Lots of people on the East Coast US have been busy looking into word of mouth marketing lately. “Do Friends Influence Purchases in a Social Network?” presents and in-depth study based on Cyworld, a popular social networking site in Korea. Cyworld is a great base to study, due to it’s abilities for members to “scrape” or copy other friends home page contents.
What the study found is that there are three distinct classes of users with different behavior:
* Low-status group (48% of users): Friends with limited interaction and connection.
* Middle-status group (40% of users): Moderate connection between members, with strong and positive effect due to friends’ purchases (“keeping up with the Joneses” behavior)
* High-status groups (12% of users): well connected and active. Showed a significant negative effect of friends purchases.
This last group – often opinion leaders who seek to stand out – actually had a 14% negative drop in purchase revenue, while the “Joneses” group had a 5% increase in revenue.
The study is not surprising to the researchers, as it validates mid-status conformity thesis in sociology. This suggests that “low-status” members (terrible name by the way – who would want to be in this group?) do not imitate others as they feel they will not gain status from it, the “middle-status” members feel the social pressures, and the “high status” are confident and believe in their own judgment and legitimacy of their own actions.
The Harvard study conflicts quite a bit with a study by Universal McCann entitled “When did we start trusting strangers?” (17mb file!). In it, they claim that “we now trust strangers as much as our closest friends”. Not off the bat of course, as social network activity could be with anyone, but as I wrote about earlier, most research posts to social networks being a hang out between friends.
What are the implications for marketers? Clearly, viral marketing works. But you have to make sure you know whom you target and what you do with them. I feel the UMC report can be somewhat misleading in terms that it initially leads you to believe that everyone gets influenced by everyone. Clearly this is not the case. A lot of people – “the Joneses” – are certainly influenced by recommendations – but probably in a much stronger degree by their immediate circles than strangers (although strangers can be sought out for reference), while a fairly significant portion (40%) really could not care, and a small portion you have to target in a completely different way because they strive not to be mainstream. UMC does try to identify this group which certainly would fit the observations in the Harvard study, and they have these characteristics:
(Source: Universal McCann)
It may be difficult to find this last group. There are companies like Youth Trends who specialize in finding the networks (at least within the youth category). The best example I have seen in terms of using this group to drive sales is a case study by a local agency called “Soup”, where they did a campaign for a local beer in Australia (Source: Soup, AdTech presentation in Sydney, 2009). Soup did a lot of research to find the influencers beforehand and base their campaign on this. At Storyz, we focus on running viral campaigns and then find out the influencer patterns based on behavior in campaigns, which is another approach.
What is clear though, as a marketer, you cannot rely on a blindsided approach by using a single social network to run your campaigns on, because people use different social networks for different purposes, and online relationship patters are only mimicking real world relationship patterns for the most part. And the best source for your real world relationships? The phone address book of course. Get to this, and you will definitely ensure that the viral message spreads to genuine connections. The likes of Twitter and Facebook cannot match this social connection, which is evidenced by recent findings again by Harvard on Twitter, which shows that the median number of lifetime tweets per user is one, and that 90% of traffic is driven by the top 10% of users:
Does this mean Twitter users are all influencers? Hardly. Does it mean that if being on Twitter becomes mainstream, all the influencers will jump ship? Maybe. But perhaps what it shows is that Twitter certainly cannot rely on being an influencer channel for word of mouth marketing campaigns as a business model, and neither should marketers.
I would welcome comments and more research in terms of how to do effective viral marketing campaigns.
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