Quantifying the Value of Social Connections
In a previous post I mentioned that an engaged user, a customer who engages with a company providing them input, feedback, and insight, is more valuable than a passive user. This post by Larry Hawes over at the Gilbane Group Blog is interesting because it discusses a recent study by IBM of data from 400,000 employees that attempts to place a monetary value on social connections. From Larry’s post:
> What makes the study so interesting — in addition to the extraordinarily huge dataset used — is that it is one of the first attempts I’ve seen to assign a currency-based value to social network connections. In this case, the social network is based in email; it lives in IBM’s internal deployment of Lotus Notes.
> The study associates incremental revenue earned by a consultant with both individual and project-level email activity. For example, the study finds that if an IBM consultant uses email to reach out to a manager that is not his direct supervisor, he produces, on average, an additional $588/month in revenue as compared to a consultant that only interfaces with her direct manager.
At LugIron, we believe strongly in the value of engaged users. Companies are building social networks every day. In fact, you could consider most support sections of companies websites to be social networks. Unfortunately, most organizations don’t make effective use of this very valuable method of user engagement.
Any conclusions drawn from this study about the value of active community users should be treated with a grain of salt; however, I’m happy to see research into the value of social connections is underway.
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