2.3.2 Social media performance potential Community usage format: basics

Learning objective social media performance potential community: The following content will enable you to

  • Understand communities as a social media usage format and
  • Assess the potential and limitations of communities for developing a social media strategy.
  • assess the performance of social media channels for the community usage format more competently and thus avoid bad investments.

Important Note: This section serves as an introduction to the use of communities from a strategic perspective. It does not replace a profound education on this topic and is definitely not sufficient to develop communities based on it.

Reading time: approx. 26 minutes

Exercises: Exercises are in the PDF of all exercises of this course. Download it from here.

Basics social media performance potential community

In this part of the topic, we will cover the basics for the following content from the perspective of social media strategy development:

  • Definition, description of communities
  • Communities communication concept
  • Formats / Versions
  • Suitability
  • Success criteria
  • Performance potential Market and competition

Definition and description

At pbsm, we define communities as common-core communities focused on longer-term networking, sharing, and collaboration.

Definition explanations

Common core: a need common to all forms of community. You can’t do without it. Communities can be formed over commonalities such as where people live, interests, preferences, activities, and shared goals. However, not every commonality is suitable as the core of a community. The decisive factor is the benefit that a community offers and the motivation to participate.

longer-term perspective: building a planned community is building an infrastructure and has a longer-term perspective for economic reasons. Business-generated communities are preferentially suited for corresponding corporate goals.

Networking, exchange and interaction are the core of a community and the basis of the relationship between users. At the same time, they are a key difference and differentiator from Audiences.

Networking: Networking is the basis of a community . Networking brings users with matching interests or goals together and facilitates and promotes exchange and joint activities. The degree of its networking has a direct impact on the community’s usefulness for the user.

Exchange: In a community, exchange takes place primarily through communication. In addition, however, exchange can also involve the sharing or reciprocal use of objects and items.

Collaboration: Working toward a common goal can be a sustaining, meaningful component of a community. This may involve, for example, practicing a sport or hobby together, pursuing a social benefit or political goal, or pursuing economically relevant goals. Crucial to the function of cooperation is that people find each other to achieve a common effect for a common goal or purpose.

Development: Communities can

  • arise from a common impulse of users or
  • Are developed by companies, institutions or individuals

to realize or support a specific goal. These goals can be of a social, cultural or economic nature.

Communities can be exclusively online, exclusively offline, or span both worlds. Online active communities can exist across multiple online platforms.

Communities are not used by their users to the same extent and intensity. They range from highly active users who are actively involved in the development of the community to casual users who take advantage of the community only sporadically and contribute little to the community.

Recommended reading 1: The well-known eBay study on communities The Long-Term Effects of Joining and Participating in Customer Communities, René Algesheimer, University of Zurich, Utpal M. Dholakia, Rice University summarized the types of users / usage. Here is a short article about it: https://hbr.org/2006/11/do-customer-communities-pay-off

Recommended reading 2: Community Building by Amy Jo Kim (older but still valuable reference book due to its comprehensive and practical background for community building and management).

Communication concept

The communication concept of communities is based on the fact that every user can be both sender and receiver equally and with equal rights. Every user can basically contact and communicate with every other user without any restrictions. Individual user restriction options do not contradict this principle.

In addition to this communication one2one, communication one2many is also recommended – e.g. for forming groups and addressing the whole community. Appropriate rights may be required here.

Participation concept

Communities enable and require the activity of their users. That is, communities without active users are dying or dead communities. In order for users to become and remain active, the community needs appropriate opportunities for participation and engagement. Communication among users is an essential, indispensable element of user participation. User participation can, of course, include other offerings beyond communication, such as users working together for a common goal or taking on tasks in the community.

Forms of communities

We differentiate between brand communities and topic communities because both community formats have fundamental differences in performance and attractiveness for companies as well as for social media users.

Brand communities form around a brand. Thus, the performance potential of the community also depends on the attractiveness of the brand and its suitability for communities. The reach / radiance of the brand also forms a performance boundary of a brand community. From this we can see that brand communities are particularly recommended for brands with great appeal.

