Is Word of Mouth Marketing Really Effective?
There are a lot of people drinking the red cool-aid about word of mouth marketing. I?m a believer in it but thankfully I always tie it to the branding. But for some folks it seems like they think it?s the only way.
I don?t like people that just believe in a certain way. To me that sounds confined and a bit scary. These same folks will tell you TV, radio and direct mail are dead. Maybe, but I don?t think so.
Every direct mail campaign we?ve ever executed for a client has resulted in 100% return on investment (ROI). Sure the ROI for responses on average is a low number but if you execute a strategy, and correct message to the right audience the dollar return is always high.?In other?words our clients may get a 3% response rate but the sales of those 3% could be worth millions. So is direct mail dead? Nope.
This takes me to that word of mouth marketing thing again. If word of mouth is SO powerful how is it that the airlines treat you like dirt and customers keep going back for more? Customers do have options. If Delta stinks why fly them again? If you tell 100 people about your horrible experience why do those 100 people choose to fly on Delta? Low price at the right time maybe?
How about the cell phone industry? Is anyone really happy with AT & T, Sprint, T-Mobil? Nope. Everyone complains about all these guys, so why isn?t word of mouth making consumers flock to another company?
I wrote several articles on how Magellan GPS stunk:
http://www.brandidentityguru.com/wordpress/?p=5 http://www.brandidentityguru.com/wordpress/?p=388 http://www.brandidentityguru.com/wordpress/?p=207
I even persuaded one of my employees?s to buy a Garmin but did that ultimately hurt Magellan? Nope. Will it? I doubt it. There are websites setup about how Magellan stinks but Magellan just keeps rolling along. Why isn?t word of mouth marketing (WOMM) hurting them?
Sure there are many examples of when WOMM works but there are just as many of it not working. Be careful not to drink too much of the red cool-aid, it can have a bitter taste.
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January 25th, 2008 at 9:09 am
Scott,
Word of mouth marketing is a strategy that, as you say, requires and integrated marketing mix to be effective. It is something every business strives to create but if it is our only strategy it is a failed one.
January 25th, 2008 at 9:12 am
So what is your take on the Seth Godin’s and Brains on Fire approach then? They seem to be stuck in word of mouth land. It never seems to relate to or tie back to a brand strategy with them.
January 25th, 2008 at 9:35 am
I know Brains of Fire and Seth talk a lot about word of mouth marketing but I don’t see either as being “stuck” in that land. I’m not defending either one but the first thing that come to my mind when I think of them is “brand indentity” or rather being remarkable and clearly communicating what makes you remarkable and if you are not remarkable you need to change or focus on being remarkable.
Yes, marketing is key to getting the word out but it begins with the product or service developed to the point that word of mouth will naturally will happen. If a product or service is crap it may get an initial jolt from a campaign but eventually the truth will come out.
I like the concept of Buzz marketing. It’s like word of mouth but it starts with a company and it’s employees.
I give word of mouth to products, services and establishments I highly believe in and value from the car I drive, computer I use and resteraunts I eat in.
We also tend to think of word of mouth as something positive but people can also give bad word of mouth from the disgruntled employee to someone disatisfied with a competing product.
My dad is “famous” in family circles for telling people how he gave up on a certain bank, etc. because of bad customer service but will also drive many miles just to eat at a resteraunt and take us or other friends with him.
January 25th, 2008 at 9:44 am
What you call “buzz” marketing I call “internal branding”. Your word sounds better! I just don’t like anything that doesn’t tie back to a brand strategy. That’s what’s important.
Great comments, come back again!
January 27th, 2008 at 6:26 pm
You said “Another words”, I think you meant “In other words.” I absolutely know where you are coming from with this post. Many small companies profess that they rely on W.O.M. The fact is, they may be getting all of the business they need, but during a down time their lack of a solid marketing stretegy will really show its true colors. They will have to start from scratch to develop awareness and it could be too late.
January 28th, 2008 at 3:54 am
Thanks, I’m such a bad righter
January 31st, 2008 at 12:49 pm
I spent 2+ years officially “kicking the tires” of word-of-mouth marketing at my former employer (an international non-alcoholic beverage company based in Atlanta, GA
). I found that word-of-mouth marketing can move the needle in a dramatic fashion when applied in the right way in the right enviroment. That said, you can’t just toss out the phrase and think that covers it. True leverage comes from plans that build WOM over time. The 5-6 days of “buzz” generated from a Super Bowl TV spot is far from a sterling example of the potential.
WOMM is not, however, the end-all. It is definately a tool in the marketing tool box. I think WOMM faces two big hurdles:
1. Too many people blur definitions, approaches and models. As an example, “buzz” and “word of mouth marketing” do not mean the same thing.
2. Major corporations rely too much on what they know. Any sort of systematic utilization of WOMM, as a strategy or a tactic, by them is so rare (i.e. Intuit, Dell, Netflix, P&G) that some might consider it a statistical anomoly.
One comment RE Brains on Fire. Brand strategy is at the center of everything they do, either in their traditional “brand identity” practice or their recent pioneering forays into WOMM. Get a capabilities presentation from them if you don’t believe me (or just call and ask for Steve. He’ll blow your mind and then send you a custom-burned soundtrack CD of the experience.)