Unleashing the Power of Word of Mouth:

Creating Brand Advocacy to Drive Growth

ED KELLER
Keller Fay Group
ekeller@kellerfay.conn
The evidence is abundantly clear: word of mouth (WOM) is the most important and
effective communications channel. Now, the search is on for strong, quantifiable
research to help marketers navigate this new terrain, where control rests with the
consumer and not the marketer. This article lays out important insights drawn
from Keller Fay's continuous monitoring of America's offline and online WOM
conversations.
WoRD-OF-MOUTH CONVERSATION is r et aki ng t he
throne in the social order. As a result of societal
changes, such as declining trust of those in au-
thority, to the explosion of the internet and other
forms of digital media, the communications land-
scape that companies face today is being funda-
mentally restructured. The evidence is becoming
abvmdantly clear: word of mouth (WOM) has
now become the most important and effective
communications channel.
McKinsey says WOM drives two-thirds of in-
dustries (Dye, 2000), while Bain & Company (Reich-
held, 2003) and the London School of Economics
(Marsden, Samson, and Upton, 2005) have pub-
lished research that finds that strong customer
advocacy on behalf of a brand or company is one
of the best predictors of top-line growth.
This phenomenon is not a fad, it is a long-term
trend, and advertisers such as P& G, Coca-Cola,
Apple, Harley-Davidson, and Starbucks, to name
just a few, increasingly recognize the important
linkage between WOM advocacy and the growth
and vibrancy of their brands.
As just one example, among many, A. G. Lafley,
P& G's CEO, spoke at the October 2006 Confer-
ence of the Association of National Advertisers
and exhorted his fellow marketers to "let go" of
their brands and bow to consumer needs and
wants: "Marketers need to stop trying to control
what their brands stand for, and listen to their
4 4 8 J OU enilL OF flDOERTI S I flG RESEIIBC H December 2 0 0 7
customers. We are operating in what is very much
a 'let go' world," he said (Wasserman and Ed-
wards, 2006).
At the 2006 Advertising Research Foundation
(ARF) Annual Conference, Jean-Louis Laborie of
Integration gave a plenary session paper about
engagementa hot topic for many marketers and
one that has been championed by the ARF since
2005 and whose official unveiling was at that
conference. The ARF defines engagement as "turn-
ing on a prospect to a brand idea enhanced by the
surrounding context" (Plummer, 2006). But which
form of contact with a consumer produces the
strongest levels of engagement? That was the ques-
tion Laborie addressed. Integration's Market Con-
tactAudit (MCA) measures the impact of many
different forms of contact that a consumer can
have with a brand. After reviewing data from
hundreds of MCA studies across multiple con-
sumer category areas, Leborie pronounced "word
of mouth" to be the form of consumer contact
with the highest capacity to create consumer en-
gagement (Laborie, 2006).
No wonder, then, that for a growing number of
marketers, WOM advocacy is becoming an increas-
ingly important pursuit. This rising interest brings
with it a search for strong, quantifiable research to
help guide marketers' efforts to increase both the
quantity and quality of WOM, and to help eval-
uate the success of marketing efforts that seek to
DOl: 10.2501/S0021849907070468
POWER OF WORD-OF-MOUTH
increase and improve the WOM advocacy
for the product or the brand.
It is for that reason that this issue of the
fournal of Advertising Research is so timely
and is certain to make an important con-
tribution to this growing area of market-
ing practice.
WORD OF MOUTH: NOT A NEW
PHENOMENON
The importance of WOM in the consumer
marketplace is not a new phenomenon. In
fact, in 1967 Professor Johan Arndt, of the
Columbia Graduate School of Business,
authored a detailed monograph for the
ARF entitled, "Word of Mouth Advertis-
ing." In it, he reviews and comments on
147 studies from the literature of sociol-
ogy, psychology, and marketing. It was,
according to the editor of the ARF's Ad-
vertising Research Monographs, "the first
comprehensive analysis of research in an
important area." The author concludes,
"[W]ord of mouth emerges as one of the
most important, if not the [emphasis in
original text] most important source of
information for the consumer" (Arndt,
1967).
Confirming the long-standing impor-
tance of WOM, research by The Roper
Organization in the early 1970s found that
across multiple category areas WOM was
the most important factor in consumer
decision making, with a small advantage
over advertising as well as editorial con-
tent from the various mass media. This
pattern continued largely intaJ:t through
the mid 1990s.
