What’s the Buzz on Word-of-Mouth Advertising?
By Al McClain
Most marketers these days seem to believe that word-of-mouth advertising is better than traditional media but that it is harder to do and there are pitfalls. Simplified, you have to get consumers talking about your brand or store, and get them talking about you in a good way. Easier said than done, no doubt.
At the recent GMA Merchandising, Sales, and Marketing Conference, marketing executives discussed the
importance of W-O-M marketing, along with the risks. Participating in the discussion were Greg Welch, CMO Practice Leader of Spencer Stuart; Steve Knox, CEO of Tremor/P &
G; and Michael Linton, former Exec VP/CMO of Best Buy.
The discussion focused on the importance of connecting with consumers emotionally so they will spend more and talk about your products and services to their friends. This is especially important in an era when most consumers don’t like the ads they see or don’t want to see ads at all, and because traditional media is missing many consumers. Reaching “connector” consumers – those who love to talk and are seeing “new news” was viewed as being especially important.
A number of successful nontraditional marketing efforts were discussed, such as Best Buy’s irreverent “Mint Brothers” ads which were posted on the web back in the mid to late 90’s; Dawn dishwashing detergent’s campaign revolving around getting kids to do more household chores; and Best Buy’s famous and exclusive Rolling Stones Live DVD event.
One of the cautionary notes sounded about W-O-M advertising is that it can kill your business if consumers turn negative, especially because what consumers HEAR about you will always be different than what they SHARE about you.
The panelists believe that funding for W-O-M needs to come from traditional marketing budgets via a shift in marketing spend, but that is difficult to do because marketers want to measure results using traditional tools that won’t work for this type of activity.
Another problem identified for this industry is that, although retailers have great transactional data, it doesn’t tell retailers why someone bought what they bought, and certainly doesn’t identify what they are saying to their friends.
Discussion Questions: How important is W-O-M marketing to retailers and brands, and how important should it be? How do you measure and define
success for a W-O-M program, especially when pressure is on to spend on promotions that move cases now?
Photo Courtesy of GMA
Word of Mouth (W-O-M) ain’t new, it’s just a new buzz word for what has been a driving force in companies success for generations. W-O-M is how something or someplace becomes popular. From the ubiquitous (The Croc Shoe) to the sublime (Napa Valley) W-O-M is the motivator for consumers to open their pocket books and make something or someplace widely known and popular.
It may be argued that W-O-M as a strategy is better geared towards EVENTS if you are a retailer, and ITEMS if you are a manufacturer.
Achieving W-O-M by building line items in your budget for W-O-M marketing may be a losing approach if the company doesn’t have anything that consumers want. Ensuring one’s company is attuned to the market place and consumer’s motivations is as important. If one has invested in this resource (brain trust investment) then I propose a more successful approach might be to make marketing decisions and funds available to these creative product development teams to work with as they develop and launch products.
A similar approach if you are a retailer is to allow your product and market experts the access to help direct such marketing funds towards events which highlight the products that they believe are key to positive word of mouth (consumer electronics such as iPods) and create interactive events which build the buzz.
As you indicated, the challenge with W-O-M advertising is that it only takes one vociferous customer with a bad experience to put a crush on all the successes. People will not mention an “ok” experience, they may praise an outstanding experience, but give them a bad experience and they will tell everyone. The good news is that they often tell the service provider too. So whether you are a manufacturer or a pure service provider it makes only sense that you take all those “complaint letters” seriously and try to exceed expectations with your response.
