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Word-of-mouth promotion has become an increasingly potent force, capable of catapulting products from obscurity into runaway commercial successes. The But to harness the considerable power of buzz, companies
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Word-of-mouth promotion has become an increasingly potent force, capable of catapulting products from obscurity into runaway commercial successes. The But to harness the considerable power of buzz, companies must reject five common myths. Buzz n Buzz ^ by Renée Dye Buzz IS THE STUFF OF MARKETING LEGENDS. Dark and witty Harry Potter, the trafficstopping retro Beetle, the addictive Pokémon, cuddly Beanie Babies, the hair-raising Blair Witch Project~a\\ are recent examples of blockbuster commercial successes driven by customer hype. For some reason, people like to share their experiences with one another-the restaurant where they ate lunch, the movie they saw over the weekend, the computer they just bought-and when those experiences are favorable, the recommendations can snowball, resulting in runaway success. But ask marketing managers about buzz, and many will simply shrug their shoulders. It's just serendipity, they say, or sheer luck. Renée Dye is a strategy expert in the London office of McKinsey & Company. HARVARD BUSINESS REVIEW November-December The Buzz on Buzz My research suggests otherwise. Investigating the marketing practices at more than 50 companies, my colleagues and 1 at McKinsey have found that buzza phenomenon we've dubbed explosive self-generating demand -is hardly a random force of nature. Instead, it evolves according to some basic principles. My research shows that companies can predict the spread of buzz by analyzing how different groups of customers interact and influence one another. Many executives have little idea how to orchestrate a marketing campaign that exploits the full power of customer word of mouth. Instead, they remain enslaved to five common misconceptions about the phenomenon. Before companies can reap the total benefits of buzz, they must understand the principles of how it works, and doing so requires a close examination of thosefivemyths. MYTH 1: Only outrageous or edgy products are buzz-worthy. Everyone can point to a buzz-driven consumer craze that was due in part to the sheer inanity or fringe quality of a product-think of pet rocks or the movie The Matrix. Yet according to our analysis, a surprisingly large portion of the U.S. economy-a shade above two-thirds - has been at least partially affected by buzz. (See What Buzz Affects for an industry-by-industry breakdown.) Obviously, buzz greatly affects the entertainment and fashion industries, but it also influences agriculture, electronics, and flnance. Indeed, few industries are immune these days, partially because of technological innovations like the Internet that enable customers to spread buzz quickly. Consider the pharmaceutical industry, which has recently witnessed a dramatic increase in the power of buzz. In the past, pharmaceutical companies marketed new prescription drugs primarily through a direct sales force that distributed educational materials and free samples to physicians. Consumers were rarely aware of new therapies except as prescribed by their doctors. Today, thanks to extensive advertising and the Internet, consumers have access to health-care information on a scale undreamed of just ten years ago. Indeed, a revolution is under way, transforming people from passive to active participants. In choosing their treatments, such active consumers can-and do-generate and spread buzz. Case in WHAT BUZZ AFFECTS* Slightly more than two-thirds of the U.S. economy has been influenced by buzz. 54% 13% 13% Largely Driven by Buzz Toys, sporting goods, motion pictures, broadcasting, amusement and recreation services, fashion 54% Partially Driven by Buzz Finance (investment products), hotels and lodging, electronics, printing and publishing, tobacco, automotive, Pharmaceuticals and health care, transportation, agriculture, food and drink 33% Largely Immune to Buzz Oil, gas, chemicals, railroads, insurance, utilities 'McKinsey & Company estimate for 1994 U.S. economy (total equals 16 triilionl point: Viagra, one of the most talked-about prescription drugs ever, even among those who don't need it. Shrewd pharmaceutical companies are now taking a two-pronged approach to jump-start buzz among both doctors and consumers. For example, when Merck launched Fosamax, a therapy for osteoporosis, the company carefully chose scientists and physicians with high standing to conduct the clinical trials and to promote the new treatment. In addition, Merck increased the visibility of the new treatment by sponsoring symposia at international meetings. On the consumer side, the company launched a major marketing campaign in women's magazines to inform readers of the risks of osteoporosis and educate them about the value of screening and preventive treatment. Before long, the debilitating bone condition