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Word-of-Mouth Marketing: Temper Your Enthusiasm?

  |  March 22, 2005   |  Comments

The path to sustainable business success lies somewhere between hype and humility.

Next week, several hundred word-of-mouth marketing enthusiasts and practitioners will descend on the University of Chicago's Business School for the first-ever Word of Mouth Marketing Association (WOMMA) summit.

I'll be among the legions of word-of-mouth cheerleaders, complete with case study pompoms, spirited R-O-I letters on my sweatshirt, and a host of "Hey-hey, ho-ho, word of mouth's the way to go" cheers. As one of the association's founders, how can I be anything but pumped about the potential and power of word-of-mouth marketing?

I'll let you in on a little secret: I'm nervous about word-of-mouth marketing's future. It's hard to put my finger on, but it's the same feeling I had when marketers went hog-wild over targeted email's potential.

Make no mistake, word-of-mouth marketing's potential is enormous, and it's one of the obvious and logical next steps for advertising. But I always get a bit nervous when marketers fixate on any new technique or practice as if they've just tripped over the Holy Grail. Having actually survived the dot-com crash (battle scars and all), I've learned the hard way the path to sustainable business success lies somewhere between hype and humility.

The other day, I presented to an ad agency. I explained, using hard, unmistakable numbers, how consumer-generated media (my term for word-of-mouth) was eroding the client's brand. One hyper-impatient attendee interrupted and stammered: "That's great, but how do we create buzz? That's really all we care about! Can't we just hire folks to seed messages on Web forums or blogs?"

I resisted the temptation to give him a piece of my own "word-of-mouth," but this much is clear: word-of-mouth marketing has zero potential for long-term, sustainable success until we evaluate it through a more restrained, even self-critical, lens. It's not as easy as we think, and it can't just be bought off the shelf. More important, there's a host of critical questions we must answer before we lead our clients down this path.

Why It Works

Word-of-mouth marketing works because it comes from a trusted source. Whether stimulated by relevant product experience (iPod), a highly creative ad campaign (Subservient Chicken), or even a degree of mystery ("The Blair Witch Project"), it works because the messenger, the consumer, is more credible and trusted than the advertiser.

This isn't fluffy conjecture. A 2004 Forrester/Intelliseek study found "recommendations from others" and even "consumer opinions posted online" significantly outranked TV, radio, print, and online advertising on the trust scale. This is a big deal because trust and persuasion share a symbiotic relationship. Research from Jupiter Research, NOP World, and Capgemini echoes this theme.

If anything, the importance of trusted recommendations is on an upswing because advertisers continue to alienate consumers with intrusive, interruptive, even invasive ad formats. Consumers are clicking away and reaching for ad filters. They're increasingly cynical about marketer duplicity. Brands such as Orbitz wax poetic about consumer experience, convenience, and self-service, yet continue to shower consumers with barrages of large pop-up ads.

New Accountability Rules and Critical Questions

Word-of-mouth marketing is hard to ignore because consumers are armed with louder megaphones. Yesterday, we worried about hostile or positive reviews on Usenet or Epinions. Now, we must contend with blogs, moblogs (define), and vlogs. And did someone mention Podcasts (define)? All this dials up the effect of one single recommendation on other consumers' purchase behavior.

This reality, consumer opinion on multimedia steroids, threatens to hold advertisers to a much higher level of accountability. Try to deceive or trick the consumer with sketchy ad claims, and blog-fortified "copy cops" go to work. Screw the consumer, and search engines will remind the world of your stupidity for eternity by ranking the most scathing testimonials at the top of the search shelf.

In a world where word-of-mouth marketing assumes a duel identity as "marketing secret sauce" and "viral whistleblower," we must ensure the medium works for us, not against us. That requires some work, industry self-disciple, and a hefty flak jacket for criticism.

We must ask the difficult questions, sooner rather than later:

  • Are we nurturing or compromising the integrity of trusted consumer-to-consumer conversations? Are marketer-designed word-of-mouth programs helping or hurting?

  • Are we sufficiently transparent in the way we message with consumers in the so-called "trust zone"? If we're not, what's the risk and associated cost?

  • If we use incentives to drive word-of-mouth, are there important disclosure obligations? Should a more rigorous disclosure standard apply to younger consumers and/or their parents?

  • Why even consider offering incentives to consumers when viral brand enthusiasts are already sitting in our corporate opt-in database? Maybe we just need to retool our segmentation models.

  • If things go wrong, who's accountable: the brand group, the agency, or the viral marketing firm?

If we don't debate these hard questions, we risk legislation answering them for us. That is bound to create surprises we'll regret. Having worked for five years in the California legislature, I can't imagine elected officials, in the absence of marketer self-regulation, not tempted by the prospect of "protecting consumers" in this arena.

Tackling an Obvious Problem

One area begging for immediate attention is message-board seeding. That's when marketers attempt to masquerade as consumers and plant favorable brand comments on message boards, forums, or blogs. It's an ugly practice, and we should really trust our consumer gut here. Most marketers are really bad at this anyway. They use repetitive phrases, redundant expressions, and more red-flag keywords than a college kid plagiarizing a term paper. It's all too easy for even the least-experienced bloggers to out that marketer. It only takes a few fools to make us all look silly.

This isn't to suggest marketers can't engage in online conversations. They can, stimulating positive word-of-mouth in the process. If a legitimate Cingular employee says, "I work for Cingular, and I'd like to address the concerns raised in this forum about our service problems," that's not only acceptable, it's often applauded by consumers.

The watchword here is "transparency." Word-of-mouth marketing's future rests in large measure on how well we address, and even self-regulate, around transparency principles. There are questionable areas but we can at least knock off the low-hanging fruit.

Silver Lining Amidst the Skepticism

The good news is these difficult questions will force us to reckon with the real dynamics and expectations of today's empowered consumers. The closer we get to the sweet spot of how consumers really think and feel, and what they find acceptable in advertising, the quicker we'll be able to build and promote brand franchises.

That's a win-win for everyone.

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ABOUT THE AUTHOR

Pete Blackshaw

Pete Blackshaw, whose professional background encompasses public policy, interactive marketing, and brand management, is executive vice president of strategic services for Nielsen Online, a combination of Nielsen BuzzMetrics, a firm Pete helped cofound, and Nielsen//NetRatings. One of Pete's key focuses is helping brands interpret, manage, and act on consumer-generated media (CGM). A former interactive marketing leader at P&G and founder of consumer feedback portal PlanetFeedback.com, Pete cofounded the Word of Mouth Marketing Association (WOMMA). He authors several blogs, including ConsumerGeneratedMedia.com, and is the author of an upcoming book from Random House, "Satisfied Customers Tell Three Friends, Angry Customers Tell 3000: Running a Business in Today's Consumer-Driven World."

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