Note: this is the fourth and final post in a series about community value. If you missed “A Perspective on Community Value“, “Understanding the Community Opportunity“, or “Developing Community Strategy, Goals & Measurements“ I’d recommend starting there.
In many organizations, community’s territory is often limited to an ill-defined middle ground between support and marketing functions. This can muddy the community value story, leading to a contributing – but not always reciprocal – relationship with other teams.
Further, community leaders struggle with a set of unique challenges when communicating community value:
1) they are required (more often than their peers) to demonstrate value for various invested stakeholders,
2) these stakeholder requests are often ad-hoc, contextual to a specific business function, and require specialized research, data manipulation and analyst skills that aren’t on the team or budgeted for, and
3) when the requested data and/or reports are delivered, they are often met with skepticism.
For example, we know that successful support communities can play an outsized role in deflecting inbound support cases, and therefore easing the burden on the support organization, saving the company money, and keeping customers satisfied. However, we routinely hear anecdotally that executives “don’t believe” the cost savings data, even when it is the statistically significant result of a sound, industry-blessed model.
Communicating Community Value to Stakeholders
With the reporting frameworks and examples in this series, you should be able to take a step toward establishing and reporting on your priority community measures that map to business value. The primary challenge remaining is how to best communicate your community’s impact to peers and executives, and advocate for additional resources and investment. Based on previous working sessions with our Cohere mastermind community, and firsthand experience in our practice, we suggest the following strategies:
- Arrive at a clear definition for community at your company and socialize it. You’ll never be able to communicate the value of community if there isn’t a shared understanding of what community means at your organization. You need to make clear how community is both distinct from and supports other functions. A starting point could be defining community as a group of people that share a focus (interest, intent or objective) and have the ability and motivation to work together on the shared focus, over time. Particularly with brand or business communities, the core activity is generally about “getting to the next level” – moving forward on a journey towards growth, development and mastery. Your definition should answer the following questions: Who are the members or prospective members of this community? What is their relationship to your brand? What is the shared purpose or set of goals that links member and host needs? And what is your intent for this community? This definition will ultimately factor heavily into your vision, which is an aspirational statement of the future state of your community.
Need additional help & guidance? Download our Community Strategy & Program planning templates here.
- Position your customer community as a critical part of a larger business or digital transformation initiative. We know from the ’19 Altimeter Digital Transformation Survey that executives are, with respect to digital transformation, most interested in providing a unified, frictionless experience across all customer touchpoints. Community touchpoints and content are critical aspects of the digital ecosystem, and therefore must be integrated across channels rather than existing as a siloed platform to store and source knowledge.
- Collaborate with other business units to reach a shared understanding of the value community can deliver for the entire company. As former Mars director Carlos Valdes-Dapena stated in a recent Harvard Business Review article “Quality collaboration does not begin with relationships and trust; it starts with a focus on individual motivation.” For community to break free from its silo and be integrated across the organization, it requires cooperation and collaboration with other teams. But first, these teams need to understand how supporting community programming will help them meet their own goals.
- Develop a draft value presentation and enlist a trusted stakeholder outside of your team to give critical feedback. Perhaps as important as finding willing collaborators is identifying someone senior within your organization who both wants you to succeed and can offer constructive criticism of your value narrative, methods, and measures. The right person, like a good editor, can help you refine your pitch and strategy to increase its efficacy with executives and in implementation.
- Deliver regular, timely reports for executives that clearly articulate the value of community. We recommend ensuring that community be part of a QBR (Quarterly Business Review) process, whereby you would pull together a community-specific quarterly review for interested senior stakeholders, and an annual review for C-suite. These presentations should:
- Use executives’ own language and priorities
- Include the voice of the customer
- Demonstrate the holistic value to the company
- Reveal a progressive community roadmap and plans to increase value over time
Integrating Community Into the Fabric of the Business
To further illustrate the concept of value exchange among community and other teams, we’ve documented the role each business unit can play with respect to community, what they can expect in return, and how to keep them in the loop on community initiatives.
Keeping Internal Stakeholders Engaged In (and enthusiastic about) Community
A Portfolio Approach: Balancing Investment and Performance
Two key themes in this series, as they relate to developing a new value story for Community, are:
a) it is valuable to look at the opportunity for community development in the widest possible sense and b) that community efforts must strike a balance of meeting customer needs while aligning with the purpose of the business – community goals, analytics and the community value story must ladder up to overall corporate objectives and business unit goals.
One advantage of this alignment is the ability to create a bigger picture with customer profile and account activity data, and understand community activity, contribution and value in relation to other customer touchpoints. For instance, understanding how a customer’s digital activity (corporate website, social media, self-paced learning and community activity) relate to product usage frequency and depth of feature use, as opposed to many current approaches where those touchpoints are looked at in isolation, by different business owners.
