New research from analyst firm Demand Metric finds that while a majority of organizations have communities, only a small fraction are satisfied with their results. In this webinar, chief analyst Jerry Rackley walks through some results from the research and shares his recommendations for ensuring online communities are revenue drivers instead of dead zones.
Welcome and introductions by Cassandra.
Housekeeping:
Slides and recording will be available after the webinar
Registrants will receive the report
Prompt question for next slide: What does the community landscape look like right now?
Online communities have reached critical mass in terms of adoption, with a majority of organizations reporting that they have one.
B2C leads in adoption, and large organizations are more likely to have branded, online communities.
Here’s a picture of a community that’s a pretty good metaphor for what we’re talking about today. You have a dedicated, passionate community manager, but the members of the community are like the walking dead: making no productive contribution to the community. Is this the norm, what we should expect from communities? We just completed a study to look at this phenomenon to find out. There are many organizations that seem to struggle with communities that were alive and well initially, but have become “dead zones,” rarely visited and showing no signs of life. One of our survey participants summed up their “dead zone” status this way: “we can’t figure out how to create one [a community] that actually works.”
So in this study we really tried to understand what organizations are looking for when they say they want a community that “actually works”, and that’s what we’ll talk about today. I think it’s helpful to provide some context here, specifically, what do we mean when we say “community?” We’re talking about websites and private Social Networks that are created and maintained by a company or group to foster communication among peers or likeminded individuals. Communities enable members to interact in a controlled setting.
Prompt question: How well are communities meeting the expectations that organizations have for them?
How well your community is meeting expectations has a lot to do with how you fund, support and allocate resources to it. What kind of vision or purpose you have for your community AND how well you execute on that vision has everything to do with its success, and meeting your expectations. Our survey data shows that almost one-fourth of communities are in the Dead Zone, meeting no or few expectations. The largest single response group for this question was 41% reporting “Meeting some” expectations. We all know that this middle ground is not where you want to be either. So really, just over one-third of communities in our study are performing at a level that meets enough of the expectations of the organizations that have them to have them feel like they’re getting some kind of return.
Prompt question: Our study shows us how well communities are or are not meeting expectations – what we should talk about is, what are those expectations? Marketers want to drive revenue, and they recognize communities as powerful engagement tools. We know that higher engagement leads to revenue. So, do marketers have confidence that communities can drive revenue?
We did ask about this on our survey, and the specific question we asked was: “Please indicate your agreement with this statement: Branded, online communities are an effective way to help drive revenue, not just offset technical support costs.” Just 8 percent of study participants disagreed or strongly disagreed with this statement. Over two-thirds agreed, or strongly agreed that communities are effective at driving revenue! So yes, the confidence in this purpose for a community is high. If you are viewing your community just as a technical support adjunct, then you’re sitting on a lot of unrealized potential.
Prompt question: There’s certainly a business case for using a community to help deliver technical support, but we agree that the highest and best use of an online community is realized when it plays a role in driving revenue. What are the ways in which communities can do this?
When you look at how our study participants rated their agreement with these revenue-related functions that communities can do, the picture is very encouraging. To me, part of what is encouraging about this data is that the things communities are great at are mid-funnel things, which is where the buying process often bogs down. The two strongest areas of agreement in this chart are both critical things marketers spend a lot of time and effort trying to figure out. Communities also get good marks for lead gen and qualification, so if you have a community and you’re not utilizing it for demand generation, that’s a missed opportunity as well.
Prompt question: So this answers the “what” question of how communities can drive revenue. What about the “how” question?
For communities to drive revenue, they must exist as major landmarks on the buyer’s journey, encountered early and often in the journey. This doesn’t happen when the community exists as a side attraction, something that the buyer must go out of the way to encounter. Our study looked at how likely it is for prospects and customers to encounter the community on their journey, and 44% of our study participants said it is neutral to very unlikely that this will happen. What this means is that for a lot of organizations with communities, the buyers on their journey are not taking the exit ramp to visit the community, and this needs to change. How? By not requiring an exit ramp in the first place, but making a community collision inevitable.
What we have to do is position our communities directly in the path of the buyers on their journey if we want them to do a good job supporting the buying process. It they aren’t in that path, communities can’t be much of an influence on that journey. We found in our study that it’s almost an even split between communities that are doing a good job supporting the buying process, and those that aren’t. High community visibility is a must for communities to support the buying process well. There’s no need to veer out of the way to find the community, because it is “very likely” that a buyer will encounter it. This is key to having the community consistently drive revenue. These community encounters can’t occur accidentally; they must be engineered into the buyer’s journey. Set the community right in the path of the buyers on their journey.
The first thing community managers need to care about, then, is just being found, easily found. Next, when the community is found, what needs to be there is a thriving, vibrant community, not a dead zone. So the path into the community must be broad and inviting. But, having a community that is easy to find and enter isn’t the only thing that matters. It may be the first thing that matters. There are other gaps as well that when companies don’t attend to, they may find their communities slipping into the Dead Zone. These gaps occur in these areas:
How well the target audience participates in the community
How frequently community members contribute to the community
The quality of those contributions
Prompt question: So these are the success factors that keep communities alive and well – since they’re so important, let’s unwrap them a bit further.
Participation in a community should come from several sources, such as executives, employees, industry thought leaders, business partners and of course customers and prospects. In fact, broad participation generally makes communities more effective. However, for a community to achieve its objectives, it must have strong participation from the audience for which it was built. Only one-third of study participants report that the target audience participates well or very well in their communities.
