What is ‘Community Market Fit’?
Do you have a great idea for a community and want to launch it to the world?
Or do you have an existing community and you’re struggling to get people to sign up and participate/engage?
Then understanding ‘Community Market Fit’ is important.
This article explains what Community Market Fit is, how it aligns to Product Market Fit and why all community strategists and community builders should aim to understand this essential marketing principle.
First up, let’s explain what Product Market Fit is
Product-market fit (PMF) is a concept used to describe the degree to which a product satisfies a strong market demand.
In simpler terms, it means that your product solves a significant problem for a specific group of customers, and that there is a clear alignment between what your product offers and what the market wants. When a product achieves PMF, it typically experiences rapid adoption and growth.
Two notable global examples are Airbnb and Slack.
Both identified pain points and gaps in the market and positioned themselves as simple, efficient, affordable, safe, easy to use and collaborative alternatives. They iterated their products based on feedback and ultimately achieved impressive product-market fit.
What is Community Market Fit?
Community Market Fit (CMF) is a concept used to describe the degree to which a community satisfies a strong demand from a group of people.
It means that your concept for a community and what the community sets out to achieve matches what a group of people want to also achieve.
When a community reaches CMF, it should follow that it should experience rapid adoption and growth.
But that isn’t always the case.
I’m hoping that providing free resources, training, coaching and consultancy can help more people and organisations achieve Community Market Fit more readily.
Michelle Goodall explaining the concept of Community Market Fit at the Brighton SEO conference
How does Product Market Fit work? What are the key considerations when determining it and how does this apply to community building?
Understanding Customer Needs
The first step in achieving PMF is understanding the needs and pain points of your target customers. This involves thorough market research, customer interviews, and feedback collection to identify the problems your product aims to solve.
This also follows for Community Market Fit. There is no point building a community if it doesn’t help to meet or address a specific need or needs. And that need can be segmenting your audiences through a combination of research types - primary and secondary research, quantitative and quantitative research, social media and audience intelligence, search data, surveys, interviews and the list goes on.Building the Right Product
Once you understand customer needs, you need to build a product that effectively addresses those needs. This involves developing features and functionalities that resonate with your target audience and provide clear value propositions.
Building the right type of community with the right mix of elements, including who the other members are, resources, knowledge bases, UX, onboarding, rules, challenges, meetups and the many, many elements that can go into community design.
If you want a blueprint of these essential elements then contact me and ask for a copy of the Periodic Table of Community Strategy. It’s a one-page, visual blueprint for the main considerations when building a community.Market Validation
Market validation is crucial in determining PMF. This involves testing your product in the market to see if there is genuine demand for it. This can be done through methods such as beta testing, pilot programs, or launching a minimum viable product (MVP) to gauge customer interest and gather feedback.
Again, these can and should be adapted for community building. And the Minimal Viable Community (MVC) approach is a low cost, valid way to build and test your community proposition. Read more here ‘What is Minimal Viable Community (MVC)?’Iterative Development
Achieving PMF often requires iterative development and continuous refinement of your product based on customer feedback or product usage information and data. You need to be willing to adapt and make changes to your product based on what you learn from your users.
Again, I often describe community to my clients as an ‘organic entity’ or a ‘living system’.
Iterative development is usually a natural process as communities evolve and mature. Failed communities tend to not iterate and adapt - and that’s where there is no longer a Community Market Fit. Members drop out and discussions fizzle out.Measuring Customer Satisfaction
PMF can be assessed by measuring and tracking customer satisfaction and engagement metrics. Typical measures include customer retention rate, customer churn, net promoter score (NPS), and customer feedback to gauge how well your product is meeting customer needs.
What you measure in your community should be aligned to your organisation’s goals and objectives, but community health metrics can also measure levels of customer satisfaction.I go deeper into community metrics in other articles, but member retention, churn, NPS, feedback, member engagement and sentiment can all indicate customer satisfaction and whether your community has a good market fit.
Scalability
PMF also considers how scalable your product is. It's not just about finding initial traction but ensuring that your product can sustainably grow and capture a larger market share over time.
In community building we talk about ‘community lifecycle’. We need to decide and plan for whether we wish to scale our community. In some cases, communities remain small and focused, but many times, communities are built to grow. Or there may be a case for creating connected or new communities. Scalability should always be front of mind.Competitive Landscape
Understanding the competitive landscape is important when determining PMF. You need to assess how your product compares to existing products and solutions in the market, and identify what sets it apart and makes it compelling to customers.
I cover Community Ecosystems and Community Everywhere in detail in this article. It’s critical to evaluate the competitive landscape when creating a new community. Your community strategy should look at social media AND other spaces where your audiences, publics, stakeholders, customers and prospects cluster.Then figure out whether you need to partner, participate, or see if there is an opportunity to take the place of those spaces. There may even be a gap for a new community and if there is, then speak to an expert like me [Michelle Goodall] to support you in planning and launching it.
Customer Acquisition Cost (CAC) vs. Customer Lifetime Value (CLV)
Achieving PMF involves ensuring that the cost of acquiring customers is justified by the value those customers bring over their lifetime. A healthy balance between CAC and CLV indicates that your product is resonating well with customers and will drive sustainable growth.
CAC is a good measure for new community members as is measuring their ‘value’ over their lifetime in your community. This is a simple concept for commercial communities, such as subscription communities, or communities that support lead generation and demand generation.
But how about non profit, social impact communities? You can track metrics such as CAC and CLV, even if the ‘V’ is not a monetary value, but applies to something that your non profit/charity needs to achieve - for example ensuring a steady stream of high quality volunteers, fundraisers, advisors or donors, or delivering social impact.
If it’s important to your organisation, and you can measure it, then you should.
Feedback Loop
Establishing a feedback loop is crucial for maintaining PMF. This involves continuously gathering feedback from customers, analysing it, and using it to make informed decisions about product development and improvements.
Customer communities and communities of all types are powerful spaces for creating informative feedback loops. Commit to listening to your community members and iterative development and you’ll continue to have community market fit.
In summary
Achieving community market fit is a dynamic and iterative process that requires a deep understanding of audience/customer needs, continuous refinement of the community, and a willingness to adapt based on market and your community members’ feedback.
By focusing on these key considerations, you’ll increase the likelihood of your community successfully resonating, achieving adoption and growing sustainably.
Further reading
I’m creating a community glossary and will be explaining some key concepts in community strategy, community building and community management.
Here are some connected articles that you may find helpful:
What is Community Everywhere / what are Community Ecosystems?
What is Community Led Growth - is it the same as Community Based Marketing (CBM)?
What is Minimal Viable Community (MVC)?
What are rituals in community building and why are they so important?
What are the 5 Ps and 1 C of community?
What is Broken Windows Theory and does it apply to Community Management?
What is Community Manager Appreciation Day (CMAD)?
Book a Free Consultation
Want help or support with your community strategy or community building? I’m ready and waiting to hear from you. Book an introductory call to speak to me about your challenges and questions you might have.
Photo by Michelle Goodall
