Word-of-mouth (WoM) has influenced all my mobile phone contracts, where I took my wife on Valentine’s day and the last jar of instant coffee I purchased. It has for you, too, probably. Maybe not those exact items, but you’ve been influenced by people saying that they had a great meal here, that you really need to get some X and their holiday in Y at the Z hotel was fantastic.
No need to be ashamed. It’s the easiest and best source of advice in most circumstances. Nor would it be an appropriate subject for this blog.
A recent McKinsey Quarterly article (registration required for this venerable organ) focusing on how marketers might measure and evaluate WoM through social media and other means, however, is definitely of interest. It’s entitled ‘A new way to measure word-of-mouth marketing’.
The Marketing blog at Brand Republic has already had a few stabs at this piece of tosh, but I felt morally compelled to join the pile-on.
The article shows how important WoM can be, especially in areas where there isn’t an established market, like many technology sectors:
In the mobile-phone market, for example, we have observed that the pass-on rates for key positive and negative messages can increase a company’s market share by as much as 10 percent or reduce it by 20 percent over a two-year period, all other things being equal.
It’s at this point, sadly, that the article starts turning from informative to utter nonsense.
As is ever the truth in editorial, there must be a list of three and long words. McKinsey identifies three 4–5 syllable types of WoM influence:
Experiential: your mate tried it; it was rubbish/great; s/he tells you about it.
Consequential: brands put out messages (e.g. ‘this face cream will make you look younger’). People believe it and pass it on.
Intentional: appears to refer to product placement or buzz marketing.
From here to insanity. McKinsey ‘develops’ a theory of ‘WoM Equity’, which everyone else calls ‘Share of Voice’ but <snark>they wouldn’t be good analysts if they didn’t make up new words for things we already know about</snark>. So what is this revolutionary new formula? WoM value is:
the average sales impact of a brand message multiplied by the number of word-of-mouth messages.
Colour me gobsmacked. This is revolutionary stuff indeed.
No, it isn’t: it’s bullshit. Nearly 3000 words to say “People pass on their opinion about good and bad things. Agencies can try to influence this by creating clever stuff people will pass on. You should measure it by multiplying the (undefined) impact of the message by the number of times it is mentioned”.
The first two conclusions are fine, if inane. The formula is bullshit on so many levels that I don’t know where to begin.
- we still don’t know from any of this what makes an ‘impactful’ message, other than it might be like the Cadbury’s Gorilla campaign (which appeared shortly after the Cadbury’s food poisoning scandal, so sales would always be significantly better than the previous quarter).
- they’re saying a clever advert is more important than a genuine conversation. Really, always?
- and that life-long loyalty is less important than a quick hit?
- isn’t this WoM stuff about your brand’s reputation to at least as great an extent as flogging stuff?
- a model based on interruption, then, rather than interaction or engagement? Are you sure that’s what the Cluetrain is about?
I did quite like their chart (below), though.
picture credit: Mareen Fischinger
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Really good post, thanks. I think its funny how people try to add formulas to prove ROI on social media. If the “Bubble bursts” it will be their doing, trying to make something directly profitable with measured returns when it’s really a brand building tool. Ah we, it’s good for a laugh?
Excellent post, Ian. Refreshing levels of direct, plain, speaking