When your best friend tells you the car he/she just bought is the most wonderful car they have every owned, that personal endorsement is more persuasive than hundreds of TV ads or billboard showings. No doubt in my mind that word-of-mouth is the most effective form of advertising – but how to do it well and measure it is another story. Word-of-mouth has been around forever but its only recently that advertisers & marketers have seen it as another “tool” in the marketing arsenal. Certainly good brands are going to engender word-of-mouth “buzz” all on their own, without any help from the brand owner. Same for poor brands. Perhaps many companies should just create great products and services and let word-of-mouth do its own “viral” thing. However, there are some consumer audiences (notably teens and young adults) where traditional marketing doesn’t work well. Astute marketers can add a “cool” quotient to a brand’s positioning or promotional campaign by utilizing “buzz marketing.” Measuring effectiveness is difficult. Utilizing qualitative and/or quantitative consumer research to look for shifts in attitude or brand attribute ratings can provide clues to success as well as trying to correlate with sales velocity during the specific campaign timeframe.
Word-of-mouth advertising has always been important, effective, and uncontrollable by the advertiser. That hasn’t changed, but the importance of word-of-mouth advertising has increased as consumer groups become more fragmented and as consumers become more demanding for personalization. Advertisers can certainly begin a word-of-mouth activity but once started it doesn’t continue to be controlled by the advertiser. Monitoring, measuring, and demonstrating positive impact is a challenge. However, those who find appropriate tools and identify tactics that have positive impact will be ahead of their competitors.
There is nothing more important or more effective for retailers than word-of-mouth advertising.
However, one thing that hasn’t been mentioned is that all the computer programs and data analyses in the world aren’t going to help you make it work. The only thing that matters is great in-store execution. Without it, there is no positive word-of-mouth advertising.
In-store execution is what gives Trader Joe’s that incredible word-of-mouth advertising among customers. It’s also what makes Tesco so successful that they don’t even mind telling their competition what they’re doing. They know that strategy isn’t worth a damn without great in-store follow up.
My products are known solely via word of mouth. It’s not the only way, but when the word is positive, this method is the most powerful. Customers will seek out the item(s) until they “experience” what they heard.
Here’s the thing….
You don’t DO word of mouth advertising. It is happening all on its own whether you like it or not. You’re not in control of what people say, be it good or bad. What retailers ARE in control of is the experience they put their customers through. Let’s stop trying to make this into some convoluted marketing strategy and get back to giving customers an inspired experience of buying good products at attractive costs from intelligent, caring and friendly people. Give customers a great experience and they’ll tell ten others. Give them a bad experience and they’ll tell thirty. Your choice.
Thank you Ian for pointing out the obvious. W-O-M is an OUTCOME of great strategy, not a chunk of the marketing plan with a line item budget. What isn’t about connecting to customers emotionally any more? Why is this so hard to finally embrace?
The era of spin job communications to manipulate consumers is over. You speak the truth and people experience that truth or you’re called out as a counterfeit brand. Phonies don’t earn trust and people who don’t earn trust become irrelevant.
W-O-M is really the new means of advertising in the current scenario and it has emerged as the most important form of advertising for retailers. There is a very famous proverb, “we manufacture cosmetics at our store but we sell hopes at our retail outlet” by Revlon cosmetics…so no company today can survive just by satisfying the customer, now it has to delight them. That’s where the role of services marketing comes into play and that’s why I said the role of word of mouth publicity comes into play….because today’s customer wants more for less and in light of that, more customer service plays a major role.
WOM is the latest buzzword marketers are trying to cash in, however WOM Is Not:
Stealth or covert or guerilla marketing
Shilling
Infiltration
Comment Spam
Blogging
Viral Marketing
Scripted
PR, Events or Stunts
WOM is much more volatile because it enrolls consumers to become the voice for the brand.
WOM is:
Spontaneous, authentic and unscripted
Negative & Positive
Fluid; it must be organic and cannot be manufactured
Extremely powerful
Dangerous to those who don’t know what they are doing
A brand’s best friend or worst nightmare
WOM is the actual unscripted conversation that occurs between consumers about a product or service regardless of outcome. Understanding and harnessing that power is the key to a successful WOM program.
Although most of the WOM efforts that are referred to are online efforts let us not forget that:
80% of WOM happens OFFLINE!
Online WOM accounts for only 7-10%!