[Dive #139] Community Performance Marketing
🏘 Community Growth will be the next thing
If you’ve been reading my pieces recently you will notice a theme over the past couple of weeks:
Can you guess what it is?
Oh boy, another ‘community is important’ piece 🙄
Yes, AND I think there are some critical pieces missing with the concept of community.
Despite all the attention, fanfare, and LinkedIn posts (mine included) highlighting the importance of building and fostering a community, most haven’t unlocked true flywheel growth, and it shows with the current market.
I don’t have all the answers, but I believe that strongest businesses will lean into Community Led Growth (CLG) and the backdrop of a recession will provide a fertile ground for Community as a business function to rise in prominence into the next market cycle of investment, growth, and opportunities.
Where is community now?
Let’s be honest. This is where we’re at.
There are exceptions to this. I’ve heard of some top community talent making $100k+ as experienced Discord mods. I also imagine the community team at Yuga Labs is compensated well and are skilled.
That said, I believe that the vast majority of community roles are:
Treated as an elevated customer support role and maybe sit within that function
Aren’t empowered to make meaningful business decisions
Are not provided the resources (skills and budget) to level up and provide more value to the business and community itself
This is where my predictions about Community come in:
More growth and performance marketers will shift into community-related roles AND skilled community managers will level up into growth and performance marketing roles. Identifying who is the best fit for these roles in either direction will be key.
Community functions will start building best in class frameworks and playbooks to show impact and demand a budget. If done correctly, the signal will be clear as day and the best organizations will create budgets for this to scale.
Community will become a business function that will rise in prominence. Community may become a subset a broader function like Marketing or Growth, or become its own function with full-stack support (creative, eng, product, etc.)
Community Growth + upskilling Community roles
How many Community Manager roles understand the concepts of ROI, K-factor, LTV/CAC, user cohorting, or attribution and are comfortable having conversations with Product Managers, Data Science, Analytics, and Performance Marketers?
I believe that number is growing, but it’s not high. Additionally, understanding a concept is different than implementing it in practice.
How many Growth professionals understand the above concepts? Nearly all, or at least the expectation is to understand them well over time.
As community-building becomes a strategy that all companies and brands employ (at least to a degree), cross-training and upskilling Community teams will be instrumental in growing the community. And as a result, the business.
What does growing a community mean for TPan?
Focusing beyond the vanity metrics of topline numbers:
Topline Community membership —> Engaged membership
Engaged membership —> Types of engagement by member
Types of engaged members —> Understanding user personas and identifying the actions that lead to the highest value members
Focusing beyond the channels where the community lives:
Community has a presence on Discord, Twitter, etc. —> Understanding the content that the community engages with
Understanding the content the community engages with —> Understanding why the community engages with specific content
Understanding why the community engages with specific content —> Creating content that provides value and results in specific actions
Redefining what it means to build a community
Building a community of customers and users —> Building a community of customers that care about each other and providing value to each other
Events and activations led by the Community team for the community —> Partnering internally and externally to create activations that benefit the community while moving the needle for the business in a measurable way.
Whew! The above points are overwhelming even for myself as I type them out.
This is where Growth folks come in to help their Community colleagues to better understand how their role and impact can be more effective for the community, themselves, and the overall business.
I imagine if I were to share this with my peers I’d get a version of this
This is where the shift in perspective and alignment of incentives is critical.
Finding the right individuals to collaborate. Humility and openness are needed in a bi-directional manner.
Who are the people in Growth functions that are willing to invest, partner, and educate their Community colleagues to supercharge the aligned goals? Are goals even aligned? Who are the Growth pros that enjoy interacting with the community?
Community isn’t just about numbers. There are softer, more qualitative aspects to this, like…just spending time with the community and saying hi. Can you measure the direct impact of every hand the President shakes? No. Shake those hands and kiss those babies.
On the other hand, who are the people in Community functions that are hungry to learn how to apply Growth concepts and frameworks to supercharge the impact of their efforts for the community?
