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Peer Persuasion: Driving Your Business Without Driving You Crazy June 8th, 2010
For all the aspects of modern life that have been irrevocably changed by the digital tsunami, happily some of the crucial drivers of human behavior have remained stubbornly the same. We’re seeing lots of clients wrestling to understand dynamics that can incent certain audience segments to persuade peer groups to support ideas, activities, and commercial transactions. According to our friends at McKinsey & Company, “word-of-mouth is the primary factor behind 20%-50% of all purchasing decisions and is the only factor that ranks among the top three at every stage of the buying process.” They argue that the influence of word-of-mouth is most pronounced when consumers are buying for the first time or when the product /service is perceived to be a premium tier, expensive product.
Peer persuasion is another way of thinking about an activity that is frequently (mis)labeled word-of-mouth marketing. This term typically refers to consumer-to-consumer communications that have occurred with no exchange of economic incentives. More and more, the mouth has less and less to do with how such behavior is promoted. Web technologies have amplified and accelerated the power of such peer persuasion by shifting the model first from a one-to-one to a one-to-many, and more recently to a many-to-many model. In this environment, the real or perceived strengths (or failings) of a product are posted on countless Web sites and blogs or disseminated through social networks with almost instantaneous impact, burnishing or bruising brands in the process.
The volume of product information available online today, and the ease of accessing that information, has profoundly shifted the balance of power between companies and those who buy their products and services. But as consumers have become overloaded with escalating multi-channel marketing messages, they have become increasingly skeptical about, and in many cases blind to, company-sponsored advertising techniques. Today’s consumers increasingly appear to make their purchase selections largely independent of what corporate marketing tells them about products. The power of this influence will almost certainly grow over time – the real question we need to be asking is how do you measure and manage this crucial dimension of the online experience?
Managing peer persuasion depends largely upon measuring its economic value. That’s more difficult than it should be due to anomalies within nebulous social communities and the fact that the viral diaspora places much of the actual peer influence outside the reach of conventional web analytics. However, there are several techniques we’re using to bring more quantitative insight to this process. A simple way to begin can be using a tool like BlogPulse, IceRocket, or Technorati, all of which offer automated trend-discovery system for blogs. BlogPulse (Nielson) is a relatively sophisticated search engine for blogs with tools for buzz-tracking, identifying emerging trends, or following conversation themes that emanate and spread from blogs or individual blog posts. You can begin to understand and then measure what is being said about your product and how frequently those comments are occurring.
Another technique that we’re seeing from our developers is to incorporate code elements that are invisible to the users but continue to report back as your content travels across social networks and around the Web. Hooks in the code can help you understand geographic penetration, duration of use, and content popularity. Ultimately, meaningful analysis will require some level of automation. Some of the best tools can be found at Buzzmetrics and Intelliseek, to name a few. Interestingly, Intelliseek was acquired by Buzzmetrics and the combined entity swallowed by Nielson who seems increasingly committed to gaining a foothold in the technology that is currently dissolving its traditional “big” media businesses. Looks like the Long Tail may win in the end!
One Comment for "Peer Persuasion: Driving Your Business Without Driving You Crazy"
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It’s interesting that while corporations have certainly recognized the trend that Leo highlights and many are now investing a lot in monitoring and participating in social media-based conversations, they still view this activity primarily (solely?) as a tool for managing and protecting their brand reputations.
Few companies (none that I’ve seen, actually) seem to be directly incorporating customer word-of-mouth (i.e. blog and social network posts) INTO their marketing. In other words, we’ve yet to see ads in traditional (or online) media that say something like “82% of bloggers in your community say they would recommend Clorox cleaning products to a friend”, followed by links to the most positive posts.
I wonder if that will be the next step? And if so, will leading bloggers start to become paid product endorsers? — RR
Rob Riordan on June 9th, 2010 at 11:46 am
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