Topic communities form around a topic and thus usually cover a broader field of a market. Theme communities can include brand communities. The suitability of the theme is of particular importance for the success of a theme community. Topic communities can open up and secure markets or submarkets.

Suitability of communities for business objectives

Communities for businesses can

  • serve a corporate function.
  • develop, process and secure a market.
  • support the company’s competitiveness – in social media and beyond.
  • support an existing business model.
  • be the basis of a business model.

Communities for business functions

Communities that serve a corporate goal / function or are otherwise part of the business model, for example, communities that take over support functions.

Community for market development and securing

Communities that are intended to develop, work and secure a market address one or more issues that define the market to be worked with the community or communities. These communities serve the company’s business model, so they are an extended corporate function. They are usually managed from the perspective of the company’s performance. (Community for own performance, marketing of company performance in the community.) To better understand this approach, let’s imagine a community for a specific sport, for example downhill skiing. The prerequisite for a community for this sport is a sufficiently strong social context. Let’s assume this exists and we reach a significant portion of the particularly active downhill skiers through this community. This enables us to build direct relationships with customers and potential customers via the community, get to know their needs better, have a communication edge over competitors without their own community, and can also directly support the sale of our products.

Communities for existing business models

Customer loyalty is a fundamental component of a business model. Communities are ideally suited for this, provided that the social context of the topics of this business model is strong enough. Beyond customer loyalty, we can of course also strengthen our own brand with a community, but above all we can benefit from the topics surrounding our own value proposition and here in particular the evaluation of performance.

Communities as a business model

Communities that are the basis of a business model go beyond communities for market development. Communities as the basis of the business model are the core purpose of the company. Here, the community does not serve the company, but the company has the community as its purpose. These communities are usually run with the community’s needs in mind. (Community as a business model, marketing of the community)

Success criteria of communities

No social media usage format is as powerful, but also as complex, as a community. This is reflected not least in the success criteria of a community. The following is a general discussion of the success criteria. Each community will be differentiated by different priorities and functions within these success criteria based on their alignment and goals. However, fundamental deficits in key success criteria are not sustainable in any community in the long term. We divide the success criteria according to

  • Suitability of the community / brand theme
  • Concept and technical-conceptual performance of the community
  • Community Management
  • economic potential of the community.
Suitability of brand and theme

The suitability of a topic or brand for a community is a prerequisite for potential market success. Without this prerequisite, the establishment and operation of a theme community resp. of a brand community is not to be expected.

The suitability of a brand for a community depends not least on whether the brand receives the necessary attention and commitment from a sufficient number of users to become an attractive community. One criterion for the suitability of a brand as the core of a community can be seen in the communication about this brand. Brands that are not or only marginally involved in the communication of their users are not very suitable as the core of an active community. Brands about which users regularly and enthusiastically exchange information offer a better prerequisite for the development of a corresponding community. We can see the level of communication or share of buzz of a brand with the help of monitoring. A brand without regular communication has a hard time as the basis of a community, because communities without regular communication quickly become inactive. So if we are dealing with a brand that social media users tend to talk about less or not at all, its suitability for a community must be critically questioned.

Brands that are particularly valued by users often lead to user-generated brand communities. So to brand communities that are founded by users for users. Active user brand communities are proof of the brand’s suitability as the core of a community. At the same time, however, they are the most intense competitors for the attention and engagement of social media users.

For the suitability of a topic as the core of a community, the same prerequisites basically apply as for a brand community. If social media users don’t communicate about the topic, networking about it is also unlikely. However, themed communities are subject to another restriction that should not be underestimated. The number of topic communities on the same topic is significantly reduced in the market due to the network effect. In other words, the conditions for success in building a community relevant to the market on a particular topic dwindle drastically with the number of existing, successful communities on that topic. The examination of the competition and its performance quality within a potential topic for a community is thus mandatory. If we encounter existing communities with clearly identifiable performance deficits, this can be an encouragement to build another community on this topic, but only if these competitors are not able to reduce their existing deficits faster than the company can establish its new topic community.

