BARRIERS TO WORD-OF-MOUTH MARKETING SUCCESSSURVEY DATA REVEALS MARKETING PROFESSIONALS FACE MAJOR HURDLES

Orlando, FL (Jan. 19, 2006)Word-of-Mouth (WOM) marketing has become a recognized and powerful tool for today's advertisers, but a newly released study from Osterman Research and BoldMouth.com reveals that few organizations know how to link word-of-mouth practices to existing marketing communications efforts to drive business growth.

Key findings from this new state-of-the-industry study were released today at the Word of Mouth Marketing Association's (WOMMA) Word of Mouth Basic Training Conference at the Coronado Springs Resorts and Convention Center at Disney World.The new study, conducted online from mid-December 2005 to mid-January 2006, found that despite the growing use of Word-of-Mouth:

• Only 28.6 percent of all respondents have an established word of mouth marketing plan and only 12.7 percent of all respondents have a formalized WOM plan.
• More than half of the organizations surveyed indicated that they are unable to track WOM marketing performance and 41.9 percent of respondents indicate they have difficulty getting customers to participate in new campaigns.
• 25.6 percent of respondents are experiencing challenges in allocating funds to run WOM campaigns with 20.9 percent of organizations noting that they lack a clear understanding of how run a WOM campaign or internal staff skill sets to manage WOM efforts.

In addition to a lack of planning, expertise and tracking results, the study also found that marketers face further obstacles in scaling their WOM campaigns and justifying their campaign budget to the rest of their organization. "The study is a wake-up call for the WOM industry and shows organization are facing significant marketing challenges in executing word-of-mouth campaigns," noted BoldMouth.com CEO Todd Tweedy. "More importantly, these barriers are likely to leave many organizations 'stranded on second base' as they attempt to hit a marketing home run with word-of-mouth," BoldMouth.com's CEO added.

BoldMouth.com CEO Todd Tweedy will be discussing key findings of the study during his presentation on Day 2 of the WOMMA conference, in the session titled "Getting Started: Creating a WOM Business Plan".

INDUSTRY STYMIED BY TRACKING, IMPLEMENTATION, LACK OF EXPERTISE

Most marketers surveyed -- 51.2 percent -- admitted that they are unable to track the performance of their WOM marketing efforts -- and they see this as a serious limitation not just on their effectiveness, but as an argument against committing additional resources to WOM.Other key difficulties facing would-be WOM marketers, including:

• Almost 42 percent of respondents noted that getting customers to participate in new campaigns presented a serious challenge to their WOM efforts.
• The third-largest problem facing marketers stems from difficulties in scaling campaigns. More than a third -- 37.2 percent -- of the organizations surveyed cite scalability as a barrier to undertaking WOM campaigns to achieving their goals.
• Less than half of those surveyed measure word-of-mouth marketing performance. Indeed, 59.1 percent either don't measure their performance, or aren't sure whether they are gathering actionable data. And 67.4 percent either doubt, or aren't certain at all that the data they gather as a result of measuring performance is valuable or meaningful.
• Lack of metrics to evaluate the effectiveness of WOM campaigns is the single largest reason -- 36.8 percent -- that respondents don't create a formal WOM marketing plan. Almost as many -- 32.6 percent -- haven't created marketing plans because they're not certain how to integrate WOM into existing marketing efforts. And the third-largest reason clients are going into WOM campaigns blind without formal plans? They lack the requisite staff experience or skill sets -- 28.4 percent.
• Metrics issues are likely to pose additional problems for organizations. Since increasing the marketing budget hinges on justifying expenditures, it shouldn't be surprising that 17.9 percent say they were limited by budget constraints in creating WOM marketing plans.
• Despite having little in the way of in-house or in-agency WOM marketing expertise, marketers still aren't availing themselves to external resources, with more than half (55.8 percent) admitting that they have never used an outside specialist to run a WOM campaign.

INDUSTRY MISCONCEPTIONS

The survey reveals that the word-of-mouth marketing industry is also plagued by basic misconceptions.

• Of marketing professionals surveyed, more than 40 percent of all respondents – 44.4 percent -- believe that buzz from WOM marketing campaign is most effective if the buzz happens quickly.
• In terms of expectations around results generation, 44.1 percent of respondents noted that they expected WOM campaigns to generate results in a few days or in a few weeks. Only 19.2 percent of survey participants indicated that their results generation expectations were six months or longer. Further, an additional 9.2 percent simply didn't know or were not sure of timing for generating results.
• A third (33.9 percent) say they are either unsure of how to respond to negative press or comments about their business, or wouldn't bother responding at all. Additionally, one in four respondents - 25.7 percent - believes they don't need a Web site to do effective WOM campaigns. ADDITIONAL SURVEY INFORMATIONAn online survey, conducted from December 8, 2005 to January 16, 2006 by Osterman Research generated 112 complete responses for a 90% confidence level for a mid-point response yielding a sampling error of 7.8%.

Source: BoldMouth.com – http://www.boldmouth.com