Strong communities have a level energy that can be harnessed in a way that can achieve business goals and provide value back to the community.
This isn’t a cross-functional relationship that is a weekly 1:1 to check in and provide ideas. There needs to be investment on both sides to truly understand each other. Until then, Community as a Growth strategy will be limited.
As an additional incentive for Growth professionals to better understand community is that the ‘organic’ channel has generally been elusive. What’s an organic user or organic channel?
As Community rises in prominence, I believe these definitions will become outdated. Organic will never be fully measurable, but I believe Community can play a much larger role in better understanding the catch-all definition.
So with that, what can Community Growth as a practice look like?
Best in class community growth through measurement and playbooks
Let’s take a couple of hypothetical examples to see how Community 🤝 Growth.
Yes, Ford the car company. I’ve been seeing a lot of car commercials as the NBA and NFL seasons have resumed, so why not lol
How much does Ford spend a year on advertising?
As a test, Ford took 1% of that budget ($31 million) to run a pilot program to kickstart community building. Screw that, even 0.1% of the marketing budget, which would be $3.1 million. That’d be plenty.
What could this community pilot look like?
Choose 5 dealerships per global region and test different types of community building initiatives:
Event-driven Community Building (virality)
Every month, one random prospective Ford buyer gets their vehicle for free right before they sign on the dotted line. No questions asked.
Every other week, one random prospective Ford buyer gets their vehicle at the base model price with all add-ons for free right before they sign on the dotted line. No questions asked.
Every week, one random prospective Ford buyer gets free service for X years right before they sign on the dotted line. No questions asked.
Education-driven Community Building (value)
Every month, host an education day around a car-related theme. How to change your engine oil, how to determine if you’re paying the right price for a used car, etc. Free food (GOOD food) and bring your kids if they love cars.
Host ‘Ford Office Hours’. If you have questions about your car and want an expert opinion, come right in. Doesn’t matter if it’s a Ford or not. Hire part-time specialists if needed.
Highlight and reward community members for service to their local community. Create a communal space for community events.
Long-term Community Building (virality + value)
Incorporate both of the above strategies
How would success of this effort be measured?
Incremental sales (duh) in the short and long-term
Incremental sales in surrounding dealerships (halo effect)
Media exposure and social listening, particularly with the viral community building strategy
Customer info - e-mails collected, referrals, and if they don’t drive a Ford, you can gather their info via the education community building strategy
Assuming this works, build out a playbook to scale this across regions and globally. Hire full-time Community managers that are responsible for growing a Ford customer community. Make sure the playbooks are complementary to cultural nuances and what the community cares about. If success continues, the $3.1 billion marketing budget shifts from paid marketing to community marketing.
Doodles is holding an event at Art Basel next month: Doodle Putt
This 9 hole mini-golf course is a on brand for Doodles. Knowing them and their history of activations, this is probably going to be a banger.
In this actual example, how might Community 🤝 Growth?
How many holders attend the event?
How does this event impact social media and Discord community activity? How does this event impact the quality of the community activity?
What is the feedback on the event in-person, via feedback forms, and on social/Discord?
How much Doodles merch was sold at the event and/or online? Are there attributable moments causing a spike in sales?
Was the AOV for activations attendees greater than online purchases?
Did people who attended the activation purchase multiple times?
How does the event impact secondary sales on NFT marketplaces like Opensea?
Are news outlets covering the event? What is the sentiment? What is the reach?
How many non-holders participated in the activation. What brought them here?
Doodles has a couple notches under the belt with these types of activations and they’ve built a community since inception, so I imagine the team has a more focused framework with how they measure success and how they can use these insights to continue fostering a healthy community while growing the business.
Or maybe they don’t 🤷🏻♂️
Tools to help with automation and measurement
As Web3 is showing early signs of maturity, Community Management tools have arrived on the scene:
Blaze - Campaign management, user segmentation, wallet insights
Dots - Automation flows and community insights
Landing Party - Support bots, support ticketing, and help centers
…and plenty more. Tools like these help with creating the community playbook as well as provide a common ground for Community 🤝 Growth outlined earlier.
