In a to-be-published Harvard Business School Case Study, the folks at BzzAgent are looking into how a company should go about creating word-of-mouth (WOM) and how best to track the impact WOM can have on sales.
Their study is focusing on "incremental WOM over and above what may have existed independent of the program.” (I suppose this “incremental WOM” is an actual BzzAgent campaign layered on top of whatever WOM may be already organically happening in the marketplace.)
The early findings indicate something counter-intuitive to generally accepted marketing thought. Most marketers, including myself, would argue that the most loyal customers make for a better customer to generate WOM. And that these “heavy loyalists” wield more WOM influence than any other customer base a company may have.
Counter-intuitive to this thinking are the early results from the study.
The most powerful incremental WOM may come from those less-loyal to the firm.
The idea behind this is that those most loyal to the firm – those that visited the firm very often before the program began – had probably already told everybody – both strong and weak ties – in their social network about the firm and its products.
Moreover, it is likely that those in the same social network as these loyal customers are themselves also loyal (or at least existing) customers. Thus, the increase in the WOM created by the program has little effect on these networks.
On the other hand, however, the networks informed by the less-loyal customers are far less likely to have heard about the firm. Thus, the incremental WOM from them is powerful.
An important implication of this is that programs with the objective to increase WOM should not be focused on the core of loyal users. In some sense, they have already (or will already) do that work for the firm. On the contrary, it is the less loyal customers that can and should be affected to a larger extent.
Okay … I have been out-spoken about the BzzAgent process of artificially seeding word-of-mouth. However, given this information, I am warming to the idea of how a BzzAgent campaign, targeted to light-loyalists and not to heavy-loyalists, can be a worthy addition to a marketing program.
Maybe … just maybe … the BzzAgent artificial seeding process can help turn the less loyal (and seemingly less vocal) into more vocal evangelists for a product or service. There are many ways to engage the less loyal customer into becoming a more vocal evangelist and the BzzAgent way may be a viable option to do just that.
I’m looking forward to the release of the full study. For now, we have only the two-page summary posted on the BzzAgent blog to go by.
John, this is VERY interesting - and it proves the worth of so-called "weak links" - that buzz spreads the same way you network for jobs: It's not the folks you know BEST who get you a job, it's the weak links that provide the "in" - the folks that connect one social network to a different one.
Posted by: Mark Ramsey | June 07, 2004 at 03:08 PM
John,
I get this "weak links" thing, but here's what the study misses: has the company *really* leveraged the WOM of the most loyal customers?
The study says the most loyal customers "...have already (or will already) do that work for the firm."
Really? Not so fast.
Many companies that we studied in writing our book have not embraced their most enthusiastic customers in an effort to get them to tell others. They don't have comprehensive databases with contact information. They can't segment customers into "very loyal" vs. "light loyal." And so they don't put together specific programs to maximize WOM.
Take for instance, TiVo. While the company enjoys high loyalty among its many customers, it does not leverage this. TiVo has a self-organized online community of over 61,000, but has yet to engage this community to help spread the word.
Contrast that with companies who put together special programs that fuel the love of loyal customers and give them something to talk about, such as Harley and its HOGS (Harley Owner's Groups), organized rides, celebrations, etc.
I wouldn't jump right over the most loyal customers and start cranking out the WOM programs with the less-loyal. Why not start with the most loyal customers who, for the most part, are probably not getting as much attention as they should?
Posted by: Jackie Huba | June 08, 2004 at 12:31 AM
Jackie … you have pointed out the built-in bias of the study. Since the study’s goal is to measure “incremental WOM over and above what may have existed,” it doesn’t fully address the issue of maximizing the WOM opportunities with heavy-loyalists.
Be it driving incremental sales or driving incremental word-of-mouth, companies should first max-out opportunities with their most loyal customers before looking to tap into other customer segments. To your point, most companies haven’t begun to take advantage of forging loyalty beyond reason with their heaviest users. That’s common marketing sense for companies … yet it is far too uncommon a practice by most companies.
It’ll be interesting to see how, or if, this BzzAgent study addresses the issues of how baseline WOM works with incremental WOM.
(Loyalty beyond reason is a term used by Kevin Roberts in his recently published Lovemarks book.)
Posted by: johnmoore (from Brand Autopsy) | June 08, 2004 at 08:11 AM
John,
As a follow-up to this, I attended the Word of Mouth Measurement session at the Ad-Tech conference yesterday. Someone asked Dave Balter to clarify this "light loyals drive more word of mouth" premise. It turns out that this conclusion was made based on a particular campaign for a restaurant chain, and the word of mouth that was measured was primarly OFFLINE, that is, in person. Read: not on the web.
It's only the crazy over-the-top customer evangelists who would go so far as to build fan website shrines to the company and possibly influence hundreds or thousands of people.
Posted by: Jackie Huba | July 13, 2004 at 07:21 PM
Jackie ... thanks for the update and clarification.
While I am by no means an ardent supporter of this “light-loyalists make for more powerful word-of-mouth evangelists,” I do support the idea of trying to evolve light-loyalists/less-vocal evangelists into being more loyal/more vocal evangelists.
Using the BzzAgent artificial seeding process of sending light-loyalists a “bzz kit” is one way to potentially make less vocal evangelists into more vocal evangelists.
Is this the BEST WAY? That is debatable.
And as marketers, we get paid to over-think everything and this is just one more thing for us marketers to over-think about.
I love marketing fodder!!!!
Posted by: johnmoore (from Brand Autopsy) | July 13, 2004 at 07:50 PM