Beginning in the 1995-1998 time pe-
riod, however, WOM began to grow dra-
matically in importance, while the relative
importance of advertising and editorial
matter began a slow decline. WOM grew
in importance by about l\ times, and by
the start of this decade was twice as im-
portant in the consumer's eyes as the
other alternatives (Keller and Berry, 2003).
If WOM and brand advocacy is becoming an increasingiy
important marketing objective and the new metric of
success, tiien iiow do we measure tiie conversation
worthiness of both brands and communications surround-
ing them? And how do we itnow if our efforts are, in fact,
ieading to greater WOM and more brand advocacy?
So while WOM has always been impor-
tant, its importance today is higher than
ever. As the credibility of "official" mar-
keting messages is waning, the power of
one consumer recommending a product
to anotheror to manyis waxing. The
imperative is for marketers and commu-
nicators to understand the dynamics of
how their brands are being discussed by
consumers in consumer-to-consumer com-
munications, and to use insights from this
understanding to find ways to engage in
a true two-way and meaningful dialogue
with consumers, rather than pushing mes-
sages out to them in a one-way flow.
THE WOM MEASUREMENT IMPERATIVE
If WOM and brand advocacy is becoming
an increasingly important marketing ob-
jective and the new metric of success,
then how do we measure the conversa-
tion worthiness of both brands and com-
munications surrounding them? And how
do we know if our efforts are, in fact,
leading to greater WOM and more brand
advocacy? Can there become a standard
"currency of conversation," as there are
"currencies" that allow us to measure the
audience for other types of media?
The Keller Fay Group's TalkTrack^M re-
search program seeks to provide such a
currency, as well as to provide strategic
and tactical insights for marketers about
the dynamics of WOM and how their
brands fit into the WOM landscape. By
continuously and consistently measuring
consumer conversations about brands,
TalkTrack helps marketers (a) to under-
stand how WOM truly works (separating
myth from reality), (b) to plan marketing
activities in a manner is most likely to
produce positive WOM, and (c) to track
the effectiveness of marketing activity to
see whether the desired WOM and brand
advocacy is being achieve.
TalkTrack is an ongoing survey of Amer-
ican consumers ages 13-69, who report to
us about the WOM conversations about
products, services, and brands that they
talked about "yesterday." TalkTrack''" uses
a single-day diary methodology to aid
recall of conversational brand mentions,
and data are collected via the internet.
(The weekly samples are demographi-
cally balanced for age, sex, educational
attainment, and race/ethnicity to match
the U.S. Census Bureau for Americans
aged 13 to 69. Respondents were re-
cruited from a large, national panel of
individuals who have agreed to partici-
pate in occasional survey research projects
and are rewarded with redeemable points.)
Every day, a fresh sample of 100 respon-
dents participates in the study relating
their conversations over the last 24 hours,
and findings are reported on a weekly basis.
December 2 0 0 7 J OORIIIIL DF IIOUERTISIIIG B ESEHB C H 4 4 9
POWER OF WORD-OF-MOUTH
collects data related to the
medium (mode of conversation, venue, and
"sender" demographics), to the message
(positive/negative polarity, perceived cred-
ibility), and to the audience (demograph-
ics of "receivers" and relationship to
"sender"). It also identifies the drivers of
brand mentions, including customer expe-
rience and marketing communications, and
the outcomes of those mentions, such as
intention to purchase, to get more informa-
tion ("inquiries"), and to pass along to other
consumers what was learned ("relays").
By using this methodology, TalkTrack
provides a nationally representative per-
spective on the extent and nature of WOM;
it studies both the people who are leading
WOM conversation as well as investigat-
ing the impact of WOM on people who
are on the receiving end of advice and
recommendations; and it measures (and
helps to size) the extent and nature of
both offline WOM (face to face and
phone-based conversations) as well as
online WOM (emails, texting or instant
messaging, blogs and chatrooms, etc). The
results are comparable over time, and be-
cause the study investigates WOM across
multiple categories and thousands of
brands, it provides benchmarks against
which brand marketers can evaluate
themselves.
WOM BASICS: FIVE IMPORTANT
INSIGHTS ON HOW WOM "REALLY"
WORKS
Findings from this ongoing tracking of
WOM conversations (which was launched
in April 2006) help answer some of the
most profound questions relating to WOM:
How much occurs, what drives it, and
what are the market outcomes? To help
set the framework for articles that follow
in this issue, it is instructive to lay out
five key findings from TalkTrack that pro-
vide perspective on how consumer WOM
works in today's marketplace.
Over the course of a typical week, the average American
consumer participates in 121 WOM conversations, in
which specific brand names are mentioned 92 times.
