Brand Autopsy

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?

More Thoughts on a WOM White Paper

Last week I blogged about a white paper researched and written by Walter Carl, a Northeastern University Asst. Professor. In my post I offered up a few questions related to the study and Walter posted a thorough reply on his WOM-Study blog.

Regarding my assertion about the BzzAgent sample most likely being more skillful at recognizing and reporting word-of-mouth activity than those in the convenience sample, Walter said …

First, I agree with you, it shouldn't be a surprising finding that BzzAgents report more WOM episodes than non-Agents. The amount of the difference was what surprised me (for example, Agents having twice as many of their total interactions include a WOM episode). Second, I don't have any direct measurement of whether or not BzzAgents are more or less skillful at recognizing WOM opportunities. My sense is, however, and like yours, that they probably are better able to recognize WOM opportunities.

WOW! BzzAgents reported 100% more word-of-mouth interactions than did those in the convenience sample. That discrepancy is empirical enough for me to know BzzAgents are indeed more skillful at recognizing and reporting word-of-mouth activities than are the everyday people in the convenience sample.

Walter also provided more specifics on the demographics of the BzzAgent sample compared with the convenience sample. There are significant discrepancies between the two samples. Walter said the BzzAgent sample was 83% female and nearly 50% were 30 years of age or older. While the convenience sample was 67% female and their average age was close to 20 years of age.

Given this clarification, the two samples appear too dissimilar to draw any empirical conclusions. That’s just my take. Read the WOM White Paper and Walter’s clarification for yourself and draw your own conclusions.

Thoughts on a WOM White Paper

According to the recently released white paper, “The Value of Managed Word-of-Mouth Programs” (pdf) ... managed word-of-mouth (WOM) programs, like those from BzzAgent, generate more WOM than happens from everyday people. (For a sum-up of the paper’s key findings, check out this post from Ben McConnell, a deacon of customer evangelism do’s and don’ts.)

The study, conducted by Dr. Walter Carl (Assistant Professor at Northeastern University), tracked the WOM activities of 1,000 BzzAgents compared to a convenience sample of everyday, non-Bzz Agent people.

As happens with most white papers, this one reads very much like an advertorial giving credibility to BzzAgent’s word-of-mouth marketing ways. It’s heavily framed to support BzzAgent’s position on generating WOM. For example, the BzzAgent sample set is referred to as ‘WOM Volunteers’ when in reality, the so-called convenience sample is more a WOM volunteer than are the BzzAgents. (BzzAgents aren’t called ‘agents’ for nothing.)

Since these WOM volunteers are BzzAgents, it’s no wonder to me they reported generating more WOM than the convenience sample did. A requirement of being a BzzAgent is to report when and where they generated WOM for the campaign they’re participating in.

Could it be BzzAgents are more skillful at recognizing and reporting WOM activity than their peers in the convenience sample? And if so, wouldn’t that make the data in the study suspect?

I’d also like to learn just how similar, in demographics and psychographics, the two sample sets are. The white paper only outlines the everyday, non-BzzAgent sample as being college educated adults ranging in age from 18 to 29. Since the paper empirically states the BzzAgent sample set is more socially active, I’d like to know if BzzAgents are potentially more socially inclined than are the people in the everyday, convenience sample.

Hopefully these questions will be addressed when the complete study is published next year in the Management Communication Quarterly.

Tasty Links and Learnings

[UPDATED LINKS on 3/7/05]

I found the following links worthy of referring ... enjoy.

Webcast Interview with Dave Balter of BzzAgent
Don’t sleep on this CMO magazine webcast with Dave Balter, CEO of BzzAgent. No matter if you are a BzzAgent devotee or a BzzAgent determined detractor, spend 42 minutes to view/listen to this very informative interview. Dave discusses all aspects of the BzzAgent business and lets us know they recently ran a highy successful BzzCampaign for 20Q … something Brand Examiner evangelized.

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Swingline and the Purple Cow Stapler
From Public Radio’s Marketplace, we learn how Swingline is improving the staid staple. Not much has changed with the stapler in decades. Well, that’s about to change. Listen to learn more.

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Harvard Business Review (March Issue)
Marcus Buckingham’s article on “What Great Managers Do” is a must-read for any manager. The article is superbly well-written, highly informative, and very actionable. I cannot imagine how his forthcoming book could be better than this article. (For more, read this Brand Autopsy blog entry from Mar. 7.)

Expect a blog early next week on my key takeaways from this article.)

