Gm Web3 Academy DOers!
It’s all about community. This is the most common phrase we hear in Web3. But why is that?
What is it that makes community so important in Web3 business vs. traditional business?
The answer is simple: interoperability.
Interoperability means that the tech is no longer the “moat” for a business, as users can seamlessly and easily move from one application to another. We are no longer stuck inside of platforms.
This means that community becomes evermore important in Web3 to create that “stickiness” factor. Community is what keeps the users around (...along with incentives and a good product of course!)
With this in mind, we thought it would be helpful to explore the ins and outs of building community. So we interviewed Vyara Ndejuru, CMO at Late Checkout, a community-design firm that builds and funds community-based businesses.
Vyara also spent a decade in the CPG niche, contributing at brand insights and omni-channel and building and scaling brand communities.
In short, community is V’s main focus and expertise, which is what we’re going to talk about today!
To highlight the benefits of community, we’re going to discuss:
- The challenges of building a community
- The opportunities that community enable
- The monetization of a community
- How community revolutionizes the traditional marketing metrics
We believe that community is something every business should build to make their marketing mix more efficient.
Let’s dig into this!
P.S: We are proud to have Vyara in our Discord Community. If you want to connect with her and hundreds of other fellow creators, entrepreneurs and marketers, apply to join our Discord Community!
We’re hosting a community call in Discord all about building community in Web3 on Monday, June 20th at 7pm EST. Join for a Q&A and discussion to help us all learn how to build stronger communities.
Join the Web3 Academy Community HERE!
You can also watch the episode below, or listen on your favorite platform: Spotify | Apple Podcast | YouTube
The Challenge Of Building A Community
Building a community around a social media account or web3 project is a no-brainer. But why do traditional businesses not create communities too?
The answer (the challenge, really…) is that it’s really difficult to value a community. There aren’t any ROI metrics that can be applied into determining / projecting your return on investing in a community. Therefore, it is hard for traditional businesses to be persuaded into focusing resources on building a community.
Ultimately, there is a need to have enormous belief and conviction coming from the firm/corporation that a community is beneficial for the growth of the business. “But if you cannot put that on a PowerPoint presentation, you cannot convince your bosses” – Vyara.
The Benefits Of Community
Community allows for endless opportunities. Let’s focus on the main ones right now!
- Lower retention costs
Once a user has joined your community, he/she is creating a bond with you through a shared goal. In Web3, that can be amplified through digital ownership via an NFT or token. It can also be that you provide a platform which they can use to their benefit. Either way, the community member is now incentivized not only to remain in the community but also to help grow your business because, at the end of the day, that would benefit him/her as well.
- Powerful word-of-mouth (WOM)
A community also typically shares powerful word-of-mouth because they have a strong conviction about the community that they are part of. Not only do they perhaps like and use your product / service, they also are an owner/voter of your business through a token or NFT.
- Content creation
The WOM that’s spread by a community also creates more content for you as a business. For instance, Bankless is creating tons of content for Ethereum, which creates basically “free” marketing for the Ethereum Network.
- Monetization
Naturally, once you’ve built a community, you can start selling products or services to your community members. Obviously, there must be value in it for them also, otherwise, you’ll destroy the community.
In conclusion, creating a community can only impose benefits long term. However, it requires a lot of time, effort and resources to build it in the first place, something that perhaps stands in the way of many businesses.
Community is Revolutionizing The Marketing Funnel
Vyara has given us an analogy that left us speechless. She explained how the marketing funnel that we know today is being reshaped by community.
Traditionally, once a business achieves loyalty, they use that to monetize.
(Loyalty –> Acquisition)
However, once you achieve a loyal community, this funnel takes the shape of an hour glass and it is the community that starts bringing in new conversions into the funnel. This is where your retention costs (and acquisition costs) are diminishing.
This event happens thanks to the power of Web3 which grants ownership to the users (members of a community). Through an NFT or a token, members are now incentivized to go out there and onboard more users or provide feedback to improve the product, which creates a cycle of constant onboarding through powerful word of mouth, reshaping the funnel as we know it.
How To Build A Community
Building a community requires you to have an audience around which a community is being built. Then, there are a few steps that will help you achieve a thriving community:
- You build your audience (via social or other avenues)
- You create engagement throughout your audience (via events, calls, etc.)
- Engagement builds relationships (creates stickiness among people)
- After relationships are built, you can attach ownership and governance (aka utility) via NFTs / Tokens.
- Once you have utility, value is being built (through the adoption of your NFT / Token)
Above is the framework to build a community, but if we have one main tip for building community it’s: “In order to scale community, do the non-scalable things first” a quote from Jeff Kauffman Jr. in a past Web3 Academy Podcast.
This means 1-on-1 calls, welcoming every person to the community, engagement and having real conversions.
Audiences can scale fast, communities can not.
Conclusion and Prediction
Community is vital in web3. Traditionally, if you had an audience on Instagram, you’d stay on Instagram but with the rise of interoperable socialplatforms, you’ll need a community that follows you wherever you go and that will be with you on every platform.
Furthermore, if you want your business to properly use web3 tools like NFTs or Tokens, you’ll need a community that’ll support your idea.
At the end of our podcast with Vyara, we had some fun and asked her to make a prediction for the web3 space. Like most of her words, this was rather unique...
V predicts two things:
- That more (older) adults will hop onboard in web3. However, this will only occur once the UX is good enough to make their onboarding seamless and doable, because we all know that isn't the case right now.
- That artists making contemporary art will take more advantage of NFTs to make themselves seen.
Let us know your own predictions on Twitter by tagging us @web3academy_!
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