Chapter 63
Word of Mouth
Measurement Need
To understand whether word of mouth (WOM) generated from social media activities is impacting business efforts.
Solutioni
WOM = # of direct clicks + # of clicks from recommendations
# of direct clicks
Where
# of direct clicks is defined as any click
that first connects to the site
# of clicks from recommendations is defined
as clicks from other links,
such as other websites, ads, banners,
social media recommendations, etc.
Example: Company X had 1,000,000 direct clicks and 1,380,000 indirect clicks in January. They wanted to determine the impact of WOM:
Each direct click influenced 4.8 additional clicks. In analog terms, this suggests one person told an average of 4.8 additional people about the product/service they purchased.
Impact
WOM helps marketers evaluate the size of the audience that visits a website directly and indirectly. Digital usage footprint data is comprised of both direct and indirect clicks, the sum of which are then divided by direct clicks. This is akin to conventional WOM in which a consumer tells several other people about the product/service experience they had. It helps marketers assess the age-old business adage that the greatest testament to a company’s offerings is whether a customer would recommend it to another person. The company gains the sale directly from the customer, and also the potential to capture the other people the consumer contacted. The converse is true as well—individual negative consumer experiences can quickly escalate to a wider audience that sees the offering as negative, even without personal experience.
iMark Jeffrey, Data-Driven Marketing: The 15 Metrics Everyone in Marketing Should Know (John Wiley & Sons, 2010), 181.