In other words, Americans participate in 3.5 billion WOM
conversations every single day.
1 . "Billions and biiiions" of WOM
conversations each day
The most basic finding from
concems the sheer volume of WOM among
consumers. Over the course of a typical
week, the average American consumer par-
ticipates in 121 WOM conversations, in
which specific brand names are men-
tioned 92 times. In other words, Ameri-
cans participate in 3.5 billion WOM
conversations every single day! Brands
are discussed 2.3 billion times per day.
Brands, it is fair to say, are a major cur-
rency of conversation in America.
The leading categories for WOM are
food and dining, media and entertain-
ment, sports and hobbies, beverages, and
shopping and retail, with about half (or
more) of the American public talking about
these categories each day. Telecom, tech-
nology, health and healthcare, and auto-
motive all generate conversation by about
40-50 percent of Americans per day. The
categories that generate the lowest vol-
ume of WOM are financial services, home
products, personal care/beauty, travel, and
household products. Even for these, be-
tween one-quarter and one-third of Amer-
ican have at least one conversation per
day. So virtually every consumer category
finds itself a part of America's conversa-
tion and should be interested in tapping
into the power of WOM. (The reason these
categories fall as low on the list as they
do is because they tend to be focused
among narrower market segments such
as adult women or parents of young chil-
dren. When one looks at results for women
and parents, the number of conversa-
tional brand mentions is about twice as
high as the national average.)
2 . Face to face is the predominant mode
of WOM conversation
How and where do these WOM conver-
sations occur? Fully 76 percent of them
occur "face to face," while another 17
percent happen by phone and 10 percent
are online. Among these online "conver-
sations," 3 percent occur via email, 2 per-
cent via instant text, and 1 percent occur
via blogs/chat rooms.
These findings are significant and surpris-
ing to many, because for many marketers,
their thinking about WOM is dominated
by the consideration of how to use new,
digital media to create conversation, or par-
ticipate in consumer conversation. These
new technologies are certainly growing
quickly and becoming increasingly impor-
tant as tools in the marketers arsenal, but
these data point to the need for marketers
to consider both offline channels as they
seek to drive WOM and brand advocacy,
as well as digital media approaches.
3. WOM is generaiiy positive toward
brands
Perhaps the most unexpected finding in
our research concerns the "polarity" of
4 5 0 J OU BOBL OF flD OERTISlOG BESEHRCII D ecember 2 0 0 7
POWER OF WORD-OF-MOUTH
WOM. Overwhelmingly, consumers have
positive things to say about brands, by a
margin of more than 6 to 1. Across all
brands in all categories, 63 percent were
mentioned in a mostly positive light, and
just 9 percent in a negative one. Another
16 percent of conversational mentions of
brands mixed both positive and negative
comments, while 12 percent of the time
the conversation" had neither a positive
nor negative tone.
Our research does find important dif-
ferences in the polarity of WOM by in-
dustry. In general, WOM is most positive
for consumer packaged goods of various
kinds, and least positive for telecommu-
nications. But for all categories, the "mostly
positive" comments outweigh the "mostly
negative" by a healthy margin.
The overwhelmingly positive nature of
WOM is extremely important for market-
ers, for several reasons. First, it means
that we should think of consumers as
primarily supportive of brands and com-
panies, in the sense that they want to help
connect good brands with good friends.
While it is true that stopping a friend
from making a bad choice is a helpful act,
the most helpful recommendation also of-
fers a replacement choice, and perhaps
several.
Second, these findings suggest that the
oft-cited "risk" of participating in WOM
is likely overblown. The greater risk for
marketers likely resides in not engaging
in a conversation that is happening with
or without the marketer's participation.
4 . WOM brings with it high impact:
Credibiiity, pass aiong, purchase intent
Word of mouth is not only mostly posi-
tive toward brands and companies; it is
also extraordinarily believable, according
to the "receivers" of WOM advice. Its
power comes from the personal trust re-
lationship that exists between most con-
versational partners. This is particularly
Among media channels, television is the most powerful
WOM medium, with references during 16 percent of ail
branded conversations, and TV advertising more often
referenced than programming. The internet is the next
most often cited media source at 12 percent. Point of
saie (8 percent) and newspapers (7 percent) follow.
Interestingly, for some particularly strong WOM brands,
the reference to media and marketing rises to as much
as 65 percentindicating just how powerful media can
be in creating great and powerful WOM.
the case in face-to-face conversations
among family, personal friends, co-workers,
and other trusted acquaintances.
