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Word of mouth begins at home

Tom Messett

29 November, 2010

I like the new BMW mini, I have driven a few, including the supercharged Cooper S, and I like them. They are quick, well equipped and, with the BMW brand behind it, I assumed they were quite well-built as well.

Then I met a guy who worked for a BMW dealership, he was a mechanic and spent a great deal of time explaining to me in some detail how poorly built the cars actually were and how he was amazed they hadn’t been recalled for various engine problems. Safe to say that damaged my perception of that brand to some degree.

More importantly I share his information with my friends, it spreads, now I have even put it online, and I trust his advice more than most because he is a genuine expert in his field (well, compared to most) and he actually works for the company he is discussing, so he has an intimate knowledge of the product.

Now this is a big problem for brands: brands spend a lot of time and money creating the brand message, now, many brands spend a lot of time monitoring and engaging in online conversation with their communities, advocates and detractors, to understand how their users perceive their brand and discuss it, but here is my problem…

WORD OF MOUTH BEGINS AT HOME

It doesn’t matter how much your community get excited about a product or how many clever WOM, social media and other campaigns you come up with, if you have your own employees telling all their mates not to buy your products then you might as well not bother.

Your employees should be your core advocates, (and no, I don’t just mean your sales teams!!) they should be as, if not more, excited than anyone else about your new products and services, and it doesn’t matter who: from the CEO to the product managers, marketing & PR to the support staff – they should all be using and advocating your services over it’s competition. If they’re not then you have a work to do, if they are actively telling people NOT to buy your products then you have a big problem!

But there is a challenge…

Here it is: Your employees are often the most qualified to hate your products and tell everyone what is wrong with them.

Why?

Because they are the most embedded, they are the people who build, market and sell the products, they know where compromises are made, they know where the competition is strong and they are the first to see problems, as they deal with the angry customers, both online, in store and on the telephone.

Let’s take the example of my friend the BMW mechanic again: every day he goes in to work and he spends his day fixing cars, he gets to know the trends, where problems arise and he gets to see angry customers presented with large bills, he may think he has a solution because he can see that washer X is too weak or the positioning of part Y is off, he is frustrated because no one listens to him, so he thinks the designers are idiots (they’re not, but that’s his perception), his frustration is shared in the form of negative WOM.

So what is the solution?

Well it depends on your company but some general points are outlined below:

  • Measure internal WOM, don’t spend all your time and effort on monitoring social media, look internally as well, ask your employees (anonymously) and try using very simple surveys like NPS scoring to avoid overwhelming your internal teams with feedback when all you want is a pulse.
  • Have proper feedback systems in place, let these hidden internal experts, who work on the “front line” spend time with the product managers, tech teams and head office staff, help them to understand the positioning of the product and why it has been made the way it has, get them excited and listen to them, take their feedback and use it!
  • Give them a reason to use your products, big discounts, free if possible, offer them friends and family discounts and referral schemes for sales (give them a damn good reason to use and promote your products)
  • Make sure they see happy customers as well as pissed off ones! – Use the intranets, tools like socialcast, or even bulletin boards to share positive feedback and reward those responsible with tangible prizes (don’t just reward your sales teams for good work!)
  • Involve them in the mission of the company and give them a good, happy working environment! Easier said than done, I know, but a happy employee who understands why they matter is far more likely to be an advocate employee than a detractor employee!

“Yes this is all very nice Tom, but where is my ROI?”

Well that is an easy one actually!

Let’s use BMW as an example again, now BMW has around 98,000 employees, so lets say they spent £500k on an internal WOM campaign to improve their companies internal NPS score, they put in place a number of the bullets above and from it just 0.05% of their employees “sold” an additional car on their behalf by advocating their products and, based on experience, the average price of a new BMW is £20k (that is a guess from looking at bmw.co.uk) then in one year that is £980k of additional sales, just in the cars, not to mention finance, servicing etc. And  if you use staff referral and reward schemes or family + friend discounts properly then you can measure a high % of that return very accurately.

But the best bit is that you additionally to the sales you can measure is the increased positive WOM created that spreads through the community and improves brand perception leading to more sales… However this success can be tracked with key KPI’s like internal NPS, which I outlined above. And you can measure pre/post campaign sales uplift.

Anyway that is it!

WOM begins at home, don’t forget to measure it and encourage it because it will make you money…

I am not sure if NPS has been used for internal comms at all, but would be keen to find out, any one have any thoughts or case studies?

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  • Carrie Grafham

    Great post Tom. Although I'm less chuffed by your comments about the Cooper S mini (just having taken delivery on one….). I am often being given the heads up from employees about their products, and it's definitely not always positive.

    A company who are doing this right are Best Buy with their Blue Shirt Nation Community:
    http://www.businessinnovationfactory.com/weblog/archives/2008/09/best_practices.html

    Also love the ROI example!

  • thehitchcockblonde

    Awesome. This forms a large part of the work I do at the 'heads (WOMBusiness, if you will) and you can't underestimate the importance and power of becoming conversationally internally before you go external. It needs to be a genuine spirit rooted across the company and carried by all employees.

    There is much talked about how hard this is – the internal barriers, the legal implications, the issues with guidelines and local/global rollout – but actually I find there is a great, positive hunger for this approach within the companies we work on this with, big and small (Mars, LocateTV, Veria, Cancer Research UK, to name a few). People *know* how to be social – the key is unlocking their instincts and passion from their professional fear of doing so and mucking up.

    I literally see rooms of people rediscover why they want to do their job in the first place. It's a privilege.

  • http://www.mollyflatt.com Molly Flatt

    Awesome. This forms a large part of the work I do at the 'heads (WOMBusiness, if you will) and you can't underestimate the importance and power of becoming conversationally internally before you go external. It needs to be a genuine spirit rooted across the company and carried by all employees.

