The Brouhaha: Word-of-Mouth Marketing. WOMM. It's been making headlines lately, what with the Edelman/WalMart RV/Blog fiasco and a few others. And a sort of but not really non-ruling ruling by the Federal Trade Commission:
The Federal Trade Commission yesterday said that companies engaging in word-of-mouth marketing, in which people are compensated to promote products to their peers, must disclose those relationships.Here's Advertising Age chiming in:
The FTC's response was to an Oct. 18, 2005, petition from Commercial Alert, which claimed that marketers were "perpetrating large-scale deception" by paying consumers to shill for products but not revealing the financial arrangements. Commercial Alert called word of mouth, or buzz marketing as it's also known, "fundamentally fraudulent and misleading." ... The FTC decision means that companies such as Procter & Gamble, Hershey Co. and countless other corporations, agencies and buzz-specialty shops will avoid the specter of a thorough probe of their marketing practices. However, the FTC did leave the door open for the commission to examine issues on a case-by-case basis.Back in March, Jack Trout weighed in on WOMM:
"How many people really want to chatter about products? Do you really want to talk about your toothpaste or your toilet paper? ..... This all brings me to my word-of-mouth on word-of-mouth marketing. It's not the next big thing. It's just another tool in your arsenal."I said the same thing in August, 2005.
So your product or service is getting some sort of positive response from users/consumers? Maybe a cult is forming. Or something. People are talking.
Take advantage of this. You'd be stupid not to. Bring in the PR professionals, the marketing people. Reference it in advertising campaigns. Support this grass roots excitement.
But trying to create buzz out of nothing? Paying shills to hand out lipstick and gum, paying bloggers for their so-called objective opinions? Not for long:
A 2005 survey of 800 consumers by market research firm Intelliseek found that 29 percent of participants age 20 to 34 and 41 percent of those age 35 to 49 said they would be unlikely to trust a recommendation again from a friend whom they later learned was compensated for making the suggestion.Follow the percentage progression above, and what will logic tell you about the efficacy of WOMM for Baby Boomers over fifty? And older? (Don't ask me why they weren't included in the survey - you probably know already if you've been reading this blog with any regularity.) Follow the percentage progression again - and will the numbers go up or down as the 20-34 year olds are in their thirties and forties in five/ten years?
My prediction: When it all comes out in the wash, WOMM will be the best thing to happen to (silly retronym ahead) traditional advertising. Pretty soon, consumers won't believe anybody - even their best friends. They'll realize that they receive the most honest and straightforward information about a product or service from a TV commercial, print ad, or product web site. At least we don't lie about who we are and why we're saying what we're saying.
As far as all the claptrap about WOMM replacing advertising - people who are hawking that one have a slippery grip on history. Word-of-mouth marketing is nothing new. It's been around for a hundred years, since the beginning of modern advertising, always morphing into various forms. The latest morphs: online social networking and blogs.
There is plenty of marketing and advertising to be done on the Web, and who knows what forms they will take over the next ten years. We'll all be surprised. But word-of-mouth as the primary driving force of marketing? I think not.
Remember this: Advertising didn't die with the invention of the telephone.