I often get asked …

Not all my customers are online, so by finding Influencers online will I miss out on reaching the important non-online segment of my market?

My first reaction, which I have now have learned not to pursue, is to explore why they think that their target market is not online. 

For most brands and most segments, their target demographic is, in reality, very largely represented online, so the issue is that the perception of the brand managers is not quite up to date with the facts. Eg more internet usage hours by women than by men, primary grocery shoppers turn to online recipe sites as their prime source of inspiration, the grey (ie retired) demographic is the fasted growing sector (typical case in point my own father, 78 now emails, IMs and webcams with me to see his new grandson)  But I’d bet most marketers wishing to target him would think online was the last way to reach him.

My actual response is to explain that Influencers are by nature information seekers, and so they are attracted to the internet like moths to light-bulbs.  Luckily this makes finding them online a nice cost effective way to reach scale. 

No matter how you find them, the personal recommendations that these Influencers  share will be done through their normal means of communication – which for most of us is still face to face. 

So, to answer the above question – yes, you will reach the non-online segments of the market by word of mouth – even if you did use online to find your Influencers to start with.

This piece of research by the very solid and traditional market researchers NOP World quantifies the answer I have been giving – showing that 80% of recommendations happen face to face.

It would be interesting to know what was the profile of the people they surveyed.  Probably market representative knowing MR people!

Whilst I would expect the percentage to drop slightly for the younger demos who are heavy IM/SMS users.  But probably not much – if you are going to recommend something – you probably want to use more than 161 characters to explain why.

Here is NOP World’s research.

Research sheds new light on word-of-mouth drivers Tuesday April 26, 2005

Recent research from NOP World has revealed that face-to-face recommendation remains the strongest medium for spreading word-of-mouth recommendation, with telephone recommendations running a close second.

When asked how they make recommendations, four out of five of the 1000 consumers questioned (80%) said that they make them in person. Some 68% said that they make them over the telephone. The NOP research found that this phenomenon is even stronger among the Influentials (the one in ten Americans who tell the other nine how to vote, where to eat and what to buy), with 90% of this group making in-person recommendations and 79% making recommendations by phone. This article is copyright 2005 TheWiseMarketer.com.

Surprisingly, the study found that fewer than 40% of consumers use e-mail to make recommendations to others. This was broken down further into: personal e-mail (37%); e-mail forwarding (32%); and mass e-mails (12%). While slightly higher percentages of Influentials use e-mail (personal e-mail 53%; e-mail forwarding 39%; and mass e-mails 18%), face-to-face communication still far outweighs this medium.

According to Jon Berry, Vice President for NOP World: "Despite widespread technology adoption, marketers must understand that the majority of word-of-mouth is still done at the coffee house, in the mall, over brunch or at the gym. Although technology and the Internet play a significant role in spreading word-of-mouth, live discussions are still driving the trend."

Conversation Catalysts
Recommendations are triggered by a variety of factors, because individual consumers are inspired by different forms of marketing and media. Respondents said the following contributed to a recommendation made in the past year:

Table 1: Contribution to recommendation made in the past year
Source: NOP World

"It is crucial that buzz marketing and blogs do not replace conventional print and television advertising," explained Berry. "Companies should avoid putting all of their eggs into one marketing basket, by developing integrated plans that incorporate all media."

Familiarity and geography
Familiarity breeds word of mouth: respondents say they are most likely to pass along a recommendation to friends (88%), family members (87%), people who share the same interests (66%) and colleagues (61%).

Geography also breeds word of mouth: significant numbers say they spread the word to neighbours (42%), community group members (42%), other consumers (35%) and fellow parents at kids’ activities (27%).

Double-edged sword
While generating word of mouth is crucial to any marketing campaign, criticism can be spread as easily as recommendation. More than 40% of Americans share their negative opinions about travel (51%), health and fitness issues (50%), technology (48%), TV programmes (46%) and investments (41%).

According to Berry, "Word-of-mouth can be extremely powerful, but it is not a one-way street. Disgruntled consumers are ready, willing and able to use this medium, and companies must take steps to identify, reach out to and pacify this group."

Carlton United Breweried tried it – and it flopped.

Coke tried it – they also flopped

Will Absolute succeed (again)?  My money says yes!

The challenge – launch a major new beverage brand.

Why do I think they will succeed? 

Well, a) because they are Absolute and have a track record for succeeding by/because they do things differently – and b) they are NOT doing any advertising at all.  Instead they are constructing an experience and creating word of mouth to do the work of advertising for them.

Here is the article from the Sydney Morning Herald

And here are some of the key quotes – like the one by CUB’s head of marketing at the bottom? I do!

“Public relations, point of sale, online, event marketing, even a branded pub in a suitably gritty part of town. Every element of the marketing mix was there at the launch of Absolut’s spin-off brand, Cut, bar one, a media schedule.

The only thing missing was the one element that has been present for the launch of a major spirits brands since marketing was invented. Last week, Absolut made marketing history when it launched without a cent being spent on traditional advertising.

Absolut’s strategy flies in the face of marketing convention; an average of $3 million is spent on advertising to launch a brand. Last year, Australian companies spent $124 million advertising alcohol brands, $22 million of which was spent on the pre-mix market, according to Nielsen Media AdEx figures. Diageo’s Smirnoff spent $2.6 million alone promoting its RTDs

The word-of-mouth approach is one that Carlton United Beverages is also adopting, having learned that big bold advertising does not always work when launching a brand to a younger discerning audience. In 2003, a large TV ad campaign announced the arrival of a new beer, Empire, aimed at much the same drinker as Cut is targeting – 18 to 29-year-olds. The beer flopped.

