The Hidden Power of Bringing People Together
Okay. I have to admit, the title is a little misleading. Corporations have made no secret of the value of community building. In fact, corporations have made billions of dollars from it. Unfortunately, however, that value has been hidden from actual community builders. For individuals who naturally bring people together, the economic power of that activity can be easy to overlook, because it can feel so normal. But there is an incredible financial opportunity in that work, and it’s time to take notice, take advantage and start turning your communities into commerce.
This means that people are looking to others to help make decisions on every day choices about what to buy, what to wear, wear to eat, and other things
What is community-building?
Community building consists of 2 components: (1) bringing people together and (2) getting those people to share.
Bringing People Together
That’s it. It doesn’t have to be a large group. Even a group of 2 can have real community dynamics so long as there is a genuine connection.
A strong community is one where the members participate in a back-and-forth sharing of thoughts, ideas, hopes, fears, memories, joys and pains. Our emotions create bonds between people. And a community-builder shares those emotions, and succeeds in getting others to do so also. When that kind of group dynamic is built, it really benefits everyone.
How much is community building worth?
As it turns out, 92% of customers trust referrals from people they know, and 81% of US customers’ decisions are influenced by friends on social media. This means that people are looking to others to help make decisions on every day choices about what to buy, what to wear, wear to eat, and other things we may want to know. For those community-builders who create environments where people trust and share information, it serves the entire group. In recognition of that fact, there are several ways corporations depend on creating or utilizing direct, human connections to generate commerce.
The direct selling market, for example, works by creating direct connections with consumers and selling to them, eliminating the need for costly middle-men like retail stores (e.g. Target or Macys). It’s all about community. The manufacturer builds a customer relationship with the customer and provides the goods when and how the customer needs them. This kind of relationship only thrives when the seller understands the customer’s needs and is responsive to them. That kind of transaction can only happen inside a community. And it is lucrative. In 2018 alone, the direct sales accounted for $35.4 billion in retail sales in the United States. And it’s not just direct marketing, corporations are taking advantage of communities in other ways to impact their bottom line.
Big name celebrities may use social media to share things with their followers, but the size of their audience prevents any real back-and-forth connection, so their influence can frequently feel hollow
Social Media Marketing
Social media has done a remarkable job of turning the entire world into a collection of communities where people from around the world can find others that share their passions and interests. From Twitter to Instagram, people are finding their tribe, so-to-speak, and large brands are taking notice and taking advantage. Unlike direct selling, influencer marketing taps into the connections built on social media to promote an advertising or brand message. We’re all aware of corporations paying top dollar for celebrity endorsements, but now they’re learning that influencers and micro-influencers frequently offer an even greater return on investments. That’s because it is the smaller, more intimate groups that motivate us more than a shout from a celebrity. It makes sense, because, as I mentioned above, a community is only created when there is sharing on all parts. Big name celebrities may use social media to share things with their followers, but the size of their audience prevents any real back-and-forth connection, so their influence can frequently feel hollow as compared to the relationships that micro-influencers can build with their circles. That’s great news for individuals, as it presents an opportunity to market themselves to great effect and to use those tools for themselves and their own enterprises.
Referrals and Word of Mouth Marketing
Referrals are also an overlooked tool that companies use to capitalize on community-building. A simple email to a friend or acquaintance can have a staggeringly positive effect on your business. According to the Word of Mouth Marketing Association (can you believe that’s really a thing?!), word-of-mouth has a marketplace impact of $6 trillion. That’s great news for natural community builders because that means you’ve got an inside track to one of the most powerful marketing tools. In addition to its pure marketing power, word-of-mouth also leads, not only to more customers, but more loyal customers, as the lifetime value of word-of-mouth referrals is 16% higher than non-referred customers. And that’s just the beginning. As I mentioned above, 92% of customers trust referrals from people they know, and 81% of US customers’ decisions were influenced by friends on social media. With those kinds of numbers, it’s clear that community-building pays off, and large corporations are using every tool at their disposal to take advantage.
How can I capitalize on my community-building skills?
So what does this mean for the entrepreneur? It means that you’d better get started building your community, or, if you already have one, put your focus on strengthening and securing it. Bringing people in to a space where they can genuinely connect, not just with the entrepreneur or enterprise, but also with others in the circle is a vital part of commerce, if not the vital part of commerce. And the more you own, curate and customize your community, to serve your members, the stronger those bonds will be and the greater your return on investment.
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