Disruptive Innovation Winner Communispace

This blog is co-posted with Next Generation Market Research.

Diane Hessan of Communispace speaks to Tom H. C. Anderson about Next Gen Research, innovation and the recent sale to Omnicom

Tom: Your company recently received the agency side NGMR Disruptive Innovation Award at the TMRE. You've certainly played a big role in what I've been calling Next Gen Market Research. The term 'MROC' (Market Research Online Community) seems so commonplace now, but it certainly wasn't even just a couple of years ago. How did this all happen?

Diane: It's been a long journey! When we first started building insights communities in 2000, people just didn't like the idea. People would say,

'No one is on the internet, and so this isn't representative of my market'
Or
'Who ARE these people and why would anyone give advice to a brand'?
Or
'Why would you engage in a conversation with someone over time when research principles say that you should only ask them once or they'll be biased'?

What we knew was that the people with concerns were not our clients. Our clients were excited and happy, and that gave us tremendous inspiration to keep innovating. I think that communities became more mainstream as social media became credible, but I also think it was a physics issue: there are now a critical mass of companies that use communities to generate insights and they are getting great results. It's just not that risky anymore! We have built and managed about 425 communities for some of the best brands in the world, and that means we have made more mistakes than you can imagine. Of course, about 1/3 of our clients have been working with us for more than 5 years, and we are ever grateful to them for working with us when it wasn't 'fashionable'.

Tom: Specifically, what are some examples of the types of insights that are easier to get out of insights communities than from other research?

Diane: Our clients will often challenge us to help them learn things about their consumers that they had never thought of before. With a community, you get true consumer immersion to understand their wants, dreams, frustrations, beliefs and more. On a daily basis! The result is that you become smarter, more innovative and more empathetic as an organization.

More specifically, communities are especially helpful in certain arenas. One is related to whenever you need to do a deep dive on consumers over time - to understand the 'why's' behind your data. Because community members are building relationships with each other, they often share information that they just wouldn't share in a less intimate environment. Other categories would include when you need to bring consumers to life, or when you need very fast reads on decisions, testing hypotheses, and so on. Of course, communities are really fantastic for that 'fuzzy front end' of innovation.

The real breakthrough with communities is about continuity. Instead of doing ad hoc projects with consumers which is often inefficient in these days of social media, the constant stream of insights can transform companies. You get a 360 degree view of community members in a way that is richer, more nuanced, more textured. It's like ethnography on steroids.

Of course, despite my passion for communities, there are many things you wouldn't use a community for, such as forecasting, sizing a market, brand equity studies, segmentation, or major decisions that really require substantial scientific validation.

Tom: Communispace was just sold to Omnicom, and this came as a surprise to many. Why did you decide to sell? Why Omnicom?

We didn't sell to 'exit' the business. In fact, no one on our leadership team is leaving. We basically sold because our opportunities are all related to faster innovation and broader distribution. For example, it's very difficult to become a truly global company on our own. Omnicom has 5000 clients in 100 countries, and thus, they can help us expand much faster. We are also excited that they are known for letting their companies remain independent. We think our culture is absolutely critical to how we deliver and we know that Omnicom isn't interested in messing that up.

Diane: Seems like a good strategy. What have you learned from this process that you can share with other research firms who may be considering similar options?

Well, I'm a big culture person. So, I'd say that people spend a tremendous amount of time worrying about their purchase price and not enough time exploring whether they are selling to a partner that will create a great future with them - and whether that partnership will work culturally. When I see acquisitions fail, it's usually about the soft stuff and not the deal structure.

For the rest of the article, visit the NGMR Blog here.