Study: 4.7% of Your Customers Generate 100% of Your Online Word of Mouth

by Mack Collier

EngageSciences recently analyzed online interactions with and from over 400 brands and drew a conclusion that’s not that surprising: A small fraction of your customers are driving all of the talk about your brand.

The startling figure from our research was that typically only 4.7 percent of a brand’s fan base generates 100 percent of the social referrals. So to put it another way, it is 4.7 percente of your social media following that generates all of the word of mouth results, and by results we mean conversions, not just reach. These are the advocates that can actually influence their friends to convert directly onto your campaigns, to connect with you as a brand or take up an offer.

Not that we are ignoring the other 95 percent, there is still plenty of value in this large segment. They’re connecting to you as a brand, the active fans are consuming your content and they are 20-30 percent more likely to buy from you as a result. But if we are looking at social media through the eyes of marketing and we want to improve our acquisition metrics, then it is the top 4.7 percent  that generates all of the earned media results and organic growth

This is exactly why it’s so important to engage with your fans.  So many companies view their marketing campaigns as the chief channel for customer acquisitions, when in fact its your fans that are driving new customer referrals.  The end result is that companies end up spending massive amounts of money on creating marketing messages that are designed to connect with potential new customers.  People that have little to no interest in hearing that marketing message.

LoyaltyGraph2

The biggest takeaway for me in writing Think Like a Rock Star was studying how rock stars create fans and learning that they all pretty much have the same marketing strategy guiding their efforts.  While companies create marketing messages designed to acquire new customers, rock stars across the board purposely ignore new customers, instead focusing on their biggest fans with the understanding that those fans will acquire new customers for them.

The problem is most brands don’t know who those 4.7 percent are and don’t have programs in place to work with this elite group of advocates. Marketers are often seduced by trying to pay for access to influencers – celebrities, bloggers and industry analysts. However everyone else is trying to do the same thing, which negates the value of this approach.

I also noticed this when writing my book.  I interviewed dozens of top brands, and asked them about their programs for connecting directly with their fans and advocates.  Every brand told me the exact same thing: We don’t have any program in place to do that.  So much of the marketing focus is on customer acquisition that brands don’t realize that their existing fans are a far more effective mechanism for customer acquisition than any series of commercials they can create.

Your fans are special customer that thrive off interacting with you.  When you connect with them, it simply validates why they love your brand and encourages them to create more positive word of mouth about your brand.

The most positive, long-term impact you can make on your business is to build a program within your brand that allows you to connect with your most passionate customers and they with you.

Period.

{ 3 comments }

Melody February 12, 2014 at 9:36 am

Great article! I would have guessed that it was a small percentage of customers who create the most conversation, but wouldn’t have guessed that small. And I think brands should strongly acknowledge their earned media. There’s a guy who for years has been writing about Trader Joe’s (http://www.whatsgoodattraderjoes.com/) and I’ve often wondered if Trader Joe’s has ever reached out to him! Only a tiny percentage of fans every create a website like that!

Mack Collier February 12, 2014 at 9:38 am

Hi Melody, you know first-hand the power of a brand reaching out to its fans. To your point, I truly wish brands understood that when they connect with their fans it INCREASES the amount of positive WOM and ‘earned media’ they create on behalf of the brand.

I need to research if someone has done a study to determine the exact amount of the increase. Have you seen anything?

Kelly February 13, 2014 at 10:10 am

Wow. That is powerful.

There is a clear call to action in this post for marketers and brand managers to understand who this core group is and extend the invitation to connect and build a meaning relationship. There are reasons beyond revenue as well.

This core group of fans has a much deeper understanding of the product or service, it’s flaws, strengths and potential than possibly even the product manager. They are using the products and services daily without being influenced by the internal struggles and politics that can move product managers and marketers off track.

Great post. Thanks Mack!

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