We felt very fortunate to have him talk as it's clear his knowledge of WOM and the market research industry is expansive. As I was reading his bio to the class I was wondering how he manages to accomplish everything. He is a board member of the Advertising Research Foundation, president of the Market Research Council, and is President and Director of the Word of Mouth Marketing Association. And last year we served together, along with Jonathan Carson, as co-chairs of WOMMA's Research and Metrics Council.
Ed began his talk by explaining how Keller Fay wanted to take well-tested research methodologies of diary-based, day after recall that had been used for many years in the advertising industry and apply them to consumer-to-consumer WOM conversations. Starting in April 2006 they launched their TalkTrack™ service which collects reports of people's WOM episodes at the rate of 3,000 reports per month from a demographically representative sample of the U.S. (disclosure: I worked with them early on as a consultant in the design and pilot phases). One of the more interesting findings to date is just the sheer volume of conversation that take place. According to their research, the U.S. population generates approximately 3.5 billion brand-related conversations every day.
They are also tracking the contributions of what they call "Conversation Catalysts™." These are people who are actively engaged in WOM (as evidenced by how they make recommendations across multiple categories of marketing-relevant topics), and have the largest and most diverse social networks (WOMMA members can download a copy of their recent report, which Ed referenced in class).
One other point I'll mention from Ed's talk is how they are tracking Net Advocacy. Net Advocacy is a measure of the volume of positive and negative WOM. The methodology of computing Net Advocacy is similar to the Net Promoter Score™, but instead of using likelihood to recommend, it is computed using volume and polarity/valence (positive, negative, neutral, and mixed). The Net Advocacy formula is as follows:
Net Advocacy = % PWOM - (% NWOM + % Mixed WOM)
Like NPS, the neutral WOM doesn't figure in to the calculation, but unlike NPS, which doesn't have a "mixed" category (both positive and negative WOM), "mixed" is added to the negative category and then that combined amount is subtracted from the percentage of positive WOM.
So, let's say 50% of a firm's WOM is mostly positive, while 10% is neutral, 10% is negative, and 30% is mixed. Their Net Advocacy score would be:
50 - (10 + 30) = 10And like NPS, a firm's net advocacy score can be negative, positive, or zero.
Ed explained that a firm could monitor their Net Advocacy score over time as an indicator of how well the company is doing in the conversations of consumers. It will be interesting to see if Net Advocacy is tied to key performance metrics and/or correlated with market share.
At the end of Ed's talk I facilitated a discussion about how companies are organizing for WOM. Ed cited the example of Intuit as one company who has been doing a great deal in organizing to leverage WOM principles, especially with the communities that form around their products and services (a point that we also heard Jackie Huba make in her talk). Ed also indicated that when he presents to companies he has far fewer "background" slides (in comparison to a year ago) about why WOM is important to companies. Most companies now already get that point and they want to move quickly about how to learn from consumer conversations and whether or not, and how, to engage consumers.
Thanks Ed for a great class visit! It was a cold and windy day with an impending snow storm so we appreciate your time and trip to Beantown!
Tags: WOM word of mouth Word-of-Mouth Marketing buzz marketing viral marketing marketing communication Northeastern University