Media & Tech Tuesday - Searching for New Members (Monetising Content, part 3)

  • Jun 2013
  • Media & Technology

Last week we looked at the different ways in which online communities have been building their mobile capability; this week, we look at how an online community can drive new membership.

There are four key ways an online community can expand its membership base:

  • Within its current market(s), until it reaches saturation;
  • By moving in to new territories;
  • By expanding the class of members – for example, from individuals to corporate entities; and
  • By broadening the demographics of its target membership base.

More of the same

Targeting ‘more of the same’ sounds like the easiest route – if nothing else, it’s worked so far! – but as you capture more of your addressable market you inevitably reduce the available market for further growth.

There is a risk that the strength of your market penetration becomes market saturation, and there is nowhere else for you to grow.

This is particularly true for ‘winner-takes-all’ social networks, as well as for B2B online communities and information providers which ‘own’ their chosen verticals. Rory Maher of Capstone Investments recently observed: “Facebook penetration estimates indicate that growth starts to flatten or decline once a market exceeds 50 percent population penetration. We believe this could be an issue for future Facebook growth since we estimate that outside of South East Asia and some countries in Latin America, most markets are approaching 50 percent penetration.”

Uncharted territories

As its membership growth has plateaued in its core western markets, Facebook has had to push hard into new geographies to continue to expand its global user base – and whilst few other online communities can claim the same level of saturation, Facebook is not alone in trying to expand its global footprint. The estimated growth of the non-Western online social networking community should incentivise online communities to make the penetration of Asian, African and South American communities a priority:

global_social_networking_growth

  • LinkedIn stated in 2012 that it was gaining two new members every second – c.60m per year – driven by the successful expansion of its mobile platform in Brazil, India and China; and
  • A September 2012 study from GlobalWebIndex found that the country with the most active Twitter users (as defined as those who contribute at least once a month), wasn’t the US, but actually China, followed closely by India.

What makes a member? – individuals and corporates

Another way to increase the size of your target market is to consider who or what you allow to become a member. This needs to be managed carefully to avoid diluting the coherence and commonality which make for a genuine community. One way to do it is to extend the concept of membership from individuals to corporate entities – Facebook, LinkedIn and even Twitter have opened the door to a new breed of user by allowing organisations such as companies and charities to participate.

However, simply allowing corporates to create profiles that mimic individual users may cause confusion. Online communities typically create a distinction between individuals and organisations to allow users to differentiate between the two. For example, Facebook allow organisations to create ‘Pages’ rather than profiles, with different functionality. For example, corporate pages offer promoted posts and can have unlimited ‘followers’ rather than ‘friends’.

It is important to consider what these organisations gain from their membership and that depends heavily on what the online community offers. Social networks can offer a marketing and communication channel, whilst a vertical-specific B2B network may provide companies with valuable market data. It’s less clear how a corporate profile would fit into something like an online dating platform, although bars, restaurants and other venues would no doubt welcome the opportunity to promote themselves as the appropriate venue for an offline rendezvous.

Demographics

Although social networking has traditionally been the pursuit of the younger, tech-savvy generation, larger social networks have made a reasonable effort to tap into older demographics. For example, Alexa’s web-traffic analysis highlights that Facebook is particularly well represented amongst the web-habits of the over 65s.
Online communities that fail to adapt their content to suit a broader range of age groups may find their core membership lose interest, as MySpace experienced when their core user base matured.

But those who aren’t yet part of the community will often have the most to gain from joining, and can create something of a virtuous circle as they recruit their own friends and/or contacts.

Diversity of community vs. Relevance of content

Ultimately, an online community’s ability to extend its membership across a broader demographic spread will depend on the relevance of the content it offers. The danger is that too diverse a community has insufficient common ground to ensure universal (or even majority) relevance of content.

Online communities need to think carefully about how to balance expansion and its associated diversity with a critical focus on relevance of content. LinkedIn has managed to do this by appealing to anyone working in a professional capacity, making it relatively narrow and deep; in contrast, the enormous range of user-generated content on YouTube makes it broader and shallower, allowing it to cater differently to a wide range of demographic groups.

Key take-aways:

  • International Expansion: if online communities can overcome the language and regulatory barriers, then the growth of online networks in Asia, Africa and South America, assisted by the spread of mobile technology, offers a wealth of potential new users;
  • Corporate Membership: corporate profiles have been around for some time now and can help increase the scale and revenue-generation of an online network. However, the purpose of each online community needs to be taken into account; and
  • Demographics: online communities may struggle to target different demographics without diluting the relevance of their content.

This is the third part of our feature on monetising content; read part one and part two.


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