Word of Mouth Marketing

October 23, 2008

Shelley Burrus | Chelsea Purviance

What is it?

• Word of mouth (WOM) - The act of consumers providing information to other consumers.

• Word of mouth marketing (WOMM) - Giving people a reason to talk about your products and services, and making it easier for that conversation to take place.– Not creating WOM but learning how to use it to achieve

marketing objectives.

– Based on the concepts of customer satisfaction, two-way dialog, and transparent communications.

It’s harnessing the voice of the customer for the good of the brand.

What does it do?

• The goal is to gain natural brand advocates.– Create customer enthusiasm– Give customers a voice & provide tools to share– Listen & respond, even if negative or neutral– Pull not push

• WOM is the desired effect achieved through various alternative media.– Organic WOM occurs naturally when people are

satisfied and want to share.– Amplified WOM occurs when marketers launch

campaigns designed to accelerate WOM.

Basic Elements

• Educating people about products/services• Identifying those most likely to share• Providing tools of communication• Studying shared opinions• Listening and responding

Buzz Marketing

Viral Marketing

Community Marketing

Word of Mouth

Marketing

Word of Mouth

Marketing

Grassroots Marketing

Evangelist Marketing

Product Seeding

Influencer Marketing

Cause Marketing

Conversation Creation

Brand Blogging

Referral Programs

Viral Marketing

• Marketing techniques that use pre-existing social networks as a vehicle to increase brand awareness through self-replicating viral processes, analogous to the spread of pathological and computer viruses.

• “Cool stuff that people want to share.”– People connect with the message and feel compelled

to pass it on.

Email Message

• Hotmail-1996– Attached a simple tag at the bottom of every email sent

by members: “Get your private, free email at www.hotmail.com.”

– Recipients saw the product offer, clicked the link and signed-up.

– Spent $500,000 for a return of 12 million new users.

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Video: Will It Blend?

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Posted 7/10/07; Views 5.6 million

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Website: Subservient Chicken

• Burger King-2004– Series of commercials featuring the

“Subservient Chicken” promoting TenderCrisp Chicken Sandwich.

– www.subservientchicken.com– Considered successful by some,

unsuccessful by others.• By Oct. 2007--14 million unique

visitors, 396 millions hits

• Product/brand too diluted, lacking exposure

• Didn’t make people want to talk about Burger King

Buzz Marketing

• An event or activity that generates publicity, excitement & information to the consumer, creating conversations and causing media to write about the brand.

• Usually extreme/over-the-top--must take risks.• Half.com - In 1999, the founder convinced a small town in Oregon to

change its name from Halfway to Half.com, Oregon for $100,000 and received $4 million in publicity.

– It catapulted into the top 10 list of retail sites in less than six months and consistently ranked as one of the top five most transacted web sites on the Internet. It sold to eBay for over $300 million less than a year after it was founded.

• Lucky Strike Cigarettes sent a team of people out to deliver chairs and iced coffees to exiled smokers.

• Vespa hired models to ride around outdoor cafes, park, interact with people and give out info about where to purchase.

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• Process of promotion via social media channels by engaging and interacting with existing or potential consumers. – Activities that are used to enable marketers to build

links, attention and receive large amounts of traffic for their company or site.

• Sharing content in and between social networks• Martell Home Builders - Canadian home builder

uses YouTube, Twitter, blogging, Facebook and more to not just promote, but sell directly to buyers and provide current customers the ability to keep track of their projects.

Social Media Marketing

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Influencer Marketing

• Identifying key individuals who have the ability to influence others

– Could be end consumers or third parties (supply chain, media, consultants/advisors, analysts, etc.)

• 80/20 rule• Activities

– Identifying influencers, and ranking them in order of importance.

– Marketing to influencers, to increase awareness of the brand within the influencer community.

– Marketing through influencers, using influencers to increase market awareness of the brand amongst target markets

– Marketing with influencers, turning influencers into advocates.

Influencer Marketing

• Accelerade– Developed a strategy to educate, involve, and

provide emotional and performance value to the Influencers in key endurance sports.

• Regional Brand Ambassadors working directly with Influencers in 15 markets created natural evangelists of the most respected triathletes, runners, cyclists, coaches, and teams.

• 6-Time Ironman Champion Dave Scott to host performance and nutritional clinics in our cities; we wrapped the brand around elite level athletes and races; and we hosted Accelerade Aid stations for clubs at their local rides, runs, swims, and clinics.

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Other Common Types

• Grassroots - organizing & motivating volunteers to engage in personal or local outreach.

• Evangelist - cultivating evangelists, advocates or volunteers who are encouraged to take a leadership role in actively spreading the word on your behalf.

• Brand blogging - creating blogs specific to products/brands & participating in the blogosphere in the spirit of open, transparent communications.

