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Transcript
The
Word-of-mouth promotion has become
an increasingly potent force, capable
of catapulting products from obscurity
into runaway commercial successes.
But to harness the considerable power
of buzz, companies must reject five
common myths.
Buzz
n Buzz ^
B
u z z IS THE STUFF OF MARKETING LEGENDS.
by Renée Dye
Dark and witty Harry Potter, the trafficstopping retro Beetle, the addictive Pokémon,
cuddly Beanie Babies, the hair-raising Blair Witch
Project~a\\ are recent examples of blockbuster commercial successes driven by customer hype. For some
reason, people like to share their experiences with
one another-the restaurant where they ate lunch,
the movie they saw over the weekend, the computer
they just bought-and when those experiences are favorable, the recommendations can snowball, resulting
in runaway success. But ask marketing managers about
buzz, and many will simply shrug their shoulders.
It's just serendipity, they say, or sheer luck.
Renée Dye is a strategy expert in the London office of
McKinsey & Company.
HARVARD BUSINESS REVIEW
November-December 2000
139
The Buzz on Buzz
point: Viagra, one of the most talked-about
prescription drugs ever, even among those who
don't need it.
Shrewd pharmaceutical companies are now
taking a two-pronged approach to jump-start
buzz among both doctors and consumers. For example,
when Merck launched Fosamax, a therapy for osteoporosis, the company carefully chose scientists and
physicians with high standing to conduct the clinical
trials and to promote the new treatment. In addition,
Merck increased the visibility of the new treatment
by sponsoring symposia at international meetings. On
the consumer side, the company launched a major marketing campaign in women's magazines to inform readers of the risks of osteoporosis and educate them about
the value of screening and preventive treatment. Before
long, the debilitating bone condition became a common
topic of discussion among women and between women
MYTH 1: Only outrageous or edgy
and their doctors. As a result of these efforts, Merck was
products are buzz-worthy.
able to generate significant buzz for a previously unnch
table
subject.
Everyone can point to a buzz-driven consumer craze that
Medicine
is one thing, but sometimes even the most
was due in part to the sheer inanity or fringe quality of
ordinary
products
can benefit from buzz. Remember
a product-think of pet rocks or the movie The Matrix.
Hush
Puppies?
When
the company discovered that hip
Yet according to our analysis, a surprisingly large portion
New
York
City
kids
were
snapping up vintage pairs of
of the U.S. economy-a shade above two-thirds - has
its
shoes
at
secondhand
stores,
it rushed into action.
been at least partially affected by buzz. (See "What Buzz
It began making its shoes in shades like
Affects" for an industry-by-industry
Day-Glo orange, red, green, and purple.
breakdown.) Obviously, buzz greatly
W H A T BUZZ AFFECTS*
Next, it sent free samples to celebrities,
affects the entertainment and fashion
Slightly more than two-thirds of
and not long after, David Bowie and
industries, but it also influences agriculthe U.S. economy has been
Susan Sarandon were spotted wearinfluenced by buzz.
ture, electronics, and flnance. Indeed,
ing them. Then the company tightly
few industries are immune these days,
54%
controlled distribution, limiting the
partially because of technological innoshoes to a handful of fashionable outvations like the Internet that enable
lets. Soon high-end retailers like Saks,
customers to spread buzz quickly.
Bergdorf Goodman, and Barneys were
Consider the pharmaceutical
13%
begging for them. In just three years,
industry, which has recently
from 1994 to 1996, Hush Puppies saw
witnessed a dramatic increase in
its annual sales of pups in
the power of buzz. In the past, pharNorth America skyrocket
maceutical companies marketed new
13% Largely Driven by Buzz
Toys, sporting goods, motion
from fewer than 100,000
prescription drugs primarily through
pictures, broadcasting, amusement
pairs to an estimated
a direct sales force that distributed eduand recreation services, fashion
1.5 million.
cational materials and free samples
Of course.
to physicians. Consumers were rarely
54% Partially Driven by Buzz
aware of new therapies except as preFinance (investment products),
not every product is a
hotels and lodging, electronics,
scribed by their doctors.