Concept and technical-conceptual performance of the community

In our concept for a community we define the functions of the community and its scope of services. The quality of the functional areas has a direct and decisive influence on the activity and attractiveness of the community and thus also on the market success of the community.

Some functional areas should be present in each community – adapted to the focus and use of the community. This concerns in particular

  • Communication and communication tools
  • Profile
  • Profiling
  • Motivation tools and methods
  • Networking tools and methods
  • social navigation
  • Galleries
  • Participation

Functional areas – communication: The quality of the communication as well as the communication tools naturally influences their use. Technical functions for communication between users can be useful for the following situations:

  • one2one realtime (chat)
  • one2one time-shifted (Messenger)
  • one2many time-shifted (forums, blog, newsletter)

one stands here for user.

The quality of communication among users is of considerable importance for the success of the community. Not keeping an eye on and maintaining this success factor of a community is more than negligent.

  • Community management ensures the quality of communication once by means of clear rules that are presented to each member, e.g. in the form of guidelines for communication among each other, and are kept ready for retrieval at all times.
  • In addition, it is recommended to give users the opportunity to immediately flag inadequate communication.
  • Inadequate communication in a community must not remain without consequences.

Functional areas – Profile: The profile in a community serves to

  • the self-expression of the user
  • the information about the activities of the user
  • the information base for the networking of the user
  • the motivation of the user and other community members

The content of a profile should meet the general requirements of a community as well as the specific usage and the thematic and content-related characteristics and peculiarities of the community. The quality of the profile picture is of great importance for the attractiveness of the profile as self-portrayal as well as information for other users, because it influences the networking of users among each other. At the same time, attractive profile pictures in preview functions as well as in networking functions increase the attractiveness of the community for new users. A user name in addition to the real name or as an alternative can increase the attractiveness of the community, because

  • thereby individuality and a specific identity can be expressed.
  • personal distance and privacy to general existence can be created.

Age and birthday are popular and helpful information because they can be used to indicate communication occasions (congratulations) as well as for networking (similar age group). A geographic location can be used as an additional criterion for the networking of users in order to

  • to use an additional commonality
  • to use an additional common identity,
  • create the option of real contacts.

User’s area of interest specific to the community topic – e.g. for

  • own content of the user,
  • Links to content of other users or
  • references to contents of the platform, or
  • References to external sources.

Relevant experience and stations of the user. Especially if the community has a focus on experience sharing and cooperation, an experience section is an important part of the profile that allows users to get more value from the community. At the same time, the profiling of the platform benefits from this content.

Work experience and professional activity: Naturally, this area is not very dispensable, especially in communities that operate with a professional background or in which professional competence on a topic is important.

Rank, status , function, awards in the community are important content for informing other users but equally important for motivating users. Ultimately, an earned rank/status in a community can be a significant contributor to user retention.

User contributions – content, overview: This area is especially important in a community with a focus in user generated content. Users can find content that is valuable to them more easily via this information / area. At the same time, it is easier to encourage users to be active in this area – especially if this is linked to a recognition system that is generally recognizable and also has an effect on the rank/status.

Topic subscriptions, subscribed users (referral users, content) inform not only the owner of the profile about his networking and about the content sources to which he subscribed. If the user discloses these subscriptions, they are helpful for content distribution and networking, and thus community activity.

Usage information (visits, online time, last visit): This area shows other users how active the visited user is and encourages activity.

Functional areas – Profiling: Profiling creates knowledge about the interests and behavior of user groups and individual users. This knowledge flows into community management as well as into the economic use of the community. Sources of profiling are both the profile and the activities of social media users.

When developing profiling and working with it on a daily basis, the legal principles – especially data protection – must be strictly observed. At the same time, it should be transparent and easy for users to see what kind of profiling is being done for what purpose and who is the contact person for this issue. It is not only recommended but required to give users the possibility to exclude profiling for their own person.

Communities are based on the consent and support of their users, which is at risk without trust in how users’ data is handled. Profiling should therefore be located in community management and less in sales-oriented functions such as marketing or sales.

