Did I get your attention? I hope so, because I loved this article in The Atlantic this month! Short and to the point, Frank Rose reports on a recent Harvard study that explores why people like to talk about themselves so damn much these days. Turns out, our brains really dig disclosing personal thoughts and opinions about, well, pretty much anything. We like it so much, in fact, that the act of sharing activates and engages our "mesolimbic dopamine system." Who knew?
Why does this matter to what we do at Amplifinity? Well, if people like to talk and share as much as this study suggests, (and as long as humans still get happy from eating and having sex), they're still going to be sharing thoughts about your brand and referring you business. And that means I have more job security than I thought.
Eric Jacobson; President and CFO at Amplifinity
There is a scene in Woody Allen’s classic film “Take The Money and Run” that always cracks me up. A prisoner working on a chain gang complains to the guards, and as punishment, he is locked up in the hole with an insurance salesman. The scene is funny because there was a time when the public perception of insurance agents was something painful -- that they maximize their revenue by telling clients all the awful things that might happen to them. Times have changed. I have referred a number of friends to my insurance agent, Matt, not because he feeds my paranoia, but because he offers excellent service and doesn’t sell me policies I don’t need. It’s all about trust.
Lately, we have been having more and more conversations here at Amplifinity with folks in the insurance industry. This is an exciting development for an industry that has been helping people to protect their assets and families for a long time. However, if you’ve seen any ads by insurance companies in the last decade, they seem to have a new problem on their hands. Ads are almost always about having the cheapest rates. This kind of price war erodes margins. And aggressive insurance agents, like Woody Allen’s cell mate, aren’t a good solution either.
But this is where word-of-mouth software can save the day. Software like the kind we sell here at Amplifinity lets happy customers at good companies create testimonials and referrals online. These good companies can now differentiate themselves by their service, not just their prices. Customer referral programs and testimonials, where customers share stories about agents who gave trustworthy service, or helped them with a claim amidst tragedy, aren’t just avoiding the industry’s price war… they are priceless.
Dan Pasick; Director of Corporate Sales at Amplifinity
If most companies today took a sample of 200 of their customers, it's probable that at least 10-20% percent of those customers would already be considered brand advocates. BUT, this pool of people has a lot of different swimmers in it, and it's important that companies know who they are.
Let me give you an overview. These people probably sound pretty familiar to you already...
Advocate Type #1 : Jack Spendal.
Jack is what we would call an uber-connecter. As a child, Jack was one of those kids who you really wanted to be friends with regardless of your gender, race, ethnicity or personality. Everyone knows a "Jack" (and probably knows him through some sort of '6 degrees of Jack Spendal separation’). It takes twice as long to get to your destination when accompanied by Jack because he is constantly running into people he knows, and he loves to talk about anything with them (work, clothes, sports etc). One of Jack's favorite topics is great deals...especially when there are incentives involved for both him and his friends. Jack doesn’t just limit his interactions to run-ins on the street; he likes to connect with friends via social media, text, email and any other form of communication. Even though Jack might be annoying to some, but he makes a pretty awesome brand advocate.
Advocate #2 : Kara Kowalski
Now, Kara is what we call a rave reviewer. As a child, Kara was that classmate who took 2 hours to fill out the teacher evaluation at the end of the year. Unlike Jack, Kara doesn’t like to refer deals to her friends, especially if she happens to be getting something out of it. Kara is the first person to write a thorough review about all the good and bad experiences she has had on sites such as Yelp, Consumer Reports, Twitter, and even a company’s Facebook fan page. For example, Kara recently went to a new restaurant that opened up in her home town. She had heard positive and negative things about this place but wanted to check it out on her own; she even brought her iPad along to take some notes. At first, the menu seemed a lot different than what she was used to, but she tried to keep an open mind. By the end of the meal Kara was raving about this restaurant. The food was unique but tasty, and the service was impeccable. As soon as she got home, she started writing reviews on her favorite social media sites. Since a lot of people were used to seeing and following Kara’s reviews, which were often more negative than positive, they were very interested in checking out the new restaurant that Kara actually
Advocate #3: James Jandeliker
James, on the other hand, is what we call a rapid re-poster. As a child, James was that kid who would let you play with his new toy before he'd even had a turn. As James grew older and technology was advancing, he began to realize all the different ways he could share cool things with his network. As an intern for GQ Magazine, James came across a lot of new styles of clothing and technology. His 2,000 Facebook friends and 10,000 Twitter followers were the (sometimes unwilling) recipients of every worthy re-post of an article, video, song or link James found interesting.
While every one of these types can give your brand a brand advocacy boost, the point is that you need to know them. You need to integrate a technology that makes it possible for you to know who your brand advocates are, where they talk about you, and what will make them talk even more. And then you need to nurture your relationship with them by thanking them for what they do and providing motivation for them to do more. They're as unique as your products, and they can make or break your brand, so take the time to get to know all your Jacks, Karas and James'.
Check out Dick Beedon's (Founder and CEO at Amplifinity) newest blog in All Things WOMM.
