Trapped By Projections

October 24, 2018 ,,Comments Off on Trapped By Projections

Earlier this year, we spoke with a large brand in the early stages of launching a new customer community.

They projected they would recruit 140k members in their first year and 800k within 3 years.

It seemed logical to them. They had almost 20m website visitors each year and a mailing list of 1.5m. If they persuaded a small percentage of each group to join, they could hit their target.

The approval for the project was based upon these projections – projections supported by the platform vendor.

We tried to warn against these projections, supplied data, and provided countless examples. In the end, they decided we were being too pessimistic and the platform vendors knew best (they went ahead without us).

In the few months since the launch, they’ve attracted less than 10k registered members and have only a dwindling handful of active participants.

It’s not looking good.

If you need a high number to get approval for a project, someone will certainly figure out a formula to come up with one. This doesn’t make the formula valid (nor going ahead any smarter).

And any projections based upon the quantity of members or overall level of activity is classic engagement trap thinking. You’re going to be chasing numbers instead of weaving a small, powerful, community first.

Don’t become the next victim.

(Also be aware platform vendors have a natural bias to overestimate projections. If they estimate 100m visits a year and you only get still pay for the 100m for the duration of the contract. The huge churn at most vendors in the past two years has accelerated this trend. Remember you can always go up to higher tiers, but it’s almost impossible to move down).

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