Functional areas – Motivation – Motivation tools and methods Motivation can be system-based. That is, according to defined criteria via software users, for example, award recognition in the form of a status. Motivation can be ad hoc, e.g. in the form of positive feedback for a particular performance – from other users or the operator. Motivation in the form of recognition is doubly effective when it is clearly visible to other users. Then it becomes a broadly motivating recognition that can motivate other users. Technical motivational tools include

  • Algorithms that award status symbols depending on operator-defined criteria.
  • Recognition systems, such as likes on user posts.
  • Highlighting user generated content individual users in key points of a home page.
  • Inclusion in leaderboards, general or thematic.

Networking tools and methods that ensure the inner stability and activity of the community by bringing together the most suitable users. Attractive are ads of users with similar profiles and interests in the form of galleries. Frequently used is the so-called friend-of-a-friend method in which users are suggested other users on the basis of a common contact. The interest-based method is particularly recommended for communities with very heterogeneous interests.

Functional areas – social navigation: Social navigation provides an easier overview of e.g.

  • The activities of contacts and friends, whose presence
  • new content of selected topics
  • new content and activities of subscribed users

Social navigation facilitates communication and increases community users.

Functional areas – Galleries: User galleries – picture galleries of the individual users – are an attractive point of attraction of a community. They can be of a general nature and / or directly related to the objective of the community. The visibility of galleries can be a direct influence on the attractiveness of a community. Feedback for content, especially images, can have a considerable motivating effect.

Community communication concept

  • each user can be a sender and a receiver.
  • In principle, communication is possible between all users on an equal basis. (Communication restrictions may exist due to the business model, especially monetization).
  • Communication should be possible one 2 one and one 2 many.

The communication concept has a direct impact on the external impact of the community and its growth potential. The quality of the communication functions should allow both real-time and time-shifted communication. The history of communication with users should be preserved and findable in the communication function. The question of the communication concept also includes the connection of the community.

  • stand alone community
  • Connected to external platform(s)
  • cross-platform community

The communication concept has a direct impact on the external impact of the community and its growth potential.

Participation

In addition to user participation through communication functions (dialog) and self-presentation (profiles) and content (galleries, blog), further involvement and participation by taking over functions in community management or the management of content areas / topics is a way to increase the activity and acceptance of a community.

Community Management

Managing a community is essential to its success. Community management has a variety of tasks. Here are some of the more important ones for me without ranking. The community management

  • ensures the growth and activity of the community.
  • pays attention to the further development of the community (content, structure and function).
  • adequately secures the economic value and use of the community by the company.
  • pays attention to a satisfactory operation of the community and here in particular also to user benefits and user satisfaction.
  • enables and ensures user participation within the framework of the community concept in terms of quantity and quality.
  • Represents the interests of the community within the company.
  • pays attention to the company’s concerns in the community.
  • is the contact person for the users for all matters concerning the community.
  • is the contact person for the functional areas of the company on all issues and topics relating to the community.
economic potential of the community

The success of a community only becomes an economic success through its economic potential. Economic potential is based on the value of the developable economic potential in the community. In a community of end users, for example, this is the portion of the economic need that the company can tap for itself or market to others.

The economic value of a community is therefore more comprehensive than the potential that can be exploited with a company’s service offering. Whether and how to leverage this broader economic potential of a community is a strategic business decision. It goes without saying that the community itself must not be endangered by a more extensive economic use.

Companies that understand and use their community only from the point of view of their own service offering may be foregoing considerable economic value as a result. This should not be overlooked when evaluating and managing a community.

Success as a community is a prerequisite for economic success from the community. In addition to a sufficient technical-functional and conceptual basis for the community, community management and the user perspective on the community are crucial to success. Companies that see communities as an extension of their own marketing – i.e., as pure marketing tools – run the risk of jeopardizing user acceptance.

Performance potential of communities in the market and competition

The following section describes the performance of communities (brand and theme communities) for generating economic value in the market from a company perspective:

  • economic values through community: developing and securing markets, supporting the business model, generating information and interested parties, etc.
  • economic value of the community: the value of the community per se for the company but also as an independent source of revenue or as the basis of a business model.
Develop and secure markets

Communities are an effective means of developing and securing a market with the help of the market itself.

