The McKinsey Community Flywheel
There have been isolated outbreaks of cynicism about ‘community’ in our feeds in recent weeks. We’ve been here before though; remember how ANGRY some got about ‘content’ and dismissed the idea that people would want to create content with, for and about a brand? (Pre TikTok of course...)
Anyway, it was a welcome, if unexpected timeline cleanse when we saw the McKinsey Community Flywheel with the headline “a better way to build a brand.”
Back in 2020 we saw ‘community’ becoming a key element of brand building and marketing driven by generational, behavioural and technological change. Not to mention the impact of The Pandemic.
So we launched VOLUME to help B2B brands develop community strategy, to implement community-based marketing, and to build and grow communities of their own.
Our first report in 2020, The Direct to Community Economy, was followed in 2021 by the Business of Community report, with insights based on our growing market knowledge and learnings from client projects. Our contribution last month to the Community Based Marketing Best Practice Guide continues the trend.
We’re delighted that our experience and many of these ideas we’ve developed in the process are reflected in the McKinsey Community Flywheel. And we’ve got a handful of observations on where the reports authors really nail it, that we hope are be of value to anyone investing in or interested in community for brands:
The authors recognise the critical role that social plays in early-stage connection building - ‘setting the wheel in motion’ but that this is not the long-term place to build a brand’s community - with a raft of alternative platforms now available
They share excellent stats for benchmarking community and content performance, stating that for brands that get their community flywheel spinning:
75%+ of content about the brand is user generated
2%+ of viewers who go on to like, comment, or share the content
4%+ of online traffic is converted to sales
Brand-related posts go viral at least twice a year
3. They express simply the value that investment in community can create for brands - higher engagement with customers that actively want to express their membership, and reduced risk (e.g. in NPD, venture building and marketing ROI) thanks to agile test and learn methods informed by super-fast direct feedback loops
4. They underline the importance of fuelling the conversation to give oxygen to the community, but that true community requires the brand to stand back, giving the members, creators and influencers a degree of agency and autonomy to enable a true community to evolve
5. They explore the impact of a community-led strategy on the P&L - and the need to rethink KPIs and measurement; For instance community-built brands may see gross profit increases as they are able to reduce promotional pricing and potentially raise prices on certain products as a result of greater and earlier insight into demand.
Talk to us if Community is on your agenda for 2023 and let’s explore together how it can be a better way to build your brand.