Asked to evaluate the believability of
WOM about specific brands, using a scale
from 0 to 10, a 55 percent majority of
consumers who were the "receivers" of
advice and opinions from another person
assign a credibility score of 9 or 10. An-
other 25 percent of the "receivers" assign
a credibility score of 7 or 8, for a grand
total of 80 percent of consumers ranking
WOM advice as credible at a level of 7 or
higher on the 0 to 10 scale. It is hard to
imagine these kinds of credibility scores
being assigned to advertising or other tra-
ditional marketing communications. That
is the power of a personal relationship.
Beyond having credibility to the person
who receives information or recommen-
dations via WOM, these consumers are
also moved to share that information with
others. Forty-nine percent of all "receiv-
ers" of WOM say they are highly likely (9
or 10 on a 10-point scale) to relay the
advice they have received to someone else.
Word-of-mouth marketing is valuable
only to the extent that it drives the ulti-
mate behavioral outputs that marketers
seekbrand purchases. Here too, we see
the power of WOM. On a scale of 0 to 10,
nearly half of all "receivers" of WOM
advice say they will likely make a pur-
chase based on the conversation (50 per-
cent give a 9 or 10 rating).
So not only is there a very large volume
of WOM, we see that the impact it has is
quite strong as well.
5. iViarketing communications drive
WOiVi
Amid the recent growth in popularity of
WOM marketing, the field is often de-
scribed as an alternative to "traditional"
media and marketing channels. While
WOM does represent a philosophical
breakaway from a one-way, top-down com-
munication model, it does not necessarily
mean the abandonment of traditional me-
dia and marketing channels. Rather, it
suggests the opportunity for all forms of
December 2 0 0 7 J DOIinilL OF B DOEB TIS IHG B ES EB RCH 4 5 1
POWER OF WORD-OF-MOUTH
consumer contact to contribute to or stim-
ulate WOM, which brings with it (as we
just saw) high levels of credibility and
purchase intent.
In fact, 50 percent of branded conver-
sations include a reference to some kind
of media or marketing that was seen or
heard by at least one conversation conver-
sational partner.
These media and marketing references
run a wide gamut: advertising, editorial,
and programming from various types of
media, company websites, marketing ma-
terials at the point of purchase, coupons,
and other promotions, etc. Indeed, as mar-
keters become more skillful at developing
targeting and messaging-to stimulate
WOM, the percentage of conversations
referencing media or marketing could grow
substantially.
Among media channels, television is
the most powerful WOM medium, with
references during 16 percent of all branded
conversations, and TV advertising more
often referenced than programming. The
internet is the next most often cited me-
dia source at 12 percent. Point of sale (8
percent) and newspapers (7 percent) fol-
low. Interestingly, for some particularly
strong WOM brands, the reference to me-
dia and marketing rises to as much as 65
percentindicating just how powerful me-
dia can be in creating great and powerful
WOM.
Hence "traditional" media and market-
ing channels must be counted among the
important "input" tools available to mar-
keters interested in driving WOM on be-
half of their brands.
SUMMARY AND CONCLUSION
Taken together, these (and other) findings
from the Keller Fay Group's research help
marketers to understand the true scope
and power of word of mouth. They show
that positive WOM is a powerful force in
driving recommendations and purchase
intent. Also, that media and marketing
communications have a significant role to
play in influencing conversations, with
significant differences evident from cat-
egory to category, and even from brand to
brand.
From a research perspective, we also
see how important it is to focus both on
the "senders" of brand advocacy, as well
as on the audience in WOMthe ulti-
mate receivers of marketing-relevant mes-
sages from other consumers. At various
times, everyone plays the role of "sender"
and "receiver" in conversations about.
brands. But in studying any one particu-
lar conversational brand mention, it is
critical to identify who is the "receiver"
on that occasion, because only he or she
can reliably tell us what they have heard,
who told them and with what degree of
credibility, and how that shared informa-
tion irrtpacts their purchases and conver-
sations in the future.
From a communications planning per-
spective, we can now bring fact-based
insights to help marketers move beyond
the traditional model of impressions, eye-
balls and efficiency, and instead to incor-
porate strategies that will generate true
advocacy for their brands and, with it,
brand growth,
E D KE LLE R is the CEO of the Keller Fay Group (www.
kellerfay.com), a market research firm that specializes
in word-of-mouth marketing. He is the co-author of The
Influentials: One American in Ten Tells the Other Nihe
How to Vote, Where to Eat, and What to Buy (Free
Press, 2003). Mr. Keller is also the president of the
board of the Word of Mouth Marketing Association
(www.womma.org).
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