The balance of power between consumers and brands has shifted. The strongest evidence for this can be seen on social media sites, where comments on specific products and services can help make or break a brand. Brand advocacy and word-of-mouth are the newest frontiers for marketing and sales, and it brings with it both challenges and opportunities.
Consumers value comments expressed directly to them, particularly when they come from someone they trust. Studies suggest that word-of-mouth is the primary factor behind 20 to 50 per cent of all purchasing decisions; and that the average person talks about ten brands every day, with two-thirds of these conversations involving a recommendation to buy, consider or avoid the brand. Increasingly, these discussions are taking place over social media, where their reach and impact is amplified many times.
Our own research reveals that nearly half (45 per cent) of European smartphone owners who have used their phone in a store message friends about something they have seen in the shop. Almost the same number, (43 per cent) take a picture or video to send to a friend, and 15 per cent tweet or update their Facebook status to share information about their store experience, good or bad.
It is encouraging to see growing numbers of brands integrating such word-of-mouth marketing into their digital communications strategies. For many, the stumbling block appears to be how or even whether to reward consumers for word-of-mouth sales and leads.
Some detractors dismiss such tactics as unmanageable or unethical, citing the negative publicity generated by companies that pay celebrities to tweet favourable messages about their product. But handled openly and with integrity, consumer-to-consumer marketing can be a powerful additional sales channel.
Consumers as conversion catalysts
Affiliate and performance marketing is about accurately rewarding a third party for their role in driving leads or generating sales of a particular product or service. From well-known price comparison sites to specialist blogs with linked banner ads, affiliate marketing is everywhere and has become an accepted and successful component of most marketing campaigns.
Inviting online consumers to become ‘micro-affiliates’ takes this one step further, offering remuneration or discounts in return for driving traffic and sales for a particular brand.
The important thing here is transparency. We are all influenced by what our friends think and social media means we can be influenced by our friends’ friends and beyond. If brands reward consumers for promoting or generating sales, other consumers should be made aware of this.
One size does not fit all
It will not be long before more brands see the benefits of this approach and allow consumers to promote them through various platforms such as social media networks through a formal or informal process of incentivised sharing. The more formalised micro-affiliate approach could involve an email sent after purchase to encourage consumers to share the details of their latest purchase with friends and family; embedding a link to the brand in a conversation thread; or a combination of both. It is the personal endorsement that will be the most powerful element. This leads me to a few important points.
To run successfully any social-media based, consumer-driven marketing campaign means understanding the different way people talk about products and services in conversation and online.
A study into word-of-mouth marketing by McKinsey found that marketers tend to build campaigns around emotional positioning, while consumers tend to talk and generate buzz around functional messages, such as features and performance. Micro-affiliate campaign content and advertising must reflect this if it is to effectively engage consumers.
Secondly, if you want consumers to talk about and endorse your brand, you need to give them something to talk about. Products, services, advertising or viral campaigns need to have ‘talk value’. This means being recommendable, easy and interesting to talk about. In fact, studies show that around a quarter of online brand-related conversations are generated by advertising content, which highlights the importance of integrated marketing campaigns.
Most of all, brands need to be able to track and measure activity and success – something that is far easier with a formalised micro-affiliate programme than an informal scheme.
The way forward
Customers, employees and partners will always be the best ambassadors for your brand. Harnessing the power of the consumer voice on social media can drive sales, boost revenue, reach consumer audiences that may lie beyond the reach of traditional digital marketing, support highly targeted marketing campaigns, deliver valuable consumer data, build and enhance brand reputation and allow a brand to quickly identify and respond to negative content. It is a trend no marketing department can afford to ignore.
