Research Study: Marquee Companies Discuss Investing in Private Online Brand Communities to Gain Consumer Insight and Advocacy

Sector Intelligence Surveys 16 Brands on How Private Online Communities
Influence Marketing and Product Development Decisions

Study Documents That Corporate Investment in Customer Communities is a Growing
Focus as Consumers Are More Accessible but Also More Vocal in Their Online
Feedback

LOS ANGELES--(Business Wire)--
Passenger, a leader in private online brand communities that inspire customer
engagement, advocacy and insight, today announced research data and an
accompanying white paper by Sector Intelligence that analyzes how companies are
currently using social media as part of their corporate marketing and product
development strategies. The white paper examines how 16 Fortune 500 food &
beverage, financial services, automotive, retailers and sporting goods brands
are involving customers directly in the planning and development of company
products, services and marketing initiatives, as well as the corporate social
media strategies themselves, via private online communities. The study found
that these interactive communities provide deeper insight into customers` needs
than traditional market research, have increased customer advocacy and loyalty,
and can help avoid consumer backlash as companies develop their public social
media presence.

"Never before has the impulse for consumers to connect with brands been
expressed and acted upon on such a large scale, and never before have so many
disparate individuals come together to help produce products and services that
would be in turn distributed on a mass basis," said Craig A. Honick, managing
partner, Sector Intelligence. "The gap between customers and brands is getting
smaller each day, and the brands we interviewed in this study documented that
direct conversations through private social networks are improving the climate
for innovation in tangible ways."

"There is no doubt that social media has changed how companies interact with
their customers, and strategically engaging with and listening to customers is a
growing area of investment for many brands right now," said Samantha Skey,
general manager, Passenger. "The survey demonstrated that private online
communities are shifting the way brands think about communicating with their
customers, and the dialogue that results from these communities is proving to be
a catalyst for significant change within organizations."

The study delivers quantitative and qualitative results that demonstrate how
marketers and brand managers are changing the way they interact with their
customers to solicit feedback and input through private online communities, and
get deeper insight into the preferences and lifestyles of their audiences.
Highlights include:

* 86 percent of respondents report that private online communities provide
richer insight into customer needs
* 33 percent report that the community input alone has actually changed product
designs and marketing plans
* 43 percent report they use fewer focus groups as a direct result of engaging
in collaboration via the private online community while 36 percent report
conducting fewer surveys
* 64 percent report that the community has improved the context for
decision-making within the company
* 96 percent report that their marketing department is deriving value from
collaboration with customers, 71 percent report the same for market research; 66
percent report a positive impact on product development

Based on the interviews with the brand executives, Sector Intelligence drew the
following conclusions:

* Word of mouth is likely to become a more central part of a company`s future
marketing strategy as they learn to integrate loyal customers into the brand
strategy. The intimacy created by ongoing conversations can be a powerful model
for connecting with the customer base and learning how to foster loyalty
* The conversations happening in private online communities are unique from
other forms of research such as focus groups. The ongoing, direct communication
of this medium provides businesses with a consistent, more affordable way to
instantly engage with consumers. As this becomes normative behavior, these
conversations turn into more impactful relationships
* For some of the more conservative brands surveyed that have shied away from
public social networks because of the risks involved, private communities
facilitate innovation and direct conversations with consumers in a safer forum,
while still organically encouraging customer advocacy
* Even with budget crunches, companies are investing in tools and services that
will help them listen to and learn more from their customer base
* Private online communities can enhance internal collaboration within larger
brands in diverse sectors. By talking to their customers directly throughout the
various product development and marketing processes, the lines between various
divisions are blurring - both for economic and productivity reasons

To download the white paper, go to www.thinkpassenger.com or email
info@thinkpassenger.com.

About Sector Intelligence

Sector Intelligence is a strategic research and consulting firm specializing in
the study of group culture and emergent social trends. The firm helps
organizations position their brands so that they are aligned with the values and
normative behavior of their target markets, a key factor in sustaining brand
appeal.

Sector is continuing to develop the Brand-Life Continuum Report and the Brand
Sustainability Index, tools which measure and benchmark the nature and depth of
how organizational and personal brands are integrated in the daily lives of
target market groups. The tools make extensive use of ethnography, word of mouth
research, and quantitative modeling and are often paired with social media
applications that track and analyze online consumer conversations.

Founded in 2001, Sector Intelligence has associates in Seattle, Los Angeles,
Dallas, Washington, D.C., and Brussels, and serves corporate, non-profit,
governmental and political organizations. For more information, please visit
www.sectorintelligence.com.

About Passenger

Passenger is a leader in private online brand communities that inspire customer
engagement, advocacy and insight. With its intuitive platform of social
networking, collaboration and analytics, Passenger works with companies such as
ABC, Coca-Cola and Fox to build and manage private online communities to make
more informed business decisions, innovate more rapidly, and design better
products and services. Founded in 2005 with offices in Los Angeles, Palo Alto
and New York, the company is privately held and funded by Shelter Capital
Partners, StarVest Partners and Steamboat Ventures. For more information, please
visit www.thinkpassenger.com.

Bateman Group for Passenger
Shannon Walsh, 415-503-1818
passenger@bateman-group.com

Copyright Business Wire 2009