WOM for B2B

What's a Brand Advocate Worth?

image001Advocates are customers and others who recommend your brand and products to friends and colleagues. Advocates serve as a Virtual Salesforce for your company, spreading positive Word of Mouth and boosting demand. So what's a Brand Advocate worth?

Advocates are worth 2X to 3X more than average customers, according to Comscore. Compared to average customers, Advocates have  2X to 3X greater reach and greater ability to influence others to buy, Comscore has found.

In the "Answering the Ultimate Question," Satmetrix CEO Richard Owen states that a single Advocate of an enterprise software company is worth $565,000, based primarily on the Advocate's ability to influence the purchase of the average contract value for the company's software solution, which costs well over $1 million.

At Zuberance, we encourage marketers to compare the relative value of Brand Advocates versus the value of their investment in other marketing and media spends.

For example, what's the comparable value that marketers get from a  $10,000 media campaign vs the value of engaging and energizing tens of thousands of Advocates?

  • How many qualified leads do marketers get from an equivalent $10,000 spend on PPC or email?
  • How many clicks will be driven to offers and landing pages for a similar media campaign investment?
  • How much Advocate engagement and mobilization would be created via a $10,000 spend on a traditional media or marketing campaign vs. an Advocate program?

Word of Mouth Rule #8: Advocates are your Most Valuable Customers

WOM_RulesAdvocates are 2X to 3X more valuable than average customers, according to studies by Yahoo!, Comscore, Zuberance than others. Why?

  • •  Advocates drive sales. Advocates not only are about twice as likely to recommend their purchases to friends than non-Advocates, but their friends also buy the recommended products two to three times more often. (see chart below from Yahoo! and Comscore)
  • •  Advocates are lead gen engines. In many companies, Advocates generate 80 to 90 percent of the referral leads (source: loyalty guru Fred Reichheld.) Ask your salespeople where their best leads come from. No doubt, the best leads come from existing customers.
  • •  Advocates are Word of Mouth machines.


Word of Mouth Rule #7: Advocates are Your Best Salespeople

WOM_RulesFire your salespeople. Energize your Advocates. That sounds extreme. But consider these three points.

  1. Prospects trust your Advocates more than your salespeople. 53% of business executives say colleagues’/friends’ Word of Mouth is the #1 influencer of their purchase decisions compared to 39% of sales representatives, according to a study for events management firm Jack Morton by Keller Fay, a leading Word of Mouth research firm.
  2. Advocates actually get their friends and colleagues to buy. According to Comscore and Yahoo!, Advocates actually convert prospects two to three times more often than non-Advocates.
  3. Unlike paid salespeople, Advocates evangelize you for free. They go out of their way to recommend you because they’ve had a great experience with your product or service and want to tell others.


B2B Buyers 2X More Active with Social Technologies than Consumers

You would think by now that B2B marketers get that their customers and prospects are using social technologies. Yet last week a senior marketer from a Fortune 1,000 B2B company said during a conference call with us that the company's small business customers do not use social media. For B2B marketers who missed it, Forrester recently announced a major new study on B2B buyers use of social technologies. The study showed that B2B buyers are two times more active users of social technologies than US online adults. Of the companies who participated in the study, 35% had fewer than 999 employees.

This chart compares social technology usage between B2B buyers and US online adults. The message for B2B marketers, according to Forrester, is that if you're not using social as part of your marketing mix, you're late.

B2B More Socially Active

Word of Mouth Rule #6: Brand Advocates are 5X More Influential than Paid Media

WOM_RulesWhy are Brand Advocates so influential? It boils down to two words: trust and reach. According to Forrester Research, 94% of consumers trust Word of Mouth recommendations. Only 14% trust online ads. (See below.)


Empowered by social technologies, Brand Advocates have massive reach. As we pointed out in WOM Rule #5, on average each Brand Advocate reaches a minimum of 150 people. A company with 100,000 Advocates can thus reach 15 million prospects with highly relevant, trusted messages.

Your Facebook Fans aren't that into you

womanWe've been saying for awhile now that Facebook Fans are not necessarily Advocates. Just because someone has joined your Facebook fan page doesn't necessarily mean that they are willing to pro-actively advocate you. In other words, there's a big difference between "liking" something and evangelizing it. A new study by email service provider ExactTarget backs this up. According to the study, 70% of Facebook members who are a fan of at least one brand say that being a fan doesn't give a brand permission to market to them and 40% of fans don't believe brands should be marketing in social networks at all. The point is this: don't treat your Facebook Fans as if they've opted in to an email campaign (see this post).

Now, compare the findings of the ExactTarget study to a study Zuberance conducted for a leading consumer company that sells cooking utensils and other home and kitchen gadgets.

  • 64% of customers we surveyed said they are Advocates (They recommend the brand and its products to friends.)
  • 14% of these customers are frequent Advocates. (They recommend the brand and its products 3 to 4 times each month.
  • 78% of Advocates said they're interested in participating in Advocate program
  • 69% said they were interested in previewing new products and providing feedback
  • 33% said they were interested in attending and participating special event
  • 22% said they wanted to pro-actively spread positive WOM by writing product reveiws and testimonials (and this percentage would be higher if these customers knew how easy it is do this.)

Summary: Your Facebook Fans may not be that into you, but your Advocates are. They want you to engage them. They want you to ask their opinions. And they are very willing to help you market your products and services as long as you do it in a way that respects them.

PS: Thanks to Alex Littlewood, president of the Silicon Valley chapter of the American Marketing Association, for sharing the ExactTarget write-up with us.

WOM Rule #5: Advocates Have Massive Reach

WOM_RulesEach Advocate reaches approximately 150 people in his or her social and/or business network. We reached that conclusion by analyzing publicly-available data from social networking sites like Facebook, Twitter, LinkedIn, plus email marketing trade associations, and other sources. First, we added the total number average number of contacts that people have. We then discounted by 60% to account for duplication. Depending on your point of view, you may consider our estimate low, high, or about right. A quick poll of our employees showed that the average number of contacts each person has on Linked In alone is 167. (We’re reproducing the chart here since we have been asked often about this data.) image002

One other point here: Advocates actually reach many more than 150 people because their friends and colleagues often forward Advocates’ recommendation others. The ability for recipients to re-Tweet content makes this easy.

WOM Rule #3: Advocates are different than loyal customers.

WOM_RulesLoyal customers are frequent buyers, but they are not necessarily Advocates. In fact, your loyal customers may be your harshest critics. The classic example is the airline industry. Many members of frequent flyer programs go out of their way to blast the airlines they fly. Yet they continue to fly the same airline because they want to pile up points or because corporate travel policies require them to do so.

In one study by Zuberance, we found that 20% of a company’s loyalty program members were Detractors – they were highly unlikely to recommend the company to friends and colleagues.

Don’t assume that your loyal customers are Advocates. Identify your true Advocates now.