The Smart Approach to Building a Brand: Engaging the Community Flywheel

Crucial Insights

In the marketing landscape of the 2020s, the spotlight is on community—connecting with customers within their communities and assisting them in embodying their sense of community through engagement with your brand. Brands that master this concept utilise five interconnected tactics: understanding your communities, making your brand's narrative engaging, focusing on flagship products, fuelling dialogue across platforms, and simplifying transactions. These tactics support the growth of a community flywheel. This approach aligns seamlessly with the fast response time of cross-discipline agile teams, doesn't necessitate heavy investment in marketing tech upfront, promotes rapid growth, offers a high return on investment with low risk and fosters energised, high-performing teams.

To comprehend present-day brand activation, we need to take a journey through the history of advertising.

During the golden era of advertising, brands used mass media to make themselves known; the metaphorical "megaphone" allowed extensive reach. Subsequently, tech and data opened the doors to personalisation, empowering brands to target consumers based on demographics and needs. Personalisation led to shifting advertising spends 'below the line', yielding short-term results but raising concerns about privacy and cost-effectiveness. We're now witnessing a new phase where changes in technology and consumer behaviours are enabling marketers to form emotional bonds with consumers within their own communities.

Brands and retailers, be it digital newcomers or established entities, need fresh tools to seize this emerging opportunity. Among various models vying to shape this new paradigm, one stands out: the community flywheel.

The community flywheel comprises five key components. Firstly, understand the consumer groups your brand appeals to and identify the communities they belong to. Secondly, select a handful of 'hero products' that truly embody your brand's value to cut through the digital clutter. Thirdly, champion these hero products with compelling and authentic stories from your brand and customers. Fourthly, nourish the community with engaging content and inspire brand supporters to create their own. Lastly, simplify the transaction process, whether online or offline. Brands that excel in all five elements—coupled with agile practices, fundamental marketing tech, and analytics—create a rapidly spinning flywheel, fostering conversation, engagement, and sales by brand advocates.

The community flywheel model was introduced by companies like Gymshark and Drunk Elephant when Instagram launched about a decade ago. Today, it is being adopted successfully across industries, from do-it-yourself to fashion. Traeger, an innovator in grills, amassed an online community or 'Traegerhood' of over a million people with 350,000 user-generated posts across social media. Luxury fashion brand Ganni created a powerful and loyal community of #GanniGirls, sharing common values such as women's empowerment and gender equality.

We will now delve into the specifics of the community flywheel, explaining how to kickstart it, why agile 'test and learn' methods and suitable marketing tech are crucial, and how businesses adopting this model can measure and enhance their success.

Starting the Flywheel

Brands that have ignited the community flywheel put community building at the heart of their strategy. They do more than just establish a social media presence with a vast follower count but limited engagement. They cultivate an actively engaged community that mentions the brand in social media posts, shares brand-related posts, tags the brand, and tags friends on the brand's feed. Unsurprisingly, these brands enjoy superior engagement levels with their customer base, typically resulting in higher conversion rates.

Brands that get the flywheel spinning exhibit strong performance across several metrics:

• Over 75% of brand-related content is user-generated.

• The engagement rate for influencers, i.e., the proportion of viewers who like, comment on, or share the content, exceeds 2%.

• More than 4% of online traffic converts to sales.

• Brand-related posts from either the brand or a consumer go viral at least twice a year (sometimes with marketing support).

• So how do they achieve it? By simultaneously implementing five marketing strategies that reinforce each other.

1. Focusing on Communities: Engage with the Collective, Not Just the Individual

The first step is to identify the communities your brand wishes to be part of. This could be anything from mothers who attend church in Utah, yoga enthusiasts in London or vegan parents worldwide. This approach is a shift from targeting consumer segments, which usually focus on demographics or individual needs, to focusing on communities of people with shared interests and values.

Brands need to gain a deep understanding of their key communities. This includes knowing why community members engage with the group, their thoughts about the brand's products, their unmet needs, their communication preferences, and their buying motivations. For example, a global haircare brand analysed its user communities and discovered a niche group of users who were passionate about preventing animal cruelty. This allowed the brand to integrate cruelty-free messaging and content for those users. Similarly, a global security systems company discovered two distinct customer communities: high net-worth art collectors looking to protect their prized possessions and pet lovers who regularly used their security systems to check on their pets when away.

Gaining this understanding requires a robust consumer-insights function with a focus on cultural anthropology. A thorough comprehension of the community can help the brand communicate effectively and create an emotional response, which is key to forming a lasting relationship between the brand and the consumer.

For example, Gymshark targets 18- to 25-year-olds whose lives revolve around fitness. The brand is unwavering in this focus, and all its efforts are aimed at satisfying this group's needs. This has allowed Gymshark to form a strong emotional bond with its community, evident from the vast amount of user-generated content created by its members.

Various consumer-insight sources can be utilised, including new or emerging ones. For instance, brands are increasingly using privacy-compliant data clean rooms to understand how communities engage with them across various platforms, enabling them to tailor unique engagement mechanisms for each group.

2. Hero Products: Concentrate on What's Talked About

Brands should channel their engagement efforts towards a few standout products designed to generate buzz. In the digital world, where consumers can feel overwhelmed by endless online shopping options, such "hero products" can guide consumers towards what makes a brand unique.

Strategies to promote these standout products may include:

• heavily featuring the product across all communication channels (both online and offline)

• investing in experiential interactions like pop-up stores where customers can experience the product firsthand

• giving away free products or discount codes to influencers

• launching interactive marketing tools that allow consumers to try the product digitally

• making sure the hero products are easily discoverable online by prominently featuring them or highlighting their most successful products
  

These hero products often end up driving a significant portion of sales, potentially 30% or more. Crocs' classic clog, for example, has been the brand's focal point for many years. The brand has stayed relevant through regular limited-distribution collaborations with the likes of Justin Bieber and Balenciaga.

3. A Memorable and Believable Brand Story: Be Vocal About Brand Values

Brands should be unafraid to voice their core values and explain how they uphold them. Just as the target community should be specific, brand stories should be tailored, use the community's language, and be straightforward yet captivating enough for customers to want to share them. The brand's narrative could be provocative, tapping into deeply held beliefs in specific communities, with the founder or a high-profile executive typically leading the charge in communicating with consumers.

For instance, Drunk Elephant has built its brand around the story of its founder, Tiffany Masterson, a mother who set out on a mission to create beauty products free of harmful ingredients. Warby Parker, on the other hand, effectively grows its brand by growing its community, capturing the brand's essence of literary quirkiness and customer friendliness across all channels.

4. Engaged and active community: Fuel the conversation

Brands not only need to attract the attention of their targeted communities through distinct products and compelling brand stories, but they must also continuously offer exciting and engaging content that consumers and influencers can engage with. Brands should appreciate, support, and thank the influencers who strongly endorse their brand. Moreover, it's crucial to understand and organically interact with the community. Brands can learn from the natural paths that consumers take to experience their products and brands, and then create plans to engage the community based on those journeys.

5. Effortless transactions: Remove all friction

Consumers expect a quick, smooth transaction experience on both desktop and mobile devices. However, many retailers fail in the final stage, leading to high cart abandonment rates and lost sales. New online shopping channels like social commerce further raise expectations for a frictionless experience. As transactions are likely to occur in new areas like the metaverse, the ability to adapt and quickly test new channels should be a core part of every conversion team's strategy
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Agile acceleration: Use cross-functional teams to test, learn, and scale

Agile ways of working enable brands to test and learn their way to successful community engagement without the need for high-risk upfront investment. It's recommended to start with one agile squad that brings together cross-functional colleagues from product, marketing, brand, sales, analytics, and insights to design, develop, test, and release products in response to community feedback.

Core marketing technology: Invest in the right tech stack

Scaling the effort over time requires a solid marketing technology (martech) stack. Done correctly, martech allows companies to track and measure the impact of marketing activities, maximize the ROI on marketing spend, engage with targeted communities, and provide customers with tailored experiences and offerings.

Measuring success: Resetting profit-and-loss expectations

Companies should track their progress across the five levers and two ways of working that the community flywheel comprises. Also, adjusting their profit-and-loss (P&L) expectations is necessary. Brands may see an increase in gross profit under the community-flywheel model, by reducing promotions and potentially raising prices on the most in-demand products. EBITDA margins will also likely benefit from reduced marketing spend, as some marketing will be organically driven by user-generated content.

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