Marketing:  Rise of word-of-mouth marketing gives PR fresh impetus

published 2005

The rise of word-of-mouth (WoM) marketing is providing fresh impetus to PR as a marketing tool.

As traditional media channels multiply, ‘clutter’ increases, consumers ‘turn off’, and marketers require new ways to ‘connect’ with those they want to sell to - it’s WoM - whose origins and techniques are interwoven with those of PR - that is emerging as a potent force in marketing communication.

How much Australia is embracing WoM is evidenced by a recent article in the Australian Financial Review (14 February 2005) by Neil Shoebridge, one of Australia’s most knowledgeable and influential marketing writers.  He began the article by saying:

“Australian marketers will pump about $9 billion into media advertising this year, using television, newspaper, magazine, radio, outdoor and cinema ads to promote their products and services.

“But they know that media advertising is not the most powerful form of marketing; that title belongs to word-of-mouth recommendations.

“Creating a brand that consumers will recommend to their friends, family and colleagues is the holy grail of marketing.

“Nothing is more effective than a personal recommendation.  No consumer is more powerful than the brand advocate, those people who happily recommend brands”.

There’s a raft of books beginning to appear on this subject - and as with any new area there is a lot of debate. So here’s PR Influences’ ‘quick guide’ to word-of-mouth marketing:

What is word-of-mouth (WoM) marketing?

In its simplest form it’s when a prospect for a product or service learns about it, or has its appropriateness endorsed by people he or she either personally knows or is perceived to be a trusted advocate.  This is in contrast to being made aware or influenced by advertising or direct mail or other traditional marketing techniques.

What is new about WoM?

In some ways it’s not new. Over the years we’ve all been strongly influenced by recommendations from friends and those we trust.  However, as a consequence of the explosion of media that bombard us, and the advertising this contains, many consumers are ‘turning off’. As a result marketers are now turning what has for years been part of marketing (albeit minor and in the background) into a new separate marketing discipline (much like the emergence of CRM a few years back). 

What are the principles behind WoM?

A successful WoM strategy seeks to find ways to reach or engage with the prospect in a manner that is perceived to be unlike the traditional advertising and sales push. As part of the process a key aim is to give the product or service more credibility in the eyes of the prospect.

What examples of word-of-mouth marketing are there?

There are many different aspects to WoM. In Australia products such as Nudie Juice and Krispy Kreme doughnuts were largely lunched using WoM techniques i.e.: there was virtually no traditional advertising or promotion. More recently Cut, a spin-off from Absolute, has done the same. Internationally, awareness for the film ‘Passion’ was achieved through a concentrated campaign aimed initially at religious audiences.

What is the connection between PR and WoM?

Many claim that WoM is an extension of traditional PR techniques.  In fact many of the elements of a successful WoM campaign need to be driven by PR. This is because PR, which has always been about influencing opinion formers (such as media) and obtaining third-party endorsement, is the most knowledgeable and capable of the marketing service providers to manage the strategic implementation of a WoM campaign. 

How does WoM link with the recent focus on the importance of Influencers?

The recent focus on the fact that influencers - who make up 10 percent of the population - directly influence the decisions of the other 90 percent is an underlying principle behind WoM and part of the reason for the development of WoM as a specialist discipline. Significantly, it is PR that has been the champion of Influencer programs and hence the catalyst for the growth of its strategic evolution.

Isn’t one-on-one promotion of products also WoM?

Yes - it’s a form of WoM, often called Buzz Marketing (eg: where people are paid to sit in bars to talk about the benefits of a particular drink). The same technique has also been used to encourage people to try new electronic ‘toys’. While this is part of WoM, it is more akin to the old-fashioned product sampling - except that there’s not the same level of disclosure and transparency. It has its place as a tactical tool, but unless it is a component of an integrated campaign which results in media and other opinion-formers involvement/participation, its impact is likely to be rather limited.

It is the buzz end of marketing that has mainly been in the public eye in Australia.  However, this end of the WoM business - which in many instances is product sampling simply taken a step further - is under scrutiny.  Some of the ploys used are perceived to be ethically questionable, and in the US a code of ethics has recently been unveiled to protect consumers from some of these more dubious practices.

Notwithstanding this, the use of buzz marketing is a legitimate marketing tool as evidenced by the fact that Proctor & Gamble has set up a specialist ‘buzz marketing’ company in the US called Tremor.  It employs 280,000 teenagers to generate positive WoM recommendations, not only about its own products but on behalf of other companies such as Coca Cola. 

Not so visible, but growing rapidly in the US, are the more private influencer building programs.  These techniques fall within the sphere of PR agencies and in-house PR departments and aim to identify and build relationships among opinion formers and potential advocates in a manner that will directly support a brand. 

These programs essentially apply core techniques used by PR people for many years as part of lead generation programs.  However, they have now been ‘discovered’ by marketers, ‘tweaked’ and modified to relate to brands, and are now becoming a key element in brand marketing campaigns.