good candidate for buzz
printing and publishing, tobacco,
Today, thanks to extensive advertising
marketing. How, then, can
automotive, Pharmaceuticals
and the Internet, consumers have access
managers assess buzz-worthiness?
and health care, transportation,
agriculture, food and drink
to health-care information on a scale
Two criteria make it possible.
undreamed of just ten years ago. InFirst, products ripe for buzz are
33% Largely Immune to Buzz
deed, a revolution is under way, transunique in some respect, be it in look,
Oil, gas, chemicals, railroads,
forming people from passive to active
functionality, ease of use, efficacy, or
insurance, utilities
participants. In choosing their treatprice. For Chrysler's PT Cruiser, the
'McKinsey & Company estimate for 1994
ments, such active consumers can-and
degree of difference from the competiU.S. economy (total equals 16 triilionl
do-generate and spread buzz. Case in
tion clearly lies in its retro, gangster-era
My research suggests otherwise. Investigating the
marketing practices at more than 50 companies, my
colleagues and 1 at McKinsey have found that buzza phenomenon we've dubbed "explosive self-generating
demand" -is hardly a random force of nature. Instead, it
evolves according to some basic principles. My research
shows that companies can predict the spread of buzz by
analyzing how different groups of customers interact
and influence one another.
Many executives have little idea how to orchestrate
a marketing campaign that exploits the full power of customer word of mouth. Instead, they remain enslaved to
five common misconceptions about the phenomenon.
Before companies can reap the total benefits of buzz,
they must understand the principles of how it works, and
doing so requires a close examination of thosefivemyths.
140
HARVARD BUSINESS REVIEW
November-December 2000
The Buzz on Buzz
managers have a portfolio of marketing
ALL CUSTOMERS
look. In the case of collapsible scooters,
tactics
from which they assemble just the
ARE
NOT
CREATED
the key buzz-worthy factors are functionright
sequence
to generate and sustain
ality and ease of use: what other product
EQUAL. SOME-THE
buzz.
Here
are
some
of the most powerful
allows people to dash from place to place
VANGUARD - HAVE A
tactics
we've
identified
from our research.
on a lightweight, folding device?
DISPROPORTIONATE
Seed
the
vanguard.
All customers are
Second, products with great buzz potenABILITY TO SHAPE
not created equal. Some-the vanguardtial are usually highly visible. For many
have a disproportionate ability to shape
PUBLIC OPINION.
products, that condition is a no-brainer.
public opinion. Increasingly, managers are
The popularity of fashion accessories, like
recognizing that getting their products
Gucci's baguette bags, tends to spread
into the hands of the vanguard can pay
Üke wildfire because they are easily seen by
off exponentially in how the mass market
others. Every time someone in a meeting
ultimately responds. Abercrombie & Fitch,
pulls out a Palm device to jot a note, the
for
example,
recruits college students from popular
company gets another endorsement of its popular PDA.
fraternities
and
sororities to work in its stores, knowBut insightful companies have discovered that products
ing
that
they
will
then probably wear A&F clothes
can be made visible. One way is to create forums, such as
more
frequently
and,
in doing so, implicitly endorse
Internet chat groups, where customers can exchange
the
fashions.
information about a product-such as a new medical
Ration suppiy. People often want what they-or othtreatment-that might otherwise have remained hidden.
ers-can't have. The luxury-goods industry has long
Often, creative approaches are needed to facilitate the
exploited this tendency, and today other companies are
discussion. Pfizer, the maker of Viagra, faced an uphill
increasingly using it to their advantage.
battle when trying to generate buzz for its breakthrough
Walt Disney has excelled at maintaining high demand
drug, because impotence was a taboo subject But by popand buzz for its animated films by carefully controlling
ularizing the medical terms "erectile dysfunction" and
"ED," the company transformed the undiscussable into their availability on video. The "Disappearing Classics"
campaign of 1991 announced that the company would
fodder for the bedroom and backyard alike.
retire certain videos, allowing consumers just a limited
time to purchase them. Films subsequently brought out
M Y T H 1 : Buzz just happens.
of retirement were being re-released in theaters. Previous experience with this campaign led Disney to proMany people believe that buzz is largely serendipitous.
ject in 1995 that video sales for some films could surge
Not so. We have found that buzz is increasingly the
by as much as 400%.
result of carefully managed marketing programs. Savvy
THE 5 MYTHS OF BUZZ
THE MYTH...
...THE REALITY
Only outrageous or edgy products
are buzz-worthy.
The most unlikely products, like prescription drugs,
can generate tremendous buzz.
Buzz is increasingly the result of shrewd marketing tactics in
which companies seed a vanguard group, ration supplies, use
celebrities to generate buzz, leverage the power of lists, and
initiate grassroots marketing.
2
Buzz just happens.
3
The best buzz-starters are your
best customers.
Often, a counterculture has a greater ability to start buzz.
A
To profit from buzz.you must act
first and fast.
Copycat companies can reap substantial profits if they know
when to jump in-and when not to.
Q
The media and advertising are needed
to create buzz.
When used either too early or too much, the media
and advertising can squelch buzz before it ignites.
..
142
M
II
1 II ' "
-
1
HARVARD BUSINESS REVIEW
November-December 2000
The Buzz on Buzz
Volkswagen took this tactic one step
further in marketing its retro Beetle.
A year after the car's introduction, the
company offered Internet-only sales in two
new colors, "vapor blue" and "reflex yellow,"
with exactly 2,000 cars available in each.
This attention-grabbing maneuver triggered
its own share of buzz and ignited an additional round of publicity for the already
popular cars. Within two weeks, consumers
had quickly snapped up half of the limitededition models.
Exploit kons to beget buzz. Another tactic that companies use to trigger buzz is celebrity endorsement. Thanks to ad campaigns
featuring icons hke Michael Jordan and Tiger
Woods, Nike has built its brand into a marketing juggernaut Advertising, however, is merely
one way to leverage the power of icons.
Tickle Me Elmo became the best-selling
toy of the 1996 Christmas season in the
United States after Rosie O'Donneil played
with the doll on her daytime talk show. A public relations agency had cleverly engineered
~~
this runaway success by sending an Elmo to
O'Donnell's son. Literary publicists eagerly
lobby staffers at Harpo, knowing that many
books Oprah Winfrey selects for her book club
pole-vault onto the New York Times best-seller list
Movies and television shows can also serve as powerWorld Report can dramatically increase or decrease the
ful endorsers. During the funeral scene in the hit film
number of applications to a given institution.
Four Weddings and a Funeral, one of the characters reads
Some companies have begun to leverage lists in
"Stop All the Clocks," a poem by W.H. Auden. After the
creative ways. In 1998, Modern Library, an imprint of
film opened. Vintage Books adroitly published a slenRandom House, surveyed its editorial board to compile
der volume containing the poem and other Auden
a list of the top loo novels of the twentieth century. The
poems, which sold 50,000 copies in three years. (Most
selections, which the company publicized on its Web
poetry books sell around 500 copies.) It's no wonder comsite, became the focus of much animated discussion, in
panies have been aggressively seeking, and sometimes
part because of a spat between the editorial board and
paying huge sums for, key product placements. Luck
the publisher over the process used to compile the list.
had little to do with the appearance of
Within five months, more than 1,000 artia BMW Z3 Roadster in the James Bond fiick
cles and editorials had appeared about
GoldenBye or the prominence of an Apple
the controversial Ust Even more remarklaptop computer in Mission Impossible.
able, though, was that within weeks ofthe
Tap the power of lists. Lists are potent
list's publication, four of the top five novLUCK HAD LITTLE TO
tools for creating buzz because they're
els made their way on to Amazon.com's
DO WITH THE
effective road signs for informationweekly list of paperback best-sellers, with
APPEARANCE OF A
besieged consumers who don't know
James Joyce's Ulysses having pride of place
where to focus their attention. Perhaps no
at number 2! Of course. Modern Library
BMWZ3 ROADSTER
one knows this better than movie execuwasn't
the only imprint to benefit from
IN THE JAMES BOND
tives, who hold their collective breath
this buzz-any publisher with editions
FLICK COLDENEYE OR
every Monday morning, waiting for the
of the selected books experienced an
THE PROMINENCE OF
weekend box-office rankings that can
upsurge in sales. But Modern Library reAN APPLE LAPTOP
either make or break new releases. Even in
ceived a tremendous amount of free pubthe world of ivory towers, the annual lists
COMPUTER IN
licity, and traffic at its Web site surged by
of colleges and universities by U.S. News & MISSION IMPOSSIBLE. a jaw-dropping 7,000%.
