From the Dream of Community to ROI Reality: How to Get Your Executives Buy-in with Vanessa DiMauro, CEO and Chief Digital Officer of Leader Networks. Online community champions often find it difficult to communicate effectively with executives in business terms which can impede their understanding of the community value. During the webinar Vanessa shared her insights on "selling” the idea of launching an online community by demonstrating its value. She also discussed: ▪︎ Getting support and resources you need to bring your online community to life ▪︎ Translating the value of community in relevant terms: time, revenue, retention ▪︎ Overcoming common obstacles online community champions face in feasibility, business model and organizational impact

2. ®
Vanessa DiMauro
CEO, Leader Networks
@vdimauro
vdimauro@leadernetworks.com
http://www.leadernetworks.com
From the Dream
of Community to
ROI Reality:
How to Get Your
Executives’ Buy-in Photo by Melaina Gilbert

3. ®
Living the Community Dream
3
Strengthen relationships
Deeper insights into new
products or services
Innovation + ideation
Increase use of existing
products/services
Participate in the market dialogue
Faster speed to market
Lower support costsPeer referrals Thought leadership platform
Listening post Generate revenue

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Sometimes the dream gets interrupted by unrealistic
executive expectations…

5. ®
A Tale of Two Executives
5
CEO Pie in the
Sky
• This is going to
be huge, quickly
• We’ll make lots
of money
• Software is free
• How hard can it
be?
CEO Oscar the
Grouch
• This will never
scale
• It’s going to cost
a fortune
• You want an FTE,
for this?
• Ugh, like
Facebook?

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Lack of Shared Vision, Insight or Business-Driven
Measures Can Often Obscure the Dream of
Community
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Is our
organization
ready for
this?

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Successful communities aspire and dream of meaningful
impact and innovation
and
are rooted in risk mitigation and realistic ROI.
This is the sweet spot for exciting your executives!

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Exciting Your Executives About Community Is More
Important Than Ever!
Two-thirds of organizations with highly involved
executives are seeing their communities influence
16% or more of their organization’s total revenue.
Source: “Online Communities: Driving Customer Engagement & Influencing Revenue”
(Demand Metric, September 2014)

9. ®
Communication Barriers Can Limit Executive Support
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Limited budget
Inadequate staffing
Uncertain credibility
Lack of internal champions
Uncooperative business partners
Failure to recognize business
outcomes
….the list of obstacles goes on.
=

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6 Reasons Why Firms Launch Online Communities
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Customer or Member -
Facing Business
Functions
Sales
Product
Groups
Online
Community
Product
Development
Customer
Service
Marketing
To help customers
get more value
from their products
and services
To market and
sell more
effectively
To get control of
the social media
conversations
about their firm
To develop
better
new products
and services
To improve the
way they
enhance
products and
services
To reduce the cost of
post-sale service

11. ®
Ways to Help Executives Spot The Value Of
Online Community….

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Situation: A community is under consideration but
decision has stalled due to unclear expectations.
Executive Question:
How will a community help us?
Excitement Inducing
Response:
“Community will help solve for X
problem and <important people’s
names> are behind it!”
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Setting Expectations

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Finding Internal Stakeholders
13
• Focus on the strategic goals of the
company
• Identify who has the most pressing needs
that community can help solve and
accelerate
• Frame the opportunity in business terms
• Answer the question “What happens if we
don’t build community?”
• Gather examples of community success
Executive sponsors can be found throughout the organization (e.g. marketing, customer
care, strategy, communications, HR, product development)

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Finding The Community Business Drivers
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A business driver is a
problem or issue that has
to be resolved in a cost-
effective manner.
Many large-scale online community
success stories began by solving a
single business problem, and
evolved into more wide-ranging
solutions which delivered outcomes
not possible prior to establishing the
community.

15. ®
Example Business Needs To Fuel Community
Business Case
Customer Service & Support
• Cost savings from contact reduction
Increase self-service
• Solve middle-of-the-night problems
Achieve scale and efficiencies
• Scale collaboration and information sharing.
Greater customer intimacy
• Leads to increased customer satisfaction
Gather customer ideas to increase speed to market
• Fuels innovation & new product adoption
Sales support and outreach
• Nurture leads through engagement

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Using Community To Enhance Existing Business
Processes
Meet with key operational
stakeholders within your
company to learn what they think
online community can do for
them.
– Operational stakeholders could
include Customer services leaders,
Product development, Marketing,
R&D, Suppliers
– Bring a few ideas to the table, but
mainly inquire about 1 or 2 areas
where customer or partner
engagement could help them
succeed.
Examine the current operational
processes and seek opportunities
for online community to enhance
or accelerate it.
– Understand off-line processes and
how they work
– Explore and propose ways online
community can enable / accelerate
– Vet with line of business leader for
changes or validation
– Document change and benefits over
time

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Align Community Strategy With Operations
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What does the
business need
for the
community to
be successful?
What do members
need from
the community
to get value?

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Situation: The community business plan is
sound, but the executive needs evidence that it
will be successful.
Executive Questions:
What will it take to deliver a
successful program?
How can we test our hypothesis
before making a significant
investment?
Excitement Inducing
Response:
We have a plan!
Operational impact: Staffing
content & business model
The community straw-model has
been validated before seeking
funding.
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Risk Management is Essential to Executive Support
A well defined plan + a thorough validation period offers an
insurance policy for community!
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A BELT AND SUSPENDERS
APPROACH HELPS MITIGATE RISK!