Empire was built using our old marketing model and it didn’t work as well as we had hoped," CUB marketing chief Steve Arthurson said in a recent interview. "Consumers said the packaging was OK, the liquid was great, but when you put it on TV, ‘that’s not me’."

The BBC News (another favorite) is "on the money" again with this article discussing how books are marketed today.  One they did not mention is The Purpose Driven Life which at 12m copies is the No7 Non Fiction best seller in the US.

"Best-selling novels like The Da Vinci Code are often chosen because of a word of mouth recommendation, a survey to mark World Book Day has revealed. 

Dan Brown’s blockbuster tops the list of titles having an initially low print run, but eventually sell millions due to word getting around.

Thursday’s World Book Day will encourage readers to tell their friends about a book they have enjoyed.

Author loyalty is another strong factor which helps books to succeed.

Other novels since 1997 which have become best-sellers on the strength of personal recommendations are

• Captain Corelli’s Mandolin,
• Memoirs Of A Geisha
• The Curious Incident Of The Dog In The Night-time.

Other factors which are said to influence readers’ book choices are the synopsis on the back cover, the jacket design – but much fewer people are swayed by advertising campaigns.

WORD OF MOUTH BEST SELLERS 1 The Da Vinci Code – 2.2m 2 The Curious Incident Of The Dog In The Night-time – 1.5m 3 The Lovely Bones – 1.3m 4 Captain Corelli’s Mandolin – 1.29m 5 Eats, Shoots And Leaves – 0.94m 6 No 1 Ladies’ Detective Agency – 0.9m 7 Birdsong – 0.85m 8 Memoirs Of A Geisha – 0.67m 9 The Alchemist – 0.64m 10 Schott’s Original Miscellany – 0.63m Source: Nielsen Bookscan

John Bond, manager of HarperCollins’ literary division said the findings were "fascinating".

"Publishers often stand accused of becoming ever more sophisticated and cynical in their pursuit of creating instant author brands, when ultimately it is as likely to be good old-fashioned personal recommendation that really sells," he said.

The World Book Day’s campaign to encourage people to recommend their favourite books to family and friends includes the circulation of eight million postcards carrying the message "spread the word".

The World Book Day survey also asked for appropriate titles for Tony Blair to read ahead of an election campaign.

The most popular suggestion was Dale Carnegie’s How To Win Friends And Influence People.

Similar reading material for Gordon Brown included If I Was Boss by Kes Gray and Machiavelli’s The Prince. "

Product Placement Becomes Expert Placement

The Wall Street Journal (you need to subscribe to read the full article) reports on the latest twist in product placement, a "little-known network that connects product experts with advertisers and TV shows."

According to the story, experts, often editors of authoritative magazines, pitch themselves to companies willing to pay for a mention, then approach local-TV stations and offer themselves up to be interviewed.

The piece names Child magazine’s Technology Editor James Oppenheim, who was allegedly paid by Kodak to mention a product, and John Owens, the editor in chief of Popular Photography & Imaging magazine, who appeared on a segment paid for by Olympus, Canon and Nikon.

Moral of the story – you can’t trust independent experts to be independent so there is even more reason to rely on the judgment of the people you personally know and trust.

2^nd Moral – In a world where secrets are harder and harder to keep, brands better be proud of everything they do. They can no longer afford to engage in unethical practices like this – Kodak just got devalued a few points in my book becase of this, and so did Olympus, Canon and Nikon (pity – I like Canon’s stuff)  The damage for Child Magazine and Popular Photography is even worse.

51st annual convention of the American Research Foundation, written up in the NY Times

"…  another executive who is to speak today at the conference is J. Walker Smith, president at Yankelovich Partners, the market research company.

"When marketers wrestle with their media budgets, trying to decide whether to use traditional media like TV or take some of those dollars and put them into new media like the Internet, the debate is pushing us in the wrong direction," Mr. Smith said in an interview last week.

"The real issue in re-engaging consumers is good marketing practices versus bad marketing practices," he added. "We have to change the way we practice, regardless of the media."

Mr. Smith is to present the results of a survey on receptivity to marketing, updating one he conducted last year. That survey, presented at the 2004 management conference of the American Association of Advertising Agencies, generated considerable discussion on its findings that negative consumer perceptions of advertising had significantly increased, making the tasks of advertisers and agencies considerably harder.

"There are those looking for the new media to be the saviors for advertising," Mr. Smith said, "but we can use the new media to be ever more intrusive and saturating, creating ever more clutter."

That may be a reason for the new survey’s finding that "there are still a lot of things consumers don’t like about advertising," he added. "There probably hasn’t been as much progress in changing that as we think."

For instance, 56 percent of survey respondents said they avoided buying products that overwhelmed them with advertising, up slightly from the 54 percent who said so in the 2004 survey. And 69 percent said they were interested in ways to block, skip or opt out of being exposed to advertising, the same percentage as in the survey last year.

All is not lost for Madison Avenue, however, the survey suggests, because respondents said they valued advertising that they could choose to see "when it is most convenient"; when it was personally communicated "by friends and experts I trust"; when it was "customized to fit my specific needs and interests"; or provided useful information about competitive brands and products.

Still, Mr. Smith said, negative consumer attitudes toward advertising "remain the single biggest barrier to improving return on investment for marketing spending.

"Until we get better at engaging consumers," he added, "they’re going to continue to push back and resist what advertisers are trying to deliver to them."