became a common topic of discussion among women and between women and their doctors. As a result of these efforts, Merck was able to generate significant buzz for a previously unnch table subject. Medicine is one thing, but sometimes even the most ordinary products can benefit from buzz. Remember Hush Puppies? When the company discovered that hip New York City kids were snapping up vintage pairs of its shoes at secondhand stores, it rushed into action. It began making its shoes in shades like Day-Glo orange, red, green, and purple. Next, it sent free samples to celebrities, and not long after, David Bowie and Susan Sarandon were spotted wearing them. Then the company tightly controlled distribution, limiting the shoes to a handful of fashionable outlets. Soon high-end retailers like Saks, Bergdorf Goodman, and Barneys were begging for them. In just three years, from 1994 to 1996, Hush Puppies saw its annual sales of pups in North America skyrocket from fewer than 100,000 pairs to an estimated 1.5 million. Of course. not every product is a good candidate for buzz marketing. How, then, can managers assess buzz-worthiness? Two criteria make it possible. First, products ripe for buzz are unique in some respect, be it in look, functionality, ease of use, efficacy, or price. For Chrysler's PT Cruiser, the degree of difference from the competition clearly lies in its retro, gangster-era 140 HARVARD BUSINESS REVIEW November-December 2000 The Buzz on Buzz look. In the case of collapsible scooters, the key buzz-worthy factors are functionality and ease of use: what other product allows people to dash from place to place on a lightweight, folding device? Second, products with great buzz potential are usually highly visible. For many products, that condition is a no-brainer. The popularity of fashion accessories, like Gucci's baguette bags, tends to spread Üke wildfire because they are easily seen by others. Every time someone in a meeting pulls out a Palm device to jot a note, the company gets another endorsement of its popular PDA. But insightful companies have discovered that products can be made visible. One way is to create forums, such as Internet chat groups, where customers can exchange information about a product-such as a new medical treatment-that might otherwise have remained hidden. Often, creative approaches are needed to facilitate the discussion. Pfizer, the maker of Viagra, faced an uphill battle when trying to generate buzz for its breakthrough drug, because impotence was a taboo subject But by popularizing the medical terms erectile dysfunction and ED, the company transformed the undiscussable into fodder for the bedroom and backyard alike. MYTH 1: Buzz just happens. Many people believe that buzz is largely serendipitous. Not so. We have found that buzz is increasingly the result of carefully managed marketing programs. Savvy ALL CUSTOMERS ARE NOT CREATED EQUAL. SOME-THE VANGUARD - HAVE A DISPROPORTIONATE ABILITY TO SHAPE PUBLIC OPINION. managers have a portfolio of marketing tactics from which they assemble just the right sequence to generate and sustain buzz. Here are some of the most powerful tactics we've identified from our research. Seed the vanguard. All customers are not created equal. Some-the vanguardhave a disproportionate ability to shape public opinion. Increasingly, managers are recognizing that getting their products into the hands of the vanguard can pay off exponentially in how the mass market ultimately responds. Abercrombie & Fitch, for example, recruits college students from popular fraternities and sororities to work in its stores, knowing that they will then probably wear A&F clothes more frequently and, in doing so, implicitly endorse the fashions. Ration suppiy. People often want what they-or others-can't have. The luxury-goods industry has long exploited this tendency, and today other companies are increasingly using it to their advantage. Walt Disney has excelled at maintaining high demand and buzz for its animated films by carefully controlling their availability on video. The Disappearing Classics campaign of 1991 announced that the company would retire certain videos, allowing consumers just a limited time to purchase them. Films subsequently brought out of retirement were being re-released in theaters. Previous experience with this campaign led Disney to project in 1995 that video sales for some films could surge by as much as 400%. THE 5 MYTHS OF BUZZ THE MYTH... Only outrageous or edgy products are buzz-worthy. 2 Buzz just happens. 