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Sunday, 21 September 2014

Conversations worth talking about

It’s human nature that we talk to our peers about the things that intrigue us and bother us. Often this leads to a recommendation – an interesting article in a newspaper or a product that’s impressed you.

Yet the power and influence of offline word of mouth (WOM) is often overlooked by marketers in favour of digital “engagement” techniques such as Facebook Pages and Twitter brand profiles.

Advances in the US could change this. New tools are coming to market that mix measurements of WOM with media planning tools to provide demonstrable metrics for how marketing influences brand conversations, and how brand conversations in turn influence purchase behaviour. And at the heart of many of these new developments is The Keller Fay Group, which was the first full-service market research company focused exclusively on WOM and brand advocacy when it launched in 2006.

“Offline WOM represents approximately 90% of total conversations about brands, and one in four of these conversations can be linked back to paid-advertising”

Since then it’s been surveying thousands of consumers each month to find out about the brands they talk about, who they discuss them with and what they say about them in a bid to convince brand managers of the importance of WOM. Over the last few weeks, its push to make WOM a central part of media planning processes has taken a huge leap forwards. Keller Fay is to fuse its data together with data from print audience researcher GfK MRI’s largest syndicated study to create a new product, known as TalkTrack/GfK MRI Data Fusion. It’ll be available by the end of the month.

MarketShare has also added word-of-mouth data streams from Keller Fay into its analytics engine to gain insights into the impact offline and online conversations have on marketing outcomes.

Pushing the WOM agenda
Brad Fay, chief operating officer of Keller Fay, said both deals signify a boost in recognition for WOM, especially the kind that takes place as conversations on the phone or face-to-face. “Offline WOM represents approximately 90% of total conversations about brands, and one in four of these conversations can be linked back to paid advertising,” he says.

Yet there is still a “digital barrier” that stands in the way of WOM fully reaching its full potential, says Sally Dickerson, MD of BrandScience, Omnicom Media Group’s global media and marketing effectiveness unit. Dickerson says that the dawn of the “communities era” and new demands for interactive content has seen many brands allocate large amounts of media spend to digital conversations on social media sites while opportunities to generate, measure and capitalise on offline WOM are ignored.

How might Keller Fay’s data fusion deals alter the status quo?

With GfK MRI, the resulting product sets out to help media agencies and owners plan media strategies to maximise consumer word of mouth about brands and companies. It does this by linking category or brand conversations to specific media audiences and product owner groups, and offering agencies the ability to rank media audiences according to engagement in product and brand word of mouth. So, for example, gardening products can be advertised close to a national newspaper’s ‘top tips’ article which enthusiasts are known to read and share; or automotive adverts can be seeded closer to coverage of the next top model discussed on Top Gear, and as a result could find themselves cropping up in conversations among car lovers the next day.

“WOM represents a critical pathway through which more than half the impact of paid advertising and media passes in generating consumer purchases and other behavioural outcomes”

Dickerson has seen the prototype of the GfK/Keller Fay product and she says she would be keen to use it. “What’s great about it is the metrics are all proven and can be presented to a client with ease. It has the right combination of speed and data access which we can then evaluate and present to demonstrate the value of WOM to those who are a little more sceptical.”

At MarketShare, meanwhile, the Keller Fay partnership aims to offer advertisers “more detailed attribution insights into the impact of offline and online social networks within the marketing mix”. This is achieved by providing marketers with a detailed breakdown of attribution models which will separate offline WOM from social media conversations.

Already, using Keller Fay’s TalkTrack data, MarketShare has tested the impact of WOM in the automotive, financial services and technology industries and says it found clear and quantifiable links to financial benefits, which will be presented at a forthcoming conference.

“WOM represents a critical pathway through which more than half the impact of paid advertising and media passes in generating consumer purchases and other behavioural outcomes,” says MarketShare COO Ivan Markman.

Ready for lift off?
Over time, then, the ability to rank media audiences based on engagement related to individual products and brand WOM could be a core metric to watch and invest in.

But despite these advances, Fay reckons that WOM measurement and campaign planning is still only at its “beginning stage” and there is still more education yet to do. “By connecting our word of mouth data to these databases, it is now possible [for advertisers] to identify which media audiences are most likely to engage in conversations about their category and brands across every media touchpoint which have the potential to stimulate conversations,” says Fay. “We can closely monitor and measure the marketing attributes of these actual consumer conversations this way.”

Across the Atlantic, Keller Fay’s UK boss Steve Thomson says the firm is identifying potential partners to help it achieve in this country what it has in the US.

“The real dilemma is that clients always follow fashion and it’s not simple to move them away from the current digital trends and look at wider WOM”

“At the moment, the UK is a little behind and client understanding of the importance of WOM is variable,” he says. “Initiatives such as the Institute of Practitioners in Advertising’s (IPA) Touchpoints survey will begin to knock down these walls and we can begin to offer more meaningful data to clients, particularly now we are reaching one year of operations and have annual figures to prove our point. The bottom line is that brands cannot afford to just think social [media] and forget the everyday conversations that their customers are having.”

