Nate Eliott Forrester presentation for WOMMA

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Marketing

How to Fix Word of Mouth
Nate Elliott, VP and Principal Analyst
@nate_elliott
November 3, 2015

© 2015 Forrester Research, Inc. Reproduction Prohibited 3
Word of mouth marketing
isn’t working.

© 2015 Forrester Research, Inc. Reproduction Prohibited 4
Agenda
› WOM marketing isn’t working
› The state of the market
› How to fix word of mouth

© 2015 Forrester Research, Inc. Reproduction Prohibited 5
Agenda
› WOM marketing isn’t working
› The state of the market
› How to fix word of mouth

© 2015 Forrester Research, Inc. Reproduction Prohibited 6
WOM is a top driver of discovery

© 2015 Forrester Research, Inc. Reproduction Prohibited 7
Word of mouth is trusted

© 2015 Forrester Research, Inc. Reproduction Prohibited 8
WOM generates reach brands can’t

© 2015 Forrester Research, Inc. Reproduction Prohibited 9

© 2015 Forrester Research, Inc. Reproduction Prohibited 10
But word of mouth marketing
isn’t working.

© 2015 Forrester Research, Inc. Reproduction Prohibited 11
But word of mouth marketing
isn’t working.
MARKETING

© 2015 Forrester Research, Inc. Reproduction Prohibited 12
Too many brands post and pray
But this does not
generate word of
mouth

© 2015 Forrester Research, Inc. Reproduction Prohibited 13
Or try to hijack hashtags

© 2015 Forrester Research, Inc. Reproduction Prohibited 14
Mistakes are piling up

© 2015 Forrester Research, Inc. Reproduction Prohibited 15
Mistakes are piling up

© 2015 Forrester Research, Inc. Reproduction Prohibited 16
Mistakes are piling up

© 2015 Forrester Research, Inc. Reproduction Prohibited 17
Mistakes are piling up

© 2015 Forrester Research, Inc. Reproduction Prohibited 18
Brands say it’s not delivering

© 2015 Forrester Research, Inc. Reproduction Prohibited 19
Both marketers and
vendors must do better.

© 2015 Forrester Research, Inc. Reproduction Prohibited 20
Agenda
› WOM marketing isn’t working
› The state of the market
› How to fix word of mouth

© 2015 Forrester Research, Inc. Reproduction Prohibited 21
Today, we published a WOMP landscape
• WOMP = Word of Mouth Platform
• Our vendor landscape reviewed 40 vendors
• Each filled out a questionnaire
• We interviewed two dozen of them
• We also interviewed and collected data from two
dozen word of mouth marketers
• Including some of the biggest brands in the world

© 2015 Forrester Research, Inc. Reproduction Prohibited 23
And we looked at three types of WOMPs
1
Customer
Advocacy
Platforms
2
Employee
Advocacy
Platforms
3
Category
Influencer
Platforms

© 2015 Forrester Research, Inc. Reproduction Prohibited 24
Marketers love to chase influencers

© 2015 Forrester Research, Inc. Reproduction Prohibited 25
But most vendors work on advocacy

© 2015 Forrester Research, Inc. Reproduction Prohibited 26
Vendors focus on activation

© 2015 Forrester Research, Inc. Reproduction Prohibited 27
Social marketers rarely run WOM efforts

© 2015 Forrester Research, Inc. Reproduction Prohibited 28
Measurement is a mess
The average WOM
vendor offers
marketers 8
“success” metrics

© 2015 Forrester Research, Inc. Reproduction Prohibited 29
I asked 14 large brands if they
would recommend their WOM
vendor to a colleague.
Only 4 said they would.

© 2015 Forrester Research, Inc. Reproduction Prohibited 30
Agenda
› WOM marketing isn’t working
› The state of the market
› How to fix word of mouth

© 2015 Forrester Research, Inc. Reproduction Prohibited 31
Marketers have work to do.

© 2015 Forrester Research, Inc. Reproduction Prohibited 32
Fix 1:
Marketers must start
taking WOM seriously.

