OPINION: Word-of-mouth marketing puts onus on users By Grant Common Editor published May 2005 Grant has 30 years direct experience in public relations and communication in Australia and New Zealand - as well as directing and managing programs in the UK and USA. He has consulted to Governments, publicly listed companies, industry bodies, marketing organisations, multinationals and not-for-profit organisations. He is Managing Director of Sydney-based Network PR and as a Fellow of the Australian Institute of Company Directors (having completed the Company Directors Diploma examination) he is also one of the few PR practitioners to have the perspective of the company director. Marketers are using all sorts of ploys to cut through the ‘clutter’ to reach consumers. The New York Post (12 December 2004) accused a number of US companies - including Nintendo, and Cabbage Patch Dolls - of using underhand tactics when marketing to kids and tweens. Specifically citing Nintendo, it made the accusation that it had used a marketing technique called the ‘Christmas-Toy-Shortage Marketing Ploy’.  This involves marketers launching a new item some weeks before Christmas, then understocking so that the demand far exceeds supply. This creates word-of-mouth that this is a ‘hot item’ and builds a huge pent-up demand for the moment when ‘fresh stock’ arrives in store - just in time for Christmas. In some cases the launch of products are deliberately low-key - with little or no advertising. So by the end of the cycle, not only have record sales been achieved, but the cost of marketing/promotion has been far lower than normal.  The success of this approach relies on a new powerful marketing tool - word-of-mouth marketing (WoM). At a direct consumer level other examples of WoM include: Hiring of actors to walk around with new electronic products, ‘showing them off’ to consumers. People in bars using a particular product, engaging in banter with other customers and encouraging them to use their product. Teenagers being hired to promote products to their peers. From an Australian perspective there is a parallel between some WoM techniques and our recent ‘Cash for Comment’ controversy. Cash for Comment began with advertisers legitimately paying for normal advertising on radio - some pre-produced and others read by the announcer. Then a few got smarter and decided that it was better to pay the announcer to ‘comment’ so it wasn’t so obvious that it was in fact a ‘plug’ for a product or service. The problem was that this tactic broke one of the golden rules of marketing - that the source of the message must be recognisable. The marketers simply went too far and, quite rightly, the practice was largely stopped.  There are many other innovative - and quite legitimate - methods of WoM which are outlined in our first article of this edition of PR Influences. Click here. However, the boundary is arguably over-stepped when the word-of-mouth is either not clearly recognisable as part of a planned marketing effort; or it is used in a dishonest way which the New York Post asserts is the case in the ‘Christmas-Toy-Shortage Marketing Ploy’.  WoM is arguably one of the most powerful new tools in marketing. Readers of PR Influences - most of whom are in marketing, PR or advertising - need to embrace this new technique, but do so in a manner that ensures it is responsibly used. The onus is on us all.

PR Influences Australian Public Relations Newsletter. Article: PR & Marketing: Word-of-mouth marketing puts onus on users. Information Content: Opinion & Comment