Save money and build value: ROI on associate communities

One of the biggest challenges for community professionals is proving the return on investment (ROI) of the community they are forming.  Requests for support and investment that don’t demonstrate a return can be shot down in flames by the big gun at the top.  ROI is traditionally tricky to measure in a community setting – but that may indicate that the wrong questions are being asked.

Money Talks

Remember the early days of social media? The big excitement on twitter when someone reached a follower milestone? Chasing those statistics was the highway to hell. All too quickly it became very clear that there was no direct ROI in follower numbers. This handy infographic from Domo, published back in 2013, demonstrated the challenge for traditional methodology. However, social media isn’t a machine – it doesn’t generate a traditional ROI. And community isn’t a machine – it is a way of achieving business goals, differently.

ROI Domo

I’ve identified three common features in communities Ive worked with:

Corporate Core

All our clients have a corporate core which, regardless of size, is the subject of considerable attention in cost savings. Every process and action within that core has been poked, prodded, and rearranged to ensure it’s carried out in the most cost effective way. The business world has been quantifying processes since the early part of the 20th Century. When corporate intranets first came on the scene, they could only be adopted if ROI could be proven, so it’s no surprise that studies like this comprehensive classic from Prescient Digital in 2009 were able to demonstrate savings in top corporations of an average of $1m, ranging up to $20m.

Wide client base

Working with large membership organisations, games builders, charities and the like, we know our clients have a lot of people to reach out to. Communication is largely linear and outward-facing, using all the social tools and mailing lists at their disposal. The calculation of ROI on this activity is less clear, but dealing with the market has always been part of business so there will be a track record of client acquisition costs, marketing and advertising spend and so on to provide a benchmark.

Associate community – the Cinderella circle

This is the poor relation of the two established groups. This is the Cinderella circle. Every business we meet has a significant group of associates of some kind. They form a solid base for the organisation’s activities, but it’s a long way to the top and their value can be overlooked.

What’s the Cinderella circle in your organisation? Look at the volunteers who help to run local branches, the brand advocates who shout for you, the inner circle of users who can beta test your work and give you honest feedback. They have a quantifiable value: their acquisition cost. How much did you invest in building that group? Can you put a figure on the skills that you’d have to replace if they left? Once you can fix on that value, you know what you have to protect. The ROI of building an associate community is the savings on retention of a skilled group whose loss you would feel. You need them to play ball; this isn’t something that can be done dirt cheap.

Retain value with a social intranet

An social intranet like Ambix helps you to engage and support the people you value. You don’t really want them tied up with your heavyweight corporate intranet, but you need to demonstrate their value through more than just lightweight social media interaction and mailings. Contact us to find out more.