WARC's Word of Mouth Masterclass 2008: Making WOM Work for Brands

James Aitchison

This article is an extract from WARC's Word of Mouth Masterclass 2008. An analysis of the WARC Word of Mouth Marketing Awards 2008 is available here, and a full list of entrants to the Awards can be accessed here. For full coverage of this event, visit our conference blog page.

WOM Panel: a Marketer’s Guide

The Stephen Fry Effect

Paul Marsden, director of Clickadvisor.com and chair of the 2008 Word of Mouth Marketing Masterclass, opened proceedings with a very contemporary example of WOM at work. But he didn’t talk about the sort of premeditated campaign from any of the “biggest brains in WOM” (which is how he described the roster of speakers that followed).

He was referring, in fact, to the slating that Stephen Fry recently gave the new Blackberry Storm on Twitter. The British media personality’s disparaging stream of consciousness (“...shockingly bad. I mean embarrassingly awful...”) led to a BBC news story to ask: Can Stephen Fry kill a gadget?

In the WOM Marketers’ Guide panel session that followed, BzzAgent’s Dave Balter was certain that he could. “One individual’s opinion can drastically change the destiny of a product,” he said, “and companies can’t go along waiting for the Stephen Fry effect.”

The growing importance of WOM was echoed by fellow panellist, Fallon’s Mark Sinnock. “We are redesigning the structures in our business to utilise social media,” he revealed. “It’s almost becoming an entire creative strategy in its own right.”

Sinnock, a partner in the agency that brought the world the Cadbury Gorilla, explained the reason for this step change. “We’re fundamentally seeing a move away from a regulated behaviour around brands to a deregulated behaviour in which brands always need to be on. We’re moving from Unique Selling Propositions and Emotional Selling Propositions to Dynamic Selling Propositions.”

From a client-side perspective, Mark Schulz from telecoms provider O2 gave a more prosaic assessment. “Consumers will interrogate a product through world of mouth,” he said, giving the example of the iPhone as “the most passed around gadget in pubs.”

O2, he said, was aware of the “Stephen Fry effect”, but the brand’s real focus was closer to home: “It’s what our millions of customers that are saying on the bus that’s important to us.”

He cited the brand’s “Orgy of Fun” WOM campaign in support of its O2 Unlimited package, which targeted students and their (real-life) social networks by engaging them in a series of UGC-generating challenges (uploading group photos, videos etc).

Stand up and be counted - but how?

It was Dave Balter, the BzzAgent boss whose company offers a research network of some 500,000 individuals across North America and the UK, who injected a note of caution into the proceedings. “The case for WOM can be confused with the media on which it’s based. At the end of the day, it’s about getting people to talk about the brand, not the funny video the brand released,” he said, reminding people that about 80% of consumers’ dialogue happens offline.

Balter actually went further, saying that WOM needed to offer be able to offer the sort of ROI metrics that’s now routinely demanded of main-media advertising. “Somewhere down the line,” he argued, the client is going to ask: ‘Did this thing drive sales?’ And the important thing is delivering a communication dividend, a value per conversation. To be able to say, 'I spent one pound per conversation and it netted me one pound fifty'. That’s the metric that it’s going to come down to.”

You’d expect this purist approach from a WOM agency seeking parity in the accountability stakes with longer-established marketing disciplines. But for more general agency folk, isolating the WOM element of a campaign seemed less of an imperative - maybe because it's so difficult.

“If I can get people involved in the brand in any way, it absolutely trumps engagement. At Fallon, we look at word of mouth as part of the larger narrative, the glue that sticks everything together. It’s not the net sale,” said Mark Sinnock.

He conceded that it’s hard to quantify and isolate the effects of word of mouth, particularly with, say, the Cadbury Gorilla, that ran concurrently as a TV ad and viral. He also cited the example of the work Fallon did for Sony Bravia. It generated a lot of buzz and noise around the brand but, when it came to equating that to sales, all he could say with certainty was that “stock was shifting while the campaign was on.”

Mark Schulz's attitude to accountability steered a middle-way between the views of his fellow panellists. O2, he explained, tries to link specific WOM initiatives to the take-up of the products, tariffs and packages it's promoting. “It’s easy to see how many people are connecting to a tariff like O2 Unlimited,” he said. He also explained how the brand relied on tracking research for slightly softer measures. For example, it measures consumer awareness levels of the fact that O2 customers are entitled to advance tickets for events at the London O2 Arena, the entertainment venue that it sponsors.

Why WOM?

Despite a divergence of opinion on the specifics of WOM and its measurement, all the panellists had specific recommendations as to why brand marketers should adopt WOM strategies:

  • Dave Balter: “This is happening anyway. You can hope it goes away or you can harness a fundamental shift in how consumers are interacting with products.”
  • Mark Sinnock: “It enables much richer and deeper consumer relationships with brands.”
  • Mark Schulz: “WOM is the communication that customers trust the most.”

WOM Practice, WOM Proof

Quoting the cyber seer William Gibson - “the future’s already here, it’s just unevenly distributed” - Paul Kemp-Robertson concluded the opening session with an example-rich march through the practical application of WOM-inducing marketing strategies.

 “The audience has always been ahead of the advertiser,” the Contagious magazine co-founder and editor told delegates, giving the story of how photographs of the filming of the original Sony Bravia ‘Balls’ ad in San Francisco were uploaded onto Flickr by local onlookers well ahead of the finished ad. Fast-forward to 2008, and Sony made a conscientious decision to involve the local community in the production around it’s Miami-based “Foam” commercial.

Such a change of approach reflects many of the wider key trends that characterise - and necessitate - the sort of non-invasive, consumer-radar-dodging marketing techniques upon which Contagious focuses. According to Kemp-Robertson, the forces at work include:

  • Radical transparency: this phrase, coined by an article in Wired magazine, relates to the West Coast business culture of openness, collaboration, new thinking and a willingness to fail. He cited the example of the environmentally-aligned US clothing brand, Patagonia . UK fruit drinks brand Innocent had also caught his eye. Its recent “buy one, get one tree” promotion promised to get a tree planted in return for every (slightly more expensive than normal) pack bought.
  • Brands as entertainers: brands that entertain become “time bandits”, able to capture consumers’ attention without having to buy their time via advertising.  In fact, ads can become the hook to promote branded content, such as http://www.nikefootball.com/which uses teaser ads to drive people to a site full of entertaining content.
  • Two-track brands: “Brands,” according to US writer Grant McKracken, “now need to see themselves as a network of the unacquainted.” Examples cited included the eco-cleaning brand, method, and fabric freshener, Fabreze, which sponsored the adoption center on dogster.com.
  • Branded utility: Brands should offer a use beyond their primary function. In Japan (where, said Kemp-Robertson, trends and crazes usually incubate and spread two years ahead of the west), the whisky brand, Johnnie Walker, offers Jennie Walker. This virtual character on a brand PDA offer 24 assistance to its user - right up to the end of the night when, after one drink too many, it will use GPS to order you a taxi home (with the fare going on your cell/mobile bill).

Proof

Dave Balter’s call for hardline ROI earlier in the day didn’t go unanswered, because the post-break session opened with back-to-back presentations from US-based WOM practitioners on proving the worth of word of mouth.

 “There’s been an explosion of interest in academic and industry circles about measuring word of mouth,” said Walter J. Carl, founder of ChatThreads. “Companies start with an interest, dip their toe in and experiment. But after that, accountability becomes vital.”

He identified four ways in which WOM adds value to a brand: 

  1. Incremental revenue - referrals from positive word of mouth (and vice-versa from negative)
  2. Reducing customer acquisition costs - a portion comes free of charge by existing customers
  3. Acceleration effect - WOM speeds up the adoption cycle
  4. Learning and insights - listening to customers aids NPD ideas and averts crises.

Similarly, he said there were four competing models to measure WOM, although all are based on calculating a Customer Lifetime Value and a Customer Referral Value. ChatThreads’ G2X Analytics platform enables WOM activity to be tracked, mapped and valued as messages are spread across networks.

Chris Ramsey followed up on the similar theme of identifying ROI in social media. As V-P of Radian6, he comes from a company that build tools to enable brands to monitor and analyse what’s being said about them in all forms of social media. He was essentially applying sound, traditional measurement logic to this new arena: set clear, specific and measurable campaign outputs and business objectives from the outset.

WOM Panel: Best in class

The growth in interest in WOM has led to a “large land grab” among competing communications professionals, Leo Rayman of Weber Shandwick told delegates in the post-lunch panel session.

His agency's take on WOM, he said, was about generating “remarkable advocacy” (although he qualified that by saying PR was sometimes about trying to reduce negative WOM).

He illustrated with a case study of a campaign that ran in the US during the recent presidential election to promote Microsoft’s Windows Media Center, a PC application designed to serve as a home-entertainment hub that brings together TV, music, photos, messages and movies. It is, he said, “Microsoft’s claim to owning everyone’s front room.”

Weber Shandwick focused on US election news junkies in a localised “TV on your PC” campaign that targeted news bloggers in the Seattle area, by giving them access to “MSNBC News Beta”, an online news channel, which included exclusive content.

The campaign used a 4-step model to stimulate WOM - identify advocates, recruit them, ignite their interest, expand that interest - and resulting data from Nielsen blogpulse showed a big spike in online conversations about the campaign's “TV on your PC” theme.

Rayman offered these lessons for wannabe WOM marketers:

  • Be interesting and be new
  • Be rewarding (e.g. offer exclusive content)
  • Be involving
  • Be sociable - and be nice

“The smartest thing, he said, “is to stimulate conversations that are already going on out there, rather than trying to push out your own message all about you.”  

Speights beer goes sailing

Like Fallon’s Mark Sinnock earlier in the day, John Woodward from Publicis explained how his agency is refocusing its activities around WOM, and creating “contagious ideas that change the conversation”. The global planning boss added that “all marketing is word of mouth” now for the French-owned agency network, although such an approach has brought significant challenges. “How do you use classical media to generate advocacy?" he asked. "And how do you structure an agency and manage a team for that output?”

As a case in point, Speights was a New Zealand beer brand facing a problem typical of its sector: a niche player with an aging consumer profile and decreasing market share, that was heavily outspent by its competitors.

With a marketing problem that could not be solved by its main-media-advertising purchasing power (which would have bought it about three weeks of TV), Publicis devised a radical strategy. It built a Speights ale house on a ship that made a 10-week voyage to London, where it would serve Speights beer to expat Kiwis who were missing their favourite tipple. The huge media interest in the initiative generated a PR value NZ$2.5m over several months, a value that was six times greater than the brand’s original promotional budget.

Take this story from New Zealand’s TV3: