Online communities deliver significant business benefits, but community leaders often struggle to demonstrate the value of their efforts through metrics that resonate with business stakeholders. That's a message we heard loud and clear when we surveyed more than 271 marketing and community professionals for our new research study, which looks at the business impact of online communities.
Here are some of the key findings:
- 92% believe that their online communities have an impact on the business, but 35% lack meaningful metrics to report success.
- 57% say that competitive advantage means retaining current customers - but they have few metrics to measure retention.
- 24% don't know if their community generates revenue or not.
- 45% say that their community reduces costs for their organization - but when asked "how are savings measured?" the number one response was "guessing."
Clearly, this lack of information is not okay, and it's certainly not sustainable.
In response to the findings, Leader Networks has developed a new framework to help community leaders link community value and competitive advantage.
The framework provides a real-world look at how community leaders are currently tracking community impact, while demonstrating that metrics (of all kinds) must align with, and support, business goals in order to be relevant.
Marketing and community leaders can use the framework to:
- Align community metrics with business goals
- Benchmark current community impact and track progress over time
- Demonstrate success in the quantitative terms that make business and financial executives sit up and take notice
- Make a case for more resources and more funding
As we move across the framework - from 'Community Vibrancy' metrics on the left to 'Business Integration' metrics on the right - we see an increased impact on the business. While a metric like "membership growth" is important to track, it's when community leaders can measure things like "new ideas implemented" and "increase in operational efficiencies" that the link between communities and competitive advantage becomes crystal clear.
So how can you use the framework to show that your community is advancing your business goals?
Here are some tips on how to get started:
Step 1 - Look at the big picture
Look at your organization's mission and vision, then think about the specific strategies the organization's using to advance its mission and vision - in both the short and long-term. Now consider how your community could, or does, support those strategies to help the organization succeed.
Step 2 - Make good choices
Pick your top performance category - for example, customer support or customer retention - then choose three to five business metrics within that category.
Step 3 - Validate your choices
Remember the old adage 'measure twice cut once'? Before you begin, be sure to secure buy-in from your stakeholders, and confirm that what you're measuring is valuable to them.
Step 4 - Track your outcomes
Effective reporting is not a "one and done" situation. You need to develop a rigorous and repeatable process to analyze and report on community performance to show impact over time.
Step 5 - Review and realign
Business priorities shift, and so should your metrics. Every six months to a year, review your metrics in light of your organization's business goals. If the metrics no longer fit, adjust accordingly.
Using this framework, you can begin to track what you should measure - not just what you can measure. You can report on what matters most to the business - and best of all, you can establish the missing link between community efforts and competitive advantage.
You can read more about Leader Networks' new community impact research here.