Word of Mouth Demystified

June 20th, 2007   •   12 comments   

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Ian McKee, CEO of Vocanic, shared at the recent PR Academy Conference about the importance of Word of Mouth (WOM) marketing. Anybody who has spent time on the blogosphere will probably have heard about this term. However, what does it truly mean?

In his presentation, Ian shared some startling findings.
Media Consumption Patterns in Asia (time spent):
Internet 47%
TV 29%
Radio 12%
Newspaper 8%
Magazines 5%

However, this is how brand managers are spending!
TV 42%
NEwspaper 38%
Radio 9%
Posters 5%
Periodicals 5%
Bus/Taxis 2%
Cinema 1%

In other words, hardly any marketing is spent online even though consumers spent 47% of their media consumption time there! This correlates with my earlier observation on media spending patterns in Singapore.

From surveys, most people are twice as likely to trust their friends compared to information direct from companies. In addition, 19% choose brands solely due to recommendations.

Word of Mouth Marketing isn’t necessarily Viral Marketing. Viral marketing usually happens with a promotional piece so entertaining that people tell each other about it. This normally is either a URL/Microsite, an image, a video clip or a game.

While viral marketing can generate eyeballs, it doesn’t necessarily work. Burger King’s Subservient Chicken, one of the most successful viral campaigns ever, generated a total of 14 million unique visitors. However, it led to 0% increase in product awareness and no increase in sales for its franchisees!

So how can one do Word of Mouth?

Step 1 is to identify your Influencers. These are “Super Recommenders” whose personality and communication style, size of their social network and affinity for the brand make them great allies.

Step 2 is to activate your Influencers. Most influencers are motivated by being better informed than the market, being the first to know, and having the chance to be “up close and personal” with the brand. Exclusive invites and previews may help here.

Step 3 is to develop the 3 components of WOM campaigns.

1) Identified and Activated Influencers
– Engaged, persuasive, highly connected recommenders

2) Remarkable Stories
– Correctly crafted for word of mouth communication (some deft copywriting needed)

3) Coversation Triggers
– the reason for them to have the conversation

There are of course ethics in WOM. Ian advocates the following 3 step test for programmes (ROI):

Relationship – transparency of their relationship with the brand
Opinion – truthfully representing their own opinion
Identity – not pretending to be someone else

I certainly found the session very fruitful and illuminating, confirming my own observations in marketing and advertising. The challenge of WOM marketing though is that it takes time to brew. I wonder how many executives and senior managers would have the patience to wait for the results to happen?

However, it is certainly the way forward, as highlighted by one of the world’s biggest advertisers P&G:

“The mass market push, BIG brand model, push the advertising on TV, LOUD as you can, as LONG as you can is not as effective as it used to be. And it certainly isn’t efficient” – AG. Lafley, CEO P&G (2003).

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12 comments

  1. posted on Jun 20, 2007 at 12:29 AM

    nice blog

  2. posted on Jun 20, 2007 at 1:28 AM

    Hey there! This is very interesting findings.

    I have this feel that internet is the way to go for my company’s products and as a small startup with limited resources, we are beginning to see some results from what we have invested sometime back on the internet instead of the mainstream channels.

    Your article is very informative.

  3. Endoh Taiki
    posted on Jun 20, 2007 at 10:20 AM

    I may sound biased since I am in the events industry, but I am very surprised how Asia marketers are still viewing events as unconventional marketing platform. As most would know, events marketing is the only medium that communicates directly with potential customers instead of adopting the “hit the mass and wait” philosophy.

    To the point that events marketing is nowhere to be seen. It could be due to the high cost of running shows in Singapore when the industry is being monopolised by a few companies and that is not healthy at all.

  4. Endoh Taiki
    posted on Jun 20, 2007 at 11:16 PM

    I feel you there. More than half the events companies we have locally are nothing more than just mere parties planners without marketing background.

    I constantly preach something that is missing very much in most events companies… “engaging target audiences without losing the focus and freshness of the product”. However, while preaching this I also learnt that the demographics of our clients are different from the rest of the world. Low price over quality.

  5. posted on Jun 20, 2007 at 10:24 PM

    all blog spots,

    Thanks for the compliments.

  6. posted on Jun 20, 2007 at 10:26 PM

    harro!

    Yep. I hope that more folks in this line will abide by the principles of WOM although I must admit that it is easier said than done.

    Perhaps if the risk of failure is too high, one approach is to mix any WOM initiative with other approaches in the bag.

  7. posted on Jun 20, 2007 at 10:29 PM

    paddy,

    I agree that the Internet is a great medium for WOM. However, it shouldn’t be the only exclusive channel especially for non tech-based products like food and clothes which require greater sensorial stimulation.

    For your business, I am glad to hear about the great achievements that you guys have done over this short period of time. Generating the right publicity is also an important component of successful WOM.

  8. posted on Jun 20, 2007 at 10:42 PM

    endoh,

    Nice observation there about events marketing and how it plays a role in Word of Mouth. As a long time practitioner of events, I totally agree with you over this. The right activity targeted at your influencers (movers and shakers) can help to set in place a WOM effect if the conditions and settings are right.

    Unfortunately, my own experience shows that many event companies in Singapore are one-trick ponies. They tend to offer similar services, and rare is the occasion where they can come up with something new and imaginative yet cost effective. Of course, as the saying goes, its easier said than done!

  9. posted on Jun 21, 2007 at 1:35 PM

    Thanks for sharing this, Walter. The media consumption patterns vs advertisement expenditure are particularly revealing. The ROI steps, by the way, are recommendations of the Word of Mouth Marketing Association (WOMMA). They are also known as the Honesty ROI.

  10. posted on Jun 21, 2007 at 3:20 PM

    endoh,

    Agree with your views on clients being stingy. Have to admit that I am quite penny pinching myself, but its really because I have little choice. I believe though that sometimes quality may be better than quantity. We are still looking for that holy grail and maybe we should catch up one day. 😉

  11. posted on Jun 21, 2007 at 3:22 PM

    clappingtrees,

    Thanks for sharing that with us. Yeah, I guess the age of honesty can be something that will be heralded in this age of new media. The tricky part is putting it into practice though, something which I admittedly suffer from myself.

  12. Shirish Govind
    posted on Jan 14, 2009 at 5:02 AM

    Thanks A bunch……. very nice observation & research…..! A ready made material for media use!!!!

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