By Maria Wasing, VP of European Marketing, EPiServer
Demonstrating return on investment is often a big stumbling block for brands that are looking to enter into the social media world. Whilst the barriers to entry are small (at least in terms of set-up, if not in terms of resource and time), confidence in delivering some sort of return is crucial in getting that all important go-ahead and budgetary support from the board.
There is little doubt that social media and online engagement can bring a number of benefits, including increased brand affinity and loyalty, but these elements are hard to quantify. And for companies with a firm focus on the bottom line, measuring the impact of this positive feeling and tying it firmly back to revenue opportunities is vital.
Online, brand-owned communities (as opposed to third party social networks like Facebook or Twitter) offer a great way to nurture relationships between a brand and large groups of like-minded people. But how many marketers have harnessed the potential to monetise these communities? It’s entirely possible, as brands like Pacemaker, Visit Sweden and TUI Nordic can attest, but it’s a careful balancing act and one that is essential for brands to master if they want to get it right. Imagine being able to use online communities to increase traffic to your website or reach a worldwide audience without expensive expansion.
So how can brands go about achieving this and, at the same time, effectively monetise a community? What steps do they need to take? Here are a few ways that some of our customers are running online communities that entice discussion and loyalty, and also add to the bottom line.
The direct approach: driving sales
For most brands that are using online communities, contributing directly to the bottom line means one thing: sales. But a company that tries to overtly promote products or services to community users will not get very far. A softly, softly approach is essential and some communities are just going to be better suited to this than others.
For example, a brand can involve its customers in an activity that has a knock-on effect on the bottom line. Søren Engelbrecht, at SAS’s Danish website, has introduced a travellers’ tips area to add a social element to the site. There are now more than 1,500 tips entered by customers, and visitors are genuinely enthusiastic and willing to share their experiences without any immediate gain for themselves. The value is realised in more than positive feedback too, with user content generating improved search results as well as an uplift in flight bookings.
The indirect approach: non-sales conversions
But of course, conversions do not need to mean bottom line sales. A conversion could be a white paper downloaded from the website, someone signing up to an email newsletter or social network, or a prospect reaching out to the brand and completing a ‘contact us’ form. While none of these is guaranteed to lead directly to a sale, the use of these ‘sticky’ tools (i.e. they all encourage deeper engagement with a brand and return visits) means that community users will be more likely to bear the brand in mind in the future.
And what about using a community to help with product development? This not only ensures that new products or services are in line with customer expectations, but it builds brand loyalty and trust.
The International Council of Chemical Associations (ICCA) has created the ICCA Connect community where members can share information and collaborate on white papers and speed up policy review. During the first 12 months of the new website and community area going live there has been significant growth in numbers visiting the main site, with a conversion rate of 18% downloading documents from the publications area of the site and a sharp downturn in people emailing with requests for information.
The partner approach: advertising or sponsorship
Sales of products and services by the brand or company that ‘owns’ the community is only one way forward. Despite reports of its demise, online advertising can still command high revenues, particularly where a website can offer advertisers the opportunity to target a niche group or community that is highly engaged, with very clear interests and behaviours.
Of course, this does not just mean banner or text advertising. This could mean affiliate marketing or even contra deals between complementary but not conflicting brands.
www.communityofsweden.com is an online community focused on making Sweden’s rich culture, attractions and range of unique destinations available to potential visitors independent of time and place. The community now contains over 9000 members from over 40 countries who all love Sweden and this growth has been achieved without any marketing. By sponsoring the community, Visit Sweden is able to fulfil its remit of encouraging positive coverage of the country and increasing buzz and activity that is not based entirely on traditional push marketing like advertising or PR.
The success of all three of these approaches depends on two things: the quality and/or the quantity of visitors to the community and, whilst this is another discussion entirely, it is worth remembering that monetisation can only occur if a thriving community is already in place.
The good news is that the tools and technologies are at an advanced stage, which means that establishing and growing these online communities has never been easier. Using the monetisation tips mentioned here to help you plan and execute an return on investment (ROI) strategy that will ensure an online community benefits your business bottom line.
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