Did you see this? PQ Media has released its second Word of Mouth Marketing Forecast Report. The report offers a deep dive into the size, scope, and growth of the Word of Mouth Marketing industry.

It’s a hefty read at 115 pages. But the information is worth digging into for marketers at both brands and agencies.

WOM spend is on the rise, even in today’s recessionary times. In this report you’ll find out where money being spent, why it is being spent, and how companies are benefitting from their strategic WOM spend.

WOMMA members get this report free. (Membership perk.) Others must pay.

However, I’ve compiled a few highlights from the report into this short video. (Hopefully this video will whet your marketing appetite to learn more from reading the full report.)

While tuned into Sarah Hofstetter’s WOMMA webinar on Weaving Social Marketing into Word of Mouth Marketing (July 29), I learned about 360i’s Social Marketing Playbook. Looks interesting. Looks helpful.

(For a PDF transcript of Tweets from Sarah’s webinar, CLICK HERE.)

Download 360i’s Social Marketing Playbook here (.pdf) or riffle through the Scribd version below.

360i Social Marketing Playbook

Mommy Bloggers have been on the frontlines of the ethical battles involving disclosure and compensation as detailed in this Ad Age article and sidebar video.

We live in a world where people trust the opinions of people like themselves more than they trust marketing messages from corporations. Which means mothers will trust what another mother says more than they will trust what a company says in a commercial. As a result, brands like Pepsi, Kodak, General Motors, Wal-Mart, and many more are reaching out to mothers who blog because their opinions have considerable sway.

“Mommy Bloggers” have come under scrutiny for accepting freebies in return for writing a positive blog post. It’s a classic case of a few bad apples spoiling the whole bunch.

Susan Getgood, Liz Gumbinner, Kristen Chase, and Julie Marsh became fed up with all the negative perceptions and decided to address the issue head-on. They’ve started a volunteer, grassroots, self-policing program called BLOG WITH INTEGRITY.

To participate, bloggers sign the pledge and promise to clearly disclose their interests, treat others with respect, and take responsibility for their words/actions. Once the pledge is signed, bloggers can post a BLOG WITH INTEGRITY badge alerting readers to their ethical stance.

It’s a great beginning. However, I can’t help but think the pledge needs more bite. It needs more guidance on what exactly is unacceptable disclosure.

WOMMA has been giving bloggers and marketers such guidance about proper disclosure and acceptable behavior since 2005. The most updated WOMMA ETHICS CODE (.pdf) details the following fundamental do’s and don’ts:

• We require marketers to disclose their relationships with consumers in relation to word of mouth initiatives.
• We require marketers to effectively monitor disclosure of consumers involved in their word of mouth initiatives.
• We stand against marketing practices whereby the consumer is paid cash by the manufacturer, supplier or one of their representatives to make recommendations, reviews or endorsements.
• We require consumers involved in a word of mouth initiative to disclose the material aspects of their commercial relationship with a marketer, including the specific type of any remuneration received.
• We require consumers involved in a word of mouth initiative to disclose the source of product samples or incentives received from a marketer.
• We comply with FTC regulations that state: “When there exists a connection between the endorser and the seller of the advertised product which might materially affect the weight or credibility of the endorsement (i.e., the connection is not reasonably expected by the audience) such connection must be fully disclosed.”

I applaud the BLOG WITH INTEGRITY initiative. Love the grassroots nature. And love the passion behind the program. I just believe it could use a little more bite to better clarify acceptable behaviors such as WOMMA provides.

More and more businesses are using Twitter. However, the return on the investment of time and money needed to use Twitter effectively might be stopping some businesses from using Twitter. Other companies might still be confused as to what Twitter is, why it matters, and how it can be used.

If your business is still on the sidelines when it comes to Twitter and you, as a marketer, need some ammo to better sell-in the benefits of using Twitter … consider reading the just published TWITTER 101 GUIDE. It’s written by the folks at Twitter and the guidance they share is helpful for small businesses, big businesses, and non-profits.

I’ve whipped a What? | So What? | Now What? abstract of the Twitter 101 Guide using verbatim snippets. Read below, then read in full.

WHAT?
“Twitter connects you to your customers right now, in a way that was never before possible. As a business, you can use it to quickly share information with people interested in your company, gather real-time market intelligence and feedback, and build relationships with customers, partners and other people who care about your company.”

(“As an individual user, you can use Twitter to tell a company (or anyone else) that you’ve had a great–or disappointing–experience with their business, offer product ideas, and learn about great offers.”)

SO WHAT?
“For example, let’s say you work for a custom bike company. If you run a search for your brand, you may find people posting messages about how happy they are that your bike lets them ride in the French Alps—giving you a chance to share tips about cyclist-friendly cafes along their route.”

“You don’t have to run a bike shop or a relatively small company to get good stuff out of Twitter. Businesses of all kinds, including major brands, increasingly find that listening and engaging on the service lead to happier customers, passionate advocates, key product improvements and, in many cases, more sales.”

NOW WHAT?
“So you’re ready to be interesting on Twitter—but what are you going to post about? That depends on your goals for using Twitter, which may include things like building deeper relationships, getting on the radar of potential new customers or partners or providing customer service.”

“You can meet several communication goals simultaneously by thinking about your Twitter account as a friendly information booth or coffee bar. It’s a good place for people to ask you spontaneous questions of all kinds, and it’s also a good spot to share juicy information they might find useful. When you hit stride with these exchanges, they often lead to unexpected, valuable relationships.”

LEARN MORE
business.twitter.com/twitter101

Charlene Li (Altimeter Group) and Ben Elowitz (Wetpaint) just released an interesting paper linking financial success with social media engagement. Their findings reveal, “… the most valuable brands in the world are experiencing a direct correlation between top financial performance and deep social engagement. The relationship is apparent and significant: socially engaged companies are in fact more financially successful.”

Li and Elowitz explain “it pays to be social” and the deeper a company engages with its customers in a variety of social media places, the more financial success they will find.

I’m not convinced their evidence is strong enough to make such a bold statement about the direct correlation between profits and social media engagement because the recession variable wrecks too much havoc on financial success models today.

However, I am a believer when the authors write, “Social media engagement and financial success work together to perpetuate a healthy business cycle: a customer-orientated mindset stemming from deep social interaction allows a company to identify and meet customer needs in the marketplace.”

And the more a company knows about the likes, dislikes, etc. of customers, the better they can develop products and services to meet their needs to drive business success. It’s basic but true.

Which brings us to WOM TRUTH # 17 … Be Everywhere Customers Expect You to Be. If your customers are heavy users of Twitter, your company should be heavy users Twitter. If your customers are heavy users of Facebook, your company should be heavy users of Facebook. If your customers are active users of Yelp, your company should actively use Yelp. If your customers are active users of {insert social media app here}, your company should actively use {re-insert social media app here}.

Word of mouth can only happen if a conversation happens. And the more places where conversations happen, the more opportunities for word of mouth to happen. And thus, it pays to be social.

This WOM Truth is a slight twist on a statement Steve Hershberger of ComBlu shared a few years at a WOMMA Conference. Steve said buzz may create awareness about a brand, but it will be evangelists and advocates that will keep the buzz alive.

As marketers we see this maxim in action often. Just a few months ago Skittles received a lot of buzz for their online antics. (You remember this, right?) It was a blip, nothing more … nothing sustained.

Denny’s created buzz with their Grand Slam breakfast giveaway. Again, a blip. A blip because I know no one today talking about how tasty Denny’s Grand Slam breakfast is.

On the other hand, there are countless businesses where customer evangelists create long-lasting buzz. These businesses treat word-of-mouth as an everyday business issue and not just a one-off marketing program. Examples are endless … Apple, In-Out-Burger, Method, USAA, Container Store, etc.

At this WOMMA Conference from the past, Steve Hershberger offered smart advice for companies wanting to work with brand advocates to create long-lasting buzz. His tips include:

Tip #1. Buzz doesn’t create advocates
Buzz may create awareness, with people saying, “Wow, I want to talk about this.” But they may or may not act on it. That costs brands time and money, because the effort that’s put into a buzz campaign the second time is the same as the first. It doesn’t have its own inertia.

Tip #2. Advocates create buzz
Creating advocates keep buzz alive. Advocates are the concentrated perfect customers. They understand the relevance of the product, and when people spread relevance — when they passionately recommend it with the force of their personality — that’s engagement and it spreads buzz.

Tip #3. Shut up and listen
Advocates will communicate with you via the avenues you give them. Sometimes those aren’t the best ways. Ask yourself if you’re creating natural pathways to communication or roadblocks.

Better yet, ask them. Many brands don’t distinguish between what they want, what their customers want, and what their prospects want. It only matters what the customer wants: they own the brand. They’ll tell you what drove them to choose you and stay with you.

Tip #4. Repeat what was said
If somebody tells you there was a problem, find out why. Too expensive? Couldn’t get through to customer service people? Hear them, then repeat the problem back to prove you understand their situation.

Tip #5. Act on it
You’ve heard what was said. You’ve repeated it back. Now, fix the problem.