Although there currently aren’t “off the shelf” comprehensive models and tools for measuring the relative impact of community in the context of (and compared to) the range of other customer touchpoints, there are related models that offer valuable direction on potential paths forward. These methods take a portfolio approach – looking at individual touchpoints and activities as they relate to other, complementary touchpoints.
In particular, marketing mix modeling has been used to establish a econometrics model for community impact on sales size, velocity and amplitude (Dell, 2011). marketing mix models “are based on microeconomic models of product demand linking business outcomes to marketing investments. Once the appropriate demand structure is specified, the next step is the quantification of sales response to variation in each of the marketing mix investments. This is the focus of econometrics – a statistical regression-based procedure to estimate the parameters of the theoretical demand functions.” (“Econometrics in marketing mix modelling” 2013)
While extending Marketing Mix Modeling can give a comprehensive and precise view of the revenue impact of community, there are a few key challenges to be aware of:
- A thorough Marketing Mix Model development exercise requires a large amount of data from the full range of customer touchpoints to be measured, as well as an economist to build the model;
- Model development can also be cost-prohibitive, as projects can easily require 6-7 figure budgets;
- Models are snapshots in time and do become inaccurate over time
The question of correlation vs causality often surfaces when exploring the impact of community engagements on customer behavior. Marketing mix modeling is one of the few certain ways we know to get to a relative financial impact vs other marketing spend. Doing A/B testing is the best option for establishing causal effect, but is obviously problematic on a “live” community, for a number or reasons. Developing synthetic control groups via “look alike” cohorts of member / non members, or split testing beta features are potential workarounds.
The next few years will likely see greater coordination of data management, analysis and reporting across all customer-facing functions to develop the next generation of methods and tools needed to more easily quantify community impact and guide future investment. Holistic approaches that combine customer data from multiple sources & touchpoints, like marketing mix modeling, provide a solid methodological baseline from which to start.
Throughout this series, we’ve sought to document the current state and highlight future possibilities for better understanding, measuring, and communicating the value of brand communities. Through Structure3C’s work experience, a literature review of academic studies and business publications, and the collective wisdom and practices from our Cohere workgroup participants, we’ve provided recommendations for:
- Positioning community as a competitive differentiator and guard against the potential negative effects of disruption;
- Understanding the total addressable market and most relevant contexts for your community efforts;
- Developing a community strategy that is both forward-looking and aligned with the language and objectives of your unique business;
- Setting measurable goals for your community that ladder up to your community and corporate vision;
- Developing formulas for value metrics that extend beyond community health and map directly to business outcomes;
- Embracing a portfolio approach to achieve buy-in across business units and prioritize community investments;
- Communicating and reporting on community value to C-suite and other stakeholders across teams in a clear and timely manner.
As stated above, many organizations are missing the community opportunity because of a short sighted focus on transactional value in the context of specific use cases. Growth-minded companies are fully embracing community as a concept and integrating community-building practices into the fabric of their business with great success. The guidance in this series should help you plot your journey toward the latter.
I hope you have found this series on Community Value helpful – if so (or if you would like to discuss your community strategy) please message me.
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It’s no secret that many Brands realize tremendous value from their social media and online community efforts. Value in the form of cost-reduction for support and service, ideas for and feedback on products, product and brand advocacy… the list goes on and on. Most organizations have analytics in place and some form of dashboard that tracks performance, and in many cases, actual financial impact of social and community efforts.
Unfortunately, there is also a problem with the current approach Brands take: it’s unsustainable – unsustainable because it is predicated on Customers doing valuable work for free.
Stay with me here. In the early days of community, all brands really had to do was show up. Hosting a discussion forum met pent-up need for customers to connect, share and help each other. The motivation for participation was generally either purely altruistic and/or driven by the desire for enhanced reputation and recognition.
More recently Community Advocacy programs, elaborate reputation systems and game mechanics were introduced to drive contribution to communities. On the one hand, these programs and technologies enhance the Brand community experience. On the other (and more cynical) hand, they could be perceived as an inequitable attempt to squeeze more value from community members.
Further, there is currently an explosion of expertise and talent marketplaces like Maven, PopExpert, Odesk, Google Helpouts and 100s of others, Community experts now have myriad marketplace options and some are starting to charge for their talent and expertise.
To net it out:
1. Brands generally view Communities as cost-saving vs. value producing, and consequently:
2. Brands haven’t truly considered what an equitable value exchange might look like between the organization and the community;
3. Compensation to the community contributors comes in the form of either reputation and / or fulfilling on an altruistic need, with a very small percentage of member getting “MVP” benefits;
4. There is an explosion of knowledge and service marketplaces that allow experts to place financial value for knowledge and expertise.
