Today, responding to the new complexities and realities of customer decision-making, marketers are zeroing-in on finding methods of creating engagement, trust, commitment and advocacy among customers well beyond traditional advertising and editorial material through formal electronic and print channels. The currency for meeting these objectives is, collectively, called "consumer-generated media," which consists of any method of personal, neural communication, including casual conversation offline and blogging, forums, communities, chat rooms and portals online.
Though word of mouth looks cheap, simple and relatively painless to implement, one of the things marketers must be prepared for in this brave new communications world is giving up full control of both the message and the medium. The rewards, however, can be substantial.
Two books, Malcolm Gladwell’s The Tipping Point (Little, Brown, February 2000) and Jon Berry’s and Ed Keller’s The Influentials, (Free Press, Jan. 7, 2003) considered together, provide a perfect reference point for understanding the impact of word-of-mouth and social networks (aka neural, peer-to-peer, informal and viral communication). The significant increase in available information about alternative suppliers, combined with how customers now make supplier product and service selection, have put word-of-mouth front and center in the minds of marketers and organizations
International quantitative research into the influence, value, and trust behind word of mouth has found that when you compare the effectiveness and trust levels of traditional sources of supplier information—print and electronic advertising; print and electronic editorial; and word-of-mouth—over time, word-of-mouth has emerged as the dominant communication vehicle for impacting customer decision-making and supplier selection.
In identifying their reasons for the willingness to intake and trust word-of-mouth, and depend upon it so strongly to help make supplier and product decisions, customers often use such words as honesty, objectivity, reliability, integrity, sincerity, interest and even passion and excitement. Thus, there"s a strong personal, and emotional, underpinning to the value and influence of word-of-mouth.
Influentials
At the macro level, word-of-mouth produces societal influentials, those individuals—about 10 percent of the population as identified by Keller and Berry—who affect and guide the behavior of the rest of society. On a category influence basis, Gladwell has identified members of social networks who are mavens, connectors and salespeople. Everyone knows people like these. They are product or service category experts in subjects like wine, sports, food, entertainment, computers, cars and travel to whom others defer, and listen to, when making decisions in these areas.
Finally, there are brand influentials or advocates. Advocacy, simply defined, occurs when customers select a single supplier from among all those they might consider, giving that supplier the highest share of spend possible and telling others about how positive the relationship is and how much value and benefit they derive from it.
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Levels of advocacy
—Michael Lowenstein |
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Advocates are the golden prize for any supplier organization, because these are customers who have minimized their consideration set, are extremely favorable toward "their" supplier and are active, vocal, frequent, and positive communicators on behalf of that supplier
Advocacy incorporates opinions formed from customers’ transactional and other contact experiences, but it is built on a foundation of strategic, positive purchase and communication behavior. So, having positive word-of-mouth is essential to generating true advocacy; and, similarly, negative word-of-mouth can contribute to customer disaffection and, in some notable cases, even sabotage.
Advocacy considers not only the likelihood that you will have an exclusive purchasing relationship, but it also incorporates both strong emotional kinship and active, positive and voluntary communication about the supplier.
Customers can be divided into advocacy segments according to degree of
kinship and engagement with a supplier; and that kinship has direct and explicit monetary translation. This is a key reason why creating advocacy is at the core of effective customer management. Put in bottom line terms: Advocacy represents revenue and profitability, plus a great deal more.
Breaking point
Several years ago, Bally Fitness, a national chain of fitness centers, enraged members by having what amounted to an open-ended financial services contract when customers first joined. In other words, customers could sign up for membership on what appeared to be a month-to-month basis, only to find that the contracts could never be canceled. Many customers ended up paying for years.
One customer who’d reached the breaking point with this arrangement set up a contra site so that members with similar experiences could be attracted to voice their negatives on a group basis. The contra site attracted visitors by the thousands. Bally Fitness, stung by the negative publicity, endeavored to sue the site developer; however, it lost in federal court on the basis of the site developer"s First Amendment rights (freedom of speech), which garnered the chain even more negative word-of-mouth.
Owners of Harley-Davidson motorcycles who are members of the H.O.G. (Harley Owners Group) clubs around the world are very visible advocates for the brand. They not only buy the motorcycles, but also they actively accessorize with Harley-Davidson equipment for their choppers, wear a vast array of Harley-Davidson clothing and enthusiastically participate in Harley-Davidson events. Starting with fewer than 50 members in 1983, H.O.G. has grown to close to a million members with more than 1,200 individual chapters in 25 countries. More than half of the members attend at least one Harley-Davidson event or rally per year.
How important is advocacy to the company? Harley-Davidson does almost no advertising, depending, instead, upon its community of advocates to purchase both motorcycles and logo gear—and spread the word to others. Unlike most companies that are just beginning to understand, and drive, word of mouth and advocacy within their customer base, Harley-Davidson has seen this as the secret of success for years.
It’s not at all an oversimplification to say that advocacy, and the positive word-of-mouth behind it, is essential to effective customer management. The reasons boil down to this: When companies have created active advocates among their customers, they have succeeded in capturing the hearts, minds, wallets and vocal cords of this group. These are customers who will vigorously leverage more active purchase behavior, both among other customers and non-customers. The ultimate goal of every company should be to make every customer an active advocate while simultaneously reducing or eliminating indifference.
