Online Communities and Their Impact on Business. Part Three: Web Community and Social Life

In our strategy work with tech companies, we’re frequently asked about web communities — how they operate, what they can and can’t do, and how a company should look to work with them. To help answer those questions, we surveyed more than 3,000 US web users on their overall Internet usage, and then dived deep on their use of online communities and what impact those communities have on their lives. This report summarizes the findings and implications to companies.

Part One (link) discussed how online communities work. Part Two (link) discussed the leading web destinations and online communities. Part Three, which you’re reading now, concludes the report. It talks about the role of online communities in the social lives of Americans.

Social sites have a much bigger impact on young people

The web has taken on an important role in social lives of web users. The study explored membership in social sites, how they’re used, and what effect they have on people.

Membership in social sites: Facebook, MySpace… and Classmates.com

The survey gave a list of the leading social community sites in the US (as determined by Alexa), supplemented by a few sites that have received extensive press coverage. Respondents were asked which of the sites, if any, they have a personal profile on. Facebook and MySpace were almost tied, followed by a very strong showing for Classmates.com, a site that gets much less press coverage than Facebook or MySpace. In fourth place was LinkedIn, followed by a long tail of various social, dating, and communication sites.

Two social-related sites that have received enormous press coverage, Twitter and SecondLife, have relatively small user bases. That doesn’t mean they are unimportant, but they’re currently serving niches rather than broad audiences.

About 30% of web users said they have no personal profile on any site.

Percent of web users having a personal profile on a given site

Although Twitter and SecondLife have both received copious amounts of press coverage, their actual user bases are still very small compared to the major social sites. This isn’t necessarily an indictment of their businesses, it just means they serve niches today.

Membership in the leading sites varied dramatically by age. MySpace and Facebook were dominant among young people, while LinkedIn and Classmates were made up mostly of adults:

Community membership by age

Membership in dating sites is also skewed toward adults, with most users being between age 22 and 50:

Dating site membership by age

Satisfaction with social sites

We asked people who use social sites a series of questions about their satisfaction and usage patterns on the sites. The results pointed out some potential problems with the sites, and assuaged some fears:

Reactions of social site members

• Most social site members tend to ignore invitations to join new social sites. This explains why the first social sites to get established in a market tend to remain dominant. The barriers to entry for a new social site have been raised substantially.
• Some people report making new friends through the social sites, but more than half say they haven’t.
• A majority of social site users are satisfied, but the overall satisfaction level is good rather than great.
• Some people reported that the sites play an important role in their social lives, but a majority said they don’t.
• Most members said it’s not a big hassle for them to maintain their online profiles. This explains the lukewarm response many web users have shown to products designed to help them consolidate management of their profiles; to most people, it’s just not an issue.
• Although most people ignore invitations to join new sites, most do not say they belong to too many sites.
• Few people said social sites play an important role in their business lives. We think this may be an opportunity for a new type of social site focused on business.
• Very few people said they had been harassed or stalked through a social site, which may be reassuring to some parents.

Adults are much less satisfied with social sites

Social sites work better and are much more satisfying to younger people. We don’t know if this means social sites work better for people with a student lifestyle, or if the younger generation just knows how to use them better. But the differences are striking — social site users are most satisfied at 13-14 years of age, and satisfaction drops steadily after that. Older adults are also less likely to make friends through the sites, and most say the sites do not play an important role in their social lives.

Percent agreeing strongly with statement, by age band

How people manage their online relationships

Young people are much more profligate with connections

There are also big differences by age in the way people manage their social connections online. Older people expect to know someone much more thoroughly before they will approve them as a connection. More than 50% of users under 18 will approve a connection to anyone they have ever heard of, whereas less than 20% of people over age 50 will do that.

How web users usually handle an invitation to connect on a social site, by age

This means older people view online connections as a reflection of relationships they have already formed elsewhere, while young people view online connections as the start of a relationship. To older people, the friends list is an outcome. To younger people, the friends list is a beginning.

There’s less deception than we expected in online profiles…

We thought we might find a lot of instances in which people have created multiple or false identities on social websites, especially among young people who are the most active social site users. But only 12% of users say they have created multiple profiles on a single site, and the rate is fairly steady across age groups.

Among the people who did create multiple profiles, the main motivations were just to have fun, to separate different groups of friends, and to protect their own privacy.

..but many people fake personal information they give to companies online

We also asked web users if they ever give false personal information when registering to use a site or download something. 27% of web users say they have given false personal information, and the rate varies a lot by age. More than half of web users under age 18 say they have faked personal information, compared to only 9% of users over age 50.

Percent of web users who have falsified personal info, by age

The reasons for falsifying information vary by age. Young people tend to do it to avoid site restrictions and age limits; older people do it to protect their privacy and avoid being contacted.

Among people who falsified information, reasons given

The personal information that’s most likely to get falsified is (in order): Phone number, mailing address, name, and e-mail address. Users are much less likely to falsify non-contact information such as sex and race.

This means companies that collect contact information online should expect to get a fairly high rate of false information — especially if they are dealing with younger web users.

The web’s impact on personal lives

More than a quarter of web users have dated someone they met online

Given the relatively low usage rate for online dating sites, we were surprised when 24% of web users said they have dated someone they first met online. The rate is highest for people age 22-30:

Percent of web users who have dated someone they first met online

Presumably most of those dates are being arranged outside of dating sites, since the usage rate for dating sites was a lot lower than these figures.

More than a quarter of teens have embarrassing information online

With the rising use of social and video sharing sites, there are plenty of anecdotes in the press about people who get in trouble over something they have posted online. We wanted to see how widespread that problem could be. Eleven percent of web users said there is information about them online that could embarrass them. The rate was much higher among teenagers, ranging between a quarter and a third of users:

Is there information about you online that would embarrass you if it was seen by…

Some of the higher rate for teens may be because they actually do have more embarrassing information online, and some may be because they are more easily embarrassed than older adults. As for who they don’t want to see the embarrassing information, the young people cited parents, other relatives, and teachers. Once they reach working age, bosses replace teachers on the list.

The main message of this finding, though, is that even among teens, most people do not have any embarrassing information about themselves online.

The web plays a bigger role for Democrats

Most surveys in the US show that young people today are more likely to identify themselves as Democrats than Republicans. This has a significant effect on the online world. Because young people are more active online, Democrats are over-represented in the MFC group. Democrats are also somewhat more likely than Republicans to be heavily influenced by the online world.

For example:

• 13% of online Democrats visit video sharing sites like YouTube daily, compared to 7% of Republicans.


• 11% of online Democrats post comments at least once a day, compared to 7% of Republicans.


• 27% of online Democrats have dated someone they met online, compared to 18% of Republicans.


• 14% of online Democrats say there is embarrassing information about them online, compared to 7% of Republicans.


• 40% of online Democrats say they have a profile on MySpace, compared to 29% of Republicans (the percentages are virtually tied for Classmates.com, though).


• 22% of online Democrats say they would be strongly influenced in a voting decision by online information, compared to 17% of Republicans.

Party affinity of the MFCs, compared to all web users:

“Which political party do you feel is closest to your personal political views?”

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About the study

In September of 2008, Rubicon Consulting’s web strategy practice surveyed 3,036 web users age 13 and up in the United States.

The survey was conducted online, using respondents sourced from a national sampling company, and should be projectable to the US web-using population, or about 75% of US residents. The margin of error is about plus or minus two points at a 95% confidence level.

Usage of web communities varies dramatically from country to country. Although the general principles outlined in this study should apply worldwide, the actual site ratings apply only in the US.

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About Rubicon Consulting

Rubicon Consulting is a strategy and marketing consultancy designed specifically for the needs of tech companies, from today’s global giants to tomorrow’s. Rubicon’s proprietary methodology continuously delivers significant material results to clients, driving revenue growth, market share, and profits. Rubicon clients include Adobe, Hewlett-Packard, Logitech, Nokia, Symantec, Autodesk, and numerous small web and software startups.

Rubicon’s insight has helped its clients thrive through the rise and fall of numerous paradigms, from the PC era to the graphical OS wars, e-commerce, Web 1.0, Web 2.0, and the rise of mobility. The firm combines the intellectual rigor and wisdom expected from a giant consulting firm with the savvy and hands-on focus of veterans from some of Silicon Valley’s best companies.

The company’s website is: www.rubiconconsulting.com

For more information on this report, contact:

Harry Max
harry at rubiconconsulting dot com

Michael Mace
mike at rubiconconsulting dot com

Harry Max, Principal, is a seasoned Web strategist and cofounder of two web companies who combines broad high-tech business experience with an unusual set of strengths. His working knowledge spans UI, customer engagement models, systems design and strategic problem solving, and includes recent work in leadership coaching. Max helps clients get to the heart of their problem and identify solutions that work. He is co-author of two books: Skype: The Definitive Guide and Art-directed Technology: Anatomy of a Shrek 2 Sequence.

Michael Mace, Principal, is a 20-year veteran of some of the tech industrys toughest battles, and is a seasoned strategist for product management, mobile, and web. Mace was Vice-President of Strategic Marketing at PalmSource, where he helped handset companies and wireless carriers plan new smartphone products and wireless services. Before that, he was Chief Competitive Officer and Vice-President of Product Planning at Palm, Inc. Mace spent almost 10 years at Apple in a variety of leadership roles. A well-known industry spokesman, Mace publishes, speaks and has appeared in the Wall Street Journal, CNN, Computerworld, and many technology trade publications.

We welcome your questions and comments. Please contact us at the addresses above, or feel free to post a comment here.

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