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Digital Concept: User Generated Content, Part 1

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Marketing in a Digital World

University of Illinois at Urbana-Champaign

4.7 (5,634 ratings) | 240K Students Enrolled

Course 1 of 7 in the Digital Marketing Specialization

This course examines how digital tools, such as the Internet, smartphones, and 3D printing, are revolutionizing the world of marketing by shifting the balance of power from firms to consumers. Marketing in a Digital World is one of the most popular courses on Coursera with over 150,000 Learners and is rated by Class Central as one of the Top 50 MOOCs of All Time (https://www.class-central.com/report/top-moocs/). This course is part of the iMBA offered by the University of Illinois, a flexible, fully-accredited online MBA at an incredibly competitive price. For more information, please see the Resource page in this course and onlinemba.illinois.edu.

Skills You'll Learn

Marketing, Digital Marketing, Marketing Mix, Pricing Strategies

Reviews

4.7 (5,634 ratings)

5 stars
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HJ

Aug 08, 2016

Greetings ,\n\nThis course is very beneficial and i thank the professor and everyone else at Coursera.\n\nPlease direct me, to be a talented successful individual in Digital Marketing.\n\nThank You.

OA

May 31, 2019

A really useful course, which contains new information about 3D Printing, and some new strategies for digital marketing. If you are new to digital marketing, I advise you to start with this course.

From the lesson

Digital Tools for Persuading Customers to Buy Your Products

How are products promoted in our digital world? In this module, you learn how new digital tools are enabling customers to take a more active role in promotional activities.

Digital Concept: User Generated Content, Part 110:20

Digital Concept: User Generated Content, Part 28:14

Taught By

Aric Rindfleisch
John M. Jones Professor of Marketing

Transcript

>> Hi, let's take a look at user generated content

or UGC for short.

Historically, most firms have carefully managed the promotion

of their products.

One of the reasons why promotion has been carefully managed is

because this activity is quite expensive.

For example, in the U.S., a 30 second commercial

on a national television channel usually costs

at $100,000 just to have it broadcast.

Since most commercials are shown multiple times,

this cost quickly multiplies into millions of dollars

and this doesn't even include the cost

of developing the commercial in the first place.

Well, the rise of new digital tools has dramatically changed

this equation, low cost digital cameras,

free digital editing software

and online broadcasting platforms such as Youtube,

Facebook and Twitter have made the creation and dissemination

of promotional messages much cheaper

and far easier than ever before.

As a result, a growing number of firms are taking advantage

of these development to reduce their promotional cost.

For example, the U.S. beer company --

excuse me, U.S. beer brand, Old Milwaukee,

has dramatically reduced its promotional cost

by airing its ads on Youtube instead of on television.

In addition to reducing the promotional cost for firms,

these tools have also enabled customers

to take a more active role in the development

and dissemination of promotional material.

For example, there are now about 300 million Twitter accounts

which produce in total about 500 million tweets a day.

It is estimated that about 20%

of these tweets are somehow brand related,

thus every day there are

about 100 million free promotional messages just

on Twitter alone.

Today, anyone with an internet connection, a computer

and an idea can create

and disseminate a promotional message

for just about any product.

So in essence, digital tools have democratized the

promotional landscape.

This is the basic idea behind UGC.

Here are a few examples of user generated content.

All of these examples are cases

in which firms are encouraging UGC in an active manner;

however, UGC often occurs without firm's encouragement

or approval, such as when travelers post reviews

about restaurants at hotels on websites

such as Travelocity.com, perhaps you've done this yourself.

Our first example is a company called Go Pro;

this California company develops

and sells high definition video cameras.

These cameras are quite compact, they're very durable

and relatively cheap and are often used

by extreme sports enthusiasts, such as mountain bikers,

wind surfers and skydivers.

They use these cameras to capture their adventures

so Go Pro strategically uses UGC by holding contests

in which they ask their customers to submit photos

or videos of their adventures

that they have taken with their cameras.

These submissions provide a steady stream of content

to Go Pro's various social media sites

and also provides a very persuasive form of promotion

by showing potential customers how Go Pro can be used

and its value of owning this product.

