Monday, April 24, 2006

 

Corporate Blogging: Practices and Perspectives

The blogging fever has caught on.
We are steadily seeing many Fortune 500 companies with blogs. Here's are two useful sites: (1) site. and (2) site. What I find frustrating is that I have not seen any good categorization of the different corporate blogs. When I discuss blogs with managers, they are invariably puzzled:

(1) why should we blog? or encourage blog? is it not just a fad?
(2) what should be the limits? what about SEC requirements? what about trade secrets etc.?
(3) Is it an alternative to public relations and news releases?
(4) What about possible contradictions?
etc. etc.

I say that blogging is NOT one thing to all firms for all purposes. I refer them to read Naked Conversations. The book provides a good overview and nice examples. But I have not seen a good typology or taxonomy to take this idea further. Now, you may be wondering why we need a taxonomy of corporate blogs. It's simple: Not all blogs are the same nor do they have the same function, focus or objective.

Some blogs reflect individual opinions of rank-and-file managers (e.g., Robert Scoble at Microsoft) or Mike Chambers at Macromedia while others reflect more senior managers responsible for specific functions or even top management (Bob Lutz of GM or Jonathan Schwartz of Sun). Some blogs are active communities inside companies (Microsoft Channel9 or Googlers' blogs). Some are product or business specific blogs (e.g., Google Enterprise blog) while others are focused on a particular theme such as mashups or TV entertainment across a wider community not limited to a single company.

There are strong feelings about blogging. Jonathan Schwartz of Sun remarked:

“We've moved from the information age to the participation age, and trust is the currency of the participation age. Companies need to speak with one voice and be authentic. Blogging allows you to speak out authentically on your own behalf, and in the long run people will recognize that. Do it consistently and they trust you.”
There seems to be some recent interest in showing the value of corporate blogging. Some are beginning to compare financial performance of the companies with blogs with those that do not have blogs to see if there are strong financial performance differences. I caution against such simplistic categorization of performance effects as management research is full of ill-conceived studies that sought to establish links between management actions and financial performance. Simple categorization such as bloggers versus non-bloggers mask many confounding effects; the results may be more of an artificat of the study design than anything more specific about blogging.

So, let us not swing for the fences trying to establish financial performance efefcts of corporate blogging right away. Let us instead develop a typology of blogs and link them to more intermediate performance effects as customer perception of trust and brand preferences and market share increases. Some blogs may have different goals than market share or customer trust and we should link those to appropriate constituencies as such.

I believe that it is more than a fad but we need to understand it in some detail. Just as not all e-commerce sites have the same business model logic, not all blogs are the same.

A typlogy of blogs with appropriate performance metrics for each type will go a longway.


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