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Using the CMX #SPACEMODEL to Create Your Business Case for Community

Posted by Mel Attia on Apr 13, 2016 11:23:52 AM

4 minute read

DAvind Spinks webinar

Imagine you suddenly have double the resources and staffing to build a stronger community team. Does it sound like a pipe dream? Or do you find yourself struggling when you are invited to speak to management about the community? What if I told you that these conversations don’t have to be uncomfortable? What if I told you that you can walk away from these meetings empowered, recharged and motivated?

Last Tuesday, we invited David Spinks, founder of CMXHub, to discuss how community managers can put together a game plan to quantify the value and track the right KPIs (a topic we’ve talked about in the past). The folks from CMX created a framework that links community initiatives to business objectives. It is based on their experience of working with dozens of consumer brands.

Still today, many community managers struggle with defining the value of their community. The ability to bridge that gap will help your group get better resources both for staffing and tools; enabling you to have more say in getting the right community platform, social listening, and reporting tools.

The less considered benefit and most important for ambitious community managers is the ability to grow beyond the bounds of tactical work. By focusing on tying community and business together, the community team becomes a strategic partner within organization, and grants visibility into other important projects where you can become a valued contributor.

Breaking down the SPACE model

The SPACE model focuses on how the community can directly have an impact on solving real business issues. But to do this, you have to focus on figuring out what the problems actually are, before leaping into action.

To have a good grasp of the business problems, consider two important factors:

  • What is the purpose of the community? Is it to provide support to customers, gather ideas, connect partners, build a fanbase? A good tip is that generally this is related to revenue, and operational cost.
  • What key goals does your organization have? If they are market facing - meaning for customers and partners, ask marketing management or CEO what the big goals are for the coming year. If it’s internal, then go to HR to figure out what the business drivers are behind the community. Is it to make it easier to recruit new employees? Keep current employees? Gather new product ideas? This usually is tied to productivity and retention.

With that, let’s take a closer look at the framework. The SPACE model focuses on 5 major business activities:

  • Support
  • Product
  • Acquisition
  • Content
  • Engagement

Most communities have a blend of these within their purview. For example, your support community may have an impact on your product because you have real time feedback on bugs and issues, customers share ideas for product improvements and your power members contribute great long-form SEO-friendly content that brings in organic traffic.

If you aren’t already measuring success, the worst thing to do is to try and chase all the possible metrics. Instead, David recommends you focus on the one metric that matters the most. If you’ve been actively managing the community, you should already have a good sense of where the community contributes the most.

So start with one objective, and find the right metric to track. With this, you’ll be defining your community measurement strategy.

You’ll want to focus on SMART (Simple, Measurable, Attainable, Realistic, Timely) goals. Simplicity is key here. Go too complex, too fast and you’ll get distracted.

For example, if you focus on Product as your one community objective that really matters, you should be focusing on:

  • Surfacing important product feedback and ideas
  • Improve customer/partner success
  • Increase customer retention

Typically, all goals tie into revenue, therefore, we can focus on tracking the impact on the average value of customers that participate in the community versus those that don’t. Look at the average amount spent from both groups for a set period of time.

Group A - Non-participating customers

  • APV (Average Purchase Value) = ( total sales for group a for set period of time/ # of group a members that bought during the set period of time)

Example
$100 average purchase value for 3 months = $10,000 in purchases /100 members

Group B - Participating customers

  • APV (Average Purchase Value) = ( total sales for group b for set period of time/ # of group b members that bought during the set period of time)

Example
$150 average purchase value for 3 months = $15,000 in purchases /100 members

To calculate the impact:

  • Additional value of participating members = [Average purchase value of group B-Average purchase value of group a]/ [Average purchase value of group a]

Example

50%=$150.00-$100.00/$100.00

50% higher than non participants.

You might think that this is too good to be true. David shared with us some compelling facts that back up the assumption. Dell understands that participants in their ideation community spend on average 50% more than other non-community participating customers.

Of course, there are many more ways a community can be valuable to your business. If you are looking for more ideas on what metrics you could be tracking: watch the recorded webinar How to Align Your Community to Your Business Goals and get a copy of the slides here!

Topics: Community, News

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