Wednesday, February 12, 2014

It's a Whole New 'World of Mouth'

The Kinane Homestead
This June we will celebrate 20 years as the quasi-owners of the home in which we live.  I say quasi-owners because there remain a few years on our mortgage. 

Over the past two decades, I've come to know the men, women and families that live around us.  Some of them have become "go-to" friends when we need help, information or advice.  Chris is the consummate neighborhood consigliere.  Need an electrician, plumber, painter?  He can make a call and get you to the right contractor.  Janet always has good ideas for something to do or buy when we feel like splurging on ourselves.  Her husband, Jeff, is the ultimate car guy, and we've sent friends to him for advice on what to buy and, more importantly, what not to buy.  What I've described here are just some of the men and women we rely on for recommendations and advice.  We've come to trust them, through trial and error, good times and bad.

Easier to Connect = Easier to Share

It's the importance of relationships like these, and the ease with which we can ask for and share information via social media, that Erik Qualman says in Chapter 5 of his Socialnomics has helped move us "from word-of-mouth to World-of-Mouth" marketing (2013, pg. 80).  The concept Qualman promotes it that, where much of the information we get today comes to us via the power of Internet search giants like Google, the information, advice and recommendations we get via our social networks will one today usurp search in informing us as we make decisions about purchases and other of life's decisions (2013, pg 75).  Just as social media and networking has made it easier for us to connect more regularly with a wider network of people than we might otherwise, so too does it mean that we can exercise that network to help us get valuable information when we need it. 

The Power of Peer Recommendations

The impact of this changing nature can be critical for marketers, as research has found that peer recommendations increase the preference for an option, even when the recommender is recognized as not being an "expert" on the matter being reviewed (D. Smith, S. Menon & K. Sivakumar, 2005, pg 26).  This also dovetails with other research that validates the idea that consumers today find more credible the information produced by fellow consumers than that produced by the brand-owner (Mir & Zaheer, 2012).

In addition to personal social networks, Qualman drives home the point that sites like TripAdvisor and Angie's List that aggregate opinion, ideas and ratings are finding new ways to bring value to consumers.   What these companies realize, according to Qualman, is that they no longer own relationships with consumers and that, instead, the consumers themselves are the owners and willingly share that power among themselves (pg. 83).

Hitting Home 

So, when just this evening my wife declined to buy a rug online because it "only had 3 1/2 stars," Socialnomics again hit home.  I wonder what my neighbors would think?


References:

Mir, I. & Zaheer, A. (2012). Verification of social impact theory claims in social media content. Journal of Internet Banking and Commerce,17(1), 1-15. Ottowa, CA: Array Development.

Smith, D., Menon, S. & Sivakumar, K. (2005).  Online peer and editorial recommendations, trust, and choice in virtual markets.  Journal of Interactive Marketing, 19(3), 15-37.  Wiley InterScience. doi: 10.1002dir.20041


Qualman, E. (2013). Socialnomics: How social media transforms the way we live and do business.  Hoboken, NJ: Wiley.

20 comments:

  1. This comment has been removed by the author.

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  2. KaitFebruary 13, 2014 at 6:34 AM

    Mike,

    Whether they come from a neighbor or a social media connection, peer recommendations are incredibly powerful.

    I have found on TripAdvisor, a site I use often, that there are varying ways in which representatives from hotels (or attractions, etc.) can respond to reviews. I've seen ones that are polite, apologetic, appreciative, and even ones that offer excuses for negative experiences. What sort of response etiquette do you think hotel employees should follow when responding to these reviews? Or, do you recommend they stay silent all together?

    Kait

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    1. Hi Kait,

      In my mind, silence is rarely the best course of action. Obviously, there are times when there may be no choice, such as when personal information is involved or something litigious is or might be in play.

      Even when uncomfortable, I think it makes sense to try to follow David Meerman Scott's premise that we need to "clearly and simply articulate what you want people to believe" pg. 190). Faced with a challenging conversation on line, we need to remain professional and focused on our message. Take the hotel, for instance, where projecting an image of quality customer service is likely a key objective. Having a courteous, respectful discussion where you maintain your brand's position will show you care enough to converse while also making valuable points about the position and benefits your brand offers.

      IOf courses, there will always be those who don't want to hear it, but by respectfully offering perspective from the brand your case will be there for those who follow later to see.

      Mike

      Reference:

      Scott, D.M. (2013) The New Rules of Marketing and PR. Hoboken, NJ: Wiley.

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    2. Nice insight! The article you posted on my blog, regarding the four C's, provides nice guidelines for businesses responding to negative complaints. You're right that silence is rarely the best route.

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  3. Hi Mike,

    I like the way you used your neighborhood connections to show how Qualman explained the importance of peer recommendations today. Although I use Google for researching just about anything I do, buy, write about, or am curious about ... I always go directly to my friends, relatives, and co-workers for advice and recommendations that are more specifically related to what I need. Since most of those I associate with are not social media friendly (and some not even internet friendly), the use of social media for these things is not quite as helpful.

    Do you think if the connections a person has on Facebook or Twitter are only those that are a distance away, and that may or may not respond or comment regularly, are still effective in supplying recommendations that a consumer will listen to? Are recommendations better utilized when the connections are closer in proximity to the area of the searcher? Or is it a generational boundary, rather than a location one?

    Nice post!

    Dawn

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    1. Hi Dawn. Thanks for visiting my blog!

      To me, the connections people have via social media are important because we have felt it important enough to actually connect. Does that make sense?

      It's not generational or geographical in any way for me. It's the fact that I know you, have some history with you, and/or respect what you do and say that makes me "connect." Therefore, I'll give more credence to what it is you have to suggest.

      For me, it goes back to the research of Mir and Zaheer that I referenced in my blog -- we trust each other more than we trust the companies that are selling to us.

      Mike

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    2. Hi Mike,

      You have phrased it better than anything I've read or heard! The simple fact that we attempt to connect says something about how we feel about the other person. And whether or not they decide to accept the connection says a great deal about how they look at the relationship as well. So once the connection is made, the real trust and sincere thoughts of each other are established.

      You definitely made a great point, and observation, that makes me feel better about my connections on Facebook. Even though I am not the most active user in the bunch, the fact that my friends have not unfriended me says quite a lot.

      Thanks Mike, I needed that social support! :)

      Dawn

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  4. Michael – Nice job in connecting this week’s reading into your personal experience with World-of-Mouth marketing. It’s normal practice for people to use platforms like Trip Advisor, Yelp and Angie’s List to read consumer reviews before making a purchase. Just last week, my fiancé and I read through many pages Trip Advisor reviews before booking our honeymoon to Grenada.

    Now let’s tie this back to what we learned in Chapter 4 about the importance of connecting with customers through online forums. If a company knows it has a profile on one of these peer recommendation sites, what should they do to monitor, strategize and react to any negative comments?

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    1. Hi Kristen,

      I just answered this in part in response to an earlier comment from Kait. I won't go into whether to engage with the owner of the negative comment because you can find that above.

      In terms of monitoring, I believe you must monitor to the best of your ability. Obviously, the degree to which you can do that depends on the size and resources of the company.

      To some degree, I think it goes back to the idea of impression management where we seek to protect the positive image by maximizing positive associations with the brand, even in the face of negative associations (Percy, 2008).

      Mike

      Reference:

      Percy, L. (2008). Strategic Integrated Marketing Communications, First Edition, pp.139-142. Burlington, MA: Elsevier, Inc.

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  5. Hey Michael, you bring up an excellent point that consumers are becoming the owners. I'm starting to notice this transformation across marketing now that puts more focus on the consumer rather than the business. Before the internet, there was only this one-way approach to advertising and marketing. Now digital channels have allowed consumers to become apart of the conversation and their actions (complaints, reviews, tweets) have forced marketers to step back and change up their strategies.

    This leads me to be another point. Many people are complaining that digital advertising is becoming too intrusive i.e. those retargeting ads that seem to follow you after you visit a website or those Facebook ad posts that show up in your feed. Do you thing these types of tactics are going to drive people away from visiting certain sites or using social media?

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    1. Those re-targeting ads are pretty interesting to me. SOmetimes I can't stand them but then I catch myself impressed when what's following me is a brand I like to be associated with.

      I'll use Marist for example. When I was considering programs, I visited Marist's IMC site several times. I don't recall if I ever got their through a banner ad or sponsored link or something, but I know that Marist ads followed me forever. I a graduate of Marist, so it didn't bother me I came to be intrigued by how persistent it was.

      Now, ask me if I want to be followed by a personal injury attorney and I'll probably say no. Interesting to me is he work of Anja Lambrecht and Catherine Tucker who found that, generally, generic retargeted ads positively impact the inclination to purchase while retargeted ads that include dynamic personal information tend to push consumers away ( ).

      I guess stalking is OK, as long as the stalker doesn't show that it knows who you are!

      Mike

      Reference:

      Lambrecht, A. * Tucker, C. (Oct 2013). When Does Retargeting Work? Information Specificity in Online Advertising. Journal of Marketing Research, 50, 561-576. doi: 10.1509/jmr.11.0503.

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  6. Hi Mike,

    I always enjoy reading your posts - this was a great recap that provided examples for which we all can relate. Your neighborhood word of mouth circle takes us back to Social Networking 101. Being a homeowner I rather seek the opinion of a friend or colleague that has had experience with a service or brand vs. relying on a stranger's review. However, there are certain sites/forums that I have more recently used in making a purchase decision. TripAdvisor is one, as well as Epicurious for recipe opinions. As I mentioned in one of my earlier posts, I've even sought the opinion of my Facebook network to find a new veterinarian. I tend to use caution when reading through forums, unless they are more reputable (like TripAdvisor).

    While forums aren't going away, what do you think are ways organizations can capitalize on the right forums? Meaning, how do they identify which ones are worth their time and effort if they aren't brand sponsored? With so many forums, authors and content out there, it seems like there will always be missed opportunities.

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    1. Tara – You make some interesting points about the impact of social sites on impacting purchase decisions. We’ve discussed at length forum sites like Yelp, TripAdvisor and Angie’s List. How do you feel about Pinterest? What are they currently doing well to drive fans to corporate owned e-commerce sites from engaging pins? Where do you see this continuing to evolve and impact online commerce?

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    2. You make a great point Tara. It's definitely harder to track everything that someone writes. A great source to use is http://www.technorati.com. If you search for key words or company names, they filter through a lot of blog posts that mention each.

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    3. To put it plainly, forums are not my forte. For that reason, I'll play my small business card.

      Since most of us are or will end up working for smaller organizations, it seems likely to me that niche and trade forums that service a specific area of interest is where a lot of attention gets paid -- yet we don't really speak about it much.

      Because they service a specific niche, these forums offer companies the chance to get new insights into consumers' needs and wants when those customers are likely gathering information to use in making a purchasing decision ( Xun & Reynolds, 2010).

      Mike

      Reference:

      Xun, Jiyao & Reynolds, J. (Mar 2010). Applying netnography to market research: The case of the online forum. Journal of Targeting, Measurement and Analysis for Marketing, 18(1), 17-31. London, UK: Palgrave Macmillan. doi: 10.1057/jt.2009.29.

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  7. Hey Michael

    Nice post! I think that you picked good areas to focus on from chapter 5. Word of mouth has changed so much recently it is crazy, it really is, "world of mouth." I personally take online reviews pretty seriously. I am with your wife on this one, if it had 3.5 stars I probably would not have gotten it either! I have found that most times people are writing the truth when they take the time to do these reviews and luckily thus far it has worked out for me when I have made online purchases.

    I find my computer itself recommending things to me based on my previous searches and it blows my mind. I cannot even imagine what the next step will be, can you?

    -Michele

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    1. Hello fellow Smithtowner...and welcome on this (once again) snowy night.

      I really have no idea where this will be going, but with all the writing about wearable technology and voice activated applications, we won't need to search so much any more as much as we will be able to simply ask out loud. After that, who knows, a Mark Zuckerberg fueled chip in or heads?

      I just responded on Amanda Brief's blog about the increasingly short attention span we all share. Author Daniel Goleman points out that having almost everything just a click away is shrinking our attention span for everything that we do....and that with a shortened attention span we may not be as aware, informed, and -- in my words -- intelligent as we would be otherwise (2013).

      It is to me an interesting argument to have: Does having access to more and more information actually help you make more intelligent decisions or learn more about the world around you? Or, is it so much information that we never really get a deep understanding of most of it anymore? Or, do we end up focusing only on our interests and needs and grow less than we might have if we had more time to consider things with which we are not familiar?

      Which of these three questions/scenarios do think most clearly fits us? Or, is there another one (perhaps less cynical) that you would offer?

      Mike

      Reference:

      Goleman, D. (2013). Focus: The Hidden Driver of Excellence. New York, NY: Harper.

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    2. Hey Michael, that's an excellent point. I also noticed I have developed a shorter attention spam. When I read articles, I tend to skim and move on to the next before I even get to the second paragraph sometimes.

      Because there's so much out there online, I tend to agree with the third point that we are focusing only on our interests and needs. When I log into Facebook, I skim through my feed until I find something that interests me. There is so much content out there that it can be overwhelming to filter through everything.

      On the positive side, if you do need to find something, you save infinite time just by googling or asking someone on social media as opposed to 20 years ago when we were using the library or calling people (not having the reach of hundreds of online followers) to find an answer or an opinion on the matter.

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  8. Michael - thanks for your engaging blog post this week. I think you tied in this week's lesson to a real-time experience, which offers a great practical learning tool for us all. I think Amanda makes a great closing arguement about our increasingly smaller attention spans and how this has changed the way we are marketed to on social media. I think social media strategists will continue to optimize platforms like Yelp, Angie's List and Trip Advisor to tailor feedback to a person's individual interests and make it easier to find feedback from those within their personal network. Thanks for sharing!

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  9. Michael,
    I really enjoyed reading your post. Your were able to generate some great points in a very interesting read! I really like how you brought up personal experiences and linked it to what Qualman was talking abut in chapter five. Word of mouth advice has always been popular, whether it was from a colleague, neighbor, friend, or stranger, and this continues today through social media. Even though peers are not always experts, reviews and advice about various products can help make or break companies and organizations. Like you brought up in your post, a review of three and a half stars can defer customers from investing in that product, even though those customers do not personally know those reviewers. As an avid "ebayer" I'm always looking into a seller's review before bidding on a product as a second nature, never really noticing that I'm taking advice. With the growing popularity of social media outlets, it is even now more important for a company to have positive reviews on the internet! Great post!

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