cgm

CGM & Forecasting Product Launch: Nielsen BASES/BuzzMetrics Study

Last week I kicked off a New York based Word-of-Mouth Marketing Association (WOMMA) workshop , and a key point I underscored -- and repeat in virtually every presentation -- is that buzz never occurs in a vacuum.  The digital trail of CGM is like a never-ending accountability scorecard that implicates just about everything in business, from advertising to customer service to employee relations.  The key challenge (and opportunity) for managers is to understand and take full advantage of the the "cause and effect" of the various inputs.

BUZZMETRICS/BASES STUDY:  Along these lines, the Nielsen BASES and BuzzMetrics divisions (disclosure/transparency check: Nielsen is my official employer) converged on a study and white paper this week underscoring the symbiotic relationship between CGM and paid media. Authored by Kate Niederhoffer (BuzzMetrics), Rob Mooth (BASES), David Wiesenfeld (AC Nielsen) and a few others, this first stage CPG brand and market-mix modeling study found that high blog interest, or buzz, around new product launches is tightly linked to paid media spending. Notes the study:

After analyzing blog buzz volume, ad spending, purchase intentions and actual product sales, Nielsen found the best predictor of buzz for newly launched consumer-packaged goods (CPG) is a large advertising budget. The study evaluated nearly 80 new CPG products across several subcategories, launched in the U.S. between 2005 and 2006. On average, the top 10% of products with the most buzz, spent nearly $20 million on paid media for the launch. In contrast, the companies that generated the next 40% of blog buzz spent an average of $15 million and the companies that generated the bottom 50% spent an average of only $5 million.

 

Worth also mentioning that 10% of brands accounted for 85% of total CPG buzz in the study. The study also suggests that blog buzz drive greater precision in market forecasting.

The news release is here, and the free white paper download is here (registration required). The authors of the study will host a special Web cast, with a Q&A moderated by Brandweek editor Todd Wasserman, on Friday, July 20 at 12PM EST. Sign up here.

Longer term, I think there are many other key variables that need to be modeled into the mix, and this study is just the first "toe in the water."   Other pieces of the mix that need to be evaluated and studied include the following:

• Ad Types: What are the key nuances between "types" of advertising and buzz; will the growth of ad spending online further confirm these conclusions?
• Role/Impact of Search: Where does online search figure into the mix?  There's no question the Apple iPhone benefited enormously from search placement, and we also know the pet food industry has been significantly scarred in search results because of negative buzz (potentially impacting future product launches)
• Intervention Impact: What's more important: the amount of spend, or how brands make key interventions against the spend, and ensuring buzz, to drive more efficiency?
• Negative Buzz: What if the buzz backfires because no one believes the advertising?  Should the concept of Negative GRPs be integrated into the planning mix?
• Forecasting Against Experience:  As brand "experiences" become more closely linked to word-of-mouth and CGM levels, should business processes like "customer service" also be factored into such forecast models?

This is all where the rubber meets the road with word-of-mouth analysis.  Very exciting!

CGM Meets Primetime!

Tomorrow is a really big CGM milestone for me.  I'm helping organize one of the first-ever "summits" focused exclusively on consumer-generated media.  This is part of my real job at Nielsen BuzzMetrics.  We're having 100 or so clients here in New York for a deep, extended conversation on all aspects of the measurability and actionability of CGM.  Should be fascinating as there's such a diversity of approaches to leveraging CGM.  Needless to say, I'm pumped!

9/11...Reflected in Letters

My first meaningful exposure to CGM took place back in 2000 when I founded PlanetFeedback, a web feedback portal that sought to facilitate communication and feedback (complaints, compliments and suggestions) to top brands and companies, and even the goverment.  Since then the site has collected over a million letters and comments. In many respects, these letters act as a de facto historical archive of consumer sentiment, feeling, and opinion that reflect not only our experiences with companies and brands, but major events and incidents that have touched or transformed our lives. Over the weekend, triggered in part by my earlier visit and post related to the Cincinnati Freedom Center's 9/11 exhibit, it suddenly dawned on me that PlanetFeedback had hundreds, if not thousands, of letters, consumer testimonials, and comments related to all aspects of 9/11. Thoughout the week, the site will be featuring these letters on the home page, and I encourage you to take a look and reflect.

PFB 9/11 Archive of Consumer Commentary

How Many Ways Can You Skin a Snake's Buzz

Had some fun with my last ClickZ column entitled "How Many Ways Can You Skin a Snake's Buzz."  Since I'm in the CGM monitoring businesss, I decided to look internally for answers and enrolled the employees of Nielsen BuzzMetrics as a focus group.  The key question: why suck lackluster box office results for the much-hyped and much-buzzed Snakes on a Plane movie (SoaP).  Or is that even the right question?   Read on!

Gaming Snakes?

I've resisted the temptation to weigh in on the already over-subscribed debate on the Snakes on a Plane (SOAP) aftermath.  And then last night my colleague Max Kalehoff forwarded me a piece written by Freakonomics author Steven Leavitt entitled Snakes on the Internet, Too that hit the strike zone of my concerns about all the hullabaloo around the movie.  To the question of why Snakes fell short at the box office, Levitt asks: 

"One reasonable answer to that question may be that when the buzz is faked/manufactured, commercial success will not follow.Was the buzz around “Snakes on a Plane” artificially manipulated by people involved with the movie?"

He proceeds to cite San Antonio College Economist Cyril Morong, who's assembled some provocative data suggesting that there may have been a significant amount of "gaming" of the system around the movie.

Of course, this is the paradox of buzz building and customer evangelism.  In our zeal to promote the things we love, do we create artificial "lifts" that betray reality?  In the case of "Snakes on a Plane" there were so many of us in the marketing community hyper-enthusiastic about the fact that a movie studio actually invited consumers to "participate" in key decisions around the movie that we may have prematurely over-hyped the movie as a reapplicable case study...even before the snakes got loose at the box office.  More importantly, are marketing bloggers the right proxy for a general movie going audience?  Were movie-goers truly listening to our commentary, or were we just listening to ourselves?  There was undeniable spillover into search engine results, which clearly drove "new" impressions with potential movie goers, but the core message delivered wasn't necessarily "this movie rocks."  It was more akin to "this marketing process or technique rocks."  Different messages, and they matter at the box office.

As for the issue of  "artificial lifts," I do think there was plenty or organic and real online excitement around this movie, but there's always the risk of manipulation.  I can't speak for the professor's findings, but there's no question grades or ratings or reviews frequently succumb to manipulation or inflation, although some of this might be likened to a well-orchestrated "Get out the Vote" campaigns.  (This is why traditional research still counts.)  Part of what we learn in buzz marketing -- for better or worse -- is to drive and build momentum, and at the personal level I certainly partake in some level of that through e-mails I might periodically send to Jackie Huba, Jim Nail, Laurent Florez, Gary Stein or other WOM/CGM experts to "expand my conversation." Enrolling others in the conversation is a rather benign exercise, provided we don't treat that conversation as a proxy for how everyone else things.  In the case of SOAP, perhaps we over-projected our own feelings and excitement to the broader marketplace.

And we got bit in the process - ouch!

Looking Back, Moving Forward

What's ahead for 2006?   There's lots of glazing through the crystal ball right now, but a few really stand out.  ClickZ editor Rebecca Lieb hits the nail on the head on so many key fronts in her link-rich piece, published today, entitled Where are We Going? Well, Where Have We Been?.  Top of her rear-view mirror informed list: "Video, Video, Video" (200% agree), RSS Feed Advertising (mostly agree, but reserve some skepticism), CGM and Buzz (of course I agree),  blog networks (yep), Adware firms cleaning up (three cheers!), and Pay Per Call (need for information to assess).  Other "year ahead" columns I've enjoyed:  Dave Winer, Bambi Francisco, John Battelle (on mobile developments), and Thomas Hawk (a compilation of predictions).  Jason Calacanis also hits some good ones.

Year End Focus Group of One

For my last ClickZ column this year, Damn The Focus Groups (Except This One), I decided to take a momentary step back from high-volume "advanced text mining of consumer-generated media" and reflect on my own "focus group of one" experiences as a guide to the future.  For extra texture, I experimented with the addition of "audio" clips next to my written observations.  Interestingly, software like Odeo is making it incredible easy to take CGM to the next level of CGM2 (consumer-generated multi-media).  Click the link to hear the audio portion

• On Online Shopping
• On On-Demand Media/Content Consumption
• On Blogging Going Personal
• On My Shift to CGM2/Multi-Media
• On Our Phase Out of the Home Phone

Weather Nerd Cranks Out Predictive CGM

  Increasingly, bloggers and media "influencers" are using blog data as a "leading indicator" of emerging trends or as a "rear-view" mirror to deepen perspective around "why" certain things happened.  Today's New York Times article, citing BlogPulse, wonderfully illustrates this in a fascinating story about how a geeky weather nerd signaled on this blog "one of the earliest and perhaps clearest alarms about Huricane Katrina's poential threat to New Orleans."  Sue MacDonald wrote about this blog earlier last week.  How do we know an ostensibly isolated "geek" has got it right?  Clearly, not every ripple becomes a wave, but just about every wave starts as a ripple. 

(Dukes of) Hazarding a Guess

BlogPulse Spotlight editor Phil Ewing did a nice job estimating Dukes of Hazard box office numbers through careful analysis of early buzz via BlogPulse. Here's his recap.