For a couple years now, Yahoo has been presenting original research at a roving event for advertisers dubbed the Summit Series. The company has been commissioning original research on topics such as online demographics, Web use, ad creative, and such online consumer behavior as shopping and the purchase consideration cycle.
"We're spending millions commissioning this research," a Yahoo ad exec noted at a reception following the presentation of the latest study in the series. "I hope it's helping sales."
An understandable sentiment, but regarding this most recent study, "Engaging Advocates through Search and Social Media," I have some reservations that it is.
(By the way, yesterday DoubleClick released some very similar and corroborative research: "Influencing the Influencers: How Online Advertising and Media Impact Word of Mouth.")
The results of this, and other studies Yahoo has recently conducted, underscore that all this stuff is mightily complicated, even for professionals immersed in the world of interactive marketing and advertising. Yahoo's New York audience wasn't composed of the digerati. Grasping the significance of online advocates might have been more than a bit over the heads of many in the agency and client-side audience Yahoo assembled for the presentation.
As Michele Madansky, Yahoo's VP of corporate sales and research, was quick to point out, the advocate/influencer concept is as old as humanity itself. That people influence other people to buy and do stuff is hardly groundbreaking. But amplify these influencers through Web channels, and the influence equation suddenly becomes very complex indeed. Search, blogs, online video, IM, community forums, user groups, photo- and video-sharing sites, and social networks all form part of an equation that channels the "billions of dollars being moved by consumer advocates," as comScore's James Lamberti (who conducted part of the study) put it.
The qualitative portion of the research wasn't particularly revelatory. Word-of-mouth (WOM) marketing has been more than prominent recently. This has given rise to the formation of the Word of Mouth Marketing Association (WOMMA), companies such as Nielsen BuzzMetrics and Cymfony to measure WOM, and shops like BzzAgent that purport to create it. It's gotten so big, even the FTC is paying attention.
Yahoo's study is of interest because of some interesting quantifiable data it presents. It found, for example, advocates have a 2:1 conversion impact across categories. In plain English, that means the researchers found an advocate talking up the virtues of her new car had at least one friend make the same purchase, to the tune of $718,000 in sales. A similarly satisfied non-advocate was responsible for only $502,000 in additional conversions. In consumer electronics, the numbers are even more staggering. For purchases over $300, advocates moved an additional $1.6 million of merchandise, compared to $570,000 attributed to their less vocal, less influential peers.
Advocates also tend to embrace consumer-generated media more than their peers, often to online retailers' advantage. When CompUSA integrated Bazaarvoice's consumer reviews into its product pages, the company quickly found its conversion rate was 60 percent higher for keywords such as "sony review" compared to its more conventional paid search ads. Given advocates review and search more, the results make sense.
Showcased were a handful of successful campaigns tied into the search and social media sites where advocates spend their time. Nikon on Yahoo-owned Flickr, for example, makes a whole bunch of sense. Honda building a MySpace page for a crab is less obvious, and, anyway, it's tied into a long-running, multichannel existing campaign. Similarly, Travelocity scored a top ranking on Yahoo for the not-terribly-expensive keyword, "gnome." But again, Travelocity's been tied to the roving garden gnome for years.
Indeed, these case studies highlight what works well in advocates' very social online spaces: major brands teamed with solidly integrated creative agencies. All have track records and spend considerable media and creative dollars in other channels, both online and off-.
What of other marketers hoping to capitalize on such a vast and amorphous world of media and creative? What if you're a B2B advertiser or a lesser-known brand?
Those were questions the audience was posing, but Yahoo and the panel of experts it assembled weren't able to satisfactorily answer.
Yahoo's reaching for those big brand advertisers, to be sure. But when the top sales executive expressed concern that the company's research and attendant events may not be achieving the desired ROI (define) for the company, I could see his point.
Yahoo isn't misrepresenting the online landscape, to be sure. Instead, it's laying bare all its complexity and confusion. It's marketing to an audience of marketers who are looking at the portal to provide answers. What it may be creating instead are many more questions.
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