How To: Measure Community Return on Investment (ROI)
Showcasing the Value of Community
Marketing and community teams are struggling to measure the business value of community in business terms. No clear analytics or financial metrics to show impact. The constant fight for more internal support and increased funding.
We’re seeing this impact with the current layoffs across industries with numerous layoffs in marketing and community departments.
Community is about creating an experience around the product. Members feel like they’re part of an exclusive group. They appreciate being part of a club, want to advocate for the brand, and are loyal subscribers to the values of the brand.
Community ROI
Return on investment (ROI) is a crucial piece of any business. Stakeholders and executives need to understand where time and money are going and how they tie back directly to the success of an organization.
Often, ROI is tied back to sales and profitability. It’s a method of measuring success.
When it comes to community, there’s still the baseline importance of understanding the value community provides to the organization. It’s increasingly important to prove community ROI, but how do you actually measure the impact of your community?
Platforms, like
Spontivly, put the data and analytics surrounding your organization’s community back into your hands to understand a variety of engagement methods across numerous platforms. Implementing products like this allow communities to have tangible numbers for proving the ROI of community.
Measuring Community Impact
It doesn’t always make sense to use profit-level metrics to evaluate community. Measuring community impact to determine ROI focuses less on the money invested or brought back into the organization, but more on the overall benefit of the community.
Now, a lot of this comes down to sentiment, which is hard to tangibly evaluate. Some high-level metrics include community:
- Engagement
- Attendance
- Activity
- Retention
When it comes to measuring engagement, it’s about how members are interacting with the community. This includes the number of messages being sent back and forth, reactions, and even just reading the content.
Measurement is a method of showing the value of the work that’s being done to build community. Gaining the right data through measurement helps make decisions. When it comes to each community use case, there are a few different ways to measure success.
Marketing
- Number of posts per month
- Member growth
- Attrition rate
Customer Support
- Number of support tickets answered
- Average resolution time
- Average response time
Product Innovation
- How many templates have been created
- Forum responses
- Churn rate
Some other important terms to understand when it comes to measuring the value and impact of your community:
Community-Driven Impact
How much influence does the community have on visitors? How many people visit the community? This includes your average member impact and reach.
Average Member Impact
This is the average impact directly caused by the community on each individual visitor. This can be measured by:
- Asking your community
- Survey questions
- Interviews
People generally aren’t great at explaining what drove their behavior. We often claim we aren’t impacted by advertising. Yet, we still find our decisions influenced by large companies. This isn’t a mere coincidence as these companies also boast large ad budgets.
The key is to balance practicality against bias to find the optimal outcome to drive the return on investment in your community.
written by The everything community team
We're a small team of community builders focused on helping our industry continue to flourish.
newsletter