Not only must the right people belong to a community for it to succeed, they must contribute content or interact with enough frequency to make the community vibrant. In our study, we learned that 80% of community members contribute at some level, even if infrequently, while the remaining members join but never contribute. Just because a community member doesn’t contribute doesn’t mean they’re not getting value from the community. If the content quality is high, even these “lurkers” get something. But, you’re not getting the engagement benefits with members who don’t contribute to the community. The more frequent the contribution, the better the engagement.
Even if a community initially does well attracting participation from its target audience, it will never sustain satisfactory engagement levels without quality content. The failure of a community to offer quality content is a fast path to it becoming a dead zone. The definition given for “quality” here is how well content helps accomplish the community’s goals. 50 percent of organizations studied consider their community content quality as high or very high, and the higher the quality, the greater the extent to which the community supports the buying process. This is why every every community manager should make extraordinary efforts to manage community content quality.
Prompt question: The second success factor here – contribution frequency – at least anecdotally is the one so many communities seem to struggle with. What has to happen to provide the kind of member experience that motivates frequent contribution?
Community managers can’t go begging for content from members. Certainly it is great for community managers to invite participation, but there’s a line that is crossed from inviting to begging, pleading or cajoling members to contribute something. Members can sense the difference, and they know what it means: the community is not working like it is supposed to, and needs artificial respiration to keep it going. If this is what is happening, then that community is flirting with entering the Dead Zone.
You need regular member participation for a community to work, but members also cannot feel that their contributions are a favor to the community host. While members get some sense of satisfaction from contributing to a community, but too soon, that satisfaction wears thin. Instead, members must associate getting value with regular contribution. Community managers should therefore incent members to contribute and then recognize them for their advocacy. This means you have to be prepared to invest something to keep the community vibrant, but the rewards don’t have to be financial. Gamification, social capital, status and other strategies are appropriate for driving the kind of participation that creates value for members. Just don’t be naïve and expect member goodwill alone to motivate adequate participation and drive contribution frequency.
Prompt question: So where should this participation ideally come from? What kind of members do we need contributing content to our communities?
Let’s first look at who is currently contributing to communities by posting content or queries. We asked study respondents to rank who is currently responsible for doing this in their communities. Notice that 3 of the top 5 ranked contributors here are not even customers, and one of the two customer types that is contributing is potentially is having a problem! This doesn’t seem like the kind of lineup that will drive revenue.
It seems that moving prospects up the list from their currently 8th ranked position is necessary if communities are to function as revenue-generating assets. Likewise, how high should industry thought leaders rank? So the question we need to ask, and we did in our survey, is “what is the right or ideal ranking?” That depends on the objectives in place for the community. Since we did ask that question, let’s look at the results…
You can’t really argue against loyal customers who are advocates occupying the top spot in this ranking. If the community’s objective is to deliver support, these customers are eager to help with that mission. Likewise, if the objective is to generate revenue, loyal customers through their advocacy influence prospects, provide credibility and accelerate purchase consideration. I think we want to keep loyal customers in the top spot of these rankings.
The real question, then, is who should occupy the second spot? If the objective is to influence revenue, shouldn’t prospects occupy the second spot? In this ideal ranking, they have moved up from 8th to 4th, but is that high enough? We have to remember the purpose: if it is to drive revenue, then we get that from customers and prospects, so they should be ranked as high as possible on this list. Remember, the list on the right is the ideal, and most communities aren’t here yet. This is where they need to go, with prospects ranked even higher as contributors and participants.
Prompt question: We’ve talked about a lot of things on this notion of communities driving revenue. From a practical perspective, how do we get beyond customer engagement to actual sales acceleration and revenue generation with our communities?
No one should need a benchmark study to know that for a community to succeed, it needs to membership and participation of the right people. The question is, how to get them on board? Community managers must first know exactly what the target audience looks like – consider using a persona to make this very clear. Next, recruit those people into the community using incentives, rewards and invites from advocates already in the community, rewarding these advocates for their recruiting activities as well. A handful of advocates, properly motivated and rewarded, can build a powerful community.
Members must perceive value coming from community membership. What’s in it for them? If the benefits are there for the members, then they’ll be there for the host. A great facilitator and indicator of value of contribution frequency. Frequent here is daily, weekly or monthly contributions. As I shared earlier, members can’t be allowed to feel that they’re doing us a favor when they contribute to the community. If providing a quality experience is contingent on member goodwill, you’re going to end up in the Dead Zone. Community managers need to invest in creating a quality by incenting participation and contribution, and recognizing contributors for their advocacy.
Even with the very best incentive and recognition strategy, a community that doesn’t keep content quality high can’t flourish. Community managers are wise to have content standards as part of the membership agreement. This doesn’t mean that managers reject content that doesn’t meet the standards – to do so would discourage participation. What it does mean is that community managers work with members who post content to help them with friendly, suggested edits to help their content reach a broader audience.
Unless a community is designed solely as a technical support adjunct, constantly optimize the community to better reach prospects. If a community’s goal is to drive revenue, then prospects have to receive value from the community, and participation has to provide value for them. If it doesn’t, then the revenue goal for a community is unattainable. Advocates and their contributions to the community will play a critical role in making a community work for attracting and converting prospects, so build a reward structure to encourage this type of advocacy.
Don’t count on prospects stumbling upon the community and having it influence their consideration. Understand the customer journey and place the community directly in this path, in several places. Don’t force community membership on prospects, but make knowing of its existence and potential value unavoidable. Market your community and position the value it provides very clearly.
Cassandra will moderate Q&A
Wrap things up with throw to report and eBook