The Value of Community Ecosystems

I’ve worked with some form of community my entire career. In 1999 I took a job with TechRepublic.com as “UX Program Manager” and spent 9 months helping design, build, launch and grow what would become one of the largest online communities of global IT Professionals. Community platforms, as we know them now, didn’t exist. We had to build everything from the ground up. A design for threaded discussions went from whiteboard to production over a weekend. Content editors played the roles of community manager and moderator - “community management” wasn’t a term of art yet. It seems quaint that for the first two years of TechRepublic we only cared about two numbers: uptime and membership. 

My first taste of what might be possible with communities of practice was volunteering to be one of the first Fast Company Company of Friends organizers in Louisville KY in 2000. The FastCo mothership gave me a list of local subscribers, a discussion guide, some facilitation guidelines and an organizer’s button. We held the first meeting in a local business conference room, and frankly, I was amazed that anyone showed up (we had 15 people at the first meeting) and impressed that we all had so much to discuss. The central topic was about how technology was changing business - especially the Internet. 

In 2001 I was offered the chance to move to California and work on an in-product community with Autodesk. The focus of the community was to support customer onboarding and product usage. Autodesk was the beginning of a personal journey to study the implicit and explicit value of communities (in their various manifestations) to companies. That journey continued with Forum One, where we developed the first conference series for community executives and developed the first practitioner research on analytics, strategy and practice. Dell allowed me to learn and experiment at a global scale, and incorporate community analytics into marketing mix models and enterprise-wide reporting. My journey now continues with Structure3C. Along the way I’ve studied and helped develop different methods and measurements for community value: the impact of forums on the support burden, the effect of community on NPS and LTV, the effect of community on purchase frequency and size, understanding how a community ecosystem develops, and much more.  

Historically, measuring the value of knowledge generated in online communities has been the focus for community analytics, particularly in the context of customer support. Over the years different approaches have been fielded for measuring this value in support communities, including the cost savings of customer labor vs staff, the value of a call deflection, the long-term value of a qualified or accepted answer, and possible causal effects of participation on customer behavior. Several thoughtful methods have been formalized and documented by platform vendors and industry experts. This “ground zero” problem seems to have been solved, and cyclically re-solved and re-quantified to the point of diminishing returns, like a community version of the Bill Murray film Groundhog Day - and we still have executives pushing back on the validity of the calculus, and the corresponding results. This is perplexing to me.

Keep in mind, the customer support scenario I describe above is arguably the most tested, proven and accepted (by community professionals) example of community value. Yet organizations continue to regularly debate this. When the conversation moves towards the value of community across customer lifecycle, and the potential value across business units our current methods, measurements and metaphors fail us.

What Got Us Here Isn't What We Need To Move Forward

It seems we missed something along the way in developing best practices for communities. Admittedly, it’s not a simple problem to solve, but the key problem areas seem fairly clear:

• "Community", as a term, is largely subjective;

• Community as a concept is still largely misunderstood by the extended organization;

• Investments in social media activities have claimed large portions of budgets and resources and have been mistakenly viewed as the primary focus for community, as opposed to a component of the community ecosystem;

• Community strategies are often independent of, and so therefore misaligned with, corporate strategy and have no clear connection to corporate goals;

• Community as a function is separated from other customer-facing functions;

• Community analytics and activities often don’t communicate value in the context and language of the business;

• Because the community function is separated from the business, it is often viewed as a cost center, as extra overhead for extended teams, and is asked to quantify value and impact in unusual or extraordinary ways - often in an ongoing, and sometimes ad hoc fashion;

Hampered by the aforementioned factors, the final straw is that community analytics and data aren’t integrated technically or programmatically into enterprise analytics, data and reporting - a critical dimension of individual customer profiles and the ability to gain insight into entire market segments is wholly missing.

Integrate Community Into The Fabric of the Organization

When most Executives think about customer communities, there is an unfortunate tendency to view them as “cost saving” vs “value producing”. This thinking leads to strategies and outcomes that fail to realize the full value of customer communities. This typically manifests in the form of a myopic focus on customer support communities and an overburdening of customers taking on the role of customer support agent. In extreme examples, this sort of strategy breeds resentment with valuable customers and leads to a dangerous dependence on an unsustainable resource. When the Executive mindset shifts to “value producing”, the aperture of community strategy widens to a rich set of possibilities: community advocacy programs, open innovation, peer to peer mentoring, complex content sharing, co-design of products and much more.

Example of an online community & social media ecosystem

As we enter into an increasingly digital & connected era, future-state communities will be key locations where tangible value is co-created and exchanged between companies and customers. To have any chance of long term success with customer communities, mindsets have to evolve beyond a fixation on cost savings to a more enlightened view of communities as a valuable catalyst for growth.

Moving forward: in order for businesses to begin defining a future state community model, they should:

• View community building as a capability and view their extended community ecosystem as a strategic asset;

• Explore and define what “community” means in the context of their customer's and employee's collective experience;

• Develop a community strategy that aligns with, and complements (in some cases, shapes), corporate strategy;

• Don't "build a community" - develop a community ecosystem;

• Understand how the community ecosystem creates value for all external stakeholders and all business functions;

• Develop community programs, goals and KPIs that tie to Business Unit goals and objectives and are translated into team, manager and individual performance goals;

• Integrate community ecosystem data, analytics and insights into enterprise analytics, communications and annual & quarterly business reviews.

In short: 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 ecosystem development practices into the fabric of their business with great success.

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This post is the first in a series on the future state of online community ecosystems, and contains excerpts from the report out of Structure3C's Community & Crowd Mastermind session on Community Analytics and Value. A version of this post appeared on LinkedIn in February of 2019.

To learn more about the Mastermind group, Structure3C's offerings, or discuss how we can help you develop the community ecosystem for your brand, please reach out: bill@structure3c.com.