In short: Brands have to rethink their social and community strategies from an exchanged-value perspective, or risk losing their community.
What to do?
The most critical thing is to rethink the Social & Community value equation, and to move beyond the myopic view of Customer Communities as solely a means to reduce cost. Instead of asking what the benefit is to the organization, real research and critical thinking needs to be applied to the needs, expectations and values of customers who might participate in a community. The range of value received from the the community by participants needs to be broadened – access to communal knowledge and connections are an expected part of the digital experience now. Compensation for Community participation and contribution must evolve beyond reputation and become more tangible, possibly in the form of products, services or even financial compensation.
A few key questions to explore:
What if community members knew the explicit value of their attention and contribution to a community?
- What impact would this knowledge of value have on the current community?
How might we enhance the community experience by surfacing and rewarding contribution beyond rank and reputation?
What are the emerging knowledge and service marketplaces that might attract our current key contributors?
How might our competition attract our customers with a more valuable community experience?
I’d love to hear other’s perspective on the issue of sustainable participation. Please chime in via the comments below.
Cross-posted from the Online Community Report blog .
How are you measuring the performance and health of your community?
This may seem like a strange or even whimsical question. Communities are organic and ever-evolving entities, right? Trying to benchmark and measure something as inherently chaotic and dynamic as online community performance, health, or the shiny new metric “engagement” can be challenging. But the reality is that this type of data is now expected from community managers by stakeholders and executives.
So where is one to start? I have outlined a few first steps below, based on my experience. You mileage, of course, may vary.
1. Review your “Basic” Web Metrics
Your “basic” web metrics, from sources like Hitbox or even your server logs will reveal quite a bit of data including # of page views, # of unique visitors, browser type, screen resolution, country, language and referring URLs. While this data in isolation won’t paint the “big picture” for you, it will give you some information to make decisions about design (target screen size), what browsers to design to, and potentially what languages to localize your community site in. This information also becomes more meaningful when you look at trends in the data over time.
2. Registrations and Attrition
These numbers are a bit more tricky to get, but you should definitely pay attention to registrations numbers. The ratio of registrations to casual visitors is also a great number to look at if one of your primary goals is conversion from visitor to member. Sign up form abandonment could indicate a usability issue with your signup flow, or could indicate that the value trade off of registering vs. the percieved benefit of the community isn’t clearly being communicated.
3. Look at Member Activity
Depending on how you collect metrics and what you used to instrument your site, data on visitor and member activity may be difficult to get as well. Being able to drill down on member participation in your community helps you understand if there is a good balance of the following functions in your community: contributors (those that produce content), connectors (those that form relationships) and consumers (those that consume content). Member activity data also gives you a good view (depending on the quality of the data) of how engaged (or not engaged) your members are in various content and features.
4. Watch Your Moderation / Maintenance Overhead
Are you constantly editing comments or discussion group posts? Banning members? Removing spam from your forums? Spending all you time approving comments or reviewing video clips before allowing them to be posted? Is hosting an online community inherently painful?
Well, in short, no.
Basically, any activity that detracts from the intended mission and purpose of the community should be tracked, and the root cause should be identified and addressed. This could be as simple as making your Discussion Group guidelines more clear and telling your moderators to lighten up (I had to do this). If you find yourself struggling against parts or all of your community rather than engaging in activity with them, something is wrong. Track the “overhead” for 2-3 months, and then take a time out with your team (and ideally members from your community) to discuss ways to optimize or solve the problem. You’ll be glad you did.
5. Ask Your Members
This should arguably be at the top of the list. The best source of data about how your community is doing? Your community. Creating an open dialog about community health and activity can be as simple as turning on blog comments or creating a new discussion forum for the sole purpose of discussing open issues and ways to improve the community.
I’ve also seen satisfaction surveys used in a very effective way to benchmark community health and satisfaction, as well as to gather feedback on usability issues, moderation activity, and feature enhancements. Several companies I know (SAP, Intiut) use the “Net Promoter” score to quantify the willingness of a member to recommend the community. You can find more information about the Net Promoter concept here:
The One Number You Need to Grow – Reichheld
Other Resources for You
Last March, Jim conducted a metrics survey and put together a white paper based on the results. You can check it out here:
Online Community Metrics Survey 2006
Forum One Web Fun fact: a lot of the snarky comments were mine, made before I knew I would eventually be working for Jim.
If you weren’t included in the 2006 survey, and would like to participate in the 2007 survey, please email me.
Survey invitations will be going out the first two weeks of Februar