Over 80% of consumers trust word of mouth, say experts By Denise Winterman BBC News Magazine Word-of-mouth marketing, the latest advertising boom in the US, is coming to Britain. Would you be prepared to slip a casual product endorsement into a cosy chat with friends?
By Denise Winterman BBC News Magazine Word-of-mouth marketing, the latest advertising boom in the US, is coming to Britain. Would you be prepared to slip a casual product endorsement into a cosy chat with friends?
The average Briton is bombarded with more than 3,000 adverts a day. From Coronation Street to the school sports day, almost every aspects of our lives seems to be sponsored these days. Ads are squeezed in, on and around everything we see, do and use.
It's relentless and we are starting to turn off and tune out. Only 14% of regular campaigns now have any effect, according to Marketing Week. To put it simply, we've grown tired and cynical of traditional advertising tactics.
I'm a talker naturally so word-of-mouth marketing was right up my alley Rani Schlenoff Hear Rani's pitch But what we do trust is a personal recommendation. Positive word-of-mouth has always been the advertisers' Holy Grail. On a credibility scale it comes top and traditional commercials come bottom, says advertising author Tom Himpe.
Now, word-of-mouth (WOM) marketing, already established in the US and Canada, is coming to the UK, the Magazine can reveal. And it means the banter you enjoy with their mates down the pub on a Friday night could soon shift into sales patter.
WOM is when unpaid volunteers are sent new products and, as they go about their everyday lives, are encouraged to tell their family and friends - even strangers - what they think of them. The products can be anything from mobile phones to sausages.
'Honest' message
WOM marketing companies are at pains to insist it isn't viral or buzz marketing because the volunteers - known as agents, advocates, ambassadors or transmitters - must state they are part of a marketing campaign. It is about harnessing "honest word of mouth", say companies.
Agents are not scripted, or commanded to spread only a positive message. And they are not paid. Instead, they get free samples, and what the industry calls "social currency" - the thrill of being among the first to try a new product.
It's flourishing in the US, with 43% of Fortune 500 companies adopting it in 2007, according to the Word of Mouth Marketing Association (WOMMA). Some industry experts believe it's set to become one of the most powerful forms of advertising.
Youngsters are more brand awareOne of the leading US companies, BzzAgent, is joining forces with a UK ad agency, GroupM. It is believed to be the first WOM agency in Britain and a handful of the UK's biggest companies have already signed up, including one FTSE 100 firm.
But why do it? It's easy to understand when the products are the latest mobile phone or fashionable jeans; less so when they are razors, toothbrushes, sweeteners or sausages.
That doesn't seem to put people off: in the US, BzzAgent claims to be recruiting 5,000 advocates a week.
The company now estimates it has a network of more than 250,000 ambassadors. It doesn't even officially launch here until Tuesday but already 260 Brits have inquired about becoming agents.
While it may feel like big business is muscling into yet another area of people's lives, WOM is actually a result of consumer power say experts.
Blurred boundaries
"Consumers are now in control, brands lost the marketing fight," says Tom Himpe, author of Advertising Is Dead, Long Live Advertising!
"Companies cannot dictate what is being said about their products and the internet allows the voice of disgruntled customers to go global. The consumer is no longer passive and it is a vulnerable situation for brands."
This communication revolution and increased cynicism has forced the industry to go back to its grassroots.
"The industry has always been fascinated with word of mouth and desperate to use it, " says Dave Balter, the founder and CEO of BzzAgent and co-founder of WOMMA.
COMPANIES THAT USE WOM PenguinAOLNestlePhilipsHershey SOURCE: BzzAgent "For the last 50 years consumers have been told every product is better, cheaper, faster, cleaner, that they will love it. They just don't buy that sort of message any more, they want to find out for themselves.
"Using WOM agents allows consumers to feel involved in the products they are being sold and companies to connect with them."
But declaring your interest as a word-of-mouth agent is surely a conversational bombshell. Does this not corrupt any recommendation? Not according to research.
People don't seem to care, what matters is that they trust the person and believe they have their best interests at heart, according to a study by Professor Walter J Carl, of North Eastern University, in Massachusetts. This is what makes WOM so potentially lucrative Who else is going to be honest if not your friends and family?
"The beauty of WOM is that it's open, raw, real and direct," says Mr Himpe. "Negative or positive, at least the message is genuine. It's not just the brand talking."
Negative WOM
Rani Schlenoff is an advocate for BzzAgent in the US and has tried 28 products, including candy bars and a toothbrush. She says WOM is just an extension of one of the "most natural things we all do" - talk about our lives. She says people's reactions are always good, even when she approaches strangers.
"After the initial shock of me injecting myself into their lives, they are usually very happy to hear what you have to say."
But there are questions hanging over the industry. There's a fine line between someone recommending a product they've been given, and one they've bought. When it's crossed it is no longer genuine word-of-mouth, say some commentators.
Socialising or selling?And isn't it all a bit sneaky? WOMMA has drawn up a code of ethics but the industry is self-regulating, so we have to take its word that agents are being open. The Advertising Standards Agency (ASA) has no rules covering the industry.
But the bottom line for some is the question of selling out. Time with friends and family is sacred and shoehorning a sales pitch in at every opportunity is extremely unpalatable. But that often comes down to age, says Mr Himpe.
"For some adults it would feel like selling your soul but for today's young people such boundaries are blurred. Brands are part of their lives in a way they have never been for generations before them."
But companies that think they've found the Holy Grail perhaps shouldn't get complacent. Research shows that positive word of mouth goes out to five people but negative word of mouth goes out to 10... and with much more passion.
Add your comments on this story, using the form below.
I spend so much time trying to avoid adverts on tv and other forms of media why on earth would i want my supposed friends to start trying to promote products too me? I couldn't think of anything worse than having a meaningful conversation with someone i trust only to have it ruined by some cynical plug for a commercial product. The way I see it I rely upon those closet to me to provide a sense of objectivity, why won't the advertisers just leave us alone and trust that people are capable of deciding by themselves what they wish to buy & try!jon, bristol
Awesome! I'm definitely up for this. I recommend products and services at the moment, so to get the items for free to try out will help me recommend or rant about more items and I get freebies.Arthur Embleton, Calne
"for today's young people such boundaries are blurred"i.e. you have force fed the younger generation so much advertising that they respect brands more than human beings?Jo, Cambridge, UK
Nice Idea, but whats to stop people taking the products and then never mentioning them to anyone, just taking the freebies?Pete, London
As it stands I'm irritated and angry by the amount of advertisements I'm bombarded with. If any of my friends start bombarding me with "word of mouth" advertisements then they certainly won't be my friends for very long.Paul Hawkins, London, UK
Free stuff for chatting to you mates? Where do I sign up?Drain, Ipswich
Fine - assuming I'd be allowed to punt products only when appropriate (or do they measure success by how many friends you lose?)People ask my opinion on matters, I give honest opinions, great if I can back my opinion up by saying - yes I've had one of them for a few weeks now...John, UK
If you're willing to manipulate your friends for money/goods - and there's no hiding from it, that's what it would be, no matter how 'gentle' - you don't deserve to have them as friends.Mike de Selincourt, Coventry, UK
Great idea. And its not as if your friends and family would actually be 'plugging' new products to you left, right and centre. Talking about the products we use and find helpful in our everyday lives is a natural part of our conversations - people are always talking about new things they've recently tried out. So if companies want to send us freebies to try out then why not let them... and if the product is really that great then we'll want to tell people so they can benefit from them. And if its not great then that'll be passed on via WOM and its the company who will lose out.Claire, Watford
Sweet. I'm going to market myself. I'll hire myself out to people and hang out with them and they can all tell their mates that they need to get one of me... let the mass cloning experiment begin!Ian Maxwell, London
Perhaps one day they will inject adverts into our dreams while we sleep. If a friend had to go on about some great toothpaste they have tried then I will think it's time that friend was a friend no more. But then I suspect that the target audience for this form of marketing have such shallow conversations anyway that a few ads will add interest to a dull lament over the weather.Shaun, Luton
Load of rubbish. Life is one big advert from talking ourselves up to the rubbish we eat see hear and die for. We may as well get paid for it into the bargain.bob, cardiff
Most people do it already, We promote the film we saw last night to our workmates, I wear a WestBromwich Albion shirt, My daughter has Nike on her trainers. My car as a sticker promoting the dealer I purchased it from. People see the name of my TV on a badge, my mate bought the same TV because he liked mine. I walk around with a carrier bag I purchased advertising a supermarket. If we look closley we all do it. We should get paid for it.Tim, Walsall
Soon we won't even be able to trust the opinion of our friends. Imagine asking a mate what he thinks about a certain car you're thinking of buying and instead of an honest view, he just extolls the virtues of one manufacturer because he's been paid to do so. Well done big business for serving to create a further degree of cynicism and amongst the public at large.Barry, London
