Measuring the value of online communities

Abstract

Purpose – The purpose of this paper is to provide a set of measures that enable better understanding of online communities, their value and the strategic decisions best suited to them. Design/methodology/approach – After an initial definition of terms and classification of online communities, a framework for assessing the value of communities is presented, enumerating benefits by their relationship to risk and reward. The disconnect between such benefits and the normal statistical measures of success is then addressed. The paper concludes with a short review of a range of other factors that should influence the valuation of online communities. Findings – There are three key points that should allow a structured approach to estimating the value of communities: a 12-part model for classifying online communities by their purposes; a consideration of how these should be measured; and a review of some other factors affecting the valuation of communities. Originality/value – The paper allows a framework for stakeholders of online communities to converse, plan and make decisions regarding those communities. The paper uses a framework already tested in the charity sector by Z/Yen Group and applies it in the online community space.