It’s okay to say, “We can’t do that right now,” as long as they know you understand. For example, if they say, “I love your product but I can’t afford it,” you might respond that you only get a 15 percent margin on that particular product and can’t afford to reduce the price. Of course, it’s better to fix the problem if you can.
[SOURCE]

“For all the ink spilled on the importance of Twitter and Facebook as feedback an customer-service channels, there’s another social-media tool marketers are increasing finding useful … the humble product review.”  [source: Ad Age article]

We’ve all seen online ratings and reviews. We’ve all read them. Some of us have even added to them. But most of us probably don’t how effective online reviews are. As WOM TRUTH #37 touts, online reviews aren’t sexy, but the results are.

A December 2008 study from Kudzu.com revealed 86% of consumers seek out and read online reviews before making a purchase decision. 90% of these consumers surveyed said they trust online reviews they read. [source]

A report from the eTailing Group in June of 2008 showed that 32% of retailers who added online reviews to their website experienced an increase of more than 11% in purchase conversions. Of those retailers, 11% of them experience a 20% or more increase in purchase conversions. [source]

A sidebar to the Ad Age article quoted above gave marketers smart advice on how best to use and incorporate online reviews into how a company does business.

Embrace Feedback
“Both the positive and negative feedback provides hints to what your’e doing well and where improvement is needed.”

Act on Lowly Reviewed Products
“Assign a team to read all of the lowest reviews. Make sure it includes the right people who can react quickly and fix the problem—before more customers get riled.”

Involve the Customer Service Team
“Negative reviews can tip off your customer service and support teams to issues that they’ll soon be dealing with.”

More chatter is happening regarding the Federal Trade Commission’s forthcoming guidelines on endorsements and testimonials in online marketing. It’s not an easy topic for us marketers to understand. However, it is something we will need to understand if physical word-of-mouth and digital word-of-mouth are to remain the most credible form of advertising.

No matter what the FTC dictates, I believe if we marketers follow a DON’T TELL. DO ASK. policy … all will be fine.

“Don’t Tell? Do Ask?,” you ask.

Click below for a 3:20 minute video ditty explaining why “Don’t Tell. Do Ask.” is a basic policy all marketers should follow when designing and delivering their next word of mouth marketing program.

The term “Social Media” is sexy. Twitter. Facebook. Blogs. All sexy in today’s marketing world where people are sharing opinions, insights, experiences, and perspectives with each other online.

A simple Google Trends search shows how much sexier a term “Social Media” has become compared to “Word of Mouth.” In early 2007, “social media” overtook “word of mouth” in online search activity.

The sexiness of social media also extends to which programs are getting greenlighted by marketing departments. Conversations I’ve had with WOMMA member agencies and brands tell me it has become far easier to gain budget approval for marketing programs sold as social media strategy than it is to get go-ahead approval for unsexy word of mouth programs.

I’m bothered by how “word of mouth” has become such an unsexy term.

As marketers we’ve lost sight that word of mouth is, was, and will continue to be social media. The term “social media” simply refers to the online digital manifestation of what has taken place for centuries in the physical world of person-to-person communication.

Word of mouth happens in physical ways (in person, on the phone) and digital ways (online, through email). Both ways are media. Both ways are social. Yet, both aren’t equal.

According to a Keller Fay study, 3.5 billion word of mouth conversations take place every day in the United States. About 90% of those conversations occur physically (in person, on the phone) while no more than 10% occur digitally (online, through email).

Today’s marketing world continues to behave a lot like yesterday’s marketing world where people share opinions, insights, experiences, and perspectives with each other through word-of-mouth. Nothing has changed there. Only the tools people use to pass along interesting information have changed, they’ve changed to include digital ways.

Seems to me word of mouth will always be the original social media.

Long after the tools of today (Twitter, Facebook, Blogs) fade away, person-to-person and voice-to-voice conversations will continue to be the driving force of word of mouth activity. Might not be sexy, but sometimes the truth ain’t sexy.

I’m starting a new series on the ALL THINGS WOM blog. Over the next couple months, I’ll be sharing bite-size lessons on key ideals that make word-of-mouth marketing more effective and ethical. It’s being called WOM TRUTHS.

This WOM TRUTHS series is somewhat inspired by NPR’s “This I Believe” essay series, which was based on a radio program hosted by Edward R. Murrow in the 1950s. However, this series is more than sharing beliefs … it’s sharing truths.

A belief is more of a hypothesis while a truth is a fact. And the facts we’ll discuss will be based upon personal lessons I’ve learned as well as lessons learned from current happenings in the world of word-of-mouth.

Stay tuned. WOM TRUTH #55 gets posted on Tuesday.