© 2015 Forrester Research, Inc. Reproduction Prohibited 33
Resolve to never again post and pray

© 2015 Forrester Research, Inc. Reproduction Prohibited 34
Never again hijack an irrelevant hashtag
Wrong Right

© 2015 Forrester Research, Inc. Reproduction Prohibited 35
And for goodness’ sake, put some
resources into this strategy
• Most marketers we spoke to said they had zero
or one person dedicated to WOM.
• Only half the marketers we spoke to said they
had increased their WOM investment in 2015.
• Most marketers I’ve spoken to don’t use any
external vendors to help with WOM.

© 2015 Forrester Research, Inc. Reproduction Prohibited 36
But if you fix the vendors,
you fix the industry.

© 2015 Forrester Research, Inc. Reproduction Prohibited 37
Fix 2:
WOM vendors must offer both
advocate and influencer services.

© 2015 Forrester Research, Inc. Reproduction Prohibited 38
Most vendors offer advocacy products

© 2015 Forrester Research, Inc. Reproduction Prohibited 39
But it’s time for WOMPs to consolidate

© 2015 Forrester Research, Inc. Reproduction Prohibited 40
WOM vendors must offer both advocate
and influencer services
• We’re not looking for end-to-end social suites.
• No vendor can do ads, organic, and WOM well.
• Clients of end-to-end social suites are less satisfied.
• But marketers can’t justify hiring three WOMPs.
• The vendors that offer complete WOM services will
win the market.

© 2015 Forrester Research, Inc. Reproduction Prohibited 41
Fix 3:
WOM vendors must offer
useful success metrics.

© 2015 Forrester Research, Inc. Reproduction Prohibited 42
Measurement is a mess

© 2015 Forrester Research, Inc. Reproduction Prohibited 43
WOM vendors must offer useful metrics
• Measure business outcomes, not operational
metrics like contacts and posts.
• Only one-quarter of vendors focus measurement on
business outcomes like awareness or sales.
• Integrate with the tools marketers trust.
• CMOs already use mix modeling and attribution
tools; make sure these vendors can use your data.

forrester.com
Thank you
Name
nelliott@forrester.com
@nate_elliott

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Nate Eliott Forrester presentation for WOMMA

2. How to Fix Word of Mouth Nate Elliott, VP and Principal Analyst @nate_elliott November 3, 2015

21. © 2015 Forrester Research, Inc. Reproduction Prohibited 21 Today, we published a WOMP landscape • WOMP = Word of Mouth Platform • Our vendor landscape reviewed 40 vendors • Each filled out a questionnaire • We interviewed two dozen of them • We also interviewed and collected data from two dozen word of mouth marketers • Including some of the biggest brands in the world

22. © 2015 Forrester Research, Inc. Reproduction Prohibited 22 Forrester sees three kinds of WOM 1 Customer Advocates Use existing, satisfied customers to spread brand messages. 2 Employee Advocates Use your employee base to spread brand messages. 3 Category Influencers Use people influential among your key audiences to spread brand messages.

35. © 2015 Forrester Research, Inc. Reproduction Prohibited 35 And for goodness’ sake, put some resources into this strategy • Most marketers we spoke to said they had zero or one person dedicated to WOM. • Only half the marketers we spoke to said they had increased their WOM investment in 2015. • Most marketers I’ve spoken to don’t use any external vendors to help with WOM.

40. © 2015 Forrester Research, Inc. Reproduction Prohibited 40 WOM vendors must offer both advocate and influencer services • We’re not looking for end-to-end social suites. • No vendor can do ads, organic, and WOM well. • Clients of end-to-end social suites are less satisfied. • But marketers can’t justify hiring three WOMPs. • The vendors that offer complete WOM services will win the market.

43. © 2015 Forrester Research, Inc. Reproduction Prohibited 43 WOM vendors must offer useful metrics • Measure business outcomes, not operational metrics like contacts and posts. • Only one-quarter of vendors focus measurement on business outcomes like awareness or sales. • Integrate with the tools marketers trust. • CMOs already use mix modeling and attribution tools; make sure these vendors can use your data.

44. forrester.com Thank you Name nelliott@forrester.com @nate_elliott

Nate Eliott Forrester presentation for WOMMA

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