The IPA has been working with Keller Fay on measuring WOM through its Touchpoints survey of multimedia usage since 2010 and the organisation says it is encouraged by the amount of respondents who have said they talk about brands and took up personal recommendations from trusted contacts. Below, it demonstrates the results of its findings from the Touchpoints4 survey this year, looking at how media agencies can correlate with category conversations well and the power of offline word of mouth.

 

Media audiences

Category conversations
MenCars
Computers/Computer software
TV DVD and audio equipment
Sport and hobbies
Mobile phones
WomenBeauty/grooming products
Health products
Children’s products
Clothes and accessories
Every day household products
15 - 34Mobile phones
Music
Clothes and Accessories
Beauty /grooming products
Computers/computer software
35-54Cars
Children’s products
Holidays and travel
Home decoration/DIY
Food and dining
55+Gardening
Home decoration
Every day household products
Home appliances
The environment
Class ABFinancial services
Public Affairs/politics
Computers/computer software
Holidays and travel
The environment
Class C1C2Cars
Sport and hobbies
Clothes and accessories
Music
Jobs and careers
Class DEEvery day household products
Children’s products
Shops and shopping centres
The Environment
Health products

 

Associate director Belinda Beeftink said: “Interest in WOM is definitely increasing and moves to link conversations more specifically and to have a set of metrics will go a long way to enhancing the use of WOM.

“On average we communicate with 21 different people fairly often. That includes relatives outside the household, friends and neighbours or acquaintances or colleagues.Human recommendations and conversations are a very strong marketing mechanism, because it triggers humans to make decisions and form opinions based on what their nearest and dearest have told them,” she says. “If you combine this with good media placing, then it becomes even stronger because you are engaging the consumer and prompting discussion. Working in isolation is never enough, a complementary media strategy like this could pay dividends – especially in certain categories that are often discussed in everyday lives.”

BrandScience’s Dickerson agrees but warns there is still some way to go before WOM really takes off in a mainstream way, a topic she discussed in a recent blog post.

She concludes: “The real dilemma is that clients always follow fashion and it’s not simple to move them away from the current digital trends and look at wider WOM. What will make a difference is the figures, which will really offer agencies something to present to clients as proof of WOM’s worth. Once it can be demonstrated to apply to broader business needs, it has more of a chance for survival and pickup.

“The role of brand communications planning is to create, integrate, direct, magnify and measure each element of a communication plan to help the brand achieve its business objectives,” says Dickerson. “It is important for us to clearly identify the forces and influences across channels, so we can maximise our clients’ communications effectiveness. WOM has to show its face in this context to really earn its stripes.”

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Readers' comments (5)

  • That's a heck of a product name they have with the GfK merged panel...

    >in a bid to convince brand managers of the importance of WOM.
    This one phrase raises some really interesting questions. Conventional wisdom has it that WoM is obviously important in brand campaigns, dur. But are we overstating it? I talk about Honda cars in positive terms, but I'm not about to buy one; I appreciate the quality of Waitrose, but I don't shop there; I buy Robinsons squash every week, but never talk about it.
    The Facebook IPO debacle has raised interesting questions about our assumptions of the value of social and WoM; could it be that we're still overstating its importance?

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  • Nick, I can see why you might think that, but to some extent your thoughts are just a variant on that old chestnut "I don't take any notice of advertising"

    The impact of WOM on brand equity and sales has been empirically proven, though of course nobody is saying it's the only driver of brand health. I'll happily share some of the evidence if you wish - I'm at sthomson@kellerfay.com

    And I bet at some point you've talked abour Robinsons! Maybe an offhand comment, no more than a 1-minute conversation perhaps - but whatever you said would have had some impact

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  • Nobody denies verbal WOM. However, this article fails to recognize the mush higher visability and reach of social WOM. Take hotels, for example. More than half of hotel guests now will not book a hotel without a review on social sites like Trip Advisor. In addition, having worked with KF data, I question the degree of accuracy in which surveys can correctly replicate a passive phenomena like WOM.

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  • Social WOM is undeniably more visible – but that’s our point: the less ‘visible’ conversations over the phone and round the kitchen table can’t simply be ignored, as there are so many of them. For most products and services, it is very difficult for social media to produce the scale of offline conversations, such as those that are triggered by good television advertising. And it is not just our research that says so; please take note of this serious academic work out of Australia by Karen Nielsen Field (http://w3.unisa.edu.au/news/2012/300112.asp). As for our methods, our diary-based approach means that our survey is not reliant on memory alone – conversations are recorded as they happen

    It is true that when social media works best, it is as an integrated campaign that includes a heavy dose of social media in addition to other forms of media. For a lot more evidence, please see The Face-to-Face Book, by Ed Keller and Brad Fay.

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  • @Steve, the impact of WOM on brand equity has not been empirically proven. There are cases where the data are consistent with the hypothesis.

    We would all be very surprised if there were no link between WOM and brand equity (although most of us may feel that brand equity drives WOM at least as much as WOM drives brand equity) - but there is not a model that explains it and the effects we see appear to vary by time, brand, and occasion.

    I hate to be picky, honestly, but evidence does not prove a theory, it only supports it :-)

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