Power Of Online Community-Based Businesses: How It Creates Success

In the digital age, where connectivity knows no bounds, online communities have emerged as dynamic platforms for fostering engagement, building relationships and driving business growth. Businesses are leveraging online communities to create valuable ecosystems that transcend traditional boundaries.

A company can unlock remarkable competitive advantages by shifting focus from product delivery to community building.

Thirty-three percent of organizations have 10,000 people or more in their online communities. The valuation of the global community engagement platform market was approximately $526 million in 2021, and it is projected to reach over $2 billion by 2030.

The Essence Of Online Communities

At the heart of the online community-based business model lies the concept of creating a virtual space where individuals with shared interests, goals or needs can come together to interact, collaborate and support one another. Whether it’s a forum, social media group, or specialized platform, these communities serve as hubs for knowledge sharing, networking and mutual empowerment. Businesses that adopt this model position themselves as facilitators of these communities, providing value through content, resources, opportunities for connection and job boards.

The Story Of A Company Pivoting To A Community-Based Model

Courtlyn Jones, founder of The Design Database, developed an online community and job platform for female creatives to support women in the arts. As a creative, she faced discrimination and disparity regarding job opportunities and autonomy over projects in the workplace. The entrepreneur decided it was time for her to build a solution to the problem that many female creatives face daily.

In two months, Jones had a beta site up and running in 2021. She explains the challenges she faced, “The first beta site was a disaster, but I managed to attract over 400 creatives in 24 hours because I was so aggressive on LinkedIn. I posted a rant on LinkedIn to discuss my struggles in the creative industry. And apparently, what I said was resonating with so many creatives who were like, ‘Yes, I understand. I feel this way too.’”

Although the creatives could sign up on the website, companies couldn’t post on the job board. Jones had to manually update the board and outsource the positions from other websites. She couldn’t sustain the business model. After joining the Leadership Accelerator program, the founder learned how to code.

“I was trying to make it better than Fiverr and Upwork,” she continues to explain. “I was trying to be in that space as a marketplace, but that wasn’t my goal. When I was in this program, I had gone back to my why. I realized that my why wasn’t just to be a job site; it was to be a support for female creatives in this space who were the most undervalued. Having help from others in a space and a community is truly valuable.”

Jones began work on designing a new platform, focusing on providing her members a safe space to share ideas, foster collaborations and learn from others. In addition to pivoting her platform, she also shifted her revenue model. Initially, it was structured as a membership-based model. However, many of the creatives had difficulty paying the monthly fee, which also went against Jones’ goal to help creatives. Instead, she launched a podcast, Fearless Narratives, which has 2,500 downloads a month, and a magazine with paid features. She also started charging clients a fee to post jobs.

Through bootstrapping and crowdfunding, Jones has built a community she wished she had earlier in her creative career. She has won Best Art Networking Platform of the Year 2023. Since its relaunch, the database has grown to 5,000 members.

Key Components Of A Successful Online Community

1. Community management and moderation: Effective community management is crucial for maintaining a positive and inclusive environment.
2. Member empowerment and contribution: Empowering members to contribute and share their knowledge fosters a sense of ownership and belonging within the community. Businesses can facilitate member-led initiatives, highlight user-generated content, and recognize contributions to encourage active participation.

Benefits Of The Online Community-Based Business Model

1. Enhanced customer engagement and loyalty: By providing a platform for ongoing interaction and support, businesses can deepen relationships with customers and foster loyalty beyond transactional interactions.
2. Increased brand awareness and authority: Building a vibrant online community enhances brand visibility and credibility, positioning the business as a trusted authority within its niche or industry.
3. Access to valuable insights and feedback: Online communities serve as invaluable sources of feedback and market intelligence, enabling businesses to better understand customer needs, preferences and pain points.
4. Scalable revenue streams: Online communities can serve as platforms for monetization through various channels, such as membership fees, premium content, sponsorships or affiliate partnerships.

Strategies For Building A Thriving Online Community

1. Start with a strong foundation: Define a clear purpose and value proposition for your community, and invest in creating a welcoming and engaging environment from the outset.
2. Focus on community building: Prioritize relationship-building and community growth over short-term gains. Nurture connections, foster trust and encourage active participation among members.
3. Provide value and support: Offer valuable content, resources and opportunities for learning and growth that address the needs and interests of your community members.
4. Listen and adapt: Continuously solicit feedback, monitor community dynamics and adjust your approach based on member insights and evolving trends.
5. Lead by example: Demonstrate authenticity, transparency and responsiveness in your interactions with community members, setting the tone for positive engagement and collaboration.