The New York-based insurer, like many other companies, took the first step toward Customer Service 2.0 with some trepidation, Hittel said.

Some executives, he noted, worried about what customers would say about the company once the "barn doors" were opened. "In fact, if there is some particularly bad thing that people want to say about us, it's better that we find out about it," Hittel maintained.

"People are talking about us on the Internet just like they are talking about everyone else. This gives people a chance to talk about us directly to us as opposed to behind our back," he added.

Therein lies the key reason why IDC analyst Rachel Happe criticized companies that are reluctant to embrace the new form of customer service because they fear negative feedback. She called such concerns a "red herring."

Customers, she noted, have always been in control of the brands they use. Now, however, they can arm themselves with virtual megaphones and shout their criticism throughout the blogosphere. It's only common sense to at least listen to what these users say.

In many cases, just acknowledging a problem can help ease criticism on the Web, she noted.

For example, Dell's acknowledgement that some critics of its support programs were correct has led to a slow shifting of the company's image. Since its admission, the tone of some initially critical bloggers has become neutral or even positive, she said.

Meanwhile, SAP's online social community for developers and business process managers now includes more than one million users, she added. Many small and mid-sized companies are using SAP-sponsored online communities to gain access to a network of peers to discuss questions and concerns about SAP products.

The SAP program is improving the lot of users, who can get quick answers from fellow customers. It's also cutting SAP's support costs as fewer questions make it to help desk personnel.

"Customers are actually starting to feel like they can ask questions, which is good because they are engaging and they are getting more satisfaction -- at a lower cost to the company," she added.

In addition, company executives can use the customer input as they make strategic business decisions.

For example, The Artful Home.com, an online site that sells art and other home decorating items, significantly changed the content on its Web site based on user suggestions.

The Artful Home site is run by The Guild, an art dealer that links artists with potential buyers of their goods.

By monitoring the number of customers participating in specific discussion topics and analyzing the content they posted, the company found that they are mostly interested in how to use the products they buy in design and decorating projects.

"That was a pretty resounding answer to a very big question for us," said Toni Sikes, the founder and artistic adviser at The Guild.

The user needs surprised the company, where some executives thought that bolstering information about individual artists and their artistic motivation would most benefit customers, Sikes said. Others had maintained that it was most important to tell customers how products were made.

The company gained an understanding of the desires of its online customers by using Networked Insights, a hosted tool from US-based Networked Insights to analyze the content posted by to its eight-month-old online customer community.

Rally Software Development, a provider of hosted Agile software development tools, is using its online customer community to help transform its users into "product co-designers," noted Ryan Martens, founder and CTO.

The customer community replaces a complex system that gleaned data from e-mail communications, customer relationship management software and other communication channels to get a 360-degree view of users of Rally products.

Now the company uses software from HiveLive to run multiple customer discussions, an extranet for partners and a customer support platform.

The hosted Rally offerings automatically link requests for support to an area in the online community where company engineers preview potential new features and collect user feedback. Users can vote on features they would most like to see in the next release. The top five or 10 are added to the products, Martens said.

Rally said that about 3,000 users of its software, or about 15 per cent of the overall customer base, are active in the community. The users can create their own topic areas and opt to restrict access to a private group or open a topic to the entire Web.

The user community has become such an integral part of the company's operations that it has begun using it as a way to let potential customers "know who we are and how we work before [they] sign their first purchase order," Martens added.

The emerging Customer Service Web 2.0 programs are allowing customers of some companies in essence to take over ownership of corporate brands and to become their miniature marketing departments, according to analysts and executives.

As more companies add such features for customers, the need for others to quickly address customer concerns and even reach out to customers before they talk about problems becomes critical.

The companies that successfully navigate the new customer service landscape can provide more service at a lower cost, forge closer relationships with customers and bolster their marketing and product development efforts.

On the other hand, companies that don't start the Web 2.0 programs risk losing significant business to competitors that do, analysts and users say.