Community-Led Growth or How to Generate Growth with Your Community?

Recently, with rising acquisition costs and new GDPR rules, brands are seeking alternative ways to reach their target audience at lower costs, and this is where Community-Led Growth comes into play.

The advantages of this marketing strategy are numerous: better understanding of your audience, reduced acquisition costs, and increased brand visibility. This translates into better retention rates and higher return on investment.

To achieve these multiple benefits, Trustt offers you an overview on how to generate growth with your community…

Community-Led Growth: A Healthy Alternative to Customer Acquisition Costs

For the past few years, this strategy has been gaining momentum… But why?

• The rise in acquisition costs: brands are falling victim to increasingly expensive advertising campaigns and an increased dependence on GAFAM via Google, Facebook, and Amazon. These companies collect a lot of information about internet users’ personal lives and their purchasing habits (web pages visited, payment methods used, etc.). This third-party data is expensive for companies wishing to exploit it.
• The GDPR (General Data Protection Regulation), in effect since 2018, restricts access to personal data of citizens in order to protect their privacy.

These obstacles to acquiring new customers and understanding target audiences are forcing e-commerce businesses to turn to alternative, more sustainable solutions.

Community-Led Growth: A Vector for Growth

Faced with these various observations, many companies want to rely on their community to accelerate their growth… But how to engage it?

This is where “Community-Led Growth” comes in.

This trendy marketing strategy is in full expansion, and places the customer community at the heart of the company’s decisions.

“Within 5 years, more than half of startups and technology companies will have entities and frameworks entirely dedicated to growing their community once they exceed $5 million in annual revenue” (Bessemer Venture Partners)

The principle behind the term Community-Led Growth? Using an engaged and supportive community to acquire and retain customers, while expanding the visibility of your company.

The B2C Community: The Essential Base of Your Brand

“The term ‘B2C’ or Business to Consumer, refers to all the relationships that connect businesses and consumers. Talking about a B2C community” means referring to the gathering of these consumers around “a common interest or an important cause” supported by a brand/company.

From the Brand’s Perspective: The Benefits of a Consumer Community

Community marketing (or tribal marketing) is a strategy that consists of identifying groups of consumers by affinity to address specific messages to them.

Successfully building a community is a real growth lever that allows:

• Engaging consumers around your brand, its values, its approach, and its products,
• Creating a privileged relationship with your audience,
• Better understanding the expectations and needs of your customers,
• Retaining consumers over the long term,
• Transforming your customers into brand ambassadors,
• Having a panel of consumers at your disposal ready to test your products or co-create new ones,
• Improving natural SEO on the Web thanks to user-generated content (blog articles, reviews, social posts, YouTube videos, etc.),
• Getting customer feedback after product use,
• Recruiting new customers,
• Involving influencers and boosting your brand awareness thanks to their audience,
• To increase the conversion rate on your website.

From the consumer’s perspective: the sense of belonging

As “spokespersons”, consumer members feel connected to the brand and contribute to its development through:

• Comments on brand posts,
• Reviews left on product pages,
• Recommendations to friends and family,
• Shares on social media,
• Advice and testimonials on online forums, etc.

Their primary motivation is to create a connection with the brand and participate in its evolution. They appreciate its products, identify with the values it promotes, or are touched by the causes the company defends.

Belonging to a community also allows them to gain recognition from their peers: they cease to be just a number on a loyalty card. By speaking up to give their opinion on products and recommend them to their friends, they truly become consumer-actors.

“The main advantage of a community is that it allows you to create a sense of belonging (…). If your brand or organization seeks to do something beyond just a product and create a special relationship with your customers, then a community is vital. ”

(Gabriel Fraga, Principal Online Community Strategist, Typeform).

Community Engagement: A Growth Booster for Businesses

Community Led Growth is defined as the growth generated through the community of consumers.

“Community engagement is THE cornerstone of any business”

(Bessemer Venture Partners, 2022)

Community growth acts as a “halo” effect: by validating and recommending products, your contributors participate in the growth related to new customers.

