Community building is so important to a business.
Sure, you can advertise in the Yellow Pages, put up a website, use Pay Per Click advertisements, you can even use television and billboard advertising – take out a full-page spread in a national newspaper if you want. But what will that do?
High cost per lead, low ROI.
Okay, okay – so “cost per lead” and “ROI” are typically thought of as big-business terms, but aren’t. You should know how much it costs you to get a customer, and you should know how much you get back for dollars spent in various ways.
For example, if you know how much your Yellow Pages advertisement costs you each year, you should find out how many customers you get from that ad – and the average amount of money those customers spend.
If your Yellow Page ad costs $240/year, and you get 12 customers from that ad (one a month, which is more than most businesses get from Yellow Page advertisements)…
Your cost per lead is $20.
Now, if we say that your cost of goods sold is $20, and your average customer spends $50, then we know three things :
1. That your Yellow Page ad is getting you about $10 in profit for each new customer.
2. That you can use any form of advertising you want, and as long as your cost per lead is under $30, you’re going to break even… And
3. That the lower your cost per lead is, the higher your profit per customer is.
We all know that online strategies like blogging and social media have drastically lower costs per lead than traditional strategies, but it gets even better – when you build a community around your business!
Within a community, you have the evangelists… They go out and sell your product or service for you. And no, you don’t have to pay them – they’re customers and community members who are so impressed with you and what you’re doing, that they want to convert other people to their way of thinking – they want to make other people buy from you.
You also have the technical support… These are users who know your product inside and out, and answer questions on your behalf to solve problems for customers – thereby increasing the value of your product, since “everyone knows how to fix it!”
You’ll have the beta-testers… Those who feverishly buy up every new product or service you release, and give you constructive feedback through your contact forms to improve the product.
You’ll have the re-tweeters… Not as prolific as the evangelists, but they believe in what you’re doing, so they share it with their friends through Twitter, Facebook, and other social media sites.
You’ll have the commenters… The insatiable commenters. They’ll discuss anything and everything you have to say. They attract massive amounts of attention to blog and social media posts by providing a level of interaction. Don’t discount “trolls” either – those who start arguments for the sake of arguing. Sure, everybody will respond to the arguments – but in the meantime, they’ll be reading your content to see what started it.
All of these personalities come out when you build a community around your company, and every one of them will give value to your business beyond what they may buy.
Communities are simple things. Mark Zuckerberg, the founder of Facebook, once said (and I’m paraphrasing here) that you can never “build” a community – you can just create great tools and hope that a community uses them.
That is what we do.
The right tools are never a guarantee of success, but if companies like Apple and Coke have taught us anything, making a cult following look easy takes time, effort, and patience.
Watch for our coming series of posts on things *you* can do to build a community around your business.