In Today's blog, Beedon digs a little deeper into just one of the ways a company can leverage their brand advocates to drive sales and marketing inititatives: Referrals.
Our Founder and CEO, Dick Beedon, writes (in All Things WOMM blog - click here) about the Social Enterprise today, and how companies can and should be leveraging their customers and employees to drive sales and marketing inititatives. Look for his next blog in All Things WOMM the week of September 3rd, when he discusses the finer points of referral marketing.
We would love to hear the ways in which your brand advocates have worked for your company.
President and CFO at Amplifinity
The story you are about to read was told to me by a stranger in a bar who swore on his life it is true. He heard it from his uncle who heard it from someone else. It comes from the frozen lakes of Northern Michigan. It’s the kind of tale that leaves the listener with nightmares, but I’m compelled to share it here nonetheless.
So, there’s this guy who goes ice fishing every day. He has a shack out on the ice off of one of the Great Lakes with a hole in the ice inside the shack. He always takes his small dog, a fluffy Pomeranian, with him. The only fish he ever catches are little perch.
So one day, the guy wakes up in the early darkness and takes his dog out to the shack. It’s a bad morning. He tries all types of lures and bait and worms, but he doesn’t get a single nibble. Then, just as he’s about to leave, his dog runs up to the edge of the hole and starts yipping at the water. Suddenly, fast as lighting, with a swoosh, a giant sturgeon, a hundred-or-so pounds, flies up out of the hole. The fish grabs the Pomeranian by the fur on its neck, and the two plunge back into the hole. The man races to the hole and looks down and sees nothing but black watery depths. The sturgeon and pomeranian are gone forever.
You may ask yourself why this story is important. I admit it’s really awful. Well, here it is: Aesop himself could not have crafted a better fable for two important rules of how to use partners in good B2B referral marketing. Here are the lessons:
1) Partnerships are critical. Good business referrals don’t just come from customers and employees. Partners often have synergies and value-added offerings that the usual referral channels (employees and customers) can’t deliver, or they are trusted experts in their fields. We’ve seen some awesome examples of partner programs work great for our customers here at Amplifinity. In our story, the dog was a partner to the fisherman. The fisherman couldn’t catch the fish no matter what bait he tried, but the partner could.
2) Keep your partner on a tight leash. Know what they say about you in social media. Know what they are saying to potential customers. Get involved with them. Make sure they are equipped with the right messaging to help you out. It’s hard to describe a product if you don’t work on it every day as an employee or if you don’t use it yourself as a customer. In our example, if the fisherman had a tight leash, he would have caught a big fish.
So that’s it. If it gives you strange dreams, I hope they’ll be about catching big customers.
Designer at Amplifinity
Lately, I’ve begun to view many aspects of life as a game – not in a casual, non-serious sense, but rather in a way that makes things more fun and less of a drag. For example, I used to loathe doing the laundry, a mindless, yet necessary task which was the bane of my existence in college. However, once I viewed it as a game, tackling the ever-growing mountain of clothing became less of a chore and more of a competition with myself. How fast could I get it done? How quickly could I fold everything? How efficiently could I bring order to chaos? (If you’re getting the sense that I led a pretty boring college life, you aren’t that far off.)
As adults in a capitalist/consumer culture, one of the biggest games we play is the money game. Paychecks become points, and bank accounts become scoreboards. An individual’s “worth,” or “value” in the eyes of Western society is often misunderstood as how much money one has. The individual plays the game of participating in commerce, attempting to make informed choices amidst a barrage of targeted advertising and marketing campaigns. For many, the game revolves around the notion of getting the most while spending the least.
The other side of this game is played by the corporate entity. Businesses are constantly
looking for ways to make more money while spending less, and are realizing that the value gained from traditional advertising versus the cost and effort it takes to set up and maintain these campaigns is diminishing in the wake of the social web. Naturally, companies are now turning to social technologies like Facebook and Twitter to directly engage their customers and promote their services or products to a vast network of people instantaenously.
The funny thing is, every business is different; every consumer has his or her own tastes, and there is no apparent way to “win” this game. Our culture likes to think that “winning” is the only option, and “losing” is a very, very bad thing. Often, we find ourselves locked in the unsolvable problem of winning without losing, over-thinking and over-strategizing instead of just doing and evaluating the results.
A consumer can be incentivized to refer friends online through social networks, but the messages that people share regarding products or services aren’t always positive, and a reward doesn’t necessarily change an individual’s negative perspective in most cases. In fact, many of the larger corporations’ Facebook pages that I’ve seen, act as a way for the disgruntled consumers to vent their unhappiness directly to a company’s social marketing group.
I’ve spoken with decision-makers at enterprise-level companies who have expressed hesitance in promoting incentive programs through social networking channels for this exact reason. There ends up being a sentiment of, “We will lose this game before we even start, because our page is full of complaints and unhappy customers.” This may appear to be the case, but the truth is that there really isn’t any such thing as “losing.”