Moreover, a loyal and convinced customer is a customer who spends more, and more often.

“Consumers engaged in a community around a brand have a loyalty rate 3 times higher than average”

(McKinsey Study).

When Communities Generate Exponential Growth

Community Led Growth has largely proven itself among companies that have implemented a strategy centered on their communities. This is notably the case for brands like Respire and Lego.

Respire: Strong Values, Engagement, and Co-creation

Respire is one of the DNVBs (Digitally Native Vertical Brands), where the consumer community is at the very heart of their creation story. The brand was born with a range of natural deodorants launched via a crowdfunding campaign in 2019.

The brand relied on the community of the founder, Justine Hutteau, who was followed by about 20,000 people on her Instagram account at the time.

By placing co-creation of its products at the heart of its development, the company sold 4.5 million products in two and a half years. The brand was conceived and created in collaboration with its community.

In 2021, Justine Hutteau opened a new private Instagram account “La Ruche Respire” which brings together 300 people tasked with “beta-testing” new products. A great way to animate a community and unite it around the brand!

Lego: Content Factory by Fans and Gamification

A leading brand in the toy market, Lego managed to recover after risking bankruptcy in the 2000s. Its turnover reached 4.8 billion euros in 2019, 4 times more than 10 years ago.

The Lego community is a source of innovation in itself: Lego allows members to design toys and propose them to the community.

The brand has also formed partnerships with blockbusters like Disney, The Simpsons, Friends, Minecraft, Harry Potter, and Star Wars, thus allowing it to engage external communities!

With multiple actions that engage its community, Lego stands as a true example in terms of community engagement thanks to its Customer Centric strategy.

I WATCH THE COMMUNITY LED GROWTH WEBINAR

What Tools to Use to Develop Your Community?

Community engagement can take various forms: the tools made available to the community should allow it to express itself freely towards your brand.

Let’s remember the 95-5% rule: 5% of customers can have an immense impact, whether it’s to praise a product or condemn it. The most loyal members of a community should be able to express themselves on platforms because their feedback is valuable.

Online Forums

Online forums allow their users to share their impressions about products or express their questions.

Maintain regular monitoring of forums to interact directly with users and maintain a connection with them. Don’t hesitate to set up Google alerts to manage your e-reputation and respond to user reviews.

Social Media

In addition to your brand’s social media (Facebook, Instagram, LinkedIn), you can create private groups for your best customers.

Share exclusive high-value resources or preview announcements about your brand.

This exchange space promotes more human interactions and attachment to your brand.

Events

Organizing physical or digital events allows you to gather members of your community around your brand.

A brand event showcases your products, provides a unique experience for guests, and benefits from increased visibility through sharing on social media. The ambassador feels privileged when you give them a leading role in a unique and selective event.

With Trustt’s Event Campaign feature, easily organize your events, select the best ambassadors, manage received applications, and create a precise mission brief on expected content. Provide a special moment for your guests and capture new people into your brand’s universe.

Our Advice for Engaging Your Community and Generating Growth

Community Led Growth should be thought of as true community building, which helps to credibilize, legitimize, and realize your projects, and generate growth. Be Community First before being Product First!

Here are the best tips for engaging your community:

• Define in advance the foundations of your brand identity: values, approach, storytelling, editorial guidelines, etc.,
• Identify your targets, and thus the members who will make up your community to find the best communication platforms,
• Adopt active listening to target consumers to identify their expectations and promote their satisfaction,
• Humanize your brand with authentic, sincere, and transparent discourse,
• Share the story of your brand’s creation,
• Invite your customers to share their opinions on your products,
• Launch an ambassador program to benefit from detailed feedback on your products,
• Involve consumers in the creation of your future products (Community Building),
• Develop a consumer panel to whom you can submit your ideas or with whom you can co-create new products,
• Encourage sharing on social media,
• Use data, reviews, and user feedback to continuously optimize the customer experience,
• Offer rich and useful content centered on the community’s needs,
• Offer exclusive rewards to your best ambassadors,
• Organize events around your brand.