the value of buzz: why businesses should care
DESCRIPTION
In a tough economy, why should businesses be focusing more on word of mouth in their marketing campaigns?TRANSCRIPT
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The Value of Buzz
Why Businesses Should Care
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What is Word of Mouth?
• The sharing of product and brand information amongst people.
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Traditional Advertising
• In 2009, advertisers in the U.S. spent an estimated $119 billion, according to The Nielson Company.
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Super Bowl Ads
• In 2010, the cost of an ad during the Super Bowl ranged from $2.5 to $2.8 million for 30-second commercials.
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Pepsi Skips the Super Bowl
• In the last decade, Pepsi spent $142 million on Super Bowl ads.
• This year, Pepsi decided not to air an ad and started a $20 million social media campaign called the Pepsi Refresh Project.
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Honey Bees and WOM
• Honey bees communicate through dances that describe the direction and distance of nearby nectar sources or new housing locations.
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Why is WOM so great?
• In 2007, Edelman Trust Barometer ranked “a person like me” as the most reliable source of information about a company.
• The average American will talk about roughly 70 brands each week.
• Recommendations are stronger influences on consumer purchase behavior.
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Why is traditional advertising not?
• Expensive!• People don’t trust ads!• Too much noise= no one pays attention!• Low return on investment!
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Can WOM be measured?
• In 2006, Keller Fay Group asked 100 people a day to record conversations they had about products and brands. Since then, they have amassed around 36,500 reports annually.
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Paranormal Activity, 2009• Driven by strong word of mouth,
Paranormal Activity earns $7.1 million in its opening box office without any expensive marketing campaign.
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WOM won’t go away
Twitter, Facebook, and Yelp are examples of how WOM will continue to stay strong.
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