Archