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Company Towns Never Work: The Case for Third-Party Online Communities

In the 1880s, industrialist George Pullman built a model company town for the workers who built his railroad cars. The planned community consisted of homes, stores, and public spaces...all owned and operated by Pullman. It won awards for being a vast improvement over the tenements and unsanitary conditions to which most industrial workers were consigned, yet within a decade the residents had gone on strike, the town was annexed by the City of Chicago, and the state's Supreme Court required Pullman to sell all non-manufacturing property to private individuals.

Somewhat similarly, much of New England was industrialized during the 19th century as factories popped up along major waterways to dominate specific product categories, like saws and axes, or guns and other machined products. Towns formed around these facilities with less planning foresight than Pullman's, much in the same way that mining towns sprang into existence during the California Gold Rush of 1849. Yet nearly all of them met the same ultimate fate as they were put out of business by other industrial capabilities in other areas of the country (or the mines failed, or were spent). Most of them are ghost towns today.

Urban philosopher Jane Jacobs wasn't surprised by these outcomes; she posited that communities can't be planned or controlled, but rather must be free to form and re-form based on the needs of the inhabitants and the exigencies of circumstance. She decried the best intentions of governmental or commercial developers in her 1961 book The Death and Life of Great American Cities, which became the best known (if not simply the only known) book on American urban planning.

She made a compelling case for the fact that company towns don't work, yet that's the belief that drives the creation of online branded communities today. It is presumed that consumers want to visit and be engaged by communities that are designed for that very purpose -- and that purpose alone -- and that it makes business sense for brands to sponsor and support them.

Why should we believe the ultimate fate of these online communities would be any different from that of the mining ghost towns that dot the American West?

Of course, history in geophysical reality doesn't provide a one-to-one correlation to virtual online experience, but the human behaviors -- acting as individuals and the experiences within and across groups -- are in large part instinctive, and therefore somewhat consistent across any time and all mediation platforms, physical or electronic. The behaviors we see online all have antecedents in the past: crowdsourcing, engagement, and debate have been social behaviors for millennia. The experience of community is no different.

Even if the correlation is only directionally useful, history provides a sober warning about the efficacy and viability of online branded communities. There are at least three reasons why company towns on the Internet might soon be (and, in some cases, already are) branded ghost towns:

  • Artificial -- Real communities arise from organic purposes (needs) that are shared by individuals and businesses, not structured to exploit their presumed individual interests (wants). Social needs trump personal wants every time, at least when it comes to communities, because needs drive the mechanisms of conduct and renewal in ways that far exceed the expression of even the most passionate wants. The ideas of "optional" and "artificial" are somewhat related in this instance; I've often suggested that nobody wakes up looking for an online relationship with their toothpaste brand, just as industrial workers didn't exhibit a relationship with the brands that owned the coal mines in which they toiled. People need to brush their teeth and earn a living, which is what drives authentic, organic engagement. What's optional is often also artificial, yet it constitutes much of what passes for engagement online.
  • Leveraged -- Real communities rely on a variety of behaviors and resources to maintain themselves, while branded and planned ones are usually conceived for a single purpose. This makes the former far more sustainable and the latter more likely to fall prey to changes in the situations of its residents, or in the circumstances of existence overall. That's why I think it's hard to consider most online marketing campaigns as creating "communities," per se, as they're really aggregations of consumers' attention for a particular topic or set of actions. Real communities force people and institutions to interact across a diverse range of purposes, which makes them more flexible. It also means they're often more robust and truly engaging; it's no surprise that when we talk about geophysical community, it's a place where people live, and when we describe online engagement, we describe "visits" and "time" spent away from somewhere or something else.
  • Tenuous -- One of the most obvious truisms of branded online communities is that they disappear once the marketers stop spending money to perpetuate them. Similarly, company towns and planned developments that rely on the sponsorship of their founders often pop out of existence as fast as they are created (I'd imagine even Disney's Celebration community in Florida would struggle if it no longer enjoyed the company's largesse). This reliance of corporate or civic planners' patronage also means that many of the mechanisms of community behavior are also dependent on funding as a trigger: if the money's not there, the community is not set up to generate it on its own. Therefore, sponsors own the communities, despite any of the pop philosophy or marketing promises that claim otherwise (consumers don't "own" brands that are funded by companies who prompt their resposes). Being entertaining doesn't earn engagement; brands pay for it and, when the funding stops, so do the communities.

So why the mad dash to create online company towns? I suspect it's because many marketers don't really consider their digital efforts as having anything to do with communities: it's just a word to describe the latest iteration of the distribution channels and consumption activity that they’ve been delivering for a hundred years, so the corollaries to geophysical communities are simply irrelevant. I'd suggest the opposite is true: New online engagement models are a fancy way of describing old behaviors. History is very relevant to what they're doing today. Ignoring history doesn't lessen its influence.

A better understanding of the history of communities would suggest a different approach to creating and sustaining online branded presence:

  • Instead of building company towns, brands might want to consider encouraging and even funding independent communities, either managed by third-parties or run by the "residents" first and only.
  • Brands could address the real needs of these communities instead of focusing on producing entertaining content intended to simply tickle their wants.
  • Companies could support a variety of community behaviors and not simply prompt those actions that have a direct link back to their particular branding goals, and
  • They could help communities discover reasons and ways to stay relevant and useful above and beyond the expenditure of marketing dollars.

I don't think Jane Jacobs would be surprised by the similarities between geophysical and online communities; she’d be shocked that we don’t see them. There'll likely be lots of very creative, robust, and entertaining social campaigns before this year's out, and many of them will claim to create or support communities. An interesting experiment will be to see how many of them are still in existence by the end of January, 2011.

My gut tells me that many of the most celebrated online branded successes this year will be tomorrow's ghost towns.

Join The Conversation

  • Dec 2 Posted 6 years ago JonathanSalemBaskin

    Mark, thanks for your comment! At a minimum, I know that the market exhibits a lot of boosterism and hope that gets passed off as insight and strategy, whether intentional or simply the result of smart, creative people seeing things for the first time and thinking they're new. I've been analyzing historical precedents for social behavior for much of this year and the approach keeps blowing my mind. So much of what's going on isn't new at all (though tech may have modified and/or amplified it). A different perspective changes both what we see as well as how we respond to it...and, on the subject of branded communities, I think at least a few hundred years of history suggest they're not destined for greatness. ;)

  • Dec 1 Posted 6 years ago Mark "Chief Alc... (not verified)

    Thank! You!! Jonathan!!! This might be one of the best articles I read all year.

    I think we'd all agree, and the market certainly reflects this, that the majority of these branded "communities" are just dumb ideas. Conclusion: Never under-estiamate the power of the ego's of mid and upper executives, as well as the selfishness of the overpaid consultants/agencies that serve them.

  • Dec 1 Posted 6 years ago JonathanSalemBaskin

    Kenneth, thanks and I agree with you, though I'd add the idea of "purpose" to the content. My belief is that quality isn't enough; history suggests that communities need compelling reasons to exist. Now of course the "how" of that is the hard part! 

  • Dec 1 Posted 6 years ago Kenneth Kowal (not verified)

    Jonathan - This is a nice, thoughtful article. My take is that the best way to create sustainable online communities is through quality content, whether that be informational content or a structure for people to interact with people you want to act with (like Facebook). Online interaction that is shaped by anything less than a user's total free choice is not sustainable.

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