What is gained by creating and promoting a program that under-performs, doesn’t go anywhere, or is ultimately a failure? Financally-speaking, money would be lost, but the true value comes from the knowledge and understaning of why the program did not work as expected. A company may learn that their customers are not who they thought they were, and that a particular incentive is meaningless to them. Or, a company may learn that their customers have not had a positive-enough experience to share it with friends and family. These are valuable things to learn, and can be used to significantly increase the quality of a business overall, as long as the entity and its decision-makers remain open to critique and change. This knowledge is, in the long-run, exponentially more valuable than money earned in the short term through a dissatisfied customer base that is just pursuing an empty cash-in.
Winning and losing, success and failure… these are all opposite sides of the same coin. Failure needs to exist in order for us to know what success is, but that doesn’t mean that something positive cannot be gained from a negative situation. After all, it’s only a game, and no one gets better at games from winning all the time! So, fear of failure should not be a barrier to learning more about your business or your customers. Put things out there, give things a try, and by all means, don’t let your laundry pile up. Do, and learn from experience.
Eric Jacobson: President & CFO, Amplifinity
The moment I realized I had hit rock bottom was in Las Vegas in 1994. It was at the software industry’s giant COMDEX trade show there. I was working for a company that made computer games for kids, and the star of our games was an animated otter. To get attention at the trade show, we hired a college mascot seamstress to fabricate a heavy otter costume out of fake fur and foam. A young woman employed at our company agreed to wear the costume, but it was warm in Vegas that November, especially in the middle of the packed convention center. You can predict what happened. Within hours, we were handing the otter cold water to try to stabilize its internal temperature. The trade show was critical for us. We were launching new products. We verbally pressured the otter to keep going, to keep waddling and hugging trade show attendees. But by the second day, we had reached the breaking point. I found our otter, in full costume, passed out from heat exhaustion on the floor behind our trade show booth.
But it wasn’t just us. In the years that preceded ’94 and the years that followed it, COMDEX became a ridiculous scene, ballooning to become the largest trade show in the world. Exhibitors attracted customers by any means necessary, often with tactics far more provocative than otter costumes. Eventually, the situation could not sustain itself. A backlash erupted from exhibitors, the press and attendees. Everyone bailed at once. And ten years later, things totally imploded. The largest trade show in the history of the world was cancelled in 2004.
And it wasn’t just COMDEX. Tradeshow attendance worldwide has tumbled in recent years. People point to virtual online tradeshows as the reason for this, but I don’t agree. I have never participated in an online tradeshow, and I don't know anyone who has.
What really killed tradeshows is word-of-mouth marketing. Companies have found it exponentially easier to find new customers through their existing networks of customers, partners and employees. Email and social media have fueled this explosion, making connections easy and innocuous. Marketing managers no longer have to pay otters, magicians or porn stars to make their connections for them in a crowded room. Sales people don’t have to spend days walking hard convention center floors, searching for an old contact in hopes he’ll introduce you to someone else. With word-of-mouth, fueled by social media, the connections we make are easy; they can happen any time, and they seem to last forever.
This is especially true in business-to-business relationships. A solid, ongoing word-of-mouth program, where incentives are used to motivate customers to introduce new ones, is like a trade show that never ends. At Amplifinity, our customers for our B2B word-of-mouth social media applications are finding this is exactly the case.
And I’d rather reward a customer than shove an employee into an otter costume any day of the week.
Eric Jacobson, President and CFO at Amplifinity
I am a grumpy CFO. And I’ve had just about enough of marketing managers who don’t like to do math. I’m not saying that all marketers avoid math, but business is about numbers and making money. A couple years ago, I was forced to speak at a marketing event on a panel about marketing ROI. One of the panelists had the audacity to say something like, “Marketing ROI is equal to brand awareness.” Later that afternoon, as I spotted the marketer leaving the conference in the parking lot, I was tempted to run him over with my car. The world might have been a better place. Do I sound cold? Good, because I am here to share two cold truths. The first is that there is only one definition of marketing ROI. It is…
ROI = (Net Present Lifetime Value of Customer) / (Marketing Cost to Acquire Customer)
This brutal metric is the only way to know if a marketing initiative is working. If the cost to acquire a customer exceeds the profits you make over the life of that customer, factoring in attrition and the cost of capital, things are not working. You’d be better off throwing the money in the trash. It would take less of your time. The second cold truth is that almost nothing works. I won’t shoot the long list of marketing vehicles that typically have negative ROIs in this blog, but the list is staggering. The amount of money wasted on bad advertising in pursuit of brand awareness should give us all pause.
And this is exactly why I joined Amplifinity. The act of current customers recruiting new customers circumvents the entire qualitative universe. It’s about friends telling friends (Word of Mouth) which products they like and why. It is transparent. The costs and returns are easy to track, manage and control. The marketing ROI is clear and obvious. And there is no creative message required to connect a brand to a primal human need. All you need is your good product, our software, and the truth. Your customers will do the rest. There's nothing cold about that.
Amplifinity's technology, which creates far-reaching word-of-mouth and brand advocacy solutions for their clients, partners with Brierley+Partners. Brierley creates some of the world's most successful loyalty and CRM programs for globally recognized companies. Read our press release: