Friday, April 15, 2005

Providing More Context For WOM Statistics; Reply to George Nimeh's Comment

This post represents a reply to George's comment to my "inaugural post".

Thanks for your interest in my study and blog. You raise a number of interesting points and questions. To start a response I want to provide some more context for a few of the statistics that I believe you heard either at Dave Balter's presentation at the WOMMA Summit or read on BzzAgent's blog.

For Statistic 1 -- about 27% of all communication including discussion about a product or service -- this is a statistic that applies to buzz marketing agents, which may or may not be representative of the general public. For example, in a small "convenience" sample of university students aged 18-29, whose findings I used for comparative purposes, I learned that their WOM episode to interaction ratio (that is, of the total number of informal, interpersonal interactions a person has, what percentage of those include a WOM episode), the number was about 14%. Of course, this isn't a completely representative study either, but it does provide a useful context.

Second, the 80/20 statistic you reference is more accurately 90/10, at least for the buzz marketing agents in the study. 77% of the WOM episodes reported were face-to-face, 17% were on the telephone, and then the rest were online, which included instant messaging (3.5%), then e-mail (about 2%), and finally chat room (less than 1%). For the non-buzz agent college student sample, the statistics were very similar for F2F and telephone, but included more instant messaging (about 10%) and less e-mail (just over 1%). Again, there's no claim being made here that these results can be generalized to the larger population; these are just results from two related studies. I should add, though, that Ed Keller from NOP World reported a similar finding during his presentation at the WOMMA Summit about the percentage of WOM recommendations made F2F, and that finding was 80% (from a representative, national sample).

Now, you ask a very interesting question about the role of the internet and offline conversations. Another part of our study looked at references to other forms of media (such as TV ads, print sources, internet, direct mail, etc.). I won't get into all the details for each different medium, but overall, 40% of the WOM interactions made reference to at least one other media form (for example, referencing a TV show or advertisement they saw). Of these references made, less than 10% were internet-related (for example, web banner ads, websites, online articles, e-mail, etc.).In this study we did not look at online conversations (such as blogs, discussion boards, etc.) and how these affect what happens in the offline world. There are researchers studying online conversations and I can refer you to a couple different studies by other researchers if you're interested. I am sure that people who have discussions online also discuss these with people in their social networks offline as well (or in other online conversations for that matter), but I don't know why the online conversations necessarily initiate offline conversations (I think the directionality of influence here could go both ways).

Another point/question you made was about the length of interaction and why this was important. You suggested that e-mail, chat, etc. are more efficient (i.e., faster) than F2F, so why would this be interesting to a marketer. My first thought would to be reflect on the assumption that efficiency is what marketers are, or should be, interested in (perhaps you're not making this assumption about marketers, but it seems reasonable that marketers might be concerned about efficiency; their reasoning perhaps being that the faster people can spread WOM the better). But research suggests that what makes WOM so powerful and effective are issues like trust, credibility, sincerity, honesty, and mutual engagement. Thus "effectiveness" rather than "efficiency" is where marketers should be focusing their attention. If they focus too much on efficiency, then WOM/buzz just becomes another way to bombard and overwhelm people. Part of the move to buzz and WOM campaigns is to get away from the overload of "traditional" forms of advertising and marketing, but if efficiency is the sole or even primary criterion, marketers' attempts will be sure to backfire.

By the way, the length of conversations that you mention were for the total length of a conversation, and not necessarily the WOM episode. That is, WOM episodes (which I define as any conversation, or portion of a conversation, where there is evaluative talk about an organization, brand, product, or service) are usually embedded within larger stretches of conversation. In our study we had buzz marketing agents and everyday people reporting interactions that lasted just a couple minutes to many hours (interestingly, the longest average interactions took place within best friend relationships).

Why would a marketer be interested in this finding? Well I'm not a professional marketer, but I think what a marketer should take away from the findings about length of interactions is that WOM occurs in everyday, routine conversations and relationships. To the conversational partners, word-of-mouth has nothing to do with marketing; it has everything to do with talking and relating with other people, solving problems, sharing gossip, etc. So, my view is that marketers should be paying attention to any research findings that allow them to better understand how WOM occurs in natural, everyday threads of human communication and relationships.

Thanks again for making the "inaugural" comment and I hope we can continue our discussion! :-)



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