Viral and Word of Mouth Marketing: Industry Report

Viral and Word of Mouth Marketing

Product Type: Market Research Report
Published by: Datamonitor
Published: June 2004
Product Code: R313-6907

Description

Introduction
With growing numbers of consumers suffering from 'confusion by over-choice' and distrusting product claims, cutting through advertising "clutter" with a credible message has never been more important. Effectively identifying and targeting the right consumers to generate "buzz" for your product is essential and this report shows how and when to effectively utilize viral and word of mouth marketing.

Scope
A comprehensive analysis of Opinion Formers, Adopters and Regulars; the three consumer groups that influence message diffusion.
In-depth analysis of why viral and word of mouth marketing is becoming an increasingly effective strategy to cut through advertising clutter.
Detailed Action Points pinpointing how to devise effective strategies appealing to the changing attitudes and behaviors of European and US consumers.
Extensive analysis of the latest and most effective viral and word of mouth campaigns including the impact of age, gender, and product format.
Highlights
A growing number of consumers are citing word of mouth as the most important factor influencing their interest in products. With the latest Euroborometer survey showing that 58% of Europeans do not trust corporations, relying on the relative credibility, honesty and impartiality of word of mouth will continue to grow.

Two major viral and word of mouth marketing tactics exist to target the three consumer groups involved in message diffusion. Marketers need to choose the most appropriate technique depending upon whether long-term 'cool' or mass market appeal is being sought.

Viral and word of mouth marketing is most effective when promoting experiential, complex, premium, quirky and cool products. Given that most packaged goods products do not meet these criteria, marketers will benefit from devising campaigns that enhance consumers' involvement in general product purchases and their emotional attachment to brands.

Reasons to Purchase
Discover how to align viral and word of mouth marketing with the latest consumer trends in order to maximize campaign effectiveness.
Understand the characteristics, behavior and relative size of key consumer groups influencing word of mouth diffusion.
Improve your marketing by understanding how and why to integrate viral and word of mouth marketing into the overall marketing mix.

Table of Contents

TABLE OF CONTENTS

CHAPTER 1 EXECUTIVE SUMMARY 3

The hot topic 3

The future decoded 3

Action points 6

CHAPTER 2 THE FUTURE DECODED 12

Introduction 12

Distinguishing between viral and word of mouth marketing 12

The importance of viral and word of mouth communication 12

Trends associated with viral and word of mouth marketing 14

Consumers lack trust in societal institutions 14

Consumers suffer from information overload 18

Consumers are connecting and talking more about CPGs 20

Consumers increasingly seek coolness and connoisseurship 24

The consumer groups influencing message diffusion 25

There are three consumer groups involved in message diffusion 25

Opinion Formers are the smallest group affecting message growth 26

Adopters play a crucial role in rapid diffusion of information 28

Regulars are the largest group in WOM diffusion 33

Two core methods exist for viral and word of mouth campaigns 34

The impact of product and brand type on message diffusion 36

Product format determines consumers’ influence levels 36

Word of mouth marketing is more conducive to certain products 36

Brand familiarity is also an important factor 39

The impact of age, gender and untargeted consumers 40

Younger consumers are more influenced by their peers 40

Women are more likely to share opinions about products 42

The best buzz starters are not always your target consumers 43

Attitudes towards viral and word of mouth marketing 43

Consumers are becoming more skeptical and aware of new tactics 43

Consumers respond particularly well to three key factors 46

Conclusions 50

The benefits must be analyzed on a brand by brand basis 50

Trendsetters and Trend Connectors possess important differences 50

Products must simply surpass consumer expectations 51

CHAPTER 3 ACTION POINTS 52

Adapt strategy depending on product or positioning 52

Target Opinion Formers for products seeking a cool positioning 53

Target the Adopters for products with mainstream positionings 53

Research consumers to identify the message connectors 54

Integrate viral and WOM efforts into your marketing strategy 56

Don’t underestimate advertising’s importance in creating buzz 58

Recognize the importance of packaging design in creating buzz 60

Use V&WOM marketing to distribute unusual messages 61

Embark on a ‘seeding’ targeting initiative 62

Strategically seed products within target market clusters 62

Target influential consumers who can act as brand ambassadors 62

Seed within the target group’s everyday lifestyle spaces 64

Talk to the people who talk to the customers 65

Ration information supply, or the product itself, to create buzz 65

Pursue ways of increasing consumer involvement 66

Embrace an Experiential Marketing philosophy 66

Use incentives, humor and simplicity for message ‘stickiness’ 67

Make use of rewards and tempting incentive mechanics 69

Consider using humor and taboo content 70

Ensure the concept is simple, minimizing potential for distortion 73

Demonstrate sensitivity to demographic factors 73

Place more emphasis on younger audiences 73

Target women as their referral rates are higher 74

CHAPTER 4 APPENDIX 75

Definitions 75

Research methodology 76

References 77

LIST OF TABLES

Table 1: Percentage of Europeans who “do not trust” the press, radio, television, political parties, big companies and religious institutions, 2003 15

Table 2: Types of brands that respondents trusted the most to provide effective goods for different regime types, 2002-03 16

Table 3: North American new domestic product launches by industry, 1999-2008 18

Table 4: Drivers and evidence of the connectivity mega-trend in Europe and North America 21

Table 5: Examples of CPG innovations capitalizing on consumer connectivity and need for social interactions 23

Table 6: The number of Opinion Formers, by country, 2003-2008 28

Table 7: The number of Adopters, by country, 2003-2008 31

Table 8: The number of Regulars, by country, 2003-2008 34

Table 9: Perceptions of media effectiveness in making a product appear cool or trendy, EU and US consumer vs. EU and US industry respondent perceptions, %, 2003 38

Table 10: EU and US consumer judgment on the importance of the 'cool' factor when making purchases from different categories, 2003 39

Table 11: Methods for identifying the category vanguard 55

Table 12: Commonly referred to attributes that European and US consumers think contribute to a product’s coolness, 2003 60

Table 13: Remington’s edgy viral push in 2003 61

Table 14: Definitions of terms and abbreviations used in this report 75

LIST OF FIGURES

Figure 1: An overview of the three consumer adoption groups influencing product and message diffusion 25

Figure 2: P&G’s view of the crucial ‘connector’ group to target to spread WOM messages 32

Figure 3: Different strategies for aspirational and mainstream brands 35

Figure 4: Identifying the two phases of viral and word of mouth campaigns through the ‘AIDA’ model of communication 48

Figure 5: Different strategies for aspirational and mainstream brands 52

Figure 6: Identifying which consumer adoption group to target, by product type 54

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