Building Community Is Good Business

As business leaders, when we are able to reinvest into our communities and the people in them that we serve, wonderful things happen.

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By Tim Murphy

Opinions expressed by Entrepreneur contributors are their own.

In decades past, advertising used to be the predominant form of businesses communicating with and attracting a large number of customers. While still crucial, today, advertising has taken a backseat to the attention a business or brand can receive by doing good for their community and those in it. That attention, when generated for (and from) the right reasons, can provide business leaders and professionals with the positive recognition they need to not only retain and acquire more loyal customers, but also the positive recognition necessary for any brand to continue growing as a successful business in today's world.

Related: Why Philanthropy is Good Business

Doing good helps foster impactful relationships

Whenever a business begins brainstorming ways for how it can do good in its community, the best place to start is by addressing concerns members in that community have. For instance, are its public schools under-supplied? Are there animal shelters or sanctuaries in need of charitable donations? By pinpointing ways in which a business can do good in its community in such a way that provides the maximum positive impact possible to the members of that community, those individuals begin to take notice and respond in kind.

As an example, Cody Pierce, vice president of marketing for Pizza Ranch based in Orange City, Iowa, began hosting "community impact" nights at his restaurants. These events allowed members of the local community to not only voice concerns about issues in their community, but also to put their heads together to discover and implement solutions for them, such as raising money for school trips. Similarly, Pierce hosted the impact nights on evenings that were traditionally slow for the restaurants, and would donate 5 to 20% of that night's tips towards the cause his community members were rallying around.

By engaging with his community in this way, Pierce was not only able to generate more revenue for his business, but he was able to do so in a way that left a positive impact on his community. This laid the foundation for more members of his community to view his business in a way that was positive for the community as a whole.

Related: Why Doing Good for Others Does Good for Your Business

Doing good bolsters employee engagement

Your business's work to do good for your community doesn't only leave a positive impact on the community itself. It also provides ways for your employees to become more engaged, both in your business and within the community. By giving your employees a way to give back, businesses often see a boost to their employees' morale as part of a collaborative effort to inspire and help others.

Over the past decade, there have been hundreds of reports and studies (if not more) generated that show a distinct correlation between how engaged employees feel and their performance in the workplace. Unsurprisingly, the data shows us that when employees feel more engaged in their work, they strive to perform better. For customers, this means that the employees they interact with are more likely to work harder to solve their problems, resulting in improved customer loyalty and retention which can serve as its own positive form of organic advertisement for a business.

Similarly, this helps the business grow and increase its profits through both more productive employees and more satisfied customers. One study published in 2012 showed, "a reciprocal relationship between job attitudes and business performance," but especially so for companies that maintained their philanthropic community engagement programs for longer periods of time (two years or more). In this way, businesses that implement charitable initiatives in their communities not only allow for further opportunities to engage and build meaningful relationships with their customers, but do so in a similar manner with their employees.

Related: 4 Ways Your Company Benefits from Giving Back

Doing good boosts your bottom line

When businesses can operate in ways that improve their employee engagement while also offering solutions to problems faced by those within their communities, those businesses are then able to witness how these initiatives can provide a similar positive impact to their own bottom line.

Allow me to clarify: In today's hyper-digital world, building and positively impacting a community around a specific brand or business allows for customers to feel as if they are a part of something larger and more meaningful than themselves as individuals — it invites them to become a part of your business's story. Humans are social creatures, and while recent digital innovations have connected the world and those in it like never before, they have likewise left a vacuum for social interaction within that digital space. Brands that can tap into this are able to set themselves apart from their competitors by creating a space where their customers and employees alike feel more connected, and thus, more valued.

Value is a two-way street: It cannot be received without being given and vice-versa. When a business's employees feel more connected to and valued by their employer, their workplace performance improves. Similarly, when a business's customers feel more connected to and valued by the brands they choose to do business with, they are more likely to continue doing business with that brand in the future. Both of these factors play a part in the business itself improving its own bottom line in creating a more profitable venture, and both can — in many cases — begin when a business is committed to doing good in its community.

Each business existing today is a comprehensive system of people, procedures and profits. Doing good through enacting philanthropic and charitable initiatives is simply one way that businesses can better blend these three aspects, but also one through which they can create better and more meaningful ways to engage with their community. This, in turn, leads to an overall more positive outcome for the business, its customers, employees and communities.

Tim Murphy

Entrepreneur Leadership Network Contributor

CEO of Boomers Parks

CEO Tim Murphy took Boomers Parks from bankruptcy to profitability in the middle of the pandemic. They were at a $10 million loss until Tim added new revenue streams to generate a 180% increase in revenue in 2021, with sales on a similar trajectory for 2022.

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