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“WOM” tops $1B — good or bad?

One of the most interesting news bits from the Word-of-Mouth Marketing Summit this month was the PQ Media report that proclaimed WOM spending will top $1B in 2007, and grow to $3.7B in 2001. Time to party? Not so fast. Despite the “meteoric rise” that Ad Age reported, WOM spending is still less than 1% of the $254B marketing services industry.

The real question: Why is WOM spending still so ridiculously low? We’ve all seen the data that says a friend’s or colleague’s recommendation has more sway than marketers do when it comes to trying, buying, registering, voting, etc. We’ve also seen that people are spending more time in front of their monitors than their TVs. And we’ve also seen the *real* meteoric rise of Facebook, MySpace and other social networks.

So what gives? Part of it is definition — PQ specifically excludes in-store sampling, event marketing, PR and other categories to “avoid double-counting.” While that’s admirable, I can equally argue that most if not all PR and events work could be counted within WOM. At least PQ recognizes that WOM is intertwined with other disciplines — which takes me back to an academic “is it the objective” or “is it the strategy” debate.

Beyond definitions, the other barrier to WOM is good ol’ habit. Traditional advertising is still very comfortable for most clients, and marketers love the appeal of 30-second spots. As a relationship and reputation function, PR is arguably much better at fueling WOM — but it doesn’t package up so neatly in a pitch. The “big idea” is more easily consumed as an “ad” than it is as a “conversation” or as a “community.” But while old habits die hard, the times they are achangin’…