HARVARD BUSINESS REVIEW
November-December 2000
The Buzz on Buzz
Nurture the grass roots. Thefinalbuzz tactic focuses
on establishing and extending product loyalty throughout a community. At first, this tactic might sound similar to seeding the vanguard, but there is a critical difference. Members of the vanguard typically delight in
being the first to know about a product; they revel
in this exclusivity. When other people begin to adopt
the product, the vanguard often moves on to the next
big, exclusive thing, in contrast, a grassroots strategy
relies on early adopters who try to convert other people-to turn them into users, too. With many new drug
therapies, for instance, early patients who've been successfully treated wish for others to benefit. Users of network services like America Online try to recruit others
because the usefulness ofthe service grows with the number of members. Or perhaps consumers identify so deeply
with a brand that they want others to become a part of
that community.
A powerful example of buzz nurtured at the grassroots level is the marketing campaign that HarleyDavidson used in its remarkahle turnaround. In 1981,
the motorcycle manufacturer was nearly bankrupt as
Japanese competitors with superior quality and lower
costs had demolished what was once a thriving U.S.
industry. But the 13 executives who bought Harley from
parent AMF believed they could save the company by
tapping into the fervent loyalty of its customers; for
FINDINCTHE BUZZ-STARTERS
ome customers shape public opinion more than others.
To identify these buzz-starters, companies can try a
process made up of four questions:
S
Research Methods
A, How would we group
our customers based
on their purchasing
behaviors?
• Marketing and industry data
' Information from trend spotters
'Observation of customers
' Customer panels and interviews
B. How do these
groups influence one
another's purchasing
of our products?
' Observation of customers
• Customer interviews
C. What are the potential
paths for buzz to
spread between different customer groups?
' Simulations that show the
flow of information from
one group to another
D. Which path is the
strongest, and which
group starts the buzz?
• Interviews of customer
groups to determine their
propensity to adopt and
recommend the product
144
A CRASSROOTS STRATEGY RELIES
ON EARLY ADOPTERS W H O TRY TO
CONVERT OTHER PEOPLE - T O TURN
T H E M INTO USERS, TOO.
them, Harley-Davidson was not just a motorcycle but an
identity. In 1983, the company established and sponsored
the Harley Owners Group, or HOG, with numerous
regional chapters around the United States. Strapped for
cash, Harley used inexpensive buzz marketing techniques-newsletters and posters-to publicize HOG via
the dealer network. More important, though, Harley
relied on extensive word of mouth generated within
these communities. HOG quickly grew in strength, sponsoring hundreds of rallies that drew Hariey owners from
across the country. Today, more than 350,000 owners
belong to nearly i,ooo chapters around the world.
All of these tactics won't be relevant for every product.
Depending on a product's characteristics, managers must
decide which tactics to deploy and in what order. In general, seeding the vanguard and rationing the supply are
usedfirstto foster a sense of exclusivity, while using icons
might come later in a mass-marketing campaign.
Consider the sequencing that Ty shrewdly used to
touch off a national mania for its rather unremarkable
bean-stuffed toys. Initially, Beanie Babies were available
only through specialty toy retailers (supply rationing)
that catered to upper-income families. Children from
those households (the vanguard) took the first Beanie
Babies to school, generating demand among other kids.
Then ly broadened the distribution by teaming with
McDonald's (an icon) to give the toys away in Happy
Meals. The craze intensified as the media ran stories of
families buying dozens of meals and throwing out the
food because they just wanted the toys. Meanwhile, Ty
regularly retired some models from production (supply
rationing), resulting in their selling for several thousand
dollars on secondary markets. Eventually, adults, many
without children, became fanatic purchasers, accumulating hundreds in their collections.
The best buzz-starters
are your best customers.
In order to spark buzz, marketing managers often turn
first to the opinion leaders from within the community that will eventually become the bulk ofthe market.
