Presented by

Community ROI

Victoria Adamov, Customer Success

AGENDA

1 Introduction

2 Why do we need an ROI

3 What is an ROI

4 Benefits and Costs

5 Bottom Line

6 Top Line

7 What’s next

WHY SHOULD I?LEVEL OF ADOPTION

WHY DO WE NEED AN ROI ?

• To make sure that the investment is justified– Is there a financial benefit, when, how does it compare to other

investments

• To build stakeholder support and sponsorship– Top Down

– Bottom Up

• To facilitate decision making and prioritization– Best allocation of company investment capabilities

WHAT IS AN ROI ?

• Headcount costs – People involved and required into the

Community

• Services – Project, Trainings, Certifications,

– Spotify attendance

• Platform subscription– Base platform

– Extensions and future enhancements

BENEFITS COSTSVS

TYPE OF BENEFITS

• Hard benefits– Tangible & Measurable

– Key for Decision making

– Ex : reduce costs by deflecting calls to the community

• Soft benefits– More difficult to measure

– Could be a reason for Decision making

– Ex : release time for more valuable tasks

• Intangible benefits– Not included in financial ROI

– May be relevant for Decision making

– Ex : Increase digital presence in supporting customers online

Hard

Soft

Intangible

VALUE LEVERS DERIVE FROM BUSINESS OBJECTIVES

What are your community’s main goals ?

Support Cost Reduction

Incremental Conversion

REDUCED SUPPORT COSTS

We help our customers reduce operating costs by eliminating a portion of their support inquires. The framework below estimates potentialsavings through the implementation of a support community from Lithium.

CommunityVisits

Resolution Rate Deflection RateCost per support

Inquiry

How many visits the community gets

Seeking Support

Of those visits, how many are in need of

support

Those seeking support found the

information needed

Visits that would have engaged support had the information not

been found

The average unit cost to engage

support

X

EXAMPLE

Year 1 Year 2 Year 3

Community Visits 1,000,000 1,100,000 1,200,000

Seeking Support (72%) 720,000 792,000 864,000

Found an answer (35%) 252,000 277,200 302,400

Would have called otherwise (65%) 163,800 180,180 196,560

Total Number of contacts deflected 163,800 180,180 196,560

Cost per contact $5 $5 $5

Benefits $819,000 $900,900 $982,800

Contact Deflection

CONVERSION INCREASE

Yearly Unique Visitors

Average Revenue

How many people are currently visiting the

brand’s website

Likely to Purchase

Of those visitors, how many are likely to

purchase

Average Revenue per subscriber

online

Improved conversion rate

online

Improved Conversion

Traditional Conversion

Average conversion rate

online

A total community has the ability to drive traffic to a brand’s website and brand awareness through SEO boosts from surfaced content fromcommunity participation. These additional visits have the potential to boost revenue through online purchase conversion

EXAMPLE

Conversion Increase

• Use Google Analytics to track customer journey from online community to online store to see how much community influence the transaction and compare it with the journey where customers convert on online store without interacting with the community.

Community Online Store

• Revenue• AOV• Products/Service

VS

SuccessfullyConvert

In 2015, community influenced online purchase conversion worth US$1,357,009 - DTAC (Total Access Communication PLC)

WHAT’S NEXT

• ROI is a financial asset to help prioritize and make decisions

• We think of benefits in 4 ways linked to business objectives and community purpose : savings, sales, loyalty, co-creation.

• Measuring Value is an ongoing task that will give you the ability to do more with community

• We can help!

THANK YOU

MARKETING ROI: EXAMPLES

average customer

community user

superfan 10x

2.5x

Sephora spend

33

Beauty Talk superfansspend an average of

hours per month on Beauty Talk

• Owned customer data was enhanced through community data

• Regression analysis indicated that highly engage community users spend more

• Value of community user base can be measured directly against non-community users