The interview with Michael Dell and Kevin Rollins from DELL is also fascinating. I learned more about the culture of DELL in twenty minutes than I have in twenty years. After reading it, I now understand how and why complacency has never and will never creep into the culture of DELL. A truly remarkable read. (For more, read this Brand Autopsy blog entry from Mar. 8.)

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Strategy + Business March Issue
The case study (PDF) on how Home Depot is making its people their competitive advantage is a very interesting read for those who believe every business is in the ‘people business.’

The article (PDF) on the state of the Consumer Packaged Goods business has some juicy nuggets on Wal-Mart’s impact, on the modus operandi of CPG brand managers, and on how CPG companies must relinquish ‘command and control’ management and adopt more of a ‘coordinate and communicate’ management style.

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Wild Ass Freak Show Link-of-the-Week
This inane video snippet reminded of an Improv exercise Andy Crouch, from the Heroes of Comedy, has his students do.

BzzAgent’s Natural Buzz

Wait … this is not another post where Brand Autopsy slams BzzAgent. We’ve played that card (and some might say overplayed that card) with past posts. Instead, this post shares a mild revelation I recently had about the business of BzzAgent.

As we know, BzzAgent’s reason for being is to help companies accelerate word-of-mouth. They seed select BzzAgents in the field with a sample product and give them talking points and ideas for how and where to spread word-of-mouth. The result is hopefully increased word-of-mouth and ‘buzz’ for the product.

Katherine Stone, from the Decent Marketing blog, sums up my core beef with the BzzAgent buzz-making process by writing, “It seems to me that if you need to hire an agency to manufacture buzz then perhaps your product isn’t all that remarkable.” (Decent Marketing | Buzz Kill post | May 6, 2004)

So how did the BUZZ begin for BzzAgent?

Did BzzAgent send out BzzGuides to BzzAgents and give them buzz-creating strategies in order to land the articles in Fast Company and the New York Times Sunday Magazine? Did BzzAgent go through the ‘BzzAgent process’ to get mentioned in Seth Godin’s book Purple Cow?

I’m serious here. BzzAgent is a case study in how to NATURALLY create buzz.

The company is insanely remarkable. So remarkable that we want to talk about it. So remarkable that the media wants to write about it. So remarkable that companies want to hire BzzAgent to create buzz for their products. So remarkable that bloggers want to dissect it.

It’s simple … companies and products worth talking about get talked about.

Which brings me back to Katherine’s quote, “… if you need to hire an agency to manufacture buzz then perhaps your product isn’t all that remarkable.”

More Bad Bzz for BzzAgent

There’s been a lot of BzzAgent hatin’ lately, so I'll try to bring something new to this conversation.

Have you been following the Folgers Home Café hubbub on the BzzAgent Blog?

If not, I encourage you to read the thread as it is fascinating to hear stories from BzzAgents and their experiences with a rumored-to-be faulty coffeemaker manufactured by Black & Decker but associated directly with Folgers.

A little background is needed. Folgers has signed up with BzzAgent to generate word-of-mouth for their Home Café brewing machines which use pods to brew single-servings of coffee. BzzAgent then sent a Home Café machine, coffee pods, and a BzzGuide to targeted BzzAgents. BzzAgents are to read the BzzGuide, brew some coffee, and then talk about the virtues of the Home Café machine with whoever will listen.

However, this BzzCampaign has not gone smoothly as many BzzAgents are not happy with the performance of their Home Café machine.

On the BzzAgent blog, BzzAgents tell stories of how the Home Café machine leaks water, emits smoke, and brews lukewarm coffee. Some even share that they’ve returned their Home Café machine to Wal-Mart for store credits of over $50. And, some of those who have returned their machines for store credit are fake buzzing the Home Café machine.

Ouch! I am quickly losing what respect and trust I have left for BzzAgent, the company, and for the word-of-mouth pilgrims known as BzzAgents. How could BzzAgent endorse a product wrought with so many issues? And, does a company really want freebie-lovin’ and cherry pickin’ customers (i.e. BzzAgents) to be their so-called evangelists.

As a marketer, I would exhaust all efforts to create 'genuine' buzz using the Creating Customer Evangelists playbook before going the BzzAgent route to create word-of-mouth.

However, to BzzAgent’s credit, this is all playing out in a very transparent way on the BzzAgent Blog.

Bravo BzzAgent

Dave Balter, BzzAgent president/ceo, continues to practice marketing transparency. Shaped by feedback from field BzzAgents and the healthy dialogue on the Brand Autopsy blog, BzzAgent has restructured their "One a Card" BzzCampaign.

