Thursday, August 21, 2008

Status, rank and how to make everyone happy

The mindset of web users is shifting (slowly for most) to the acceptance of the Internet now not only as a tool for viewing information, but also as a tool for creating and discussing information. Marketers are embracing this concept (slowly too I might add) and are now using the web for a variety of interactive promotions or, in some instances, community building.

But of course, as with all promotions, marketers can't get something for nothing. If you want to engage your customers you need to be able to provide a reward. In sales it's usually quite simple, give a discount or some other form of physical or monetary incentive. This works in a transactional sense, but does not exploit the true benefits of what the web is capable of.

Two examples that provide us with an example of what is possible are Amazon and eBay. While the format of these businesses are somewhat unique (their customers are both buyers AND sellers), one of the successful tools that they employ is not overly complicated, but is attractive because it hits us on a largely universal level - and that is status.

Starting even before you know what status means, it's there and people are using it to place you in the pecking order. If you ever did Scouts you'd know your status by your badges. Scouts Australia say it is to:

* Facilitate the young person's entry into the Scout Troop.
* Reinforce or teach basic Scouting skills.
* Provide early recognition, and
* Encourage further participation in the Scout Award Scheme

On a national societal level you'll encounter more status symbols than could be imagined. The Australian Government says that its honours "help define, encourage and reinforce national aspirations, ideals and standards by identifying role models. We give honours to recognise, celebrate and say thank you to those who make a difference, those who achieve their best and those who serve others."

Taking this long standing societal notion of status through rank and honour we can see that it is employed vigorously through many of the web's successful businesses. Coming back to our two pioneering online businesses we can see that rank and status is front and centre and one of the primary shopper tools when deciding with whom to shop with.

eBay uses a coloured star system to rank their sellers, with the highest award being a "power seller". The system is based on the transactional value of your business per month and the quality of feedback you receive from buyers. A power seller badge on your profile is meant to inspire confidence in the quality of service a buyer will receive. However there are murmurs throughout the eBay community about the value in the power seller badge.

A recent blog post on the Romow shopping blog described the anger of many small business eBay sellers to the news that eBay had struck up a deal with the large brand whereby can now sell its products on eBay, surely gaining instant power seller status. Locally in Australia, the large online auction house OO-Auctions is also an eBay power seller. By changing the level of the playing field in eBay you get the feeling that the small businesses that have earnt their status the hard way have a right to feel poorly when large businesses tread on what used to be their exclusive turf.

At the same time, another example clearly shows how the automated function of status giving can sometimes lead to unwarranted status. eBay seller Violetsaxrayphone, in an eBay community forum described how she was given power seller status after she offered her services as a mercenary in Iraq for $20,000 dollars. The value of her post must have been enough to trigger power seller status and this stayed until the next automated review of status.

eBay seems to be learning many lessons very quickly about the value of status in a community. If you employ a status system ensure that it is level across all users, naturally the bigger you become the easier it is to stay there, but as is becoming the norm on the web - don't forget the long tail.

Amazon more recently introduced the reseller system and has taken a slightly different, less complicated, path. It has a one to five star system of seller status that is based on feedback and fulfillment metrics and leaves out volume or monetary targets. This system seems to keep a more level playing field. Although the status may not seem as grand it is effective in what the status system is trying to achieve - buyer confidence.

Amazon has also taken the status system and implemented one for reviewers of its products. Instead of reviewing only the products, the actual reviewers themselves are "reviewed" through a system that recognises consistent and informed contributions. Much like the badge system of Scouts or the Army, reviewers are awarded badges based on their contributions. The uniqueness of these badges also distinguishes reviewers - I personally like the "The" badge for known industry personalities.

Status is not limited to buyers and sellers though. In Web 2.0-land many people on the web do not buy or sell anything, rather they interact with each other with information and knowledge as the defining features of status. But the question is how to provide status to this new breed of web user?

Technorati has gone some way to solving this question by introducing the "Authority" system for bloggers. In this system bloggers are awarded an authority number based on the number of current links on others' blogs. While the system is simple enough there can also be problems seen in this system, similar to the eBay dilemma. The premise of the Technorati system, while admittedly requiring blogs to have content worthy of linking to, favours those blogs that have multiple contributors. At what point does the blog/newspaper cross-over happen? The Huffington Post is ranked here but the NY Times is not. Technorati does not give a very clear explanation. I would suggest Technorati provides a widget for the Technorati "fans" ranking too as this may give fairer view of the quality of the post rather than the number of posts.

AdAge's Power 150 of bloggers also trys to rank bloggers. While it is a selective list it aggregates a number of ranking systems to try and even out the playing field. However this system by-and-large still revolves around the volume of links rather than quality.

And finally I come to professional status online. Short of taking a photograph of your university degree and widgetising it, a system for ranking the status of professionals online is something that must be discussed. LinkedIn has had a stab at the status badge with its Company Insider widget. It works like a reverse status symbol. By adding the widget to a company name you give a reader the opportunity to see who they are linked to via LinkedIn in that company. I am not sure of the benefits given to the poster of the original content though. LexisNexis' Martindale index of lawyers has had a go at utilising the function and an example can be seen here.

What the Martindale index does show, though, is a well thought out system for attributing status to lawyers through its Martindale-Hubbell Peer Review Ratings. Accompanying this is the visibility ranking on each lawyer page which is a simple ranking system based on the number of weekly profile views of the person/firm's profile page.

So, what's the big deal with status!? As we can see from these examples it is a pretty big deal. We live in a world of rankings and status that has been ingrained in us from birth. We search by and feel comfortable when another person has given status to another person. From the preceding case studies we can also take away a few key points to guide us on our way to true and fair rankings:

1. KISS - keep it simple stupid
2. Be fair - make sure that the small guys have a chance of a high ranking as well
3. Keep it relevant - make sure that your ranking system is relevant to your audience and the benefits of the ranking are easily identified
4. Set the rules - Clearly set out the ground rules for your ranking system
5. Make it rewarding - Make the system rewarding for good work, don't penalise people for not keeping up with others

I'm hoping that I've got all the status speak out of my head now, it's a contentious subject, you could spend days cruising through the hundreds of discussion threads on the topic.

Have I missed anything? Are there any other good examples of status or ranking systems out there?

01/09/2008 Update: I've noticed on Flickr you can pay to become a pro Flickr-ist(?) and you get a little "pro" icon at the end of your name. Paying for status? Not sure what benefit the pro icon is, except telling others you can do more stuff than them.

01/09/2008 Update: Wikipedia and the wiki community-at-large have the barnstar recognition system for wiki contributors. That would be a nice thing to put on your CV - and all it takes is some knowledge and hard work.

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