Viral Marketing: Effectiveness and Implementation

Word-Of-Mouth Marketing: Effectiveness and Implementation Submitted by: Spandana Araga Marketing II Term Paper How it works Advertising agencies and marketing experts get paid big money to create ads that are unforgettable. But getting those ads seen and getting people to talk about them are two of the biggest challenges facing any advertiser these days. It is a common misconception that memorable marketing campaigns require big budgets. Somewhere along the line, marketers came up with a brilliant solution: let the customers spread the word themselves.Word-OfMouth Marketing(WOM), also known as Viral Marketing consists of advertising campaigns and messages that depend on peer to peer forwarding. WOM plays on the common sense that when a person likes something, they want to talk about it. They create a potential for exponential growth like a â€Å"virus†, and hence the name. Trusav et al (2009) in a study of WOM versus traditional marketing found that WOM referrals have a strong impact on new customer acquisition. The long-term elasticity of signups with respect to WOM was estimated to be . 3. The elasticity for WOM is approximately 20 times higher than that for marketing events and 30 times that of media appearances Effectiveness of WOM According to the article, â€Å"Word-Of-Mouth Marketing will change your business† by Hedges and Chung word-of-mouth marketing â€Å"gives brands a powerful and influential way to engage their target audience. The article talks about how consumers are very vocal about their views especially when it comes to personal care products like cosmetics.Projections by eMarketer predict 72 million U. S. adults will regularly give WOM advice about products or services in 2011, up from 65 million in 2006. There are 3. 5 billion WOM conversations occurring daily in the U. S. , according to the Keller Fay Group. Though 92% of these conversations are through off line means- face to face or phone- a vast majority of the influencer s depend on the internet to get more information and make decisions.From plain old word of mouth, now with the use of social networking sites such as facebook, youtube and twitter, the effects of viral marketing campaigns can be amplified. For example Barack Obama got the youth to vote, a task many thought impossible, by utilizing social networking sites. He accomplished this by strategically tapping into nearly every major social media outlet. At the time of Obama's inauguration in January 2009, the President had 3 million friends on facebook, 3000 videos on Youtube and several followers on twitter and myspace.Implementation Though most marketers will agree that WOM is an effective marketing tool, surprisingly, not many choose to utilise it. A CMO Council survey found 56% of senior marketers saying their companies have no programs to track or propagate positive WOM. Marketers would benefit by keeping track of what is being said about their product and learning ways to infiltrate, i nfluence and spark conversations about their products. Word of Mouth Marketing Association outlines some positive WOM guidelines. The first is creating communities and connecting people.This can be in the form of creating user groups and fan clubs, supporting independent groups that form around your product, hosting discussions and message boards about your products. Avon hired Communispace to create a private online customer community, where the company can develop and maintain relationships with its brand advocates. Another guideline is motivating brand advocates and evangelists to actively promote a product by providing recognition and tools to active advocates, recruiting new advocates, and teaching new advocates about the benefits of the products and encouraging them to spread the word.For example WOM services such as SheSpeaks and BzzAgent are a great way to recruit new brand advocates and engage them into the brand. The initial conversation starter is product sampling, but lo ng-lasting relationships can be formed. It is of outmost importance to engage in transparent conversation. WOM campaigns work best when the marketer can engage in two-way conversation with consumers. Some simple ways to execute include creating blogs and other tools to share information or participating openly on online blogs and discussions.For a brand to build an impactful WOM online or off -line campaign some touch-points need to be defined. First the marketer needs to identify who the â€Å"Talkers† are-the ideal brand advocates who will tell their friends about the brand. This target group has to be defined and then be wooed to become true advocates for the brand. Next, the â€Å"Tools† have to be identified- the campaign mediums or resources through which the message can travel (online, off-line or integrated).An effective tactic to make the message spread faster is to disguise the message as something which is entertaining and interesting enough that it begs to be passed around. It needs to be remembered that viral marketing is not about the product but about the message. Next it is to be decided how the brand owner will be â€Å"Taking Part†- how the marketer should directly or indirectly join the conversation while being careful not to be heavy-handed and giving thousands or millions of potential customers a platform to interact. An important final step is â€Å"Tracking†.It has to be decided on how the research will be collected, analyzed, disseminated and utilized to best impact the brand. A mistake many marketers do is rushing into a WOM campaign without a clear strategy or vision. There is a dangerous flipside to WOM- in the absence of an authentic, wellconstructed brand message, consumers will unleash their own impressions which could be positive or negative to fill the void, and today’s speed of light communication platforms enable those homemade brand messages to travel at lightening speed.Brands must fiercely protect the brand assets and remain loyal to the core brand identity in order to gain the respect of the masses. Profitable brands can be built on deploying WOM smartly. The online success of the beauty brand e. l. f. Cosmetics is a good example. Joseph Shamah, the brand’s CEO says that WOM has been very effective for them and more than 80% of their customers say they heard about the brand from a friend.