Participate.com, Chicago, is a 20-person company that builds and manages communities for business-to-business and business-to-consumer companies, such as Ace Hardware, AT&T Corp., Arthur Andersen & CareerPath.com. For Ace, for instance, Participate.com is trying to get about 500 dealers to share merchandising tips.
"Much of the effort is getting participation," said Alan Warms, CEO of Participate.com, which used telephone, fax and e-mail to stimulate participation in the online community.
For CareerPath.com, Participate.com managed a job fair, making sure that everyone who inquired about a job got a prompt, informative reply. Mr. Warms calls this service "community watch."
Participate.com charges based on the size of the community and the types of services it needs.
The business benefits can be substantial. It can cost $50 to $100 to get a customer through a portal such as Yahoo!, he said.
"By creating and managing communities, we drive that cost down, but we also drive the value of current customers up."
Businesses aren't doing this for their health, he said, but to gain more value from their best customers and build word of mouth for their products.
"Ten years ago, if you wanted to talk to the people selling [a product], you'd have to mail something or call an 800 number, and it would take months to get a reply," Mr. Warms said. "Now the process takes a few hours."
That means "many more people will participate with companies than before," he said. "It's not just incremental.
"How do you take these hyper-affiliated customers and harness their energy? It behooves you to maintain a dialogue, and that's what we're about."