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Community-Led Growth: The Key to Acquisition and Retention?

Published On
May 24, 2023
Read Time
Shreya Ganguly

Every company has a community, which comprises people who are passionate about your work and want to spread it to the rest of the world. In fact, according to a report from Higher Logic, 66% of branded communities say that their communities have impacted customer retention. 

As a marketing tactic, community-led growth involves leveraging the marketing potential of these individuals and allowing them to share their enthusiasm with others. Companies often find it an effective way to acquire and retain customers.

In this article, we will explore how community-led companies provide value and how communities can help a company grow.

What Does Community-Led Growth Mean for Companies?

Community-led growth for companies refers to a business strategy that strongly emphasises building and engaging with a loyal community of customers or users and leveraging the company's growth.

A customer-focused approach involves actively seeking out and listening to customer feedback, involving them in product development and marketing, and creating shared ownership.

Companies prioritising their communities' needs and preferences can develop loyal customers more likely to refer others and provide valuable word-of-mouth marketing. This will lead to higher sales, higher customer retention rates, and a sustainable and scalable business model. 

Examples of companies that have successfully implemented community-led growth strategies include Airbnb, Etsy, and Glossier, all of which have built thriving communities of users and customers that have helped drive their growth and success.

How Community-Led Growth Promotes Acquisition and Retention

Community-led growth can play an essential role in the acquisition and retention of customers or users of a product or service. 

Here are some ways that community-led growth can help in acquisition and retention:

Creating personalised experiences

By building a community, companies can create personalised experiences that make customers feel valued and invested in the brand. According to Salesforce research, 75% of business buyers expect customised experiences, anticipatory suggestions, and personalised experiences.


By building strong relationships with customers and understanding their individual needs and preferences, community-led companies can tailor their products and services to meet each customer's specific needs. This can increase customer loyalty and retention rates.

For example, Netflix's content recommendations improve usability by eliminating visitors needing to search the website for new content to watch. Their machine learning algorithms allow it to make compelling recommendations to keep people using the streaming service. This is a crucial illustration of how content personalisation can encourage users to continue paying for a service.

Utilising user-generated content

According to TINT, 93% of consumers utilise user-generated content to inform their purchasing decisions and find it helpful.

Therefore, you can allow your members to create and share product or service-related content with the community. This user-generated content (UGC) may attract new customers because they will see how passionate your existing customers are about your products and services.

Coca-Cola is an excellent example of how to build a brand's customer base and increase interest in its products through user-generated content. Coke produced special bottles labelled with the hashtag #shareacoke to promote its "Share a Coke" advertising campaign.

Valuing diverse feedback and insights

Community engagement can provide valuable feedback and insights into what customers want. Businesses can improve their products and services based on customer feedback. By interacting with them regularly, community-driven businesses understand their customers' needs, preferences, and pain points.

Also, by applying this knowledge to product development and marketing, the company can ensure it meets customer needs and promotes community-led growth.

Developing community-driven features

Community members can be involved in developing new product features and new service offerings that will benefit the community. Creating a sense of ownership and investment in the product can positively affect customer loyalty and retention and create a sense of ownership and investment among the customers, ultimately achieving substantial community-led growth.

Final Thoughts

Community-led growth is a powerful strategy for businesses looking to acquire and retain customers. By building a strong community of invested users in your product or service, you can create a loyal customer base that will promote your brand and help you grow organically.

Whether just starting out or looking to scale up, investing in community-led growth can help you achieve your goals. 

You can learn more about community-led growth by joining Scalix’s exclusive startup community. This platform helps startups and founders connect and learn how to leverage the power of community and build startups together.

Using Scalix, you can connect with people who share a similar goal, build valuable networks, and access insights that can help you grow your business.

Also, with our Exclusive Founder Community, you will have access to other startup founders who may be potential partners or customers for your business.

Sign up now to learn more!