The second example is a company called Warby Parker;

Warby Parker is a manufacturer and retailer of eye glasses

that has a few physical retail locations but does the majority

of its business online.

This company offers a service called home try on;

in this service, it mails its customers five different pairs

of eye glasses.

These customers can try them on for five days

and then send the ones that they don't want back to the company.

Warby Parker actively encourages these customers to take photos

of themselves and share these photos

on social media using the hash tag Warby home try on.

In fact, many of the customers do take

and share these photos online as a way

of gaining helpful feedback from others.

In addition to helping their customers,

these shared photos also provide Warby Parker

with increased exposure and a free source

of promotional material.

The third example is T-Mobile,

the mobile phone market is a very competitive industry

and has intense competition among carriers

such as T-Mobile, AT&T and Verizon.

T-Mobile has effectively used UGC to help fight these battles.

For example, February 2014,

it conducted a Twitter campaign called Breakup Letter;

this campaign encouraged users of competing carriers to switch

to T-Mobile by sending their old carrier a breakup letter

and then posting this letter on social media.

This campaign was very successful

with over 80,000 new customers submitting breakup letters.

In addition to generating many new customers,

this campaign also resulted

in substantial embarrassment for its competition.

Now that we've had these examples, let's take a look

at defining what UGC really is.

Well, user generated content occurs

when a product's customers create

and disseminate online ideas about the product

of the firm that markets it.

These ideas often come in the form of text but can also come

in other forms, such as music, photos or videos.

UGC has three defining characteristics; first,

the contribution is by the users of a product rather

than the firm that sells the product.

Second, these contributions are somewhat creative in nature

and the user adds something new to what's been done before.

And third, these contributions are posted online

and are generally accessible to others, thus an email

that transmits a link to a Youtube video created

by somebody else wouldn't be considered UGC.

Typically, UGC is not a commercial in nature

and doesn't make any direct promotional appeals,

thus it's a very interact

and very subtle form of product promotion.

Now that we have this definition,

let's take a deeper dive into this interesting issue

and the concern surrounding it.

For purposes of this discussion, I want to focus

on three key issues; number one,

what are the different types of UGC?

Although most UGC appears on social media platforms

such as Facebook, Twitter and Youtube, it can also appear

in other online platforms, such as blogs, discussion forums

or even a firm's website.

Some of the most common types of UGC include blog postings,

product reviews and various types of submissions

to firm based invitations, such as the T-Mobile example

that we discussed earlier.

Of all of these different types of UGC, product reviews appear

to have the most important impact in terms

of convincing customers to buy a product.

Number two, what motivates users to contribute?

Well, the factors that motivate customers to engage

in UGC are very similar to the motives that encourage them

to engage in co-creation which we discussed earlier.

The biggest motive by far is simple social recognition.

Being an active contributor on a social media platform

such as Facebook or Twitter can help provide a certain amount

of fame and prestige.

In addition, customers can also gain social recognition

when a firm profiles their contributions on its web page

or in its advertisements.

For example, the yogurt company Chobani,

has placed its customer tweets

on physical billboard signs across U.S. highways.

In addition to social recognition,

some users are motivated by financial incentives.

Typically there are few financial rewards for UGC;

however, a few firms are trying to encourage UGC

by holding contests that provide winners with cash, gift cards

or some other type of tangible reward.

For example, Dunkin Donuts encourages UGC

by holding contests in which customers submit photos

of themselves consuming its products and it rewards winners

with a variety of prizes such as smart phones and televisions.

Third, what are the benefits of UGC?

Well, user contributions provide firms

with lots and lots of benefits.

First of all, this type of promotion is typically low cost

since the content is provided freely by a firm's customers.

In addition to this cost savings,

UGC also has a positive impact on product sales.

In fact, research suggests that most customers trust UGC more

than they trust traditional promotions

such as paid advertising.

UGC also helps meet a firm's need to keep its content fresh

and makes their website much more interesting, thus websites

that feature UGC benefit from both higher traffic,

as well as longer page views.

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