• Conversation creation - interesting or fun advertising, emails, catch phrases, entertainment, etc. designed to start word of mouth activity.

• Product seeding - placing the right product into the right hands at the right time.

• Cause - supporting social causes to ear respect & support.• Community - forming or supporting niche communities likely to share

interests about a brand (user groups, fan club, forums).• Referral programs - creating tools that enable satisfied customers to

refer friends

Why Use WOMM?

• People are already talking about you.– Satisfied customers tell an average of 3 people about a

product/service.

– Unsatisfied customers tell an average of 11 people.

• WOM influences 80% of purchase decisions.• “Most powerful medium on the planet.”

– Creates trust in a product or brand.

– Encourages communication/gives people something to talk about

– Creates communities and connects people.

– Allows opportunity to research and listen to customer feedback as well as respond to both negative and positive conversations.

– It’s trackable/measurable.

– Provides opportunity for list building via contesting or opt-in options.

When Should You Use WOMM?• Is your business/product/service WOM-worthy? Make sure

it meets expectations• Make sure you have all your “ducks in a row,” i.e. make

sure you are ready for this, that your website can handle the traffic, that you have people in place to monitor and help facilitate this.

• Need to figure out how viral fits into the overall campaign strategy. Don’t do a viral campaign just to do one.

• Don’t base success on overall numbers.– Success should be based on generating the right response

from your target audience.

• Organic vs. Amplified WOM – should you just let it happen naturally or help it along?

How To Use WOMM

• Commandments of Viral Marketing– Thou Shalt Know Thy Customer

• Know what they want and listen to them

– Thou Shalt Be Remarkable• Message (VW crashes); Company (Zappos.com)

– Thou Shalt Try, Try Again• Only 15% of viral WOM campaigns are ever deemed

“successful” according to Jupiter Research.• WOM is a calculated risk but allows for experimentation

– Thou Shalt Tie in Your Message• What are the clients goals? Which one matters most?

– Get attention? Sell product? Build the brand?

– Elf Yourself

How To Use WOMM

• Make sure you:– Know your customer

– Are honest and transparent

– Keep it simple

– Make it interesting/entertaining

– Provide benefit to the receiver

– Use success stories/testimonials

– Make it easy to pass it on

What Not To Do

• WOMMA’s Ethics Code– Honesty of Relationship: You say who you're representing.– Honesty of Opinion: You only say what you really believe.– Honesty of Identity: You never lie about who you are.

• Don’t ignore what consumers say• Don’t create a WOM campaign for the sake of creating one

- it must relate to the brand• Don’t discourage sharing, downloading, embedding or

commenting--this is the essence of WOMM, especially viral• Don’t underestimate the intelligence of your audience• Don’t forget the ramifications

– Pontiac giveaway on Oprah, GM overlooked the $7K tax bill each recipient faced

Managing WOM

• WOM can be managed by creating a great customer experience on every contact.

• If you don’t have good business practices in place, WOM will more likely be negative than positive.

• To effectively manage WOM, you need to know:– What percentage of new customers are referrals?– How likely are existing customers to recommend?– How many people does each satisfied customer tell? (Average

3)– Of those, how many approach the company to do business?– What can we do to increase the number of referrals from

existing customers?– What is the cost of getting a new customer using WOM versus

other advertising/marketing efforts?

Measuring

• Number of persons told (WOM volume)• Impact on opinion of the company

– Personal interactions have more impact on opinion than traditional advertising

• Number of those told who take action based on recommendation– People tell 3-4 others about positive experience– 1 out of 4 took action

• The percentage of new customers who come to the organization based on personal referral– Among scores of successful companies, the lowest

percentage of new customers gained from referrals was 20%. The highest percentage was over 70%.

“Measuring buzz success in the short term is like measuring the quality of a tree one day after you plant it.” --Dean Hunt

K&W Efforts

• FHSU - football & basketball games; mashed potato sculpting

• Liberty - fall festival, softball game• KCAD - fortune cookies• Kuhn & Wittenborn - 30th Anniversary; 30 Days of

Making Life Better in Kansas City– Lovebait.com commercial

• Posted 10/6; Views to date 122

– Elect Billy Bob Quincy Adams commercial• Posted 10/9; Views to date 25

Questions?

• What else could we be doing for K&W? For our clients?

A Few Sources

• WOMMA• Wikipedia• The Tipping Point by Malcolm

Gladwell• Jennifer Laycock, Editor,

Search Engine Guide• Marketing Sherpa• “Six Simple Principles of Viral

Marketing,” Dr. Ralph F. Wilson

• BrandWeek• “The Word on Word of Mouth,”

Dave Balter, ChangeThis• “Buzz Marketing: What works,

what doesn’t and why,” Sally Durcan, Hotcow

• Buzzmarketing.com• Business Week• Social Media Explorer• “The Web Traffic Orgasm: A

Case Study,” by Dean Hunt