Sunday, August 08, 2010

What is the Value of a Brand Advocate?

How much is an enthusiastic advocate of your brand worth to you? It turns out that it is 5X their lifetime value to you. For example, if they spend $500 buying dinner at your restaurant over a few years, then you can estimate their value at $2,500 according to a recent white paper from Zuberance. A simple definition of this powerful consumer is someone who is willing to recommend your brand their friends or advocate on your behalf.

I've found these people difficult to find, but once they are found they are even more difficult to engage. You'd think in this world of email and Facebook I could capture them in a database and message to them. The problem is that they don't like that. According to a study by Deloitte, 53 percent of advocates (vs 33 percent for consumers) want to be recognized as an individual with individual needs. The second challenge is that brand advocates tend to believe they are busier than the average consumer, so convenience in use and access is important. The good news is that advocates tend to be more social and outgoing and are much more likely to share. Deloitte's research also found that brand advocates are more likely to be perfectionists, and more likely to be the first to buy new products.

So this is where the campaign to build 15,000 advocates for your successful software start-up fails. Most marketing and PR departments simply don't have the resources to interact with the large influx of advocates over a long term. You can find them with email surveys, but then what do you say back to them? Sure, you can send them a tin of mints (I just got some from one of my favorite brands), but what you really need is to help direct their efforts in a positive direction that they see as valuable. Just like a bunch of volunteers who show up with hammers to a Habitat for Humanity house building project, it is critical that you give each person a job that they see as meaningful so they will want to come back. Similarly, the energy emanating from your brand advocates needs to be focused like a laser to help them share that excitement with others. In the restaurant example, you can ask each of those advocates to share their honest reviews on Yelp. Or you could ask them to share your restaurant's Facebook Fan page with their friends.

There are lots of simple ways to build that word-of-mouth, but I still see most of these efforts fail for some simple reasons. First, many advocates will find it too time consuming to go home, find your Yelp site and then write a meaningful review. You have to harness the enthusiasm when they are actually in a position to write something. Today that is likely to be in front of their computer. Second, they need a variety of places to advocate. Once they have posted on Yelp, they can't post there again. You have to continue to present them with fresh opportunities to talk about you. Third, managing this stuff in spreadsheets and direct email systems simply won't work. You never learn more about what the advocate does and it is impossible to measure. This all comes down to something I say often about advocacy building - It simply does not scale.

“It is what companies do with fans that create value, not merely that a brand has fans,” says Forrester’s Augie Ray in a blog post.

Zuberance has build a platform that helps companies identify advocates, direct them to places where they can contribute and then track the results. They are currently working with large consumer and tech brands on campaigns that would crash my spreadsheet and email methods of the past. These types of CRM systems for advocates are exactly what is needed to overcome the scale issue. Rob Fuggetta, Zuberance CEO, tells a story about how they recently responded to a crisis with a brand that was receiving lots of bad online reviews. Using unpaid advocates, they were able to settle down the issue by activating the advocates to balancing out the negative comments.

With the right systems to focus the efforts of your brand's advocates' enthusiasm you can unlock their 5X value and create a cost-effective word-0f-mouth campaign.


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