“Word of mouth agencies and clients need to start talking money”

April 30, 2010 at 12:21 pm | Posted in Events, Measurement, Research | 1 Comment
Tags: barak libai, CRM, Measurement, roi, social media, social networks, WOM, word of mouth

This week, Professor Barak Libai gave WOM UK members a glimpse into the future of WOM measurement and ROI as he presented his latest research and thinking on the value of consumer conversation.

We were delighted that Professor Libai, Marketing Professor at Recanati Graduate School of Business, Tel Aviv University, and award-winning researcher on the economics of WOM, narrowly escaped ashgate to present to the brands, agencies, fellow academics and students who piled into Grey’s London offices.

He began with establishing the importance of CRM in the past 20 years, and the need to start seeing the value of WOM in CRM terms, focusing on both customer lifetime value (CLV) and social value, and the lifetime and social values of people’s wider networks.

While Professor Libai admitted that there are still big holes in our knowledge of exactly how value creation is achieved through WOM – “we don’t necessarily know how, but we know that before and after, something happened that led to sales” – he also emphasised that the volume of data we now have access to is enormous, and is leading to a revolution in quantifying individual and social contributions.

His own work in simulating social networks to investigate how and why brands WOM spreads, using models from biology and anthropology, prompted questions from a crowd eager to know how accurate these trials could be, and how soon we might see more scientific approaches to measurement.

Professor Libai’s own international perspective also led to a discussion about rates of uptake in different countries, and the session ended with a quick delve into the tricky area of measuring offline WOM before everyone got stuck into the free wine and some relaxed networking.

With Dr Robert East in the audience bringing his perspective to bear on the research, and a real variety of attendees, this was the sort of event we love – challenging, thoughtful and with a real community feel. Big thanks to sponsors Royal Mail and Grey.

Next up, on the 27th May, Richard Anson, Founder and CEO of Reevoo, talks about the value for brands of independent review sites online – make sure you pre-register now.

WOM UK April Thought Leadership event: Professor Barak Libai on ‘Assessing the value of customers’ word of mouth’

April 9, 2010 at 1:05 pm | Posted in Events, Measurement, Research, Uncategorized | Leave a Comment
Tags: barak libai, event, Measurement, Research, roi, social media, WOM

Book now for the first of our great free spring events on Tuesday 27th April, which brings renowned WOM researcher and speaker Professor Barak Libai all the way from Tel Aviv to London to give his latest insights to WOM UK.

The event is being held at Grey, The Johnson Building, 77 Hatton Garden, London EC1N 8JS from 4.30pm, with the presentation at 5-6 and relaxed discussion, drinks and networking extending until 8pm. It’s essential to pre-register with Julian to reserve your place (WOM UK members get priority).

Assessing the ROI that results from customers’ word of mouth is a key challenge many marketers face today, especially given the plethora of word of mouth programs and social media investments by firms. However, most measures used are simplistic and do not necessarily capture the complex way in which social interactions turn into monetary gains. In ‘Assessing the value of customers’ word of mouth’, Prof. Libai will present the basic approaches to value customers’ word of mouth, highlight some major limitations, and discuss new approaches for understanding the “social value” of customers.

Professor Barak Libai , currently on the marketing faculty of  the Recanati Graduate School of Business, Tel Aviv University, was also Visiting Professor at the MIT Sloan School of Management from 2006-2008, and has a Ph.D. in Marketing from The University of North Carolina at Chapel Hill.  Prof. Libai’s research deals with the economic value of customers’ word of mouth, and relevant questions he examines include how different is customer  lifetime value when word of mouth is taken into account; what is the ROI of word of mouth programs; and how advertising effectiveness measurement should take social effects into account.  His research on the economic consequences of customers’ word of mouth has won prizes from The Marketing Science Institute, The American Marketing Association, the International Journal of Research in Marketing, Journal of Service Research, and ESOMAR.

This is bound to be a lively evening of thought leadership and networking, and we look forward to seeing you over a few beers. Big nod to Grey and Royal Mail for generously sponsoring the event.

Has Dr Robert East shown us the future of WOM measurement?

January 28, 2010 at 6:27 pm | Posted in Events, Measurement, Research | 2 Comments
Tags: dr robert east, Measurement, net promoter score, social media, WOM, word of mouth

Wednesday morning’s espresso briefing event certainly drew a big crowd – and a host of questions. It wasn’t surprising, as Dr Robert East’s presentation on the limitations and alternatives to the famous WOM measurement tool Net Promoter Score was provocative and persuasive in equal measure.

As Professor of Consumer Psychology at Kingston University, Dr East has long applied rigorous academic thinking to the contentious world of WOM metrics. He began by looking at the actual impact of positive and negative WOM for brands, something that NPS ignores. His research showed that measuring levels of sentiment is also more complex than it might initially seem, as detractors and promoters may not be as wholeheartedly glowing or derogatory as we assume.

He next moved on to look at the American Customer Satisfaction Index, another popular measure, and questioned the validity of ‘satisfaction’ as determined by the survey – highlighting such important points as the fact that satisfaction is proved to have little correlation with customer retention, and is only one of the causes of WOM.

By proposing a new methodology that takes into account these discrepancies and subtleties, Dr East showed that there could be a way of producing a much more reliable and effective measurement. This was very well received, and prompted a lively debate, with most of the questions circling the perennial problem of measuring essentially emotional and complex data quantitavely, and how to incorporate the differing value of different types of WOM. The issue of offline monitoring was also raised, with Dr East suggesting that examining individual industries and passion groups was the best starting point for gaining deeper insight. Check out the full presentation below.

What is certain is that this is an area that will be central to the growth and strength of the WOM industry in the next few years – and that an injection of funding is badly needed to investigate new systems large-scale. If you have any questions, comments, or suggestions for Dr East in securing further funding, leave a comment below or get in touch.

Exclusive download of WOMMA 09 Summit materials

January 14, 2010 at 12:58 pm | Posted in Case studies, Events, Measurement, Research | Leave a Comment
Tags: Research, social media case studies, wom uk, womma, word of mouth case studies

Last November’s Summit organised by our US partners WOMMA was one of the most exciting industry idea-sharing and -storming sessions of the year; a collision of brand case studies, new research and trends and academic debates that sparked some deep investigation into where word of mouth marketing currently stands.

WOM UK President Molly attended and posted an overview of what went on, but we’re delighted to announce that all WOM UK members can now download the decks presented by the keynote speakers, along with live videos from the general sessions,  from the WOMMA Member Center here.

All you need is your WOMMA library username and password, provided to every WOM UK member when they join. If you’ve lost track of yours, email Julian and he’ll send it over. And if you don’t have one? Well, joining WOM UK could be just the New Year’s resolution you need…

How HR professionals score as social networkers

December 14, 2009 at 3:28 pm | Posted in Research | Leave a Comment
Tags: hr, Research, social media, word of mouth

We like to share the great research and thinking around word of mouth and social marketing that is constantly being done by our members, so take a look at the whitepaper WOM UK member and social media agency Pass It On Media have created in collaboration with CHA, the workplace communications specialists.

Conversations at your fingertips: How HR professionals score as social networkers looks at “how well HR professionals and consultancies are embracing this new medium, and how their organisations could benefit from a strategic approach to social networking to build closer relationships with clients and customers, employees and suppliers.”

As the graph above suggests, the findings might come as a surprise; the majority of work and career conversations are positive, despite the current difficult environment. The study found that HR professionals’ nervousness about embracing social networking is not vindicated by the online content, and that the field is still wide open for commercial players to get involved in conversations to build their brands, position themselves as thought-leaders and attract staff, clients and interest from influencers through word of mouth.

Look through the full whitepaper below and let us know your thoughts in the comments; if you’d like to discuss further or set up a WOM UK debate or workshop on the subject, drop us a line.

January Espresso Briefing: Dr Robert East on moving your WOM measurement beyond Net Promoter Score

December 10, 2009 at 1:51 pm | Posted in Events, Measurement, Research | Leave a Comment
Tags: consumer behaviour, net promoter score, professor robert east, social media measurement, wom uk, word of mouth measurement

We’re going to kick off the New Year with a corker of an event. At 8.30-10.30am, Wednesday 27th January at Guardian News & Media, Kings Place, 90 York Way, London N1 9GU, Dr Robert East, Professor of Consumer Behaviour at Kingston University, joins WOM UK to discuss: Net Promoter Score is a popular WOM measure but are there better alternatives?

Net Promoter Score is a popular WOM measure for assessing the performance of the brand/company. Along with satisfaction measures, it does predict sales growth. However NPS has several deficiencies as a measure; in particular it fails to measure negative word of mouth. With increasing interest in predicting sales, profits and equity gains, we need customer metrics that do a better job at predicting customer behaviour. In this lively morning event, Dr East will be asking:

  • Why does NPS have shortcomings as a measure for WOM?
  • What are the alternatives and why are they better?
  • What are the implications moving forward?

Dr Robert East is Professor of Consumer Behaviour at Kingston University and directs the Consumer Research Unit in the Department of Strategy, Entrepreneurship and Marketing. He is one of the world’s most authoritative and respected leaders in word of mouth, brand switching and loyalty. He is the author of numerous books and articles on consumer behaviour and his research on word of mouth has been pivotal in improving our understanding of the importance of WOM.

All our Espresso Briefings are FREE and include breakfast and networking. To register for a place please email [email protected] – members get priority booking.

Using crowdsourcing and co-creation for adaptive brand planning

November 26, 2009 at 12:25 pm | Posted in Events, Research | 1 Comment
Tags: adaptive brand planning, co-creation, crowdsourcing, research 3.0, social media, wom uk, word of mouth

Word of mouth marketing is usually associated with building consumer advocacy, but this week’s WOM UK Espresso Briefing looked at a more inward focused use of WOM: using the groundswell of consumer knowledge and enthusiasm as a research base to develop an adaptive brand planning strategy.

Head of Social Media and Planning for Face, Francisco D’Orazio, presented Research 3.0 to a packed east London room of agencies, brands and researchers all interested in the latest developments in the WOM industry. After half an hour’s coffee and networking, Fran explained how brands can use our participatory, real time and constantly changing culture to move research onto a whole new level.

He identified three key elements in the process. Companies must first learn to immerse themselves in the real time intelligence available in social media to build a picture of the emotions, intentions and actions of consumers. They can then use this to develop an insight journey, or feedback loop, which should be as short as possible in order for them to change quickly, according to the opinions evolving in the space.

The next step is to conduct collaborative research in two ways. First, a wider crowdsourcing project connects a number of relevant individuals and communities around problem-solving tasks which prompt both hypothesis validation and ideas generation for the brand’s marketing. Then a more focused co-creation stage gathers a select few opinion leaders to test the best ideas and nail down specific proposals for activity. Both strategies have limitations by themselves – crowdsourcing can be rather messy, impersonal and limited by confidentiality constraints, while co-creation can be too rigid and retains a few-to-many philosophy – but together they combine individual and group thinking, bottom and top down structures, to provide a nuanced and effective outcome. Check out Fran’s deck below for more detail.

This was a fresh and exciting concept for many in the room and there was some animated discussion afterwards, around where the collaborators come from (a mixture of Face’s own communities and per-project targeted voices), the tricky issue of reward (different incentives and payments are offered depending on the client), and the role of brand-sponsored WOM in skewing the real time intelligence (there was a general concensus that communities would remain self-regulating and analysis could take into account the dubious value of those paid-for opinions). It was great to see so many new faces, suggesting that WOM UK events are addressing issues a broad range of people are interested in.

If you think you might be one of them, keep an eye out for our next FREE Espresso Briefing – details soon.

The latest WOM issues and insights from WOMMA Summit 09

November 23, 2009 at 4:03 pm | Posted in Events, Research | 3 Comments
Tags: Measurement, Research, roi, social media, wom uk, womma summit, word of mouth

WOM UK President Molly Flatt hit Vegas last week for the annual conference of our US sister organisation, WOMMA…

Having arrived back in Heathrow at midnight, I’m still dogged by jetlag and trying to assimilate the great eclectic beast that was WOMMA’s 2009 Summit in Vegas, no less. With three days of keynotes, panels and case studies from some of the biggest US brands active in the WOM space such as Ford, HP and Coca-Cola, as well as research from the likes of Forrester Research, Nielsen and The Keller Fay Group, it was a mindblast of the latest theories and commercial applications of WOM.

Measurement was predictably high on the agenda. Clients are crying out for industry-wide standards, but there was an acknowledgment that meaningful metrics will be be different according to client objectives (visibility, sales, loyalty etc) and therefore project-specific education is still essential. Conversation relies on context, while most ad metrics are stand-alone and focused on scale alone. Consequently, the most successful examples of effective measurement involved a brand combining insights and figures from other departments (sales, eyeballs, customer services calls etc) with a broad range of qual and quant WOM data.

Internal ownership was also a massive issue, with some great sessions from IBM & Newell Rubbermaid and Mars on how they’ve integrated WOM listening and advocacy programmes into their existing structures and processes. This was related to an ongoing conversation about how Customer Services links with WOM. A panel including Pete Blackshaw from Nielsen, Frank Eliason from Comcast, Tom Asher from Levi Strauss, Denise Morrissey from Toyota and John Bernier from Best Buy looked at examples such as @TWELPFORCE and @comcastcares which fully integrate Twitter into CS. The main takeaway was: just try, keep communicating, and help employees learn and progress from their mistakes. Take the risk, and as long as your approach has integrity and strategy behind it, the benefits will be enormous.

Another highlight was Steve Knox from P&G’s Tremor using cognitive psychology to explain why customers talk – apparently if you disrupt their schema (the model in their head of how the world works and their assumptions about a brand) it’s WOM gold. And the panel of WOM academics tackling the toughest questions in the industry had some powerful messages, in particular the importance of overlooked visual, aural and offline WOM triggers; the need for research into geographical and cultural differences in behaviour; and the use of future visioning to sell in the value of WOM to brands: if we do or don’t engage this talkative customer, what will the impact be?

Steve Knox from Tremor on cognitive psychology. Spot me earnestly taking notes on my Mac…

On the flipside, some of the examples I saw were still too based around an old-school marketing approach. Isn’t a moderated, branded page or forum in an independent community (such as Tropicana for BlogHer) really just a microsite dressed up in social clothing? From a WOM UK perspective, it was interesting to observe the differences in approach between the US and UK. I’m not sure that some of the more gung-ho, blatantly branded adovacy groups such as the Feld Family Activators at Mom Central would gain much traction in a nation that tends to be highly sceptical of associating itself so strongly with commerce. And some agencies were even stipulating time limits whereby participants were ‘expected’ to talk in return for goods or experiences – where’s the spontaneous, independent and heartfelt advocacy in that?

Overall it was a rich and stimulating event and I’m sure more thoughts and observations will trickle through across the next few weeks. For more, check out my live tweets from the Summit @WOMUK, as well as video highlights here and photos here. And if you want a more detailed lowdown on insights and issues raised, just drop me a line and I’d be happy to take you through it over a coffee… or indeed a Vegas-themed cocktail.

The Guardian unveil new word of mouth research tool to WOM UK

September 30, 2009 at 5:34 pm | Posted in Events, Research | 1 Comment
Tags: espresso briefing, the guardian, wom uk, word of mouth database, word of mouth research

womThis morning’s WOM UK Espresso Briefing, where The Guardian’s commercial director Chris Pelekanou and ad planner Katherine Miall unveiled their new Word of Mouth database, got our new events programme off to a fantastic start. The fully booked event was crammed with businesses, agencies and individuals buzzing with questions, ideas, challenges – and the sugar high from their coffee and Danish.

The Guardian study combines existing thinking around what makes people influential with a new piece of qualitative and quantitative research – including an expert panel involving WOM UK Council members Steve Barton from Advokator and Ivan Palmer from Wildfire. This mass of data has been used to develop a communications planning tool in the form of a database which helps companies and advertisers to understand the type of people they’ll want to target to ensure their content is rapidly and widely spread. Click through for the presentation on Slideshare below.

Having defined influential people  as those who have greater access to new ideas and who spread them faster and more persuasively than others, Chris and Katherine drilled down into the three basic traits these people display: weak ties (relationships and networks outside close family and friends), bridging capital (an ability to make information contextualised and relevant to others) and status bargain (a willingness to listen and modify their own opinions, making them more trustworthy).

Their study is understandably oriented towards proving that Guardian readers are a particularly influential bunch, but they also hope that it will become integrated into wider media planning, helping advertisers to identify who will carry their message best. The assembled crowd threw out some interesting questions – Might demographics other than Guardian readers behave differently? Do these influential people trust advertisers, or each other? Can they prove that this spread of content actually leads to sales? – and the debate showed just how relevant and engaging the topic is to the WOM industry. Our video and Flickr set of the event are coming very soon.

And if that sort of intelligent social media debate appeals, you’ll love next week’s WOM UK thought leadership event where Emanuel Rosen speaks about his revised edition of Anatomy of Buzz, the best-selling international Bible of WOM, next Wednesday 7th October at 8.3oam. Click through here for more details and to register – we look forward to seeing you there.

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