In the comments section to my BzzAgent BuzzKill??? post, Dave writes …

Thanks so much for the energetic debate about the One of a Card BzzCampaign and BzzAgent. While we don't agree with all of the hypotheses, we appreciate the perceptions and - in the end - this type of feedback helps us learn how to build a stronger company.

I'm proud to announce that your opinions, and the voices of thousands of the BzzAgents, haven't fallen on deaf ears. We've worked with our client and have relaunched this campaign so that individuals may sign up without having to have the card. Why, because we know this is an inherently Bzzable product and one that is worth getting to know. The Official One of a Card Relaunch Announcement tells you more of the story.

Bravo BzzAgent for being transparent enough to engage in honest, open, and sometimes difficult conversations. Bravo.

BzzAgent BuzzKill???

Last week I was invited to participate in my first BzzAgent campaign. The campaign is for a new Visa card issued by the First National Bank of Omaha.

If you’ve been following Brand Autopsy, you’ve read my criticism of BzzAgent’s seemingly artificial process of seeding word-of-mouth and my intrigue in how the BzzAgent process can potentially help to turn less loyal consumers into more vocal evangelists.

So with great interest, I opened up my email invitation to participate in a BzzAgent campaign.

As I perused my email, a few words popped … One of a Card Visa … next generation of credit cards … fully customizable picture card technology … ability to change the image on the credit card up to four times per year … “Now, that’s a Bzzable credit card!”

After perusing, I paused and rephrased what I just read. Hmm … it’s an affinity credit card that I can personalize up to four times a year by putting a photo on the card. Okay … s-u-p-e-r.

Is this One of a Card credit card compelling enough to evangelize? There are other photo personalizable affinity credit cards on the market. And, why would I want/need to monkey around with changing the photo on my credit card up to four times in one year? The 7.9% APR for the credit card is good, but not good enough to be buzz-worthy.

I am not alone in my skepticism for the buzz-worthiness of this BzzAgent One of Card campaign. Since initiating the campaign, BzzAgent has received inquiries from their field of BzzAgents questioning the motives and the genuineness of the campaign.

On the BzzAgent blog, Dave Balter, the founder of BzzAgent, replied by explaining the thought process behind deciding if the One of Card was (a) buzz-worthy and (b) consistent with the values of the BzzAgent business.

His reply is fascinating and well worth reading. One has to respect Dave’s transparent look into the BzzAgent business. The comments from the BzzAgents in the field are also fascinating. The most poignant comment so far is:

“… stop using the BzzAgents to make money; use them to create the bzz from which money is made”

Wow! Poignant is an understatement ... that comment was downright lethal.

Further Learning:
For a primer on BzzAgent, read the Fast Company article from April 2004

Light Loyalists Create More Powerful Word-of-Mouth

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.

BzzAgent – Buzz or Buzzt?

Katherine over at Decent Marketing has some HMOs (hot marketing opinions) on BzzAgent. BzzAgent is a company that generates buzz for client’s products by incentifying qualified BzzAgents to spread the word. (For a BzzAgent primer, read the Fast Company article.)

Katherine writes ... "Is it me, or is this simply fake buzz? I think of word-of-mouth marketing as something that arises out of a really great product. People buy it, use it, and then tell their friends and family how really great it is. It seems to me that if you need to hire an agency to manufacture buzz then perhaps your product isn't all that remarkable."

Katherine … I agree with you 100%. Real, true, and heartfelt evangelists do not need redeemable points to compensate them for sharing their passion for a product or service. This is manufactured buzz, synthetic buzz … fake buzz.

After reading the article in Fast Company last month, I signed up as a BzzAgent to learn how the program works. While I have yet to participate in a campaign, I was eligible to participate in the BzzAgent campaign for the recently published book, UNSTUCK. However, I have already generated real, true, and heartfelt evangelical buzz for UNSTUCK without prodding and without the expectation that I will earn BzzReward points.

The seed for my genuine buzz for UNSTUCK was planted when I rifled through the book at Barnes & Noble and felt compelled to buy it. After reading a third of the book I was impressed. So impressed, that I told my fellow marketing coroner, Brand Examiner Paul, about the book and … he bought UNSTUCK. I then told Liz at work about the book and … she bought UNSTUCK. Next, I told Nona at work about it and … she bought UNSTUCK. Liz then told Margaret at work and … she bought UNSTUCK.

Real, true, and heartfelt evangelical buzz at work ... nothing fake or contrived about that buzz.