There are many examples today where brands are listening to their customer’s feedback and making decisions. eBay (client), for example, recently launched PayPal Student Accounts which stemmed from continued frustrations among their customers who wanted family accounts. Intel simply gave away t-shirts to a community that was begging for them. Starbucks (client) not only solved a serious business problem of coffee spillage, but they also changed the customer experience for millions by creating the Starbucks Splash Stick; which was an idea posted by a customer on My Starbucks Idea.

These three brands share more in common than just the fact that they are listening to their customers. They were also cited in recent study by Charlene Li and Wetpaint titled “Deep brand engagement correlates with financial performance”. The report examined the top 50 brands and measured their depth of engagement with consumers on the web; and then looked at their financial performance for the last 12 months. The analysis showed that – on average – the brands that were more engaged on a variety of channels grew 18% in revenue during the reporting period versus the companies who were least engaged suffered an average of 6% decline in revenue. Here is the actual report (PDF) for reference. Starbucks, eBay, and Intel were all listed in the top 10 brands. Not an exact science but food for thought for brands who are considering to engage online.

In these examples, the noted brands were listening to the conversation and then making actionable decisions. The feedback has proven to make the case that those decisions were the right ones. Here are four key takeaways brands must consider when engaging with consumers online.

1. Consumers demand to be heard; and they expect brands to engage.
   

   Social media is not a fad; and with hi-speed Internet now at critical mass globally, more consumers are embracing social technologies. The numbers aren’t only growing but data now suggests that consumers expect brands to engage with them online. According to a more recent study, Almost 80 percent of social media users interact with companies or brands online, an increase of 32 percent from 2008. What’s even more interesting is that 72 percent of consumers that have ongoing dialogue with a brand online feel a stronger emotional connection. This alone should have marketers salivating but at the same time, be ready to act.

2. Authenticity means that employees should also participate.

   Advertising and PR firms can always help with strategic counsel and guidance but it’s more effective if real employees are engaging with consumers. This humanizes the brand and is imperative in fostering that “emotional connection”. The challenge is organizational structure and not having the right people engaging. If there isn’t incremental budget for additional headcount, marketers must enlist the help of others throughout the organization. In the example of Starbucks and Intel, they have real employees interacting with the community; and it’s usually on a first name basis. This act alone fosters a more authentic and nurturing environment where consumers will feel like they are being heard and more open to sharing feedback and suggestions.

3. Scalable listening software is key.

   There are a variety of free tools available to marketers to begin listening to online conversations such as Social Mention, Twitter Search and Google Alerts; but the growth in usage of social media requires a more robust and sustainable solution. Many of today’s enterprise social listening software platforms can not only listen to online chatter globally in various blogs, forums, Twitter; but they can also help marketers create workflows that filter feedback to the appropriate person as well as assign organizational tasks. A few that come to mind are Radian6, Visible Technologies and Sysomos.

4. Management buy in is critical.

   Management support is important from many different angles. Budget investments will be needed to create the infrastructure where the two-way conversations can be facilitated and feedback captured. Many tools like Lithium and Jive are excellent platforms for conversations and community building but do not come cheap. If these conversations can’t happen on domain or it doesn’t align with business objectives to create a branded online community, there is a significant investment of time in engaging in third party web sites and communities. Hiring community managers and/or relying on volunteers also contributes to some level of financial investment.

The conclusion here is rather simple. Consumers now have a voice and they are sharing their points of view online. Some are talking directly with brands and others are sharing their opinions within their circle of influence. In either case, brands now have the opportunity to listen in to what is being said about their products/services. The smart ones, however, are taking the collective feedback from the community and making things happen. The end result is better products and a community of advocates that truly care about the brand.

As SXSW begins, the ‘big news’ in social media will feature the latest and greatest developments for location based tools like Foursquare, Gowalla and Plancast. Twitter ‘exploded’ at SXSW a few years ago and Foursquare began to bubble in 2009. We calmly await to see who the next “darling” will be this year! Translation: checking our Twitter streams like mad to see what SXSW people are talking about.

Facebook Gets into the Location Game

Joining their geo counterparts at Fourquare and Gowalla, Facebook plans on adding location based features to its current API.

Eventbrite and Facebook Join Forces

This partnership is a ‘no brainer’. Facebook users will now be able to purchase tickets to Eventbrite gatherings via their Facebook page. Yet another service incorporating into Facebook – keeping users in their personal Facebook perusing, versus clicking away and visiting another site. These types of partnerships will also increase Facebook’s average time spent metrics month over month.

French Connection Celebrates the Randomness of Global Chat

Chatroulette’s voyeuristic reputation is celebrated in French Connection’s new campaign – aiming to seek the best pick-up attempts.

Starbucks Announces Foursquare Partnership

Though not firmly defined, Starbucks (client) will begin rewarding loyalty points for its frequent customer base. Easy wins here: Starbucks card and weekly coffee freebies.

Open Your Front Door With – Your iPhone?

News of this hit as Apple’s patent application surrounding this technology was released. Imagine walking up to your front door and scanning your iPhone into a designated reader, accessed via pin code. Enter, the iKey.

Chevy Uses Augmented Reality to ‘Geek Out’ at SXSW

Augmented reality isn’t new, but enabling the experience to happen on consumer phones versus their computers moves the dial. Chevy (client) is also teaming up with Foursquare competitor, Gowalla, to assist SXSW attendees with their airport transportation needs.