Product-led growth or Community-led growth, how should a business decide what works best for them? This is a question that can never have a one-size-fits-all answer. While the most diplomatic answer is to say "combine both" (product building & community building) in designing the go-to-market strategy, both approaches have pros and cons.

One of the fundamental differences between product building and community building is time. While product building is all about moving fast and iterating faster, community building is a slow, long-term process. But is that all there is to know about product vs. community building?

We have done some research and gathered a few experts to break down the differences, commonalities, and everything in between about product and community building and how to design, nurture, and scale your community the right way.

Let's go!!

The Difference

The world of PRDs and development sprints is different from the universe of people and moments that weave stories of experiences with the product. As mentioned earlier one of the key differences is the pace of building. Another major difference is reliance on tech and data. In product development, it is a lot easier to define and track metrics. In contrast, community managers need to come up with creative ways to track and measure the effectiveness as well as the demand and utility of their community for the end user. This also means that even the metrics that are tracked for communities will have a behavioral impact baked into them. According to Ritu Mittal, who is the Community Lead at NextLeap.

Product building is driven by tech and runs on automation by and large. The metrics you measure are well-defined & quantifiable. Example: adoption rate of a feature, conversions on a landing page, etc.
‍Whereas, community building requires constant P2P interaction. Not all metrics can be quantified easily. Example: how would you feel if you can no longer be part of this community, rate on a scale of 1-5 with 1 being disappointed and 5 being indifferent. It is a feeling that is being captured by a scale, dependent on members to fill in a survey form, allowing for bias.
Ritu

This behavioral aspect also means an unfair advantage for a business if communities are built the right way. As Harshad Fad who has been a Community Growth Specialist at Bizongo said:

Products can be copied or forked. A community cannot be. Communities are organic entities composed of people, shared values, experiences, and interactions. They can't be duplicated or replicated in the way products can. And even if you try to replicate a community or its spirit elsewhere, it often proves challenging. Authentic communities grow organically and are shaped by shared experiences and time.
‍Harshad

This is not to say that there is no relation. Your product and community go together not only in defining the user experience but also in driving the business goals, creating a unique mix, and becoming the business moat over time.

We spoke to Tilo Mathes who has been a product manager as well as community relations manager at ResearchGate and in his words:

From the first principles, I see more similarities than differences. I've observed though that community builders are often more driven by providing value to a company's potential users/customers whereas product managers are often more driven by creating value for the company. Great community and product managers understand that there might be friction between these goals but are able to successfully harmonize both. They are relentless advocates for their users/customers and strong creators of business value.
‍Tilo    

In the end, a business exists to solve a particular problem for its users. Even with certain overlaps in both product and community building, the fundamental difference in the problem-solving approach can be defined as:

Community building is about solving a problem with trust and a sense of belonging. Product building is about solving a problem with features and scalability.
‍Siddharth Kothari, Group Product Manager, Niyo

The Guiding Principles For Community Building And Measuring Its Success

In a State of Startups report by First Round Capital, over 80% of founders agreed that communities are crucial for building a moat, creating brand awareness, and customer success.

We have also found that communities are a great way to improve retention, gain customer feedback beyond basic surveys, and even launch new, successful products making communities a no-brainer.

Now that we have established key differences between product and community, and the advantage of communities. Let's dig deeper into understanding the most efficient way of community building and driving community-led growth.

Read Our Expert's View:

If the community use case and utility have been established for the business, the next key step to keep in mind from the beginning is to have a common benchmark of community success.

 For the first 12-18 months, the brand and/or community team should only give sans asking, expecting anything from members.
‍Ritu

This comment by Ritu brings into focus what we said earlier - community building is indeed a slow, long-haul process. This also means that once the community has started to show signs of stability and maturity, said business is on its way to building the community moat. Here is a simple way to access the direction and efficiency of community-building efforts in any organization:

If you have started to see a flywheel effect forming in your community, and are able to retain the super users per industry benchmark, you can fairly conclude that your community-building efforts are moving in the right direction.
‍Siddharth

How you measure the success of your community also depends on the purpose and placement of the community. This is especially true in cases where the community is part of the product being offered.