Community as a business function
As companies and brands scale, Community can turn into a business function of its own. What might this look like from 0 to 100?
Phase 1: Minimum Viable Community (MVC)
Community lead with support from various functions
Focus on digital channels to build community
Understand the ‘1000 true fans’ and what they engage with and why
Test and learn
Phase 2: Scaling community
Building out community team
Expand digital footprint and consider physical footprint where appropriate
Cross-functional partnerships to measure impact
Build frameworks and playbooks
Phase 3: Community as a business function
Scale community team: Community managers, community relations, community ambassadors
Omnipresence across channels and ecosystem
Establish independent budget for community building and scaling efforts
Build cross-functional playbooks to create a 1+1=3 impact
I’m not strictly defining what small, medium, and large looks like intentionally. A large company still needs to start small and then scale up. Also, certain pieces may come in earlier phases. Some companies may be able to create a budget at an earlier point than others.
Another source of inspiration is B2B companies and how they build community with the existing and prospective clients. It’s arguably easier to do than B2C because there is a smaller community base.
Bessemer Venture Partners recently wrote a piece about community-led growth and featured several portfolio companies and their strategies.
You don’t have to start with 0 when you’re thinking about how to create a community. There are plenty of examples out there and they might not be called a ‘community’ in the traditional sense.
A great example of this is the role of Developer Relations teams. How do DevRel teams foster a strong communities, how do they measure success, how do they balance a digital and physical presence?
What happens when you replace ‘Developer’ with ‘Community’? 🤔
Arguments against community growth
If I’m making a case for something, it’s only fair to think through arguments against it.
Community as a strategy isn’t right for everyone
I generally disagree with this. However, if I were to peel the layers of the statement there are two angles in which this is getting at:
When is the right time to build community?
What kind of community should be built?
If you’re an Amazon dropshipper, you don’t need to build a community. Amazon does that work. You focus on getting more products and optimizing them to show up as the first result.
However, once you get to a certain scale, you can incorporate community building by creating a Youtube channel that reviews various Amazon products, including your own 😉
Community doesn’t drive business results
It’s fairly clear that communities drive business impact. The missing piece is having the resources and knowledge for Community professionals to show that, which goes back to my first prediction and point.
In fact, I believe strong communities combined with creative marketing strategies will create outsized results. Look at any top tier NFT brand.
Getting too close to the community is a business risk
This a valid point. Empowering and engaging your community is not the same as giving the community the authority to make business decisions. The key with this is draw healthy boundaries between community and company.
Community ≠ Employee
This is why starting small and scaling up, especially for larger companies, is important. Understanding the motivations and personas for your community are key. If the goal is just financial gain, things can get ugly quick.
Community isn’t proven for ____________
This is fair point, especially when communities are Web3-enabled with an ownership component. We’re in the early innings for that.
Similar to how blockchain games have been largely unsuccessful so far, every major gaming studio is attempting to be the first to figure it out. The reward for doing so will be substantial.
Also it’s easier to lead with authenticity. Back to blockchain gaming, the game needs to be fun first. If it isn’t fun, no one will about the NFTs in the game or how much you might be able to earn. The game will turn into work.
If a company has a strong Community management team, but the CEO begrudgingly engages with the Discord server or Twitter Spaces? 🙅♀️
In a world where everything is increasingly turning into an advertisement and people question if something is ‘real’, authenticity wins. Communities thrive off it.
Ask SBF of FTX about it. Oh wait…
I want to reemphasize that Community Growth is an evolving discipline. I believe there will be more and better frameworks and examples than what I’ve provided. Maybe Ford has already tested this local community concept and I’m not aware!
Regardless, I hope they provide a spark or new ideas of how to think about building community.
I’ll be off on a weekend trip tomorrow, see you next week! 💪