A prerequisite for the functioning of this procedure is the suitability of the market resp. of the brand for a community.

In terms of market performance, we distinguish between the impact of the brand community and the topic community. Topic communities address the entire market within a topic. Topic communities do not exclude any brands and thus also no brand potentials and can offer all brand friends of their topic a virtual home. In this way, the operating company also taps into the customers of other companies. Companies as operators of a topic community gain acceptance if they place the topic in the foreground of the community and dispense with a concise presentation of their own brand.

The prerequisite for the use of a topic community is the suitability of the topic for a community. You can also recognize the basic suitability by the fact that social media users regularly / permanently talk about this topic (monitoring) or even areas in forums and groups of social media users are used for this purpose. The existence of specific forums / groups on this topic is an exclamation point for a corresponding interest. But in this case, check whether the topic is not already too comprehensive and well occupied.

Market development via community works by creating an active community based on suitable topics. That is, we need to bring together, connect, and empower social media users with interests in a topic and interest in a community around that topic to create value for themselves and the community. Through the active community, we not only get important insights but also direct contact with these users. Active members are the best source of new members, as long as we allow this opportunity for our community accordingly. In the development and management of our community, we should pay strict attention to the fact that the user benefit is in the foreground of the community and not short-term marketing and sales goals. This does not mean that we cannot pursue marketing goals with a community, but that a community that is primarily thought of and used as a marketing function does not work in the long term. If we put the user benefit before a short-term company benefit, we will have the greater company benefit in the long run.

Market protection via community also works by creating an active community based on suitable topics. In this case, we collect users and commit their attention and time to these issues with our community. Users of this community provide the benefits of the community and maintain its attractiveness. In doing so, we should support these users in the best possible way with appropriate functions, incentives and motivation systems. We need a relatively small core of users for an active community. The eBay study was the first to describe this phenomenon. A look at Wikipedia shows how a relatively small group of users creates a remarkable benefit for a much larger group of users, completely changing an industry.

Information Retrieval

Through self-expression and user information and communication, communities provide extensive information about users, their attitudes and perceptions, current needs and general desires. This information gathering can be expanded and supplemented via direct communication with users. Information is up to date and directly available. Neither in social media nor outside of it is there a comparable instrument for obtaining information.

Participation

Communities function through user participation. Participation is therefore an essential component of communities. This participation can – if accepted – be extended to forms of participation that are of economic importance to the company and its interests.

Participation can already be a comment, a recognition. In this form, we all know participation. But participation can go so far that social media users build and manage functional areas of a community systematically, regularly, with commitment and responsibility. This can go as far as building volunteer organizations that are themselves a community within the community and can be extremely successful – both in terms of the impact they have in the marketplace and in terms of profitability.

Participation / community is not a child of the Internet. The Internet has only changed the technology. Building and operating communities has become easier. If you want to know an example of the impact of a pre-Internet community, I recommend you study aarp.org. AARP is an independent, non-commercial organization that sees itself as an advocacy group, is active in the media, lobbies, and provides a variety of services through a core of volunteer members. To understand the impact of a community, it also helps to remember the importance that associations can have – on a small scale at the local level as well as on a larger scale.

Values through community

Communities can create economic value for companies on multiple levels. The most important are found in the form of

  • Customer loyalty
  • New customer acquisition
  • Information Retrieval
  • Competitive advantages
  • Participation.

Participation of social media users in a community can sustainably support the impact of corporate activities or even replace them. This means the company is more successful and / or has lower costs in the process. An example of this is the recurring support of customer service by social media users in the form of forums in which users support other users with questions and problems arising from the use of company services.

In addition, communities themselves can create economic value. For example in which they

  • enable an independent business model, i.e. are its basis.
  • contain a market in themselves and thus represent an independent value in themselves as a market as well as market access.

In a corresponding constellation, a company’s communities represent an independent economic asset that can be managed, used or even sold separately from the company. This possibility should – where recognized, feasible and desired – be considered in the conception of the community from the beginning to avoid later acceptance problems with the use of this possibility as far as possible.

