WOM UK Guest Post: Dr Martin Oetting explains why online marketing needs to become WOM advocacy

November 16, 2009 at 5:10 pm | Posted in Events, Guest post | 1 Comment
Tags: martin oetting, online marketing, trnd, wom uk, word of mouth

To whet your appetite for this Wednesday’s WOM Thought Leader event featuring Dr Martin Oetting from trnd presenting his doctoral thesis The Ripple Effect, Martin has written us an exclusive blog post about how online marketing is migrating to a focus on word of mouth. Click here for details and registration for the free evening networking event then read on…

OettingOnline marketing is all about data: clicks, hits, downloads, visits. Consumers are no longer strolling incognito but on digitally supervised grounds. They leave countless traces that savvy marketers mine, analyse, understand and leverage – to divide the audience into little pieces, turn them into handy segments, provide each and everyone with their own click-path, most conducive to purchase. This number-crunching game, undoubtedly, must be the online marketing story. Right?

Personally, I don’t believe this. I don’t believe that modern marketing is made most exciting by the sheer amount of data that we collect and mess with. Yes, this is amazing, but I think the wonder of the web, with regards to online marketing, lies somewhere else.

I think the real story is this: On the web, a Mom and Pop store can scale.

Let me explain. Word of mouth is thought to be the most powerful force in marketing. A number of researchers have found that there is an interesting factor that stimulates it: better, closer relationships between a company and its customers. It seems like a no-brainer (of course I’ll recommend the friendly guy more often than the idiot), but no one was interested in this research from a mass marketing perspective – after all, it sounds like advice you give a local restaurant or your favourite barber’s shop. If you are Unilever, Volkswagen or Barcley’s Bank, you cannot worry about forging real relationships with your customers. You have millions of them, and you’re too busy devising cunning advertising strategies, to reach each one of them at least 17 times over. So that they finally remember that one ad which “penetrates your strategic position deeply into the target group“ (or something like that). Under these circumstances, there is no way to build real relationships like the little corner shop can.

Prof. Robin Dunbar agreed. In 1992, he proposed what became known as Dunbar’s Number. As he was researching the cognitive capacity of humans, he estimated that a normal human being can have and maintain something like 150 meaningful relationships. On average, our brains are not capable of really keeping track of more people than that. Close or not so close ties with 150 people seems reasonable: they range from your spouse (as, arguably, the closest) all the way to the guy down the pub with whom you have a brief chat every so often but don’t remember his last name (as number 150). Now let us say a marketing department of a large multinational has 35 employees. Taken together, they can then maintain relationships with 5,250 people (35 times 150). If they market to millions, that seems awfully little. Besides, most of these 5,250 people are their friends (“Art, don’t start with that marketing bullshit of yours again.“). No way to heed the Academics’ advice, to stimulate word of mouth through relationships.

And then the web happened.

Let’s have a look. You now have a LinkedIn profile, two email accounts, a blog, a Facebook page, and you’re on Twitter. If we assume that you are really actively using these tools, and if we take all of these devices together, to count the number of people with whom you are in touch, know of, hear from every now and then, might look up in your account and remember, reply to on Twitter, briefly: engage with in some way, we might easily conclude that your number reaches 1,500 people. Maybe more.

In other words: the web allows us to multiply Dunbar’s number by ten. (And you don’t need to be Robert Scoble for that – he’s probably closer to 100 times Dunbar.) Now let’s go back to the fictitious marketing department from above, and let’s assume that each of the 35 employees actively and passionately use the tools I mentioned. Then they can – taken together – create, build and maintain relationships with 52,500 people. Relationships in which they show that the company listens. Provides answers. Is caring. Understands its customers. Admits faults and rights them. Responds. Just like, in former times, only Mom and Pop could, in the little cobbler’s shop on the corner of the street. The web allows us to scale up these relationships. To a level where it becomes interesting for the largest marketers around.

Because what’s going to happen? 52,500 people in that market become its distributed network of communication hubs – people who know the company. Who will defend the company in times of trouble. Who are out there in the market, who listen and report back what’s going on. Who can have an influence on the buying decisions of ten people each – that’s 525,000 potential new customers!

And rather than wasting another day in yet another strategy meeting, or pouring over the umpteenth market research deck, the marketing people can actually start to do real marketing – by learning from the world around them, by taking that insight into the company, and helping to turn it into the type of product that the world out there is waiting for.

I believe that is the real power of online marketing.

WOM UK Guest Post: Emanuel Rosen on The Dangers of Secondhand Buzz

October 5, 2009 at 10:17 am | Posted in Events, Guest post | 1 Comment
Tags: emmanuel rosen, negative word of mouth, secondhand buzz, wom uk

As a teaser for his presentation in London at 8.30am this Wednesday 7th October, internationally renowned word of mouth author Emanuel Rosen has written an exclusive article for us on one of the big worries for brands in social media: negative, uninformed WOM. Read on below and make sure to register for his talk – you’ll get a chance to network with the UK’s top WOM agencies and get a free copy of his book too!

EMMANUELOne of the most interesting studies I read in conducting the research for my new book was done by Dr. Robert East from Kingston University in London. He found that about 30% of negative word of mouth comes from people who never owned the product that they were talking about. If you’re a marketer, I’m sure this is pretty upsetting: you’re working hard on developing a product or a service, and people are badmouthing it without giving it a chance.

But consumers should be annoyed by this too because secondhand buzz is not very helpful. In its purest form, word of mouth is a filtering mechanism that we use in order to find good products. In a society where every person recommends only products that they personally tried and liked, good products will quickly rise to the top. When people simply relay information that they heard, you get something that could be best described as a buzz bubble, as depicted in some book reviews that I found on Amazon.com: “I haven’t read this book but judging from the online reviews below, I don’t think it’s a very good book” (one star). Or “I haven’t read this book yet, but my friend has and she said it was a really cool book…” (five stars).

As consumers and as marketers, we should try to reduce secondhand buzz. Specifically, here’s what marketers can do about it. A good way to start is to divide the people who talk about your brand into four groups: experience-based promoters (“I tried it. It’s great”), experience-based detractors (“I tried it. It’s terrible”), secondhand promoters (“Julie says it’s great”), and secondhand detractors (“Joe says it’s terrible”). And here’s what you should do with each group:

1. Maximize the number of experience-based promoters
Research shows that experience-based buzz is more likely to bring sales. The Keller Fay Group found that 53% of the people who listen to experience-based positive buzz mark 9 or 10 on a 0-10 scale of likelihood to purchase a product. In the case of second-hand positive word of mouth, the percentage of people who mark the top boxes drops to 33%. And that’s why it’s so important to trigger your happy customers to spread the word. A big part of word-of-mouth marketing is about reminding people who had a positive experience with your brand to talk about it. This will not stop the secondhand detractors from talking, but will reduce the percentage of their comments in the overall mix.

2. Encourage secondhand promoters to try your product
Of course it’s great that these secondhand promoters are buzzing about your brand, but their ability to create actual sales is not as high as the experience-based promoters. So secondhand promoters should be triggered to keep spreading the word, and equally important – to actually use the product! Their buzz will become more valuable.

3. Listen to experience-based detractors
Listening to bad buzz can be painful, but by doing it you achieve two goals: first, you can find unhappy customers (experience-based detractors), solve their problem, and possibly turn them into promoters. Even more importantly, you may identify problems in your system that will allow you to improve the experience of future customers and reduce additional negative buzz. (And there are so many ways to listen to buzz these days: pick up the phone and talk to customers, meet them at retail outlets, read what’s being said about you in blogs and Twitter, set up a private online community, run surveys, talk to the people at your call center…)

4. Three things to do with secondhand detractors
First, you should listen to them, too. They may be repeating a valid complaint, thus helping you identify a problem that is fixable. Second, you can try to find them and let them try the product, although this may be impractical in many cases. Third, as mentioned earlier, you should reduce their influence by encouraging your happy customers to talk. Perhaps the most important thing here is to build an immune system that will reduce the impact of their negative comments on the rest of your audience. There’s a name for this immune system. It’s called reputation, and it is affected by the consumer experience with your product and by what they have heard about you over the years. This is where advertising and public relations can help too in setting the facts straight. Word-of-mouth marketing does not work in isolation.

The main point is this—a firm can and should be proactive about minimizing unjustified negative word of mouth and maximizing positive word of mouth. You can’t afford to leave things to chance.

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