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Study Finds Branded Communities Increase Sales Significantly

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Companies are benefiting from having a branded community attached to their website, according to a University of Michigan-Based study. In an article found on online publication Campaign US, called “Study: Branded Communities Boost Sales by 20%” by Douglas Quenqua, written on May 6, 2015 – we learn why having a branded community is worth considering.

Study Details

According to the article:

To conduct the study, researchers observed the behavior of consumers for 15 months before and after they joined the online community of an American retailer… They then compared that with the behavior of a group of the brand’s customers who didn’t join.”

The article goes on to say:

“What they found was that customers who joined the community spent on average 20% more than those who did not.”

Understanding the Study

The article goes on to explain that the most loyal customers didn’t change much in their spending patterns, rather the lower 25% of the customer spectrum was most affected by participating in the branded community. This shows that having a branded community helps move the least loyal customers to a place where they’re more invested in your brand.

Branded Community Perspective

This is a promising find for companies with a branded community, yet the benefits of having a branded community aren’t limited to increasing the spending of the least loyal customers. For example, having a branded community also brings research insights to marketing directors, directly from customers.

Another benefit is that the visitors to their sites are being entertained and informed while they’re examining the branded community. All the while the company’s website stays active and alive with fresh content, helping to improve SEO.

Summary

This study validates what SocialEngine has understood for a long time, after helping thousands of customers create their own social networks and branded communities.

Helping our clients create a branded community is one of our specialties, and with our affordable prices and ease of application – our clients are continually amazed at the results. If you’re interested in learning more about how a branded community can help increase sales for your company, please contact us today.

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