Why Conversion Funnel Models Don’t Work for Customer Communities—and How to Measure What Really Matters

Customer advocacy and engagement are crucial to driving retention, upsell, and long-term revenue growth. Yet, when it comes to customer communities, many companies still rely on the traditional conversion funnel to measure success—a framework that doesn't capture the full value these communities bring to the business.

The truth is, customer communities are an ecosystem, not a linear conversion funnel (frankly, the pre-sales customer journey isn't linear either, but that's a topic for another blog post). Each interaction within a community—from answering a peer’s question, to participating in a webinar, to sharing product feedback—has a cumulative and additive effect on both customer advocacy and revenue. Yet, when budgets tighten, these communities are often first on the chopping block, partly because their impact is more difficult to quantify in a simple "put in X dollars for Y activity, get Z ROI" way.

Here’s why the funnel model falls short and how you can measure the true impact of customer communities on your business.

The Problem with the Funnel Model

The conversion funnel assumes a linear, predictable path from awareness to purchase. But customer communities don't work this way. In reality, community members engage with a brand in non-linear ways, with multiple touchpoints throughout their journey.

For example:

• A customer might participate in a forum, then attend a user group meeting, then refer a peer, and later advocate for your brand at a conference.
• This person didn’t follow a straightforward path to conversion, yet their advocacy directly contributes to your bottom line.

In a community, value builds over time. It’s not just about getting a customer from point A to point B; it’s about continuous engagement that builds loyalty, strengthens the brand, and drives long-term growth.

Don’t Conflate "Easy to Measure" with "Valuable"

One of the biggest mistakes in evaluating the success of a customer community is focusing too much on what’s easy to measure. Metrics like post counts, likes, and the number of active users are vanity metrics that don’t fully reflect the business impact. While these are simple to track, they often lead to undervaluing community contributions because they don’t directly link to revenue.

The challenge is that communities foster long-term relationships and influence that are harder to track but are deeply valuable. Acts of advocacy—such as case studies, reviews, and reference calls—that emerge from community engagement directly contribute to sales and revenue growth but often go unnoticed (or uncredited) in traditional KPIs. These advocacy activities are powerful touchpoints that build credibility and influence potential buyers, leading to more renewals, upsells, and cross-sells over time. While the value of these contributions may not be immediately visible, they are critical to the overall health and growth of the business.

A Better Way to Measure the Impact of Customer Communities

To truly capture the value of customer communities, you need to use a more nuanced approach to measurement. Here are three key business outcomes where communities have a significant impact—and actionable ways to measure it.

1. Renewals and Retention

Customer communities often serve as a source of ongoing education, support, and peer networking. Engaged customers are more likely to renew because they feel connected to both the product and the brand. Here’s how you can measure that:

• Track Engagement in the CRM: Use your CRM to track which customers are active in your community. Create custom fields or tags to capture community participation (e.g., forum posts, event attendance, webinar participation).
• Correlation Analysis: Analyze the retention rates of customers who engage in the community versus those who don’t. You can use cohort analysis to compare the renewal rates of active participants with inactive ones.
• NPS and CSAT Integration: Link community participation data to customer satisfaction (CSAT) and Net Promoter Score (NPS) scores to see if there’s a correlation between community engagement and customer loyalty.

2. Upsell and Cross-Sell Opportunities

Active community members are often the most knowledgeable about your product, making them prime candidates for upsell and cross-sell opportunities. They’re more likely to adopt new features and expand usage because they’re highly engaged.

• Track Feature Requests and Feedback: Many customer communities provide product feedback or request new features. Track which customers are making these requests and integrate that data into your CRM. Use it to identify upsell opportunities for new modules or advanced features--and don't forget to give a shoutout or reward to community members whose feedback directly leads to the creation of new features or products that benefit everyone!
• Engagement to Upsell Analysis: For customers who participate in your community, track their product usage and cross-reference it with your sales data. How many of them went on to purchase additional products or services after interacting in the community? This helps you build a clear link between community participation and upsell/cross-sell conversions.
• Community-Driven Campaigns: Launch upsell or cross-sell campaigns specifically targeting active community members, and measure the conversion rates compared to non-community members.

3. Overall Revenue Impact

Measuring the community’s overall contribution to revenue requires looking beyond individual transactions to understand the cumulative effect of customer advocacy and engagement.

• Time Decay Attribution Model: Use the time decay model to analyze how community touchpoints contribute to the customer journey. Assign more weight to interactions that occur closer to a renewal, upsell, or other revenue event. For instance, if a customer attended a community webinar shortly before renewing their contract, that touchpoint should be given more credit in your attribution model.
• Multi-Touch Attribution: Communities are multi-touch environments, and traditional single-touch attribution won’t capture the full impact. Use a multi-touch attribution model in your CRM to assign partial credit to all community interactions leading up to a conversion event.
• Account Health Scoring: In your CRM, integrate community engagement as part of an account health score. Higher community involvement could raise the health score, indicating the likelihood of renewal or upsell.

Tangible Ways to Track Community Activities in Your CRM

For most marketing and customer success teams, the CRM is already the central hub for tracking customer interactions. By integrating community touchpoints, you can get a fuller picture of how community engagement drives revenue. Here’s how to do it:

1. Custom Fields and Tags: Create custom fields in your CRM to track community-specific activities like forum posts, event attendance, product feedback submissions, or community-driven referrals.
2. Engagement Scoring: Assign points for each community activity (e.g., 5 points for attending a webinar, 3 points for posting in a forum), and integrate this score into your CRM’s customer health metrics.
3. Automated Reporting: Set up automated reports that track community engagement by cohort, then link this data to key revenue metrics like renewal rates, upsell opportunities, and overall account value.

Making the Case for Investment

Customer communities are too valuable to be relegated to the "nice-to-have" category, only to be cut when budgets shrink. To ensure these communities receive the strategic focus and funding they deserve, program managers need to measure and communicate their long-term value effectively. By moving beyond surface-level metrics and applying advanced attribution models like time decay, you can show that communities are not just engagement tools but revenue drivers.

In the end, it’s about understanding that community impact is cumulative—each interaction builds on the next, and over time, these touchpoints lead to stronger customer relationships, higher renewal rates, and increased revenue. The path may not be linear, but the impact is undeniable.

Is your company looking to build out a customer community, or does your current one need a tune-up? Let's talk!