But that can be a crucial mistake. The best vanguard for
a product may not be immediately obvious. It may even
come from a counterculture.
Take Tommy Hilfiger. The designer focused on young,
urban African-Americans to imprint his brand with
a street hipness. It worked. The popularity of Hilfiger
clothes quickly spread from the inner city to the suburbs,
HARVARD BUSINESS REVIEW
November-EJecember 2OO0
The Buzz on Buzz
reaching a broad audience of all ethnicities. Similarly,
when the marketers of Absolut vodka wanted to spark
buzz for its then lower-end no-name alcohol, they did
not target married middle-aged males in the suburbs.
Instead, they initially focused on the gay community in
San Francisco. Buzz rapidly diffused outward and, combined with a funky, award-winning marketing campaign,
helped catapult Absolut to the enviable position of topselling vodka in the United States.
Finding such unexpected vanguards is nearly impossible with marketing data that concentrate solely on what
individual consumers think about a product-and not on
how consumers influence one another about the product. Marketing researchers are thus developing new
methodologies to account for customer-to-customer
interactions. An obvious approach is to track the path of
buzz for a similar product that was successful and then
seek to replicate that pattern. More sophisticated techniques attempt to model how consumers interact with
one another and how highly they value others as sources
of information or as behavioral models. (For details of
such an approach, see "Finding the Buzz-Starters.")
icons like Quentin Tarantino and Drew Barrymore wearing Hard Candy. The buzz then reached near-excruciating
decibel levels when actress Alicia Silverstone gushed
about her sky-blue polish to David Letterman on national television. In three years. Hard Candy sales hit an
estimated $30 million.
The major cosmetics companies, such as Fstée Lauder
and Lancôme, didn't just sit there. Many moved quickly
to launch their own lines of funky-colored nail polish.
But only after the craze became firmly entrenched
did Revlon, the cosmetics mass-marketer, launch its
StreetWear line.
Did Revlon miss the boat? In a word, no. Companies
with established midmarket or downstream brands
and large, loyal customer bases often have very good
reasons for waiting until a trend is flrmly established
before building it into their product portfolios. Without having to invest time or money in product development, a copycat company can enjoy the rewards of buzz
as a late participant-provided it knows when to enter
the market and can do so quickly before the trend
has faded. In its early days, the Limited could copy
a fashion design from the runway, manufacture knockoff products, and distribute them to company stores in
MYTH 4: To profit from buzz,
just 30 days.
you must act first and fast.
Yet most companies don't have the right systems or
Trendsetting companies may generate buzz, but copycat
processes in place to successfully follow trendsetters.
firms can also reap tremendous benefits. The cosmetics By the time buzz works its way up a traditional marketindustry provides insight into how trendsetting compaing department, the trend may already be dead. To be
nies and their followers can create value for themselves.
successful, fast followers and mass-market adapters
Consider funky-colored nail polish, a buzz-created
must develop an alternative set of practices for tuning in
product if ever there was one. The rise to glory began
to buzz. Teen People, for instance, keeps a group of 4,otxi
when Dinah Mohajer, then a college student, wanted
"trend spotters" on call. The magazine encourages them
to paint her toenails to match her strappy blue sandals.
to submit story ideas and respond to published articles.
So she did what any budding entrepreneur would: she
In addition, it invites them monthly into regional offices
mixed some polish herself.
to discuss what's cool and, equally important, what's not
Mohajer's homemade concoction created such a stir
Manufacturing and retailing companies commonly
on the University of Southern California campus that she
employ "cool hunters," individuals who specialize in
and her boyfriend soon found themselves in business,
knowing what's in vogue. The cool hunter for urban
mixing batches in her bathtub and wearing gas masks
retailer Wet Seals routinely attends runway shows, scouts
for protection from the noxious fumes.
competitors' stores, reads popular magaTo distribute their product, dubbed Hard
zines, watches hit television shows, listens
Candy, they selected exclusive clothing
WITHOUT HAVINO
to popular music, and interviews kids
boutique Fred Segal in upscale Beverly
on the street in different international
TO INVEST TIME OR
Hills as their flrst outlet and then exmetropolises.
