If you’ve been following tech trends over the past couple of years, you’ve probably noticed a lot of tech firms acquiring online and hybrid communities and wondering, “why the sudden uptick and interest in communities?”
The short answer: these firms are buying ready-made fans and engaged audiences to boost their brand. This leads us to a bigger discovery - that communities have become a hot commodity because tech firms have figured out the tangible and intangible value they bring which you can’t find anywhere else.
In this article you’ll learn more about the value of communities for tech companies including an active and engaged audience, new revenue generation streams, year-round monetization opportunities, and of course, the intangible benefits of community that can’t be quantified. This article will help you better understand why communities aren’t just a trend, they’re here to stay.
Smart move: Buying an audience that advocates for your brand
What makes the acquisition of communities so appealing for tech companies is the ability to acquire a group of people that are already engaged and enthusiastic about a particular brand or collective mission.
These community members will often do a lot of the marketing legwork for you. They’re the most vocal and passionate participants, advocating for your brand via word of mouth or social media. The value of such an audience can’t be overstated.
Access to new revenue streams
In January 2022, Gainsight, a customer success software company, announced their acquisition of inSided, a customer success community platform, which they describe as being “uniquely designed to leverage the power of communities to drive product engagement and adoption, increase retention, and build lasting customer relationships.”
Nick Mehta, CEO of Gainsight, explains exactly how the acquisition of a community platform creates a new revenue generation stream for their company:
“Every technology company wants to increase Net Revenue Retention (NRR) – the number one driver of shareholder and enterprise value. But achieving this in a scalable manner is the number one challenge executives face. In our research with clients, the top strategy they were using to scale was to leverage communities to bring users directly into the Customer Success process and to connect customers with their peers.”
- Nick Mehta, CEO of Gainsight
At first glance, you might miss the connection between a CSM software company and an online community engagement platform. Gainsight didn’t. They understood that utilizing an online community network to bring like-minded customers into their sales funnel is an untapped revenue generation stream that they wanted in on. And they were willing to pay to acquire that kind of community.
Keeping members engaged opens the door to year-round monetization opportunities
Identifying that communities present an all-new revenue generation stream is one thing. Capitalizing on it and turning that stream into a continuously flowing river of monetization opportunities is another thing.
Take the recent acquisition of Mind the Product by Pendo in February 2022. A simple description of Pendo is they are a product-adoption software company. On the surface, there doesn’t appear to be an obvious connection between product adoption and communities. Pendo realized otherwise.
In their official press release, Pendo explains that “The acquisition [of Mind the Product] supports Pendo's goal to provide the most complete platform for product-led companies — Pendo's software products paired with content, training and community enable companies to become product led.”
Here we again see the alignment of a tech company with an online community, in this case, a community of product managers, designers, and developers. Where the year-round monetization opportunities present themselves is through the constant engagement between Pendo and Mind the Product’s product management community via conferences, content, events and meetups, workshops and training.
Todd Olson, CEO and co-founder of Pendo, explains: “We’re really excited to join forces with some of our earliest influencers, and offer substantially more education and resources to the global product management community for years to come.”
These year-round touchpoints between Pendo and their newly acquired community of product-oriented professionals shows that relying on influencers within the community can help drive brand loyalty and growth.
The intangible connections between a community and a brand
What about the intangibles of community? That feeling of connection and the strong bond between a community member and a brand that keeps them loyal and returning to you day after day?
When Substack, an online platform that helps writers and creators earn money through subscription services, acquired the community-building consultancy team People & Company, they signaled their commitment to growing their community and creating a support network for their writers.
In their announcement, Substack explains that “to really flourish, especially when starting something new, writers need a support structure to reduce the anxiety that can come with doing important work for the public. They need peer support; they need advice and guidance; they need access to healthcare and legal support and design…being independent shouldn’t mean being alone.”
Isn’t that a beautiful reason to invest in one’s community?
Bevy/CMX also touched on the intangibles of community in their acquisition announcement. “We see a world that’s growing increasingly lonely despite being more connected than ever before. Millennials are in desperate need of meaningful community.” said David Spinks, CEO and co-founder of CMX, in the acquisition announcement.
Derek Andersen, Bevy CEO and co-founder also said, “New technology is driving how we interact with each other on and offline. It’s how our society is evolving. This also affects how millennials and Gen Z interact with businesses and organizations. They’re looking for more than just products from businesses, they’re looking for a sense of shared identity and belonging.”
Value doesn’t only have a price tag associated with it. Although the likelihood of translating the intangible sense of connection between community members and your brand are extremely high, that shouldn’t be the only reason to pursue a community strategy.
In 2019, Bevy, who describe themselves as a “community event engine,” acquired CMX, which they describe as “the world’s largest community for community professionals.” Through this acquisition, Bevy has gained access to a hybrid community of professional community builders, exactly in line with Bevy’s community-building mission statement. That’s a lot of community!
The community network that CMX cultivated is an audience that’s already primed to be enthusiastic about what Bevy can offer them. The type of community that CMX built takes time and dedicated resources, but this type of audience will help propel your brand and mission forward in ways that can’t be found anywhere else.
So what does this mean for eventprofs?
The acquisition of online and hybrid communities by a wide-range of tech companies shows us that they have discovered the importance of communities and put a dollar value to them.
The trend and valuations of some of these recent purchases also proves that CMOs are now quantifying the value of a community member (just as they used to calculate the value per user when acquiring a company with free users).
At Swapcard, we believe that this community model is the future of the events industry.
When it comes to events, studies have shown that extending the life cycle of your event leads to more networking, better ROI and more engagement. So we say: why stop at leaving the platform open for a couple of weeks after the event? What if you made the people and content accessible all year long?
Enter: the event community. With a community, planners can start immersing attendees in a branded online world where they can get their fix of networking, new content, human connection and news at the click of a button, any day of the year.
Communities are the ideal place from which to inspire and recruit brand ambassadors, get ideas on how to shape your future events, foster a sense of connectedness that goes beyond your event days, and get excitement going for your upcoming events.
Event planners already have an audience that they engage every year at their annual events. That audience is already loyal - they keep coming back. So the natural next step is to start engaging with them using different tools throughout the year. Most of the year-round interactions take place online, but it’s nothing new. Most people already do around 80% of their networking, business, shopping and content consumption online anyway.
Capturing & keeping a buyer’s attention is difficult. So is building a global brand. We at Swapcard believe that communities build brands and unlock exponential viral growth. Events are a medium to create a community around your brand where buyers learn, connect, and engage all-year long. This drives word of mouth and turns into continuous revenue.
Turning your events into a 365-day community nurtures and grows your audience faster.
We even released our full community roadmap a few weeks ago, and you can check it out right here.
Building a community network doesn’t happen overnight.
Inspiring and connecting people centered around your brand takes time, a skilled and talented team dedicated to community building, and of course, the budget to invest. Buying a community is easier for tech companies flush with cash.
Online and hybrid communities have existed in some form long before the pandemic hit and offer significant benefits to both members and organizers. When done correctly, communities complement and elevate a brand while also providing all-new revenue streams, monetization opportunities, and the intangible benefits of community that can’t be quantified.
Want to learn how you can engage your audience throughout the year and grow your community to drive more ROI and brand awareness? Join our free consultations with event and community experts.