mad.co.uk - DM Weekly, 17 August 2005

DMC’s MD Justin Kirby asks what metrics should be used when employing non-traditional marketing alternatives.

Justin Kirby asks what metrics should be used when employing non-traditional marketing alternatives.

Viral marketing is over 10 years old now and has finally been embraced with gusto by mainstream marketers, as noted in NMA (’Catching on’ 20 April, 2006).

The ‘death of the 30-second ad spot’ issue is a bit like ‘climate change’ or ’smoking kills’: only those with a lot to lose continue to dispute it. As ever, change is a very slow and often painful process rather than an epiphany. However, more brands are slowly beginning to acknowledge the problems of relying solely on traditional advertising, and they are starting to explore non-traditional marketing alternatives, such as advergaming, product placement, branded content, viral, mobile, experiential, etc.

The efficacy of these non-traditional techniques is an important issue: if you can measure something, you can manage it and learn how to improve results. Yet there is little agreement about how new and innovative marketing techniques should be measured.

Take viral marketing as an example. Most viral marketing output is better described as contagious advertising and is judged to be successful simply in terms of whether it has ‘gone viral’ or not. This means that success is judged on the extent to which the creative material has been seen, rather than what happens after people see the material (did it shift any product, did it increase awareness of the brand, etc).

So, in reality, viral or contagious advertising successes currently have less to do with adding to a brand’s bottom line and more to do with creating low-cost brand awareness. They do the latter predominantly by leveraging user-driven online personal communications technologies and people’s social networks, rather than using paid-for media. Strange then that many brands and ad agencies still view the distribution or seeding of contagious advertising in terms of traditional media buying. As ever, old habits die hard.

But there is a wider problem if contagious advertising is going to be justified simply in terms of generating brand awareness. Contagious advertising - or any form of branded content for that matter - is likely to increase general ad clutter and become part of the ‘much advertising no longer works’ problem, rather than the solution. Take the Budweiser ‘Whassup?’ campaign. People in the UK knew the catchphrase before the ads even appeared on TV here. So was this a ‘viral’ success? For many in adland the answer would be an unequivocal ‘yes’, but despite the buzz, Budweiser’s market share dropped by eight per cent during that period. The point is that there is no consistent correlation between creating brand awareness and generating sales.

So exactly what metric should be used to prove marcoms success?

Brands and the advertising and marketing community need to take a leaf out of the management consultants’ book. Research by Fred Reicheld at Bain & Co shows that there’s a strong correlation between a company’s growth rate and the percentage of its customers who say they are extremely likely to recommend the company to a friend or colleague. Therefore the more customers that recommend your brand, the more sales you make.

Forget about any other metric, whether customer satisfaction, brand awareness, or intent to purchase, etc. Just ask customers one basic question: on a scale of one to ten how likely are you to recommend this brand, product, or service? That simple metric when mapped against brand performance is proven to predict company growth accurately.

Obviously, it’s not really fair to compare mainstream entertainment sites with social networking sites such as MySpace.com. The latter has not only more than 60 million users, but also much deeper pockets since its US$580 million acquisition by News Corp. Its users can be targeted geographically, and profiled in terms of how connected and influential they are within their respective communities.

With this outcome foremost in mind, successful marketing communications are not about using X, Y, or Z alternative marketing technique to create conversations per se, but whether those approaches and the conversations they generate are increasing recommendation rates.

If advertising and marketing practitioners can show that they have improved brand recommendation rates rather than simply increased brand awareness - (who doesn’t know about Coca Cola?) - then they can prove they are adding value to the bottom line.

This in turn overcomes the problems for brands of deciding which marketing practitioners and techniques to employ, and for practitioners of being commissioned based on such ambiguous ’success criteria’ as hourly rates, creative awards, etc.

It’s a win-win situation for everyone involved. Now let’s see how long it takes for everyone to realise it…

Justin Kirby is managing director of Digital Media Communications and co-founder of the Viral + Buzz Marketing Association