Compensation for Spreading Word of Mouth Marketing?
| posted by Fast Company staffAt yesterday's 2006 Corante Innovative Marketing Conference, Larry Weber had this to say about word of marketing: "Compensation is a big red flag for word of mouth marketing.....true word of mouth is transparent recommendations."
This was said at a conference at which at least a few in the audience were engaged in that very thing -- coming up with appropriate ways in which to reward people who spread the word about their products and brands. No one questioned him on it at the time, but I had a couple of conversations afterward with a few attendees about it.
For me, the only truly authentic ways for a company to be involved in word of mouth is to come up with truly great things (products, services, promotions, etc.) for people to spread the word about. And make it easier for them to spread the word by making the word available (putting information on the web where it can be linked to, making company reps and spokespeople available for comment to people besides the mainstream media). And then use all available technological means to track what's being said and try to measure the effect.
It seems that when a company tries to do more than this to manipulate word of mouth, the potential downside is just too great.
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Recent Comments | 4 Total
June 11, 2006 at 3:10am
SanjayI don't see anything wrong with pushing people a little bit. My company, Simply Audiobooks, rewards people who refer by giving them a one month upgrade in service (non cash compensation). But I'll agree that it's sometimes unecessary - 15% of our site traffic comes from referrals, but only 1/4 of that via the formal referral system.
June 11, 2006 at 3:29pm
PaulMaclThere is an industry of very successful word-of-mouth marketing, including appropriate compensation for those spreading the word.
Cash compensation and totally connected.
Of course, the mainstream media and conventional advertisers hate word-of-mouth marketing! There is no cut for them.
June 11, 2006 at 10:07pm
Rob TothI just finished a 62-page report (with 30 mins video tutorials) on nearly the same subject. Word of mouth is just too effective to simply "leave it to chance". Have the systems (and incentives) in place and encourage customers to create more customers. Afterall, they are customers for a reason (they find value in the product/service). Doesn't it make sense that they should offer this same value to their friends/coworkers?
With compensation, you beter ensure that they will take this step.
June 12, 2006 at 10:43am
Myles KHaving worked on several extremely successful online WOM programs (although in the interactive space we tend to call this "viral"), there certainly is tremendous opportunity, and to PaulMacl's point--the offline-general (TV, print) may not like it, but in the online space we DO!
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