61% of US corporations will have an online community

Recent research found that some 61% of US corporations have or are developing an online – or brand – community.

Wikipedia defines an online or brand community as – ‘a community formed on the basis of attachment to a product or marque. …….. stressing the connection between brand, individual identity and culture’ In practical terms, an online or brand community is a tribe, a group of members of the target audience with common values and interest, brought together by a common interest.

Online or brand communities are increasingly important in facilitating effective and most importantly, cost effective marketing. Emphasising this point are the following findings arising from recent research:

• 86% of Fortune 500 companies say communities provide insight into customer needs
• 96% of businesses see the value in online customer collaboration
• 66% of businesses turn to brand communities for product development
• 71% of businesses use customer collaborations for market research
• 64% of businesses with a brand community have improved their decision-making
• 36% of businesses use fewer surveys for marketing research and development

The reality is, online or brand communities:

• Drive marketing costs down
• Drive sales including repeat business up
• Facilitate more effective product development]
• Can significantly enhance margins

Online or brand communities are much less common in Australia than they are in the United States and Europe. The reasons for this lag are not clear, but the opportunity this lag creates for enlightened businesses. Online or brand communities are equally relevant B2C and B2B enterprises.

One of the more famous brand community was that established by Harley Davidson, established in 1983, when the business was facing bankruptcy. Evolving from an offline community to an offline and online community, the Harley Davidson community has helped boost sales and performance to a point where the brand is now valued at US$7.8 billion.

In 2019, there are two types of online community being developed

• Brand
• General

Brand communities are brand specific while general communities might address a number of brands and or a geographic region. Both facilitate:

• Developing a Tribe
• Permission Marketing

Best-selling Author Seth Godin has written books on both.

RECOMMENDATION

Consider developing a brand or general online community with a view to increasing sales and margins while decreasing marketing costs.