbands’ assaults.

Thus I created the business idea which was focusing on selling the hand-made products these women make. In the core, its basic e-commerce/social commerce site, where the company is an intermediary to connect sellers and buyers, but since the company is non-profit organization and creating successful C2C in Turkey is really difficult. Most of these women are illiterate also even if they are literate, they do not have computers or do not know how to use computers.

Rather than using mainstream charity structures, we are hoping this way will empower the women more and create sustainable way for them to support themselves. In this model we could use different pricing models such as English Auctions, standard pricing. Because the model is online and the labor cost for these women is less, – they do not need to go to their local market place to sell their items- they can be more productive or spend more time with their children, which eventually enhance the social impact of the idea.

My conclusion is since social media and social networks are evolving, sadly the charity organizations are not utilizing these opportunities good. Non-profit organizations should develop themselves with the current trend and come up with new ideas to make the world a better place.

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Ps. We couldn’t start the business yet mainly because administrative costs are high in Turkey, but I am trying to develop the idea every day and joining competition to attract more attention. I have a web-site but you cannot buy or sell items there yet. If your interested you can have a look, let me warn you tho, my web site design skills are really bad!

http://www.burdanaliyoruz.com/

http://buradanaliyoruz.com/

http://forum.burdanaliyoruz.com/

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Is it really good to have too many options?

3

October

2012

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Hello Everyone 🙂

In LinkedIn case, it is said that LinkedIn opened its APIs to outsider developers in 2007, but unlike Facebook, they control the quality of all the apps that is going to be launched, if not approved by LinkedIn, developers cannot launch their widgets or apps. Thus the huge gap between number of apps in Facebook and LinkedIn.

I am going to introduce you a theory by Barry Schwartz –http://en.wikipedia.org/wiki/Barry_Schwartz_(psychologist).

It is called the “paradox of choice”. But rather than explaining the theory and bore all of you with my long post, I think its better to watch him to explain what his theory is all about.

I really recommend you to watch this video in full, because its really interesting and funny too. You can also apply his theory in any subject, even in your life.

My understanding of Schwartz theory is that having too many choices makes us miserable, takes too much time come to a conclusion, eventually when we made our minds we regret it, and think that we are not good decision makers.

So how this theory is related to LinkedIn case issue I stated above?

I don’t know if you remember Steve Jobs was showing off about how many apps they had in the app store – the current number is around 700k. When Android introduced itself they criticize that many apps in Apple App store pretty much useless, and that what makes Android Store great is that every application has a purpose and is useful.

So is it really  terrible for LinkedIn to have a strict control over the apps and widgets, and having few apps and widgets compared to Facebook?

I believe the answer is no. Mainly because rather than being frustrated about the useless apps and their pop-up message bombs everyday in Facebook, I believe most people would chose to have less but sophisticated and working apps and widgets. Especially in LinkedIn, where people gather not for fun but for academic and/or work-related issues, subjects, and professional networking.

Hopefully you’ll enjoy my first entry.

 

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