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Validating Your Hypothesis
Interview prospective
members
• Semi-structured
interviews
• Learn what they need
from peer-peer
collaboration and what
info they need from your
organization.
Survey a broader set of
prospective members
• Refine your hunches
qualitatively
• Validate specific features
or programs
• Understand success
factors from their point of
view.
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Sample Community Business Plan
Executive Summary
Why Community:
– Market trends
– Competitive forces
– Customer feedback
– Implications
Community Definition:
– Community vision & culture
– Who the community will serve
– Value proposition
– Client / member validation
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Key Elements of the Site:
– Features & content
Operational Focus:
– Governance
– Community goals
– Measures of success
– Project approach & milestones
Timeline & Financials:
– Community road map
– Cost & benefit scenarios
– Risks & mitigation strategies
Options and Alternatives
Road map

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Costs Category Estimate
Strategy & support costs Planning (e.g. internal assessment of needs)
Consulting (e.g. strategic guidance, recommendations)
Preliminary research (e.g. competitive analysis)
Legal (e.g. user agreement, privacy, employee policy)
Software platform Own or subscribe licenses
Initial implementation fees
Service and support fees (e.g. training)
Ancillary products (e.g. analytics, member mgmt tools)
Design & development Community design treatment & branding
Custom programming
Ongoing enhancements
Member acquisition,
Marketing & support
Member acquisition programs / assets
Online and off-line outreach programs
Member incentives
Content Repurposing existing assets & new content creation
Licensing fees for outside content (if applicable)
Staffing FTEs or contractors fully burdened
Sample Planning Budget

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Category Estimate
Direct
Revenues
In-community transactions (pay-per-download, pay-per-answer, pay-to-
learn, lead generation, membership fees)
Advertising & sponsorships (co-branding, partner or event marketing, co-
sponsorships)
Cost substitution (lower overall cost per customer served, per-incident
cost differential vs. other channels)
Reduced cost (cost per service incident; self-service for support needs,
product information, sales inquiries)
Indirect
Revenues
Increased customer satisfaction (faster response, reduced wait times,
more knowledgeable responses from community member collaboration)
Increased brand awareness (unsolicited brand mentions externally,
positive brand comparisons on 3rd party sites, increased inquiry traffic
across all channels)
Increased prospect and sales leads (referrals, community mentions on
3rd party sites, word of mouth via community members)
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Sample Revenue Model

24. ®
Forrester Research TEI Model
Forrester created a reference model of a successful owner community implementation
for a B2B company with an average deal size of US $100,000 and 2,000 qualified
annual leads:

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Early Launch: Managing Expectations
Situation: The community recently
launched and executives are tracking it,
but engagement is just starting
Executive Question Excitement Inducing Response
Proactive monthly dashboard that
includes:
Member acquisition program & numbers
Example exchanges
Quotes from Influencers
Business integration plan overview
Baseline data and change over time
Reasonable projections
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How is the community going?

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Establishing Return-On-Investment
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N
Source: Competing for the Future | Gary Hamel & C.K. Prahalad | Harvard Business School Press, 1994
Numerator / Net Income:
-Identifying where new opportunities lie
-Anticipating changing customers’ needs
-Investing preemptively in building
new competencies
Denominator:
-Investments
-Net assets
-Capital employed
-People
ROI= D

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Community Metrics Should Align with Business Objectives
Current Target Outcome Delta / ROI
General Metrics
Site Metrics
Business Metrics
Corporate Objectives
Business / Functional Unit
Objectives
Online Community Initiative
(Business Case / ROI)
– Financial
– Customer
– Process
– Learning & Growth

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Example Dashboard
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Sample Metrics Current Target Outcome Delta / ROI
General Metrics:
- # of site visits
- # of members
- # of new members
Site Metrics:
- # of posts
- Most visited pages
- Visits by geography
- Search rankings
Business Metrics:
- Fewer defects
- Problem resolution
- New ideas
- Leads generated
- Time-to-market

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Situation: Leadership needs greater insights about
the community’s success before becoming a
visible supporter.
Executive Question:
What is the community story?
Excitement Inducing Response:
Reusable presentations about the
community story
Community mission & mantra
Member demographics & growth trajectory
Quotes from members’ experiences and
from internal stakeholders whose line of
business was assisted by community.
Successes that tie back to the business
case you developed.
Future vision, road map
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Championing the Online Community Success Story

30. ®
.
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The most exciting thing you can do for community
(and for your executive) is measure success
in business terms.

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Summary: Making the Dream Reality!
• Executive sponsorship is key to successful online community –
Take the time to cultivate it, it is your responsibility.
• Have a consistent and clear answer to the “So what?” question.
• Community must be tied to organizational strategy in order to
deliver value — make those linkages apparent.
• Tell the whole community story in business terms. Keep your
executive sponsor(s) informed and enable them to understand
the opportunities, outcomes and challenges with building and
growing online community.
• You/community succeeds when you enable your executive
sponsor(s) to shine!
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