History[edit]
In the early 1970s, psychologist George Silverman pioneered word-of-mouth marketing by creating "teleconferenced peer influence groups" aimed at engaging physicians in discussions concerning new pharmaceutical products. Through his conduction of these focus groups, Silverman noted that physicians with positive experiences regarding a particular drug could influence skeptical peers, including a dissatisfied group of ex-prescribers who had negative experiences with the drug.[3]
The emergence of Web 2.0 brought about noteworthy changes in WOMM, with many web startups such as Facebook, YouTube, MySpace, and Digg incorporating buzz marketing into their platforms to leverage their social networks. This integration has amplified the power of word-of-mouth marketing, especially with the Internet serving as a primary research and communication platform. The Internet's role has simplified communication processes by eliminating barriers like distance and language, encouraging consumers to share their opinions readily and form communities, sequentially strengthening word-of-mouth marketing.
In 2003, Fred Reichheld introduced the Net Promoter Score as a word-of-mouth marketing strategy, assessing the number of promoters recommending a brand to others. This tactic emphasizes the importance of positive customer experiences in driving organic word-of-mouth marketing.
In October 2005, the advertising watchdog group Commercial Alert petitioned the United States Federal Trade Commission (FTC) to issue guidelines for paid word-of-mouth marketers, requiring them to disclose their relationship and compensation from the company whose product they promote.[4] The FTC responded by committing to investigate cases where such relationships are undisclosed and could impact endorsements, pledging to take enforcement actions as necessary, including cease-and-desist orders, fines, or civil penalties.[5] The Word of Mouth Marketing Association, a prominent US trade group representing numerous companies, has since adopted an ethics code prohibiting manufacturers from offering cash to consumers in exchange for recommendations or endorsements.[6]
In 2008, PQ Media stated that companies spent $1.54 billion on word-of-mouth marketing, indicating a significant growth trend compared to traditional advertising channels. Within this, word-of-mouth marketing expenditure increased by 14.2% in 2008, with 30% allotted to food and drink brands.[7]
In December 2014, the Journal of Advertising Research found that 75% of all consumer conversations about brands happen face-to-face with merely 15% happening over the phone and just 10% taking place online.
According to the Journal of Consumer Psychology[8] and Jonah Berger's book Contagious: Why Things Catch On,[9] six key factors drive what people talk about and share.[10] They are organized in an acronym called STEPPS, which stands for:
Additionally, as mentioned by Berger, interest plays an essential role in driving word-of-mouth communication.[11] Andy Sernovitz supports this theory, stating that, “nobody talks about boring companies, boring products, or boring ads,”.[12]
Techniques[edit]
Marketing buzz[edit]
Marketing buzz, also known simply as "buzz", refers to the phenomenon in word-of-mouth marketing where consumers and users of a product or service contribute to amplifying the original marketing message.[16] It can be described as a form of positive hype,[17] excitement, or anticipation surrounding a product or service among consumers. Achieving positive "buzz" is often a key goal of viral marketing, public relations efforts, and advertising campaigns on Web 2.0 platforms. This term encompasses both the strategic execution of marketing techniques and the resulting positive sentiment and goodwill generated.
Products that generated strong marketing buzz upon their introduction include Harry Potter, the Volkswagen New Beetle, Pokémon, Beanie Babies, and The Blair Witch Project. These products successfully leveraged various marketing strategies to create widespread excitement and positive associations among consumers, highlighting the power and impact of generating effective marketing buzz.
Viral effects[edit]
Viral marketing and viral advertising are buzzwords referring to marketing techniques that use pre-existing social networks to boost brand awareness or achieve marketing goals like increased product sales through self-replicating viral processes, analogous to the spread of a virus. These methods can be amplified by word-of-mouth or enhanced through Internet network effects.[18] Viral campaigns can manifest as various content formats such as video clips, interactive games, ebooks, brandable software, images, or text messages. Successful viral marketing aims to target individuals with high social networking potential (SNP) and create compelling viral messages that resonate within this group. However, it's worth noting that the term "viral marketing" also carries negative connotations, referring to deceptive practices like stealth marketing and astroturfing to simulate organic word-of-mouth enthusiasm.[19]
Consumers promote brands through word-of-mouth based on social, functional, and emotional factors.[20] The Journal of Marketing Researchhas identified thirteen brand characteristics that stimulate WOM:[21]
While social and functional play a significant role in online WOM promotion, offline WOM is primarily driven by emotional factors.
Advantages and disadvantages[edit]
Advantages[edit]
Word-of-mouth marketing plays a crucial role in amplifying the impact of an advertising campaign by effectively navigating consumers' defenses and encouraging discussions about a specific product. Marketers value WOMM for its ability to analyze personal networks, which are driven by genuine experiences rather than organizational motives.
One notable advantage of word-of-mouth marketing is its reliance on personal recommendations, fostering trust and authenticity in consumers' perceptions. Positive feedback from trusted sources boost consumers' willingness to try a product or service, enhancing overall campaign effectiveness.
Disadvantages[edit]
Word-of-mouth marketing is not favorited by everyone, particularly in today's digital landscape. Online platforms allow not only positive but also negative reviews to spread rapidly,[23] potentially undermining brand perception and consumer attitudes. Negative word-of-mouth can have a more significant impact on purchase intentions compared to positive feedback, highlighting the delicate balance in managing brand reputation.[24]
Another issue arises when consumers perceive manipulation or hidden agendas behind word-of-mouth recommendations.[25] Discovering that influencers have vested interests in promoting a product can lead to skepticism and negative shifts in attitude, ultimately affecting brand reputation negatively.[25]
Similarly, engineered word-of-mouth campaigns by internet-focused companies face scrutiny for their perceived artificiality and invasion of privacy, further complicating the dynamics of consumer trust and perception in marketing strategies.[15]