If you are building a community while building your core product then I think the success depends on how well you drive the growth of your core product through community initiatives.
‍If your community is the product, then it's about the growth of the community with respect to acquisition and retention leading to revenue (if you are monetizing it) and growth as a business.
‍Lokesh Gupta, Founder ProductHood

Harshad shared a simple tip for both Product Managers (PMs) and Community Managers (CMs) to assess the direction, impact, and success of the community.

PMs: Look at how often members are providing feedback about the product. This can give insights into product direction and user sentiment.  

CMs: Strike a balance between data-driven and sentiments-driven decision-making. Measure success by looking at the growth, engagement, and churn in the community while also keeping the environment welcoming and human. People want to reap rewards and be themselves and not be a part of another brand community trying to sell.  

Harnessing The Power Of Processes To Guide Better Behaviour

If you have read so far, chances are that you already have a community or planning to launch one. This is the moment where we would tell you to be a community builder who also has the qualities of a product manager.

Communities are tricky and get tricker with scale. You can not have an iron fist approach but design your experiments with a clear plan of action, apply frameworks wherever possible, and document everything like your life depends on it. As such you definitely need to don the two hats at all times.

A great way to add a PM approach is to build a Minimum Viable Community (MVC). Suhas Motwani, Founding Member of The Product Folks describes it as follows:

Similar to a Minimum Viable Product, an MVC is the most basic version of a community that still fulfills its purpose. Building an MVC allows for quicker launches and lets community builders focus on key functionalities before expanding.

Other experts that we spoke to also shared a similar view.

Community building is best done with a product management lens & approach. My Onboarding experiences, feedback surveys, and user calls are highly influenced by product management. Additionally, the way we measure engagement and content, event marketing too, are all driven by a product approach i.e. Jobs To Be Done (JTBD).
‍Ritu

Lokesh shared the example of ProductHood, a community-led ed-tech product, where they spend a lot of time understanding the behavior of members from a data-led approach, which is essentially a PM's way of understanding users. This in turn helped the team in improving the communication and the way they engaged with the users.

Scaling Up The Community

Once the community has matured and you have understood how to measure the ROI and establish systems for community building, you can focus on scaling up the community.

At this point, there should be some aspects of community building and engagement that have the potential productization. While also keeping enough room to experiment and introduce new things in the community.

Here are some of the ways shared by our experts to assess the community-market-fit, readiness to be productive, and scale up the community:

 My suggestion would be to assess this similarly to product market fit. Asking a representative sample of your community how they would feel about "no longer being able to access the community", should give you a good idea if you're (still) on the right track. You might ask stakeholders within your organization the same question.
‍As you scale you obviously need to pay attention to this metric, as with scaling your community composition might change and hence different needs for programming/services/products may arise.
Tilo

When programs & their outcomes are starting to become predictable, repeatable & business as usual, it is time to playbook it & productize it. Until then, keep it scrappy, iterate
‍Ritu

You know you have found a community market fit when the engagement levels are high and organic growth has started kicking in. This is also a time when there is a rise in super-users, ambassadors, or advocates who passionately promote, defend, and engage with your product. You can scale from here by localizing your community - creating local chapters, virtual spaces dedicated to diverse languages, etc. You can also run a referral program, improve the technical infrastructure to cater to the growing community and double down on engagement strategies like events, meetups, and webinars.
‍Harshad

If you have solved for the motivation of providers, the super users and you are able to retain them to a certain degree.
‍Siddharth

A mature community shows consistent, organic engagement and a strong sense of member ownership. Key metrics like Community Lifetime Value and retention rates stabilize or grow autonomously. This stability allows the Community Manager to shift focus towards scaling and productizing community features. It's an ideal phase for experimenting with growth and monetization strategies.
‍Suhas

Summary

If you are trying to figure out the community equation here are some questions you should ask before you start or realign your community-building efforts.

"How much would you pay to acquire a thriving community of 10,000 of your current and potential customers? Why?"

"Is this community achieving its stated goal?"

While there is no right or wrong way to community building, asking the right questions from the start and periodically checking if the answers to fundamental questions have shifted will help in avoiding wasted efforts.

Note for the PMs: Reach out to us if you are gearing to build in-app communities. We can help you do so without requiring engineering efforts and an integration that can happen in under 15 minutes.