MONEY IN PRODUCT
panded to other trendy local salons. DurAnother provocative and powerful
DEVELOPMENT, A
ing this time, demand was solely driven by
buzz-spotting medium is the Internet.
COPYCAT COMPANY
word-of-mouth hype among chic urban
Many companies have discovered that by
CAN ENJOY THE
clientele (that is, the vanguard).
setting up chat sites like Gurl.com, they
Hard Candy was gradually introduced
REWARDS OF BUZZ AS
can establish an efficient and economical
into additional exclusive salons and stores,
main line into what consumers are thinkA LATE PARTICIPANT.
eventually becoming available in high-end
ing. These Web sites can function as
chains such as Nordstrom and Neiman
virtual focus groups operating in nearMarcus. Publicity for the product surged
continual session, enabling companies
as the paparazzi photographed Hollywood
to track consumer buzz as it develops.
HARVARD BUSINESS REVIEW
November-December 2000
145
The Buzz on Buzz
With such methods, copycat firms can strike while the
market is just heating up, not while a trend has already
begun to cool.
M Y T H 5: The media and advertising
are needed to create buzz.
while the media and advertising can help fan the flames
of buzz, involving them too early can undermine buzz.
Indeed, the vanguard will often reject a heavily promoted product that it otherwise would have embraced
merely because of overexposure.
Buzz-hungry companies need to refocus their marketing lenses on consumer-to-consumer communicationsbe they verbal, visual, or digital. That's where buzz
is bom. In other words, to generate buzz, the objective is
not to besiege consumers with advertising but to somehow encourage them to talk about a product or to use
that product so that it's noticed by other people.
The founders of Hotmail, the free e-mail service, keenly
understood this principle. The start-up company made its
customers its most potent marketing force by appending
a soft-sell line-"Get your free e-mail at Hotmail" -to
every outgoing e-mail from one of its users. In its first
18 months of business, Hotmail signed up 12 million people. (In comparison, AOL took more than six years to
amass that many customers.) Yet the company spent
a meager $500,000 on advertising during that period. By
contrast, Hotmail advertisements with "Free e-mail" buttons on highly trafficked Web sites produced dwarfish
response rates, suggesting that the company's remarkable
success owed more to the marketing strategy of active
messaging than to the free nature ofthe service itself,
Today Hotmail, now owned by Microsoft, claims to have
more than 80 million registered users.
But such programs, dubbed viral marketing, can also
be dangerous, because consumers may feel that they are
being exploited or are themselves taking advantage of
others. Some companies have offered cash to people to
provide the names and e-mail addresses of their friends
and relatives, who would then have the same opportunity for financial gain in enlisting others. When such
techniques smack of pyramid schemes, they are more
likely to offend rather than entice.
The Future of Buzz
Globalization continues to expand the universe of trends
and trendsetters and to make buzz ever more exportable
across borders. Consider that the three hottest children's
crazes in the United States today-Pokémon, Harry
Potter, and Teletubbies-are imports from Japan or the
United Kingdom. Advancements in mobile telephony,
PC networking, and communications bandwidth will
facilitate the creation of forums where buzz can fiour146
BUZZ-HUNORY COMPANIES NEED TO
REFOCUS THEIR MARKETING LENSES
ON CONSUMER-TO-CONSUMER
COMMUNICATIONS-BE THEY
VERBAL, VISUAL, OR DIGITAL.
THATS WHERE BUZZ IS BORN.
ish unconstrained by geography. And the continued
proliferation of brands will encourage people's close
associations with them, thus furthering buzz potential.
Finally, rising disposable incomes worldwide will enable
a wider participation in hype phenomena.
All these factors point toward a world in which buzz
will dominate the shaping of markets. In fact, the phenomenon of buzz is already becoming an industry unto
itself Dot-com companies like Epinions.com have built
their entire businesses and Web sites around customer
word of mouth: consumers rate and review products, and
the results are tallied for prospective shoppers to view.
Such forums, as well as the past successes of buzz marketing, are themselves generating buzz about the growing power of customer hype. Indeed, companies that are
unable to control buzz may soon find that the phenomenon is increasingly controlling them.
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HARVARD BUSINESS REVIEW
November-December 2000
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