What is Community Led Growth - is it the same as Community Based Marketing?
If I had a dollar, pound or euro for every time I’ve heard or read the word Community Led Growth this year, I’d be able to to retire early. ‘Community’ is the shiny new Go To Market buzzword.
CEOs, founders and marketers across the globe are talking excitedly about Community Led Growth, Community as a “reputational moat”, a driver for growth and a regenerative approach to business.
Community Based Marketing and Community Led Growth have gained traction in sectors such as technology/SaaS, subscription businesses, media, publishing, membership organisations where customer retention is an important growth lever and access to deep customer insight and data is critical for marketers.
But how many businesses have actually developed a Community Led Growth Strategy?
How many marketers really know what to do and where to start with Community Based Marketing and deeply understand community strategy?
And are Community Led Growth and Community Based Marketing the same thing?
Let me summarise what Community Based Marketing is, and whether it is different to Community Led Growth?
Community Based Marketing - a definition
What do we mean when we say Community Based Marketing?
In 2020, Guild’s founder Ashley Friedlein and I coined the term “Community Based Marketing” or CBM and wrote a best practice guide about it.
We updated it in October 2022. Just before then, McKinsey called community the “big idea” in marketing for the decade.
It’s hardly a surprise that I agree with them.
Ashley and I defined Community Based Marketing as:
"Community Based Marketing (CBM) is bringing people together around a shared practice, purpose, place, product or set of circumstances to create insights and closer, more valuable relationships with prospects, customers and other stakeholders to deliver organisational value."
It is a reflection of good marketing practice - to develop a model that puts insight and customers plus community at the centre of business growth.
After all, good marketing is all about anticipating your customers needs and meeting them profitably. So anything that gives a business much greater proximity to its customers and prospects has got to be good. Right?
Community Led Growth - a definition
I’ve found it difficult to find the actual source of this phrase and a bit of research finds that pretty much every community platform has described what it is to ensure that they rank highly in search for the phrase.
It might be helpful to give you a definition for Product Led Growth (PLG) first:
“Product Led Growth (PLG) is a strategy where a business builds and uses its product as the main tool to acquire, retain and grow it customers.
In many cases, with this Go-To-Market strategy a business will offer free access to its product with the goal of persuading them to become paying customers.”
Product Led Growth businesses are common in the technology/SaaS space and include self-serve platforms like Hubspot, Salesforce, Slack, Dropbox, Guild and many others.
Interestingly, these businesses have Community Led Growth strategies too.
Here’s a definition of Community Led Growth from me:
Community Led Growth is a growth focused strategy creating valued and engaged communities to acquire and retain customers, whilst also expanding the reach of a business.
It’s a must-have Go-To-Market (GTM) strategy for technology and SaaS businesses and a viable growth strategy for all businesses.
So are Community Led Growth and Community Based Marketing the same thing?
Community Led Growth focuses on the creation of a community or communities to power growth from customers or prospects.
Community Based Marketing is a much broader strategy.
Community Based Marketing does incorporate Community Led Growth and the creation and sustaining of customer and prospect communities. But it also includes the identification of existing networks/communities and the support of these as well as the creation and sustaining of communities and networks for “other stakeholders to deliver organisational value."
These stakeholders depend on your business. They can be alumni, employees, volunteers, donors, investors, advisors or channel partners/resellers.
It’s the creation and sustaining of these multiple stakeholder communities and networks that can help an organisation deliver against its mission or goals.
For example, SaaS business The Happiness Index developing a customer prospect community and an investor/advisor community. It's co-founder has also created a community of likeminded CEOs who share similar philosophies about people, purpose, product and planet.
If you want to focus on a customer/prospect growth strategy. Then develop a Community Led Growth Strategy.
If you are ready to think more broadly about your multiple stakeholders and how community can help you achieve multiple organisational goals, including growth, then develop a Community Based Marketing Strategy
What are the key ingredients for Community Based Marketing and Community Led Growth?
I cover these in detail in my Community Based Marketing training course, but here are some essential elements.
A community strategy and plan
Alignment to your organisational, marketing and growth strategy
A community or communities to join, sponsor or a community that you set up yourself - these can be digital or physical communities. They are often a combination of both.
A long term approach - community is more akin to brand building than performance marketing - but should align with both
Patience, consistency, persistence and resilience
A focus on mutual value creation and building trust - communties are delicate ecosystems
Excellent community management
The right community success metrics
A test and learn approach
A senior stakeholder to support you and ensure that you are aligned to organisational goals and missions - e.g. CEO, Founder, CMO
I co-authored this Community Based Marketing Best Practice Guide with Ashley Friedlein - it’s a great primer to Community Based Marketing and a great read
Why should you be excited by Community Based Marketing and Community Led Growth?
We are living in deeply uncertain times, but what is certain is that we can’t solve big societal issues alone and we can’t build a business alone.
As the African proverb says:
"If you want to go fast, go alone. If you want to go far, go together."
Those who can see the long term impact of gathering their most important stakeholders, publics, audiences, customer, prospects - i.e the people who can help them go far, are building community.
Smart start up and scale up businesses understand that without supportive communities they will fail very quickly. Investors want to know whether they are building community as a long term reputational moat and as a lever for growth.
Established businesses and organisations know that they have the power to mobilise a community to support retention and growth. But they know how the value of community to gather important insights to drive campaigns, product and service innovation and much more.
Both new and established businesses and non profits are interested in community as a business model to drive sustainability and regeneration as well as create new revenue streams. More on that in the Community Based Marketing training course.
The cookie has crumbled and marketing gold dust today is rich ‘data’. Communities are an excellent way to maximise the creation of first party and zero party data from customers and prospects.
In B2B, it’s get harder and more expensive to reach prospects - customer acquisition costs in some channels are eye watering . It’s also more critical than ever to retain and grow existing customers and increase their Lifetime Value (LTV). Community is great at all stages of the marketing funnel.
Investing in community can generate Return On Investment (ROI) in so many ways and community is an essential element of marketing today because:
- Community delivers market, customer insights and first party data at scale
- It drives inbound sales leads and reduces Customer Acqusition Costs (CAC)
- It provides always on brand awareness + "mental availability" for prospects
- It improves sales conversion rates
- It impacts customer retention, upsell, loyalty and advocacy
- It delivers scalable Customer Service
- It creates ambassadors and influence
- It is a viable business model
and much, much more.
Why talk to me about Community Based Marketing (CBM) and Community Led Growth?
I’ve been helping brands, businesses and non profits with their marketing, community and network strategy and building for more than 25 years.
What’s new is that more people are waking up to the opportunity and are more open to the power of community.
But communities are delicate ecosystems. You can’t just build them, extract value and expect them to survive and thrive.
It’s now time to get serious about community, your community strategy and Community Based Marketing / Community Led Growth approach.
Let me help you.
Further reading
I’m creating a community glossary and will be explaining some key concepts in community strategy, community building and community management.
Here are some connected articles that you may find helpful:
What is Community Everywhere / what are Community Ecosystems?
What is Community Led Growth - is it the same as Community Based Marketing (CBM)?
What is Community Market Fit?
What is Minimal Viable Community (MVC)?
What are the 5 Ps and 1 C of community?
What are rituals in community building and why are they so important?
What is Broken Windows Theory and does it apply to Community Management?
What is Community Manager Appreciation Day (CMAD)?
Book a Free Consultation
Want help launching or growing a community? I’m ready and waiting to hear from you. Book an introductory call to speak to me about your challenges, projects or questions you might have.
