Start Low With Your Community Incentive Offerings or Pay the Price Later

Community IncentiveYou have a brilliant idea for an online community and you need members in droves fast. You hatch your Social Media strategy, launch various Search Engine Marketing campaigns and implement the best SEO possible. However, there are so many communities available you want to distinguish yourself and you have chosen the incentive route to encourage massive registrations. Your first inclination is to offer the very best incentives and to tackle international fulfillment. This might be the worst decision you can possibly make.

The operative word in the last sentence was “might.” If you are operating an enormous consumer community with millions of members and you have a very healthy weekly sign-up rate coupled with a positive membership growth rate then you can get away with incentive reductions. However, you will see some backlash and will witness a hefty support cost spike if you do not properly and clearly message the incentive reduction. You might also notice some reputation damage through the Twitterverse and blogosphere. You also might wander over to review sites like Yelp and see if your brand is taking a beating because you have greatly reduced the carrot for being a community member.

Expect this backlash to be more intense if you are monetizing your community members when they complete an action such as completing a market research survey or provide product feedback. When they know or believe you are generating revenue from community participation and then you reduce the payout or share of that revenue they will march with pitchforks and torches. In most cases this onslaught will subside and if you see a dip in membership retention that too will turn positive shortly. So you reduced costs, weathered the storm brought on by discontent passionate members and your community retention after a few months is ascending instead of plummeting.

This could have been avoided if you did not offer such amazing and costly incentives to begin with. You work hard establishing your brand and building a great community. Avoid the PR nightmare by offering low incentives or incentives that are very easy to fulfill. Shipping checks internationally is a massive pain and a check is merely a piece of paper in an envelope. Paypal is an option but they do not provide service to every county. It is best to start out low and watch the registrations and how the current membership shares your idea amongst their social network and if they refer members to the community. If sign-ups are trickling in then you might want to ratchet up the offering and repeat the review process. You will be surprised. You do not need to break the bank to gain critical mass when building a community.

Smaller communities suffer greater harm when incentives are reduced. If you are a brand that offers a product or service and you are building awareness through your own community you must be very careful with your initial community incentive offerings. If you over pay with a small community (hundreds to thousands of members) and you reduce or completely remove the community incentive expect a huge firestorm. Worse yet this nightmare is fueled by your top customers; your most passionate marketplace allies and influencers. This is a storm you do not want to weather and chances are your calculated responses will be torn to shreds or misinterpreted.

If you are looking to build an online community you must build it with experienced community managers or you will make the same mistakes made by many before you. If you really want to brave it without that experience then here are some tips:

  • Lock down your incentive budget
  • Understand every step of your fulfillment process
  • Brainstorm risks that will delay or prevent fulfillment and create action plans
  • Learn incentive legal and tax restrictions of your target countries
  • Determine amount of time needed to deliver incentives to target countries
  • Create clear and specific messaging to the membership to set expectations
  • Evaluate many fulfillment options to find the one that offers the lowest costs, fast delivery and high reliability
  • Create and arm a support staff with solutions to all possible incentive issues

That was not the be all the end all lists, but it will help you build a strong foundation to your community incentive program.

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