4. How to make money in social media? Solve real problems, don’t create imagined benefits Retain customers, sell them more, keep them longer Co-innovate, develop better products and services Create promoters of your brand Encourage and enable promoters to advocate for you Word of mouth is alluring but elusive
5. Advertising goes into cardiac arrest “The problem is not the medium, the problem is the message, and the fact that it is not trusted, not wanted, and not needed,” Prof. Eric Clemons, Wharton, March 2009 “…every business needs revenues—and advertising, it transpires, is not going to provide enough” The Economist, March 2009
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7. Word of mouth is 9X as effective as advertising in converting unfavorable or neutral dispositions into positive attitudes. (Day)
8. More than 90% of customers consider WOM as the best source of ideas and info about products and services (McKinsey & Co )Source: CMO Council Profitability from Customer Affinity Report 2007
11. NPS is Word of Mouth capacity Capacity (economics), the point of production at which a firm or industry's average (or "per-unit") costs begin to rise, usually because some factor is fixed (often capital or land).
Across companies: the relationship holds as more promoters, the more + womPromoters drive PWOM; if you care about your business’ WOM, you need to care about your proportion of Promoterscustomer experience– and loyalty– become a relevant dimension to consider in marketing efforts r = .87Data come from 2008 NP benchmarkData cleaned for inconsistent responses (ex. “I have recommended in the past” AND “number of recommendations = 0”); cut cases above 98th percentile spend; Only business with more than 24 responses included in the analysis.
