Marketing: Word-of-Mouth & Influencers

This semester, I am fortunate to be in a couple of business classes that feature accomplished guest speakers who share their insights and experience. My marketing class (Consumer Behavior) has featured speakers from Campbell Soup, Nike, Nielsen and Fizz (a word-of-mouth marketing agency), each sharing their experience in positioning and targeting strategies at their respective companies.

In marketing, we always learn about how “word-of-mouth” is the strongest form of marketing; nothing is as powerful as someone naturally recommending a product to you. When I first heard this stated in my marketing 101 class, I thought of it as a testament to the importance of product; your product has to be so good that people want to share it with others. Everyone has their swear-by products that they have persuaded their friends to use (for me, Twitter, Pinterest, Jaipur Avenue Chai and the Mexicali food truck on Penn’s campus) – but I would probably never have shared those products unless they provided real value to me. I’ve also heard that Sriracha, the popular and now pretty much ubiquitous hot sauce brand, has never put out an advertisement; I’ve always thought of that as a reminder of how good their product is and how much people like it.

However, I heard a little bit of different perspective on “word-of-mouth” marketing from Ted Wright, founder and CEO of Fizz, a marketing agency focused on word-of-mouth marketing. One of the clients he talked about was a Chocolate Milk company who were trying to increase sales in the middle school age range. Fizz did their market research and found that the best way to influence middle school kids was to use high school kids – but how to influence high school kids (a notoriously hormonal, surly crowd)? They started with a research study that showed that chocolate milk was the best post-exercise drink. They decided that they needed to get the sportspeople (read: jocks) to drink milk, and to do this, they had to target coaches – high school football coaches. They went to high school football clinics and recruited NFL alumni to talk about milk to these coaches, and in turn these coaches went to their kids and pushed milk. This became a huge thing – at the end, there was a ton of earned media (ESPN, Men’s Health, etc.) that led to the NFL eventually co-promoting milk.

This made me rethink word-of-mouth, while chocolate milk was undoubtedly a good product, but it had always been. Nothing about that had changed with Fizz’s approach. While I definitely think Fizz’s approach was innovative and of course effective, it definitely wasn’t the same as me trying chocolate milk and saying “this is great!” and sharing that with my friends. I couldn’t help but think of it has “high ROI, authentic PR”, because it doesn’t strike consumers as traditional advertising. Nevertheless, they were still paying those NFL alumni to talk about milk in an applicable setting for the target market. What makes that more effective than mass market, say, TV advertising? It was using an authentic voice (NFL players) to talk to the target market (football coaches) in a setting that was focused (football clinics/conferences). This was where the conversations started; they then proceeded from the coaches to their players, and then players to other players. And that is where the product comes in – I’m sure this campaign wouldn’t be effective unless chocolate milk actually made these players feel re-energized after practice.

So, I think that two things are essential for word-of-mouth marketing: an excellent, value-adding product (this could be enough, and something to get the conversation started in the target audience. I don’t think this always has to be the type of marketing Fizz used is essential for a product to go “viral” – it could be a mass advertising campaign that gets people talking; recent examples in my memory are Virgin Airline’s “Sassy” safety video or Chipotle’s “The Scarecrow” video – those were big budget company-produced campaigns, but they got shared voluminously by consumers. If the virality is enough that it encourages consumers to try the product, this is enough if the product is actually value-adding – because if it is, the consumer will come back and buy it again (ding, Customer Lifetime Value!).

I also think there’s a lot of buzz around “digital word-of-mouth” effects. The company that comes to mind is Klout; a company that measures users’ “social influence” by an algorithm that combines your influence (likes, retweets, etc.) on all of your social networks and calculates a “Klout score”. Companies can then offer “perks” to certain consumers to encourage them to share opinions about the product via their social media. For example, this summer, I was given free tickets to the horror flick The Conjuring; I was encouraged to tweet about the trailer and movie after I had seen it.

While I think Klout’s model makes a lot of sense and could potentially be extremely powerful, I do have some problems with it. First, something Ted (from Fizz) mentioned was that digitally sharing something is much less effective than sharing it in a face-to-face conversation. That’s something I agree with fully: think about it, are you more likely to be influenced by something your friend tweets or shares on Facebook, or something they talk to you about over lunch? Secondly, I think that it comes back to the product – if I hadn’t liked The Conjuring, I wouldn’t have shared anything about it – at least not anything positive. And I would be most likely to appreciate the movie if I was someone who was part of their target market – but was I? How did they determine whether I was – based on my Klout score? I think that it’s great to use socially influential people, but they have to be part of their target market as well, so that the people I was reaching on social media were part of the target market too, and so that I actually appreciated the product! Klout has topics that you can give “+Ks” to people for – to indicate they are an expert on the topic – but I am skeptical as to whether they use these topics to categorize people, seeing as the perks that have been offered to me – ice cream, the movie, and business cards – aren’t really things I especially like or would talk about.

Anyway, as you can tell, I’m studying marketing – so I can go on about it forever! If you made it this far, I hope you enjoyed my thoughts – they are by no means right or wrong – just my reaction to things I’ve learned and heard!

(thanks to Ted Wright of Fizz for getting me thinking – he is an amazing speaker!)