Competitive performance – generating competitive advantages

Successful communities form a fixed structure in which social media users find and engage with each other. The competitive advantages from these structures can be temporary, i.e. of a limited duration, or of a permanent nature. The competitive effect is to build relationships with social media users who are not from their own market share/customer base, to strengthen customer relationships, to gather market-relevant information, and to reduce social media users’ attention to competitors’ offers on social media.

  • Temporary competitive advantages: In this case, one or more competitors must also succeed in establishing a community with comparable performance.
  • Permanent competitive advantage: no direct competitor has a comparably successful community.

Topic communities in competition: Topic communities address all those interested in a topic, regardless of brand affinity or customer status. This means that customers of competitors can also be reached via a thematic community .

  • Topic communities can also be used to reach customers and potential customers of competitors.
  • Theme communities are not infinitely replicable due to their digital nature. As a rule, a few – successful – topic communities are enough to occupy a topic.

Resource requirements

The establishment and operation of communities requires appropriate resources, in particular

  • a technical platform with sufficient functions.
  • a community concept with sufficient benefits for the users.
  • a community management with the competence / know how to build and operate the community.
  • A value creation/monetization concept for leveraging the economic potential of the community.

What corporate communities fail at

There are more reasons for failure than for success, and it’s no different with communities. Below are some reasons for the expected failure of enterprise communities that are neither new nor surprising, but still encountered.

  • Topic: The suitability of a topic for a community is a basic requirement for the success of a community. Whether the theme is actually strong enough for a community should be well examined.
  • Brand: Brand communities require a brand that users want to publicly identify with. Communities require their users to be as active as possible on a regular basis. Brand communities therefore require a user benefit in the form of a brand that is highly motivating for users. Not all brands fulfill this. Even very well-known brands fail with the attempt to build brand communities. In particular, everyday brands suffer from a lower willingness of social media users to publicly engage with them.
  • Size isn’t everything: Not every topic that we think is suitable because it has grown on us is actually suitable for inspiring crowds. It is a pity when a community project with a suitable topic fails because the expectations it raises in the company are in dimensions that this topic – and the community it aims for – can never achieve.
  • Type of community: when we establish a brand community, we achieve the performance of a brand community with it. Too bad if instead we expected the performance of a theme community.
  • Business first: Corporate communities serve a business objective. That’s a good thing. But for these communities to serve a business objective, they must be successful. For this, the rules of the community must be respected. Which sometimes seems difficult for companies. If you take the ball in your hand and throw it into the goal, the ball is in the goal, but this goal does not count and you are probably out of the game. Anyone who runs a community and allows short-term marketing and sales interests to get the upper hand is putting the chainsaw to the credibility of the community.
  • Social media and management competence: Communities are Champions League. As a rule, it is not enough to have once managed an audience and been active in a forum to be able to build up and manage a community.
  • Platform and functions: if important functions are missing or insufficient, we should not be surprised if a community does not run smoothly. I’ve seen communities from well-known companies that ignored fundamental deficiencies in critical functional areas for years and couldn’t bring themselves to solve problems that severely hindered community success. Pay meticulous attention to the quality of the communication functions, active networking, profiles and participation options, and first and foremost draw up specifications with concrete requirements for the individual functions and their scope and quality before embarking on the choice between technical solution alternatives.

EXERCISE OWN COMPANY

Check whether a community for the topics of your company's markets is possible and useful in principle and, if so, how it should be structured.

Define the topics for which you are assessing the suitability of a cummunity.
Define the criteria you will use to assess the suitability of a community for these topics.
Give reasons for your assessment - i.e. why you think a community is possible or not possible for the topics of your company.
Outline the user benefits that are to be created with this community.
Describe the company benefits that can be created with this community.
Describe the main functions of the community for communication, networking, motivation and participation.
Describe the requirements for social media resources and social media expertise (platform and operations) for using this community.
Describe the competitive nature of this community.
Describe the competitive impact of this community against performance competitors and attention competitors.
Describe the competitive situation of your company vis-à-vis a community on critical topics of your company.