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Advocacy Measurement Month

Apparently April was Advocacy Measurement Month. I collected a number of fantastic and enormously valuable reports and articles published during April or so that are highly relevant to evaluating the impact of advocacy.  I’ve summarized interesting findings and stats from each piece below that I thought are worth noting but hope that you’ll find the bytes interesting enough to click-thru to read the full analyses.

1. The McKinsey Quarterly: A New Way to Measure Word-of-Mouth Marketing (April 2010)

• Word-of-mouth is the primary factor behind 20 to 50 percent of all purchasing decisions
• McKinsey has developed the “word-of-mouth equity” index which measures a brand’s power to generate messages that influence the consumer’s decision to purchase
• In the mobile-phone market, McKinsey has found that the pass-on rates for messages can increase a company’s market share by 10 percent (positive messages) and reduce it by 20 percent (negative messages) over a two-year period. [If you are familiar with Weber Shandwick’s advocacy research, you may recall that badvocacy, or brand criticism, reaches nearly twice as many people as brand advocacy.]
• Marketers tend to build campaigns around emotional positioning, but McKinsey found that consumers actually talk and generate buzz about product functions
• About 8 to 10 percent of consumers are influentials, whose common factor is trust and competence in a particular subject area. Influentials generate three times more word-of-mouth messages than noninfluentials do, and each message has four times more impact on a recipient’s purchasing decision. About 1 percent of these people are digital influentials—most notably, bloggers—with disproportionate power to influence
• Marketing-induced consumer-to-consumer word of mouth generates more than twice the sales of paid advertising in categories as diverse as skincare and mobile phones

2. AdvertisingAge: Spotting the Creators of Peer Influence, by Josh Bernoff (April 20, 2010)

Through online word-of-mouth, people make over 500 billion impressions on each other about products and services annually. Forrester Research estimates that U.S. social network users create 256 billion impressions on other social networkers per year and blog posts, blog comments, ratings and reviews, etc. generate another 250 billion impressions per year (hence the roughly 500 billion impressions)

Forrester concludes:

• People’s influence on each other rivals online advertising. For comparison, for a 12-month period ending September 30 last year, Nielsen Online estimates advertisers created 1.974 trillion online advertising impressions, compared to the 500 billion impressions people make on each other about products and services. And peer impressions are more credible than advertising, since they come from friends.
• A minority of people generate 80% of the impressions. About 6.2% of the online adults generate 80% of the influence impressions. Around 13.8% of the online adults generate 80% of the influence posts.

3. Nielsen/Facebook Report: The Value of Social Media Ad Impressions (April 20, 2010)

One common form of advocacy on Facebook is through social ads. That is, if a user’s friends are fans of a brand on Facebook, the ad unit itself will contain the names of those friends. But does this lightweight form of endorsement actually impact the effectiveness of the advertising? Nielsen and Facebook compared the responses of users who had seen ads with social context against users who saw ads with no social context from the same campaign. A user would be eligible to see social context if one of their friends had previously “Become a Fan” of the brand running the advertisement.

The result? Social advocacy impacts consumers three-fold: Ad recall is substantially higher with social advocacy with a lift of 16% (vs. 10% for non-social ads), the awareness lift is doubled, and the  purchase intent lift increases from 2% to nearly 8%.

4. Altimeter Group and Web Analytics Demystified: Social Marketing Analytics – A New Framework for Measuring Results in Social Media (April 22, 2010)

This report provides methods for quantifying your social media advocates, their reach/influence and their impact. It assumes that a company already has an agreed upon definition of advocates and a  process for identifying them, for example, the individuals generating positive or negative discussion about your brand.

Finally, having nothing at all to do with measuring advocacy, April saw the release of a movie called “The Joneses.” David Duchovny and Demi Moore star as a couple planted by a consumer marketing company in a gated community to spread word-of-mouth about its goods and services with the upscale community. The intent, of course, is to drive demand for the products. When I read the review for this movie (haven’t seen it), I thought of how the value advocacy has become so acknowledged by the mainstream.