3 The best buzz-starters are your best customers....the REALITY The most unlikely products, like prescription drugs, can generate tremendous buzz. Buzz is increasingly the result of shrewd marketing tactics in which companies seed a vanguard group, ration supplies, use celebrities to generate buzz, leverage the power of lists, and initiate grassroots marketing. Often, a counterculture has a greater ability to start buzz. A Q To profit from must act first and fast. The media and advertising are needed to create buzz. Copycat companies can reap substantial profits if they know when to jump in-and when not to. When used either too early or too much, the media and advertising can squelch buzz before it ignites... M II 1 II ' HARVARD BUSINESS REVIEW November-December 2000 Volkswagen took this tactic one step further in marketing its retro Beetle. A year after the car's introduction, the company offered Internet-only sales in two new colors, vapor blue and reflex yellow, with exactly 2,000 cars available in each. This attention-grabbing maneuver triggered its own share of buzz and ignited an additional round of publicity for the already popular cars. Within two weeks, consumers had quickly snapped up half of the limitededition models. Exploit kons to beget buzz. Another tactic that companies use to trigger buzz is celebrity endorsement. Thanks to ad campaigns featuring icons hke Michael Jordan and Tiger Woods, Nike has built its brand into a marketing juggernaut Advertising, however, is merely one way to leverage the power of icons. Tickle Me Elmo became the best-selling toy of the 1996 Christmas season in the United States after Rosie O'Donneil played with the doll on her daytime talk show. A public relations agency had cleverly engineered ~~ this runaway success by sending an Elmo to O'Donnell's son. Literary publicists eagerly lobby staffers at Harpo, knowing that many books Oprah Winfrey selects for her book club pole-vault onto the New York Times best-seller list Movies and television shows can also serve as powerful endorsers. During the funeral scene in the hit film Four Weddings and a Funeral, one of the characters reads Stop All the Clocks, a poem by W.H. Auden. After the film opened. Vintage Books adroitly published a slender volume containing the poem and other Auden poems, which sold 50,000 copies in three years. (Most poetry books sell around 500 copies.) It's no wonder companies have been aggressively seeking, and sometimes paying huge sums for, key product placements. Luck had little to do with the appearance of a BMW Z3 Roadster in the James Bond fiick GoldenBye or the prominence of an Apple laptop computer in Mission Impossible. Tap the power of lists. Lists are potent tools for creating buzz because they're effective road signs for informationbesieged consumers who don't know where to focus their attention. Perhaps no one knows this better than movie executives, who hold their collective breath every Monday morning, waiting for the weekend box-office rankings that can either make or break new releases. Even in the world of ivory towers, the annual lists of colleges and universities by U.S. News & LUCK HAD LITTLE TO DO WITH THE APPEARANCE OF A BMWZ3 ROADSTER IN THE JAMES BOND FLICK COLDENEYE OR THE PROMINENCE OF AN APPLE LAPTOP COMPUTER IN MISSION IMPOSSIBLE. The Buzz on Buzz World Report can dramatically increase or decrease the number of applications to a given institution. Some companies have begun to leverage lists in creative ways. In 1998, Modern Library, an imprint of Random House, surveyed its editorial board to compile a list of the top loo novels of the twentieth century. The selections, which the company publicized on its Web site, became the focus of much animated discussion, in part because of a spat between the editorial board and the publisher over the process used to compile the list. Within five months, more than 1,000 articles and editorials had appeared about the controversial Ust Even more remarkable, though, was that within weeks ofthe list's publication, four of the top five novels made their way on to's weekly list of paperback best-sellers, with James Joyce's Ulysses having pride of place at number 2! Of course. Modern Library wasn't the only imprint to benefit from this buzz-any publisher with editions of the selected books experienced an upsurge in sales. But Modern Library received a tremendous amount of free publicity, and traffic at its Web site surged by a jaw-dropping 7,000%. HARVARD BUSINESS REVIEW November-December 2000 The Buzz on Buzz Nurture the grass roots. Thefinalbuzz tactic focuses on establishing and extending product loyalty throughout a community. At first, this tactic might sound similar to seeding the vanguard, but there is a critical difference. Members of the vanguard typically delight in being the first to know about a product; they revel in this exclusivity. When other people begin to adopt the product, the vanguard often moves on to the next big, exclusive thing, in contrast, a grassroots strategy relies on early adopters who try to convert other people-to turn them into users, too. With many new drug therapies, for instance, early patients who've been successfully treated wish for others to benefit. Users of network services like America Online try to recruit others because the usefulness ofthe service grows with the number of members. Or perhaps consumers identify so deeply with a brand that they want others to become a part of that community. A powerful example of buzz nurtured at the grassroots level is the marketing campaign that Harley- Davidson used in its remarkahle turnaround. In 1981, the motorcycle manufacturer was nearly bankrupt as Japanese competitors with superior quality and lower costs had demolished what was once a thriving U.S. industry. But the 13 executives who bought Harley from parent AMF believed they could save the company by tapping into the fervent loyalty of its customers; for FINDINCTHE BUZZ-STARTERS Some customers shape public opinion more than others. To identify these buzz-starters, companies can try a process made up of four questions: A, How would we group our customers based on their purchasing behaviors? B. How do these groups influence one another's purchasing of our products? C. What are the potential paths for buzz to spread between different customer groups? D. Which path is the strongest, and which group starts the buzz? Research Methods Marketing and industry data ' Information from trend spotters 'Observation of customers ' Customer panels and interviews ' Observation of customers Customer interviews ' Simulations that show the flow of information from one group to another Interviews of customer groups to determine their propensity to adopt and recommend the product A CRASSROOTS STRATEGY RELIES ON EARLY ADOPTERS WHO TRY TO CONVERT OTHER PEOPLE -TO TURN THEM INTO USERS, TOO. them, Harley-Davidson was not just a motorcycle but an identity. In 1983, the company established and sponsored the Harley Owners Group, or HOG, with numerous regional chapters around the United States. Strapped for cash, Harley used inexpensive buzz marketing techniques-newsletters and posters-to publicize HOG via the dealer network. More important, though, Harley relied on extensive word of mouth generated within these communities. HOG quickly grew in strength, sponsoring hundreds of rallies that drew Hariey owners from across the country. Today, more than 350,000 owners belong to nearly i,ooo chapters around the world. All of these tactics won't be relevant for every product. Depending on a product's characteristics, managers must decide which tactics to deploy and in what order. In general, seeding the vanguard and rationing the supply are usedfirst to foster a sense of exclusivity, while using icons might come later in a mass-marketing campaign. Consider the sequencing that Ty shrewdly used to touch off a national mania for its rather unremarkable bean-stuffed toys. Initially, Beanie Babies were available only through specialty toy retailers (supply rationing) that catered to upper-income families. Children from those households (the vanguard) took the first Beanie Babies to school, generating demand among other kids. Then ly broadened the distribution by teaming with McDonald's (an icon) to give the toys away in Happy Meals. The craze intensified as the media ran stories of families buying dozens of meals and throwing out the food because they just wanted the toys. Meanwhile, Ty regularly retired some models from production (supply rationing), resulting in their selling for several thousand dollars on secondary markets. Eventually, adults, many without children, became fanatic purchasers, accumulating hundreds in their collections. The best buzz-starters are your best customers. In order to spark buzz, marketing managers often turn first to the opinion leaders from within the community that will eventually become the bulk ofthe market. But that can be a crucial mistake. The best vanguard for a product may not be immediately obvious. It may even come from a counterculture. Take Tommy Hilfiger. The designer focused on young, urban African-Americans to imprint his brand with a street hipness. It worked. The popularity of Hilfiger clothes quickly spread from the inner city to the suburbs, 144 HARVARD BUSINESS REVIEW November-EJecember 2OO0 reaching a broad audience of all ethnicities. Similarly, when the marketers of Absolut vodka wanted to spark buzz for its then lower-end no-name alcohol, they did not target married middle-aged males in the suburbs. Instead, they initially focused on the gay community in San Francisco. Buzz rapidly diffused outward and, combined with a funky, award-winning marketing campaign, helped catapult Absolut to the enviable position of topselling vodka in the United States. Finding such unexpected vanguards is nearly impossible with marketing data that concentrate solely on what individual consumers think about a product-and not on how consumers influence one another about the product. Marketing researchers are thus developing new methodologies to account for customer-to-customer interactions. An obvious approach is to track the path of buzz for a similar product that was successful and then seek to replicate that pattern. More sophisticated techniques attempt to model how consumers interact with one another and how highly they value others as sources of information or as behavioral models. (For details of such an approach, see Finding the Buzz-Starters. ) MYTH 4: To profit from buzz, you must act first and fast. Trendsetting compa
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