Motivated by Seth's post on the difference between PR and Publicity, I excavated this juicy marketing quote from a vintage Brand Autopsy post (circa May 6, 2005).
”Advertising is when you tell people how great you are.
PR is when someone else says how great you are.”
— Guy Kawasaki —
THE MACINTOSH WAY
(HarperPerennial reprint, 1990)
When you give people something to believe, they will come together. And when people come together ... communities will form, love will spread, and movements will happen.
Watch and listen as Greg Cordell, from Brains on Fire, tells the story of The Red Ribbon…
Last we checked in with Tim Keiningham, SVP at IPSOS Loyalty and co-author of LOYALTY MYTHS, was in December of 2005. At that time I posted some riffs on his LOYALTY MYTHS book.
Keiningham’s book debunked over 50 commonly accepted loyalty marketing practices, one of which was Fred Reichheld’s NET PROMOTER score. In discrediting Reichheld’s NET PROMOTER score, I felt his reasoning was more argumentative then constructive.
Tim emailed me today sharing his recently published article in the Journal of Marketing vetting the Net Promoter measurement. This time around, the reasoning from Tim and his co-authors is much more constructive than argumentative.
Fredrick Reichheld’s Net Promoter measurement contends companies no longer need to rely on expensive studies and complex statistical models to measure customer loyalty in hopes of increasing sales. Instead, a company only has to ask its customers one question: “How likely is it that you would recommend [company x] to a friend or a colleague?" Knowing the answer to this one question allows a company to easily interpret where it stands in creating net promoters (evangelical customers) which in turn lead to sustainable, profitable growth.
Reichheld so strongly believes in the Net Promoter measurement that he says it is “the single most reliable indicator of company’s ability to grow.” His contention is backed by research done on select companies showing a strong correlation between a company’s growth rate and the percentage of its net promoters. According to Reichheld, “The more ‘promoters’ your company has, the bigger its growth.”
I’ll pass on boring you with all the wonky research methodology used because you can read about it in the paper. Instead, here’s the gist of the paper’s findings …
“We find no support for the claim that Net Promoter is the ‘single most reliable indicator of a company’s ability to grow.’The clear implication is that managers have adopted the Net Promoter metric for tracking growth on the basis of the belief that solid science underpins the findings and that it is superior to other metrics. However, our research suggests that such presumptions are erroneous. The consequences are the potential misallocation of resources as a function of erroneous strategies guided by Net Promoter on firm performance, company value, and shareholder wealth.”
So statistically speaking, the Net Promoter score may not be the “single most reliable indicator of a company’s ability to grow.” Okay … got it … after all, that’s a HUGE claim to make.
However, the Net Promoter score is still ONE indicator of a company’s ability to grow.
And as a marketer, I feel it’s safe to assume the more evangelical customers a business has talking up its products and services to others … the greater likelihood the business is growing and not declining. If all I have to ask, as a marketer, to determine this likelihood of growth, is to ask customers how likely is it that they would recommend this business to others ... SIGN ME UP.
That’s just my take. Read Keiningham’s research paper and decide on your own.
The Winter 2006 edition of Business Week’s SMALL BIZ supplemental magazine includes a very interesting article on how passionate customers can transform companies. It’s a worthy read but for those suffering from acute time fatigue and/or from an attention deficit disorder, I’ve whittled down the nearly 3,000 word article into a 500-word abstract.
TRUE BELIEVERS: Passionate Customers can Transform your Company. (by Amy Barrett)CEOs have been talking about customer loyalty for years, but entrepreneurs know that making people truly loyal to your company—to make them really, really like you—takes a lot more than a frequent buyer program. It means nothing less than getting people so jazzed about your brand that they become engaged contributors to your company's sales, marketing, and innovation efforts, and ultimately its success.
How does that happen? By knocking down the walls between "you" and "them" and creating a larger, looser community that is inviting to both your customers and your employees.
For many companies, transforming customers from passive buyers to active participants demands a seismic shift in thinking. You can't just slap up a blog and expect people to get excited. It requires an intense focus on customers that shapes everything you do, from how you hire and motivate employees to how you design products.
Then it's a matter of spotting loyal customers and starting a real conversation with them. Customers should have multiple channels through which they can express their views, and employees should respond by addressing their concerns, enlisting their involvement, and collecting their suggestions to improve existing products and services and create new ones.
Every company has loyal followers who may become advocates. It's simply a matter of finding them. One way to get into customers' heads is through surveys. Blog postings can also be revealing, which is why CEOs or top managers should regularly blog on a company Web site about products and issues of interest to customers and encourage customers to respond.
It's also a good idea to see what is being said about your company on industry blogs. Ben McConnell, a Chicago marketing consultant, suggests hosting a party or reception, possibly with an educational or training component, and inviting a large number of customers. Those who show up may be good candidates to become advocates.
Customers who see themselves mirrored in your brand are more likely to be loyal. You can develop that reflection by building a community in which customers can interact with your employees as well as their peers.
"By bringing customers together you give them the chance to talk about their experience with your product or brand," says McConnell. "And if you invite [prospective customers], then existing customers often become the salespeople."
You can't create [customer] loyalty if your employees aren't putting your customers' needs front and center. Think long and hard about how you want customers to be treated, and then set firm rules about who you'll hire to work with them. Continuous training of employees is crucial to keeping them focused on customers. Try having a lunch session once a month [with employees] on topics such as listening more effectively or handling angry customers. And ask employees to share stories regularly about the creative ways they assisted customers.
SOURCE: BusinessWeek SMALL BIZ (Winter 2006)
Full article | TRUE BELIEVERS [sub. req’d.]
Sidebar article | LISTENING UP [sub. req’d.]
"Organizations that create customer evangelists often create customer communities. The communities create a sense of belonging for customers, of being a part of something bigger than themselves. Enabling customers to connect with each other and with you provides benefits for all the involved parties. For companies, customer communities build loyalty, provide valuable feedback, and contribute to increased sales."
8cr honors the game of business writing by honoring the authors who supply them the business content in the books they sell.
Earlier this week, 8cr gathered 22 business book authors and a handful of industry experts for a two day Pow-Wow of Peace, Love and Business Books. Every author in attendance left a little smarter and a lot more inspired to use business books as a catalyst to share ideas. I felt fortunate to be a part of this community and left the Pow-Wow totally giddy with new friends, new knowledge, and a renewed vigor to make things happen in 2007.
The backside beauty of the 8cr Pow-Wow is that not only did it create a community with us authors, it also created customers for life. Every author in attendance is indebted to 800 CEO READ for helping us to become better at sharing our ideas through our business books and speaking gigs. 8cr endeared itself to us and out of deep gratitude, I will go out of my way to evangelize 8cr. 8cr GAVE and they shall RECEIVE. Dig?
Just think, your business could do the same. You, too, could benefit from further endearing your company to customers, suppliers, and/or distributors. Create an event that will help make customers smarter and more inspired about the business you are all in. Allow your customers to network with each other and to learn from each other. Honor your customers by honoring the business you are all working in. I guarantee that whatever effort you put into creating the event, your company will reap the benefits tenfold.
Expect me to dribble tid-bits from the 800 CEO READ Author Pow-Wow all next week on the Brand Autopsy blog. I met lots of interesting people with interesting ideas and can’t wait to share what has me so giddy.
Jake McKee’s report from Brickfest 2006, a weekend gathering of adult LEGO lovers, reminded me of another recent gathering of adults who adore another childhood toy—HOT WHEELS.
In a recent article, The Wall Street Journal highlighted Mattel’s Hot Wheels NEED FOR SPEED event in Speed, Kansas. Yes. Speed, KS. Now before you go jumping to Creationist WOM conclusions that Speed, KS is just another attention-grabbing buzz-hungry tactic mimicking Half.com, Oregon and Dish, TX. It’s not.
Seems as though a GolinHarris PR guy was doing a Google search for ‘a town that loves cars’ and up popped Speed, KS. So instead of holding the NEED FOR SPEED event in Southern California, where many Hot Wheels conventions are held, Mattel decided to create a blow-out event in Speed, KS (population 37).
Over 10,000 Hot Wheels enthusiasts stormed Speed, KS on August 6, 2006 to revel in all things Hot Wheels. You can read more about the event in this Wall Street Journal article and in this press release.
The take-a-away for us marketers is the Hot Wheel’s NEED FOR SPEED event is yet another marketing case study in creating community with customers. As Ben McConnell and Jackie Huba note in CREATING CUSTOMER EVANGELISTS …
”Enabling customers to connect with each other and with you provides benefits for all the involved parties. It helps customers … connect with like-minded people for social reasons. For companies, customer communities build loyalty, provide valuable feedback, and contribute to increased sales.
“Creating community is key to creating customer evangelists Community encourages customers to bond with one another underneath the umbrella of your organization’s goodwill."
Some months ago I picked up LOYALTY MYTHS: Hyped Strategies That Will Put You Out of Business and Proven Tactics that Really Work. In this book, the authors contend businesses fail at creating customer loyalty because they mistakenly follow conventional marketing wisdom. They also debunk over 50 commonly accepted loyalty marketing practices. Can’t say I agree with everything the authors say because much of their reasoning is more argumentative than constructive. However, the book does make you think.
For example, LOYALTY MYTHS debunks Frederick Reichheld’s “Net Promoter” theory by writing, “… the concept of net promoters is a bad idea that would not likely have seen the light of day had it not come from such a respected individual. “
If you’ve been following the Word-of-Mouth Marketing game for the past year then you’re probably familiar with Reichheld’s influential Harvard Business Review article outlining his Net Promoter theory. In “The One Number You Need to Grow,” Reichheld’s research indicates there is a strong correlation between a company’s growth rate and the percentage of its promoters. (Promoters are customers who are willing to recommend the company to a friend.) According to Reichheld, “The more ‘promoters’ your company has, the bigger its growth.”
Reichheld contends companies no longer need to rely on expensive studies and complex statistical models to measure customer loyalty in hopes of increasing sales. Instead, Reichheld’s research says a company only has to ask its customers one question: “How likely is it that you would recommend [company x] to a friend or a colleague?" Knowing the answer to this one question allows a company to easily interpret where it stands in creating net promoters (evangelical customers) which in turn lead to sustainable, profitable growth.
In discrediting Reichheld’s Net Promoter research, the authors of LOYALTY MYTHS point to four issues.
Issue #1
”… the implication that all customer satisfaction and loyalty measurement systems fail to correlate with profits is ridiculous.” The authors go on to list a slew of marketing research papers which contradict Reichheld’s research.
[Hmm … are the LOYALTY MYTHS authors mistakenly following conventional marketing wisdom by referencing so many conventional marketing research papers?]
[Good point. Maybe Reichheld will address the “actionability” of the Net Promoter score in his to-be-published book titled, THE ULTIMATE QUESTION.]
[I agree. Although, I’m not a marketing research wonk so I do not fully understanding how a customer’s satisfaction rating and repurchase intent with a company are not highly correlated to a net promoter rating of recommending that company to a friend. Any marketing research wonks wanna enlighten me?]
[A net promoter score is just one tool in a marketer’s toolbox. It is not a marketer’s Rosetta Stone allowing us to all speak and understand the same language as it relates to customer research and growing sales. However, this information is extremely useful in understanding the role customer evangelists can play in whether or not a business succeeds or fails.]
When Star Trek (original series) first began, the USS Enterprise set out on a five-year mission. However, NBC cut the mission short cancelling the series after only three years (seasons).
Now a crew of Star Trek evangelists ranging from an urologist to an Elvis Presley impersonator are resurrecting the original series and completing the mission by filming new episodes playing off the original timeline. Yep … these extreme Star Trek evangelists are filming new episodes under the name STAR TREK NEW VOYAGES. They've filmed two episodes and the third episode is to be released in the Summer of 2006.
For more …
Check-out the way worthy Wired magazine article titled, “To Boldly Go Where No Fan Has Gone Before.”
Wander over to www.newvoyages.com to learn more about these remarkable Star Trek evangelists and to download the first two episodes.
The following quote is suitable for any presentation from a Word-of-Mouth Marketer or Customer Evangelist evangelist …
”Advertising is when you tell people how great you are.
PR is when someone else says how great you are.”
SOURCE: Guy Kawasaki, THE MACINTOSH WAY (HarperPerennial reprint, 1990)
Thanks Stephen, for alerting us that Real Networks is feeling the wrath of Apple/iPod evangelists.
The conversation happening at Real's Freedom of Music website is getting vicious as Apple evangelists are showing up in droves to flame Real for picking a fight with Apple.
Real Networks fired the first salvo with this attack:
"Your company (Apple) has long stood for innovation and open competition. We're asking that you...support the right of your own customers to make their own choices about where they buy music for the iPod. We want Freedom of Music Choice! Don't lock us in to purchasing digital music from one source. That's bad for competition. It will stifle innovation. And it will slow the adoption of digital music devices like the iPod." [source: Real’s online petition against Apple]
One Apple supporter retaliated by writing, "You people (Real Networks) are wrong, wrong, wrong. If we wanted 'choices' like yours, they wouldn't have to be foisted on us. Most of us, given a real choice, would rather see you and your tactics go away. 'Competition' doesn't give you any right to reverse-engineer when you feel like it, but come down on those that hack into your IP rights. It's theft, pure and simple."
Another Apple evangelist wrote, "I choose to use a Macintosh. Why won't Real support me? Rhapsody doesn't work on the Mac. So even if I was interested in buying music from Real, I can't do it."
[soure: news.com article]
In an online battle pitting REAL Evangelists versus APPLE Evangelists … I’ll take the APPLE Evangelists any day. Apple clearly has fostered a more passionate and dedicated following from its users than Real Networks ever will.
Apple essentially wrote the book on creating a movement to build a firewall against the Microsoft juggernaut. With their Freedom of Choice movement, Real Networks is trying to take a page out of the Apple movement playbook but Real may have underestimated the power of Mac evangelists.
So, did Real misstep by calling out Apple directly and not focusing on the more global issue/movement of promoting universal digital music formats?
Is it true Real’s Rhapsody music service isn’t Mac-compatible?
Will Dick make up with Jane on Search for Tomorrow?
Will johnmoore get called out for flip-flopping on this issue?
Over at the Church of the Customer, Ben and Jackie introduced the blog world to John Winter Smith and his quest to visit every Starbucks company-owned location in the world. So far, he has visited nearly 4,300 locations in North America, UK, and Japan. WOW! That is fanatical behavior becoming of an evangelist!
In their post, Jackie writes the following:
"Ultimate evangelists like Winter don't turn up every day. He's generating lots of favorable press on his own. Starbucks should embrace Winter in every conceivable way. Promote his visits. Lend him a car with the Starbucks logo on the side. (Winter sleeps in his old car with no air conditioning when he goes on his frequent Starbucks road trips.) He's authentic, not a schlocky spokesthing. Make him a hero. Starbucks, your Jared is here."
Here at Brand Autopsy we have a different take on Winter becoming the "Starbucks Jared." We contend Starbucks should acknowledge Winter in an ongoing manner, just not in every conceivable way that Subway acknowledges and promotes Jared.
Someone like Winter is good for those folks who LOVE Starbucks - it makes those who visit 3x a day feel better because they can say, "At least I’m not that Winter guy going to ALL the stores… Now, that’s freakish!"
As Ben and Jackie have taught us, customer evangelists exhibit fanatical behavior (some more fanatical than others). Jared fanatically used Subway to better himself by losing 245 pounds. His actions of eating Subway sandwiches to improve his health plays into Subway's branding strategy of being a more healthy alternative to the other fast food chains. Jared is a credible* spokesperson/evangelist for Subway because his personal goals were/are more in line with the business/branding goals of Subway.
*(he's credible in a 30-second spot to the masses, but he is still only the 1 in 123 million who has seen results from a Subway diet. I'm sure the fine print reads -> "Individual results may vary. Not typical weight loss.")
Winter’s goal of visiting every Starbucks in the world is fanatical evangelist behavior. However, his goal does not mesh with Starbucks goals. Winter’s goal perpetuates the perception (and in many ways the reality) that Starbucks is ubiquitous, that Starbucks is everywhere. Starbucks is trying not to promote its ubiquity and that is why Winter wouldn’t make for a credible Starbucks spokesperson.
Winter would be a more credible spokesperson, along the lines of Jared, if he exhibited a passion for aspects of Starbucks beyond its massive reach such as Starbucks involvement in local communities, its coffee quality, its business practices, etc.
If you read Winter’s travel logs, you’ll notice that he admits to gagging and nearly vomiting after drinking too much Starbucks. (Ouch.) That behavior is not becoming of a Starbucks spokesperson. In fact, this conjures up images of Morgan Spurlock, of Super Size Me fame, and his McBurps, McNausea, and McRegurgitation after downing too many Big Macs.
Imagine if a documentary was made chronicling Winter’s journey … it could be called, “Ubiquitize Me.” (Double ouch.)
For the record, we think Starbucks should ACKNOWLEDGE Winter in an ongoing manner just not as Subway acknowledges Jared.
Instead of featuring Winter in marketing/advertising campaigns, we contend Starbucks SHOULD…
We also agree Starbucks SHOULD consider making a donation to a charity each time Winter visits a new store. (That is Jackie's great idea).
(In return, Starbucks should politely ask Winter to stop saying the coffee is making him sick).
That’s Brand Autopsy’s take … what’s yours?
Welcome to the Brand Autopsy leg of the Business Blog Book Tour 2. Jackie Huba and Ben McConnell, authors of Creating Customer Evangelists, are blog-hopping this week sharing thoughts and insights about their book and about customer evangelists. You will find yesterday's (Mon. Mar. 15) entries on BusinessPundit.com.
Below is a jump-list of the topics Brand Autopsy discussess with Jackie and Ben. They will be popping in to answer any additional questions these posts may create.
Topics:
Birth of an Evangelist – How williams + moore became evangelists for the book.
Blame it on TiVo – Jackie and Ben share what prompted writing the book.
Evangelist in the Midst – How to spot a 'customer evangelist.'
Hot Evangelist's Now! - How about later? - What happens when doughnuts begin to go stale?
If You Could Turn Back Time and If You Could Turn Back Time II – These two post have nothing to do with Cher.
Creating Customer VIGILANTES – the UnEvangelist.
The Evangelist Responsibility - A call to action.
Thanks to Todd at the blog site "A Penny For…" for coordinating this blog tour. Tomorrow, the tour stops at Jeremy's Ensight blog.
Enjoy!
williams + moore
This past week I read a very interesting Harvard Business Review article, "The One Number You Need to Grow," penned by Frederick Reichheld. I encourage you to get a copy of the article ... it is a worthy read.
Reichheld’s research indicates that there is a strong correlation between a company’s growth rate and the percentage of it’s customers who are willing to recommend the company to a friend. His working assumption is that evangelical customer loyalty is one of the most important drivers of growth as Reichheld contends, “the ultimate act of loyalty is a recommendation to a friend.”
His article focuses on how companies have gone astray in trying to measure “loyalty” through complicated customer satisfaction surveys. Instead, he contends, “you don’t need expensive surveys and complex statistical models. You only have to ask your customers one question: How likely is it that you would recommend [company x] to a friend or a colleague."
In his case studies, Reichheld used a ten-point scale to measure the likelihood of a customer recommendation where 10 means “extremely likely” to recommend, 5 means “neutral,” and 0 means “not at all likely” to recommend.
Customers that answered with a 9 or a 10 were classified as “Promoters.” Those that answered with a 7 or 8 were classified as “Passively Satisfied” and those that gave ratings from 0 to 6 were classified as “Detractors.”
This leads to Reichheld’s simplistic premise -- “The path to sustainable, profitable growth begins with creating more promoters and fewer detractors.”
I may have overly simplified his HBR report but the critical nugget of knowledge for marketers is that Reichheld, a long-time believer that customer loyalty is the harbinger for whether or not a company can activate and sustain profitability, is now singing the praises of getting evangelical loyal customers to become, in essence, the marketing department.
Sound familiar? It should.
In Creating Customer Evangelists, Ben McConnell and Jackie Huba expertly wrote about not only the importance of getting current customers to become, in essence, a volunteer sales force but they also gave tactical advice on how businesses can engage their loyal customers to become evangelical “promoters.”
While I have your attention, I gotta close with a plug. On March 16th, Ben and Jackie will drop by the Brand Autopsy coroner offices for the second leg of their Business Blog Book Tour.
