Brand Autopsy

Rushkoff on Word of Mouth

Douglas Rushkoff is an author, thinker, and cultural clairvoyant. He is also a subscriber to the Evolutionist Word of Mouth theory as proof by the following snippets from his brilliantly insightful book, GET BACK IN THE BOX.

”Businesses today are counting on the power of ‘community’ to keep their products in perpetual circulation. A clever new marketing campaign or a snazzy new package, it is hoped, will stir word of mouth about the same old product. But the only lasting way to raise the value of a product as social currency is to raise the value of the product itself. While creative marketing is always a plus, it is no substitute for creative development.” (GET BACK IN THE BOX | pgs. 157-158)

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"To put it simply, communities naturally build around product lines that overflow with intrinsic value. People may talk about a brilliant advertising campaign, but they will never advocate an ad the way they advocate a product they love. A company’s real relationship with a customer is not communicated through the marketing, however compelling it may be. It is communicated through the cup holders in the doors, the easy-to-read LED display in the cell phone cover, the user-friendly menu on the digital video recorder, or the leak-proof absorbency of the baby diaper.” (GET BACK IN THE BOX | pg. 158)

BzzAgent is Redefining CPM

As time goes on, we learn a little more about the evolving BzzAgent word-of-mouth (WOM) model.

At the International Word-of-Mouth Marketing Conference in Barcelona, Dave Balter, BzzAgent founder/CEO, gave a little more insight into the direction his company is taking. He talked about the current slate of media channels where marketers can buy TV, buy Radio, and buy Billboards. However, when it comes to new media options such as Blogs, CGM, and Viral stuff … a media channel doesn’t really exist for marketers to “buy.”

And that’s where the BzzAgent WOM model is heading—creating a media channel for marketers to “buy” word-of-mouth from the company’s growing list of volunteer BzzAgents. In many ways this is old news as BzzAgent announced this business strategy back in February with a press release [PDF link] saying,

”The BzzAgent media channel enables advertising, marketing and public relations firms to purchase access to BzzAgent’s growing community of more than 130,000 consumer volunteers just as they would buy time on a broadcast network or space in a publication."

Whoa! I’m just now beginning to understand the reality of what BzzAgent is trying to do with word-of-mouth. The notion that WOM can be purchased like marketers can purchase impressions via TV, Radio, Print, Online, etc. gets this marketer all riled up. And I’m not the only marketer riled up.

On the Brains on Fire blog, Virginia Miracle discusses this very issue and rightly states, “… WOM has to be earned. [WOM] is earned though creating connections with your customers that extend beyond the exchange of goods for cash.”

Yet, BzzAgent is seemingly propagating that WOM can be purchased like marketers purchase traditional media. In its upcoming Masters in Bzz Administration Workshop (June 21), BzzAgent states that marketers attending the workshop will learn how to buy “media” on the BzzAgent network. Like a television network can price its commercial inventory on a CPM basis, BzzAgent will be doing the same by pricing access to its BzzAgents on a different type of CPM basis.

It’s a case where BzzAgent is trying to redefine CPM from Cost-Per-Thousand to Cost-Per-Minion … I mean cost per thousand BzzAgents.

Why does BzzAgent want to apply traditional media buying rules to the WOM media channel? Old media rules state marketers can buy impressions, while the inherent rules of WOM state that opinions must be earned.

Everything I’ve learned in the marketing game tells me the more meaningful way to generate word-of-mouth is to earn opinions from customers and not to buy them.

What do you think? Is BzzAgent making a smart move in defining its volunteer BzzAgents as a bona fide media channel? What’s your take on generating WOM through Buying Impressions versus Earning Opinions?

A Writer Seeks WOM Case Studies

I received an email from a writer needing concrete information showcasing the rapid snowball effect of Word-of-Mouth. Read Randy’s note below and if you have something worthwhile to share, leave it in the comments section.

I'm doing research for a novel and wondered if you could direct me to a link, book or case study of a WOM phenomenon. Specifically, I'm looking for a 24-48 hour phenomenon of anything--product, movie, internet video, link, or rumor--that was spread to millions via WOM/email.

Thanks,
Randy

Earning the Right to be Tight

I jotted those words down after experiencing so many restaurants in Barcelona where the restaurateur has tight control of how customers experience his/her dishes. The most respected and sought-after restaurants in Barcelona have limited seating, limited hours, and their menus are limited to the ingredients the chef purchased that morning. But customers don’t seem to mind all the limits as all the dishes are right-on-the-mark in terms of tastiness.

For example, I had two superb lunches at Cal PEP during my trip. And as you can see from the image below, Cal PEP keeps very limited hours.

But the tight hours Cal PEP keeps doesn’t keep customers away. In fact, it all adds to the allure and to the story of Cal PEP where, on any given day, you’ll find customers lined up outside to grab a scarce seat once the doors open for lunch at 1:30.

But if the food wasn’t so delicious at Cal PEP, then its customers wouldn’t allow Cal PEP to dictate how and when they can enjoy the food.

These days, marketers are quick to point fingers at businesses clinging to top-down direction as opposed to bottom-up creation from customers. But if the product is right and their passion is right, then a business earns the right to be tight. Right?

Most grocery stores are open 24 hours/7days a week. Not Whole Foods Market. Whole Foods has limited hours but because their product is right and their passion is right, customers grant them the right to be tight. Can’t say the same for Kroger, Giant, or Vons.

Most fast food burger joints have seemingly unlimited menus. Not In-N-Out Burger. In-N-Out Burger has a very tight menu and a tight “hidden menu.” Customers willingly allow In-N-Out to get away with being tight because their product and passion are right. Can’t say the same for McDonald’s, Burger King, or Wendy’s.

Those are just two RIGHT & TIGHT businesses. Many more exist. Feel free to add to the list.

Barcelona Slide Show on YouTube

I’m ga-ga over YouTube. So ga-ga that I converted 100 photos from my recent trip to Barcelona into a video ditty. And yeah I know ... YouTube is probably not the best way to share my travel photos because the video quality is only so-so. (Plus, the pacing going from image to image is at times tedious.) But if you a few minutes to spare this week, consider checking out the sights and sounds from my Barcelona trip.

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RSS Readers … click here to view the YouTube video.

Starbucks shuts down its Hear Music kiosks

UPDATED (May 26, 2006) | The Seattle Times is reporting Starbucks "has pulled them [CD-burning kiosks] out of all but five locations in each city and will not install them in future coffee stores."

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According to this Austin American-Statesman article (reg. req'd), Starbucks has decided to pull its CD-burning kiosks from its Austin and Seattle stores. Can’t say I’m surprised. Living in Austin and frequenting Starbucks a couple times per week, I’ve NEVER seen anyone actually burn a CD using the kiosk. Seen lots of college kids curled up reading a textbook while listening to tunes from the kiosk though.

In an email exchange with the Statesman reporter, I shared the following thoughts about why the Hear Music Media Bars weren’t working out as planned:

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Starbucks failed to solve a consumer problem with their CD-burning stations like they solved the problem of weak, flavorless coffee. Before Starbucks, coffee was a hot, brown liquid meant to be a caffeine delivery vehicle more than a drink that actually tasted good. Starbucks changed all that. Thanks to Starbucks, it is far easier for us to find better tasting coffee that is meant to be enjoyed more than just endured.

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Starbucks has been successful because it made the coffee experience uncommonly better. So uncommonly better that we gladly pay a premium for it. Using that mindset, the Starbucks CD-burning stations have been unsuccessful because they failed to make the music download experience uncommonly better. It’s far easier for us to download music using our own computers than it is using the Starbucks CD-burning kiosk.

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This CD-burning venture was doomed to fail from the start. Launching the service without the ability for customers to download music directly to their mp3 player was a major misstep. Starbucks may have attained success if they launched the service with mp3 downloads directly to a customer’s mp3 player. As a Starbucks consumer, I would be more apt to enjoy a latte while using their wi-fi service to download music from iTunes directly to my laptop than to sit down at the Hear Music kiosk, navigate through the clunky interface, and burn a music CD.

Still in Barcelona

Did some business at the International WOM Conference ... now I´m doing the pleasure part while still in Barcelona. (Ain´t it great when you can mix business with pleasure.)

Don´t expect any posts this week, however, I´m posting a few photos though. Next week I´ll do a whiz-bang YouTube thang with all the photos I´ve taken from Barcelona. Till then, enjoy these ...

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And thanks to an email from a friend, I was able to see THE BAD PLUS play at The Jazz Room. (Thanks Matt.)

WOM Presentation on YouTube

I’m in Barcelona this week at the Marketing without Advertising Conference sharing my Creationist Word-of-Mouth vs. Evolutionist Word-of-Mouth presentation. Before leaving for Barcelona, I synced up recorded audio with my presentation slides then converted it to a video file and uploaded it to YouTube for all to view.

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Video Description:
Which came first ... Word-of-Mouth Marketing or Marketing that’s worthy of Word-of-Mouth? It's similar to the age-old question of which came first--the Chicken or the Egg? This particular question has Creationists going up against Evolutionists in heated debates. Same goes for Word-of-Mouth Marketing where in one corner you have WOM Creationists and in the other corner you have WOM Evolutionists debating which method is best.

johnmoore, the marketing medic from the Brand Autopsy Marketing Practice, adds his unique perspective to this marketing debate by dissecting the differences between Creationist WOM and Evolutionist WOM.

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RSS Readers click here to view the video.

Levine Fixes His Broken Window

Last November I blogged about Michael Levine’s BROKEN WINDOWS BROKEN BUSINESS book and I subsequently mentioned how his abandoned website/blog was a broken window that needed to fixed.

Well ... it may have taken him a few months to do it but the Broken Windows Broken Business website is no longer broken. Levine recently updated his book companion website and this time around, he doesn’t try to accomplish too much by having links to a blog and discussion board. Instead, Levine sticks with the basics and doesn’t make implied promises he might not be able to deliver upon.

Not overpromising and under-delivering ... good move Michael.

Question … do you expect authors of business books to maintain a companion blog? I’ve come to expect authors to either maintain a companion blog to support the book or a catch-all blog with wide-ranging ruminations. To me, having and maintaining a blog has become a cost of doing business be it as an author or as a markerting medic with Brand Autopsy.

Upcoming Marketing Conferences (May/June)

2nd Int’l Word-of-Mouth Marketing Conference
Barcelona | May 18, 19

Looking to add some International flavour to your understanding of Word-of-Mouth Marketing? Then make your way to Barcelona and join me along with a cadre of marketing wonks as we dive into deep discussions on Word-of-Mouth Marketing. Register here.

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Corante’s Marketers Forum
New York City | June 9th

The agenda is chock-full of interesting people so the conversation on all things marketing-related should be just as interesting. I’m going. Are you going? Register here.

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Word of Mouth Basic Training 2
San Francisco | June 20, 21

WOMBAT 1 was very informative and the agenda for WOMBAT 2 is shaping up to be just as informative. For marketers wanting to get into the swing of Word-of-Mouth Marketing, this is a must-attend event. Register here.

Advertising’s Punch in the Face

As I’ve mentioned before… ”I’m not an advertising atheist … just agnostic about advertising. I’ve always believed if advertising is the answer, one should question the question.”

No need to question the astuteness of Hugh MacLeod's latest riff.

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Ahh yes … The Difference is Why [5] [4] [3] [2] [1].

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John Mackey | American Made

For those wanting to learn more about Whole Foods Market and its visionary leader John Mackey, tune into CNBC tonight (Monday) at 8:00 PM (est) for a one-hour profile on a show called AMERICAN MADE.

I saw the premiere episode of AMERICAN MADE last month when it profiled Starbucks and its visionary leader Howard Schultz. Since Whole Foods has yet to receive a long-form television profile ... this episode should make for a way worthy watch.

High-Flying Business Book Promotion Idea

[UPDATED on May 9 to fix a broken link]

Earlier today, Stefan Engeseth conducted a lecture at 30,000 feet in the air sharing ideas from his book (ONE: A Consumer Revolution for Business) on FlyNordic’s Stockholm to Olso flight. I wonder if Stefan began his presentation by asking travelers to … “Adjust their business mindset and marketing mentality to a full upright and unlocked position?”

Lessons Learned from Howard Schultz

Carmine Gallo, writing for BusinessWeek Small Biz, has a worthwhile take on how Howard Schultz uses passion, performance, and persuasion to create the endearing and enduring business Starbucks has become. In the short article, Gallo outlines three lessons to be learned from Howard Schultz’s leadership ways. (Good stuff.)

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LESSON 1: Dig deep to identify what you are truly passionate about (hint: it's not always the product itself) and convey that message to employees, customers, and colleagues. When you are passionate, you come across as excited, energetic, and enthusiastic -- all of the qualities people like to see in others. And if people like you, they're more likely to do business with you or to back your vision.

LESSON 2: Inspire your colleagues, investors, or employees by painting a picture of a world made better by your service, product, company, or cause.

LESSON 3: To get the most out of people, a leader has to tap into their emotions as well as their minds. People can relate to stories. They can see themselves in other people's stories. The ability to use stories to get people to buy into one's vision with their hearts is a powerful leadership capability.

SOURCE | BusinessWeek Small Biz article | May 2006

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Yum or Dumb?

Yum! Brands is set to become the first-ever presenting sponsor of the Kentucky Derby. For the next five years, the official name of the Kentucky Derby will be … “The Kentucky Derby presented by Yum! Brands.” Additionally, Yum! Brands will receive logo visibility throughout the horse racetrack as well as a handful of commercials to run on NBC’s telecast this weekend.

Many of you are probably murmuring, “What the heck and who the heck is Yum! Brands?” Yum! Brands is the parent company of Taco Bell, Kentucky Fried Chicken, Pizza Hut, Long John Silvers, and a few other fast food restaurants. (Ahh, now you know.)

Besides the fact that this is the first-time the 132 year-old tradition-rich Kentucky Derby has signed up a presenting sponsor, it’s also an interesting marketing play. Yum! Brands is advertising not to increase customer awareness of its fast food restaurants. Instead, they are advertising to increase investor awareness of Yum! Brands as a smart stock investment. The company is seeking to raise its percentage of individual stockholders from 20% to 30%.

As I said … this is an interesting marketing play. But it’s also a confusing marketing play.

Investors are smart people. When you are talking about finding strong performing stocks, there are very few secrets out there. It’s pretty simple, if a publicly-traded business profits from attracting customers living on Main Street, the analysts working on Wall Street will notice. When these analysts notice strong performing stocks, it’s only a matter of time before the individual investor also notices these same stocks.

To me it’s simple … if you operate a business that consistently delivers great sales with sizeable profit margins, investors of all types will notice. Actions and not advertising will attract investors.

That’s my take. What’s your take? Is this Yum! Brands marketing play YUM or DUMB?

Praise for Prologue Publishing

In February, I answered the question of ‘what am I willing to do today to become more successful tomorrow?’ by hiring a ghostwriter to assist me in making TRIBAL KNOWLEDGE the book it is supposed to be.

Good news ... last week I submitted the final TRIBAL KNOWLEDGE manuscript to Kaplan Publishing and it is a much better book after Alex Lubertozzi and Jennifer Barrell of Prologue Publishing heavily massaged the manuscript. Thank you Alex and Jen for helping me to actualize my aspirations of writing a business book. It is my pleasure to write the following endorsement of your quality work.

WEBSITE | Prologue Publishing Services