Whether by referrals or positive product reviews, companies depend on Word of Mouth (WOM) to help drive new opportunities. Why? WOM can have a very positive impact on your brand marketing plan.

Every business initiative must be measured, so if you are working on WOM projects, how will you measure success? It’s not as cut and dried as you might expect. A study found almost 50 different measures being used by WOM “experts” to calculate the value of word of mouth. Before we examine and suggest some metrics for your WOM efforts, let’s be sure we’re on the same page about what comprises WOM.

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The Word of Mouth Marketing Association (WOMMA) explains WOM for companies as “The purpose of…word-of-mouth marketing is…to enlist target consumers to become senders of marketing-relevant information to other consumers/customers, who will ultimately go on to buy products and services.” Most expert practitioners agree that there are two types of word of mouth: organic — that which happens naturally — and amplified — a campaign that the marketer facilitates. Experts believe that the former can be measured through traditional brand tracking, reputation surveys, and customer experience monitoring, while the latter can also be measured through traditional campaign tracking tools. A note of interest, per WOMMA, nearly 80 percent of word of mouth marketing occurs offline.

Best practices for Word of Mouth projects generally include the following steps:

• Define outcomes. Clearly and succinctly state the intended outcome of the campaign expenditure in economic or behavioral terms. If your primary goal is to influence awareness or attitudes by reviews, attempt to forecast how that will translate into an increase in profitable customer behavior patterns. If the objective is to shorten the sales cycle, develop hypotheses about how much shortening you can do and what the economic value of a shorter sales cycle would be. If you’re intending to influence the net promoter score, be clear on your expectations for the financial outcome associated with a 1 percent, 5 percent, or 20 percent improvement.
• Test message strategy effectiveness on behavioral intentions. There are many choice/options techniques available today that can tease out the potential impact of subtle changes in message execution. Much of this can be done quickly and inexpensively via online research panels.
• Construct experimental designs to validate the relationships between intended behavior change and actual behavior change. Develop test/control constructs to determine the true predictive value of the awareness or attitude change. Try to control WOM message exposure either geographically or, if that’s not possible, on the basis of targeted delivery channels, demographic sub-segments, or simply time (pre-launch vs. post-launch). Methods of controlling for extraneous environmental factors are readily available from your local statistician or academic.
• Conduct post-campaign interviews with current and new customers, and those who still resist your value proposition. The goal is to find out what did/did not influence their decisions to act/not act as you desired.
• Review your proposed measurement methodology with key constituents of the outcome in advance. If the campaign results are positive, who is most likely to challenge your eventual findings? Ensure that finance, sales, and operations are able to air their concerns about the validity of the approach before launch and ask if they have any better ideas.

So what are other companies doing in terms of WOM measures and metrics? Read Part Two.

FAQ:

• Organic WOM: Happens naturally without a marketer-led campaign. It is typically measured through brand tracking, reputation surveys, and customer experience monitoring.
• Amplified WOM: Facilitated by a marketer through a campaign. It can be measured using traditional campaign tracking tools in addition to brand and reputation measures.

1. Define outcomes: State intended outcomes in economic or behavioral terms (e.g., awareness-to-behavior translation, sales-cycle reduction, NPS improvement with financial implications).
2. Test message effectiveness on behavioral intentions: Use choice/option techniques and fast online panels to evaluate message impact before scaling.
3. Use experimental design to validate causality: Apply test/control structures and control exposure by geography, channel, segment, or time (pre vs. post).
4. Conduct post-campaign interviews: Speak with customers who converted, those who are new, and those who resisted to isolate what influenced decisions.
5. Pre-review methodology with stakeholders: Align with Finance, Sales, and Operations in advance—so validity concerns are addressed before launch, not after results are reported.

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