Monday, December 05, 2005

The Practical Value of Disclosure in Word-of-Mouth Marketing Campaigns

Today BzzAgent has released a white paper (link opens PDF in new window) arguing for the practical value of disclosure in word-of-mouth marketing campaigns.

Their report is based on analysis of more than 270,000 reports filed by their WOM volunteers (BzzAgents) over three years, preliminary findings from our collaborative research project investigating dyadic (two person) or multi-party perspectives on the same WOM episode, and other third-party sources.

In short, BzzAgent concluded that "disclosure increases the validity of WOM interactions without reducing the breadth of campaign reach" (p. 2). More specifically they found that:

- Disclosure does not reduce WOM activity.
- Disclosure creates peer trust.
- Disclosure combats “stealth” stigma.
- Disclosure supports perceived product value.
- Disclosure increases depth and reach of product-related discussions.

I am currently in the process of writing up the results of our collaborative study for academic publication and will be releasing additional findings over the coming weeks and months. I will also be sharing some of these findings in my presentation at WOMMA's WOM Basic Training conference in January 2006.

It should also be noted that the findings from their white paper also led to changes in their disclosure policy. Here's a comment from BzzAgent's PR person that elaborates on their new policy:

BzzAgent also issued a press release today announcing the impact the conclusions in the whitepaper had on the company's business.

Specifically, the positive relationship between agent transparency and campaign performance has inspired us to strengthen our disclosure policy. Here are the changes BzzAgent volunteers can expect to see:

1.) New volunteers will be required to accept a Terms of Service prior to completing their registration.
2.) Agents that complete a report will be given the option of clicking a "disclosure check box" prior to submitting their WOM report. This box verifies that the conversational partner was aware of the agent's participation in the WOM campaign.

Please be sure to disclose. It's the right think to do from an ethical standpoint ... and now we know that it's also vital from a performance standpoint. Agents that do not disclose their affiliation will be required to participate in an online disclosure training -- similar to the BzzAgent "boot camps" -- prior to being offered access to future campaigns.

Keep in mind that the primary benefit to transparency is agent credibility. Revealing you are part of a BzzCampaign contributes to the legitimacy of everything you say and it underscores the validity of your opinions.