Value Of A Single Member

January 29, 2014Comments Off on Value Of A Single Member

Forums devoted to video games usually aren't worth much.

Gamers don't click on ads. They resist any form of control. They're as likely to hurt you as they are to help you. They don't have much money. They say things that make advertisers shudder. A conversion is worth $30 to $50 of revenue. 

Forums devoted to cars are worth millions. The age range is higher. Purchasing power is considerable. They click on ads more frequently. Each sale is worth thousands. The lifetime value is huge.

We were involved in a healthcare community two years ago. It was tiny, a few hundred members. Yet, each member had a $250k purchasing power for that specific service. Increasing the retention rate by just a handful of people, or attracting new sales, was worth millions.

The value you get from your members is greatly affected by age, gender, purchasing power, frequency of purchase, level of top-down resistance, and, for knowledge sharing, what knowledge they have to share. 

This is why it's important to check a few things before begin the community effort. Chiefly this includes:

  • Are they of an age (or cultural persuasion) that would make them resistant to doing what you ask them.
  • Do they have the spending power to do what you want them to do?
  • Do they have useful knowledge to share with one another? (we made this mistake once, but only once).

Simply by looking for existing communities (and doing 25 to 50 interviews with members of the target audience) you can get this information very quickly. Spend the time doing it, it's worth every minute. 

In many sectors, it's simply not worth building a community. 

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