    There is much talked about how hard this is – the internal barriers, the legal implications, the issues with guidelines and local/global rollout – but actually I find there is a great, positive hunger for this approach within the companies we work on this with, big and small (Mars, LocateTV, Veria, Cancer Research UK, to name a few). People *know* how to be social – the key is unlocking their instincts and passion from their professional fear of doing so and mucking up.

    I literally see rooms of people rediscover why they want to do their job in the first place. It's a privilege.

  • Ted Wright from Fizz

    As a certified gearhead let me just say that if you get three mechanics of equal quality and experience in a room and ask their opinions about a specific topic, at least four distinct and often differing opinions will emerge. Given that Coopers are mostly sold to “car people” or wanna be’s, it would be an interesting problem to tackle for Coopers.

    As for the ROI example, let me just point out that the 500K spent on a marketing program in your example would come out of net profit and the sales numbers in your example are gross revenue so the numbers on your model show the WOMM exercise to be value destroying not creating.

    That’s it from over here. Look forward to more conversation.

  • http://www.askspike.com Spike Jones

    Greetings Tom,

    Nice post and I agree with your general premise, but there’s a flaw in your theory: you’re dealing with PEOPLE. I lived in South Carolina for 10 years and on many occasions worked with the BMW museum and plant there (where they make all the X5s and Z4s in the world). I talked with the factory workers on the line and the folks in communications in corporate – we even implemented an internal feedback system to improve processes. And because of their love of the brand and their pride in craftsmanship, I bought a BMW and (if I can help it) only own BMWs for the rest of my days.

    But back to my point: Like you said, BMW has 98,000 employees. Sometimes a few of them have bad days. Some of them might even be disgruntled. In other words, you’re always going to find a few folks within a company that have something bad to say. And you can’t control that. You’re points are very valid indeed and all great ideas to close that gap between unhappy and happy employees, but people are people – and that means that no matter what, they’re unpredictable.

  • http://treypennington.com treypennington

    98,000 people represents, I would think, a substantial marketing niche; one well-worth crafting specific listening, training, communication practices around.

    Interesting dynamic at play with the mechanic. By the nature of his job, he mainly sees the problems. Also interesting dynamic at play with BMW in general: they tend to be a closed, ultra-conservative marketing company. I'm told they're even extremely selective in sharing and giving access to data internally. But what a powerful brand though. What an opportunity for leadership online.

    My hunch is, BMW will eventually be as powerful a brand through every online media as they are in real life.

  • http://twitter.com/ajpapeLA A.J. Pape

    Tom you make the case brilliantly. And this is where things get interesting -

    As you (and Molly and Trey) point out, we're at the overlap of organisational culture on the one hand and use of social/listening/WOM tools on the other.

    A hierarchical organization, like the ones most of our parents worked in, will not and cannot embrace these tools and behaviours. Listening and engagement fly counter to the whole notion of scarce power for a limited few, maintained by hoarding information and keeping the silos disconnected. (“Who cares if the mechanics aren't happy? I'm in Marketing, why don't you go talk to HR?”)

    What's exciting is we're getting to a place where smarter organisations are realising there is serious money to be made by becoming fanatical listeners. If you want great design, customer loyalty, employee engagement, brand value, you get there by listening 1000x times more than you used to.

    Every part of leading organisations is being reinvented by more lean, conversational, iterative practices. So the work y'all are doing at Heads blends perfectly with the work my lot do around transforming organisational cultures.

    For further fun/inspiring examples you might like the gang at @Rypple, @WorldBlu (@MirandAsh is in the UK), @Employees1st by @vineetnayar. As CEO of a 55,000 person services firm he's led a real live transformation to making leaders accountable via drastic increases in transparency and listening.

    And of course the ever-awesome @Zappos. Have you read Tony Hsieh's new book Delivering Happiness? It's all about the nail you hit so beautifully on the head with your excellent post.

  • http://twitter.com/Tom_Messett Tom Messett

    Hi Ted, both good points: On BMW specifically it is just an example story that sprang to mind, I experienced similar things when working for GAP clothing a few years ago. On ROI, this was purely a “back of a fag packet” type calculation to prove a point based on the idea that BMW build to quota and so realise revenue within the financial year against fixed overheads created the value and return, I know that is statistically not robust but the figures are actually very worst case scenario based on selling just 49 extra cars!! If you look at BMW's operating profit margin of 8% (http://www.just-auto.com/news/bmw-seen-posting-q3-auto-ebit-margin-of-79-poll_id106762.aspx) then this activity has to sell 312 extra cars to even out, and as said that does not include any extras!

    If you're more interested on the figures and stats side I am sure this will be of interest: http://forrester.typepad.com/groundswell/2010/11/how-many-of-your-employees-love-your-products-and-why-it-matters.html – from Forrester

  • http://twitter.com/Tom_Messett Tom Messett

    Hi Spike, you are right, we are dealing with people! But almost everything a marketing team does is dealing with people in some way, paticularly in social media and Word of mouth. Of course peoples oppinions and ideas change over time but everything we do is about people and influencing their ideas, decisions and recommendations! – I see that as an opportunity, not a threat!

  • http://twitter.com/Tom_Messett Tom Messett

    Yes the dynamic is really interesting, the same is true of customer service staff and even social media teams. But most ironically this recent article from Forrester points out that the marketing team are actually the most likely to be detractors: http://forrester.typepad.com/groundswell/2010/11/how-many-of-your-employees-love-your-products-and-why-it-matters.html – I am sure that will worry many a marketing VP!

  • http://twitter.com/Tom_Messett Tom Messett

    Thanks for the comment :-) I haven't read Tony Hsieh's book yet but I plan to when I get a chance!

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