Wom, eWOM and ROI

1. Using Word of Mouth
Strategy in via Social Media
to increase Return on
Investment
By: Dana Christensen

2. ROI and SM: The struggle is Real
Is there a good way to measure ROI?
-Traditional methods sometimes aren’t truthful
-Many misconceptions
-How do you show ROI?

3. RQ 1: What is a true form of
engagement?
 Likes, shares and retweets are deceiving.
 WOM (word of mouth) is a proven revenue booster
outside of the SM world.
 eWOM & WOM go hand and hand
 Great success can be had by eWOM for a valuable
ROI

4. RQ 2: How is eWOM
measured?
 “Marketers know that theoretically, social media should
be a powerful way to generate sustainable, positive
WOM. If they can only select the right social media
platform, design the right message and engage the
right users to spread that message, their campaign
should be a success.”
 How do we effectively measure eWOM in terms of how
to boost a campaign?

5. How to evaluate eWOM
 The Customer Influence Effect: “In a group of social
media users who like to discuss, for example, ice
cream, the CIE measures the influence a user has on
other users in the network in regard to conversations
relevant to ice cream.”
 The Stickiness Index: “To be effective influencers for
Hokey Pokey, individuals needed not only to be
influential on social networks but also to like to talk
about ice cream.”
 Customer Influence Value: Purchase Value +
Influence Value = Customer’s Value.

6. RQ 3: What kind of content
sparks positive eWOM?
 Listed are the engagement level results of the survey:
 13% active creators
 nearly 19% critics
 15% collectors (social bookmarking to share)
 19% joining (joining but not contributing)
 32% passive spectators (activity but no contributions)
 52% inactives (does not engage in any activity)
 These statistics are depressing for SM marketers.

7. Community vs. Content
 “The most successful social marketers are building
communities.”
 “Scholars theorizing the current trend of participatory
culture emphasize users’ strong preference to share
knowledge and culture in communities.”

8. RQ 4: What do case studies reveal about
the relationship of eWOM and ROI.
 Zappos.com
 Hokey Pokey ice cream
 Case study analysis

9. Zappos Case Study
 … Although the website is doing a great job of offering
products and service once customers are there, how
can we increase the level of interaction and the
relationship intensity— customer engagement—with
Zappos?
 Analyzed FB posts related to revanue
 Used new Twitter API Tweet Wall

10. Zappos Results
 Facebook Results:
 42% of Zappos' posts resulted in sales,
 This campaign had an average conversion rate of 1.75%
of the Facebook posts, with some reaching 10%
conversion rates
 Twitter Results:
 600 product tweets from customers a month
 60 tweets a day about products
 40-85 Twitter based conversations daily

11. Hokey Pokey Case Study
cont.
 After analyzing key influencers
 Monitor conversations
 Identify influential individuals who can spread messages.
 Identify the factors shared by influential individuals.
 Locate those potential influencers who have interests relevant to
the campaign.
 Recruit those influencers with interests relevant to the campaign to
talk about the company’s product or service.
 Incentivize those influencers to spread positive WOM about the
product or service.

12. Hokey Pokey Case Study
Results
 The “Share your Brownies” and “Creations on the Wall”
campaigns were the campaigns that came from the
framework above.
 The total revenue from “Share Your Brownies” was
attributed to 23% to the conversations on Twitter and
about 80% was attributed to Facebook. The two social
networks had a 3%-8% overlap between the two.
“Overall, the campaign was a huge success: Hokey
Pokey realized increases of 49% in brand awareness,
83% in ROI and 40% in the sales revenue growth rate.”

13. Conclusion
 Due to many inactive SM users, eWOM and true
engagement are difficult to implement.
 There are direct links between eWOM and the impact
on a business’s ROI.
 Garnering eWOM is obtained through influential
individuals and a sense of community.
 User-generated content is a valuable asset within
online social networks.