Forum Moderators: rogerd
It can be nice to work out what your average (still posting) user is worth to you each year. It could change your opinion/attitude to them.
If you could come up with a $$ figure that you were happy with, you could also compare it to how much it costs to acquire new members, i.e. advertising costs, as a method of determining if a specific advertising venue is a valid option.
If your business model is quite different, e.g., you have a forum on an ecommerce site, estimating the value of a member will be a lot more difficult. At that point, it starts to enter the intangible category, like the value of a brand.
If you must come up with a number, then devise a formula and tell the buyer (assuming this is for site valuation) how you estimated it. (E.g., the average member purchases $200 per year, vs. an average non-member customer at $150. Therefore, each member is worth $50.) The buyer can choose to ignore the number or come up with his own method; at least you provide a starting point.
Note, too, that there are different kinds of members. If a member hasn't visited in six months, is that person counted? Is a member who visits daily worth more than one who visits once a week? It can easily get complicated.
For example, buying a forum with 10k members is all very well, but how many post were there? How many members are responsible for those posts?
In smaller communities it can be a core few who are responsible for "making" the forum.
I remember a forum I used to post on - there were maybe 10 or so regular members who made an effort to answer the questions people asked (there were an additional 10 to 20 new posts by new members *asking* questions each day).
I don't think it would be possible to put a price on an "average" member simply because there is no such thing - some members are just more beneficial than others! ;)
So if you are going to start judging the "quality" of members, then how do you do it? Post count? One member with 10 quality posts could be worth more than someone with 1000 spammy posts (um...don't look at my post count right now... :P).
In the same respect, 1 person with 300 "quality information" posts vs. 1 person with 300 posts welcoming new members and making them feel at home. Which is worth more?
Judging value, you'd have to take into account knowledge, experience, contribution, enthusiasm / loyalty to forum, personality, etc etc - just to start with!
THEN you have to think about the long term - has member_01 increased or decreased in value?
THEN you need to think about their overall impact - has member_01 caused member_02 to contribute more?
In a brick and mortar shop it's fairly easy to assign value to individuals - you're playing the odds basically. 1 in #*$! customers will buy.
The difference is that they don't interact.
While the 1 in xxx "will buy" principle may apply to a certain extent in online communities, your "customers" also impact each other. They will effect your conversion rate and repeat business rate - more than you can probably control.
Which means the 1, 2, 3, 4, etc people that *aren't* the "1 in xxx who buy" are still important! :) They still have an impact.
Maybe it would be possible to come up with a system that takes multiple factors into account (posts, average post rating, member "karma", thread starter vs responder, etc)?
PageRank for members, but with dollar value? Would be a nice mod / hack for a forum to mess around with (no public values displayed)!
Admin could assign dollar values for each variable - maybe have a public "top 10" valued members?
Imagine if WW did that?!?! It would be more chaotic than the update threads of days gone by! ;)
Scott :)
Calculate how much time and effort each extra member of your forum takes to administer. Then calculate how much extra income you would have generated had you spent that amount of time and effort in direct revenue-generating activities. And that's the amount you spend on each forum member, and therefore the value of each one as an asset at historic cost.
rogerd had a pretty impressive formula in his presentation during our community/blogs session at the conference last week - maybe he has the perfect formula for determining this as well :)
One other consideration in valuing members is content creation - new content makes the site sticky for visitors and may attract new traffic as it is indexed in search engines. One could make a case that a member who makes 100 quality posts a month is worth quite a bit. This is all quite subjective, though.
Even more nebulous are the community impacts of some members. A member who is exceptionally friendly, helpful, and patient is extremely valuable - a small number of these can turn a weak forum into a strong one. I'm not saying you should try and count these; rather, I guess it's an indication of the difficulty of establishing a per-member value. (In the real world, of course, a business analyst could estimate a per-member value and assume that the membership will contain a distribution of member types - prolific posters vs. lurkers, altruistic helpers vs. selfish takers, etc.)
I'm looking at it from a page views perspective. I'm hoping that the forum will increase our pageviews by 25%, and then we'll make more revenue from advertising. I don't think we can expect a 25% increase in ad revenue though, because I think many users viewing a few pages click more ads than a few users viewing a bunch of pages. If we could increase our pageviews by 25% and our ad revenue by 10% I'd be happy.
Assuming our revenue increases, I'd just divide our increased revenue by the number of forum users to get the value per user.
I'm not sure how comfortable our users would be if they knew there was a price on their heads....
I'm not sure I agree that a user who makes 1% of posts is worth 1% of our revenue. I manage a site that makes about $15k/mo., without a forum. We may add a forum in the next few months, though. Let's say only two people signed up for it. Each of them is worth $7.5k? I don't think so....
I don't think it should be calculated as the overall earnings of an entire site, but rather over what revenue the message boards are bringing into and contributing to your site. People often make the mistake of only taking into account direct revenue, but also the indirect revenue that never would have been there if your message boards weren't there.
This could be not only advertising revenue from the message boards, but even to include someone who landed on your message boards through a search referral, then continued onto the site to purchase something. Content on the message boards were directly related to that person finding your site and ultimately purchasing something from you. Likewise, a member could refer someone else to read a post on your message boards, then that person might place an order.
Message board stickyness can also result in repeat orders - you keep them coming back and eventually they will order or place second (third, fourth, etc) orders with you.
So while each member might not be worth $7.5k a piece, don't forget to include indirect revenues in your calculations as well.
Incidentally, I figure each visitor is worth $0.15 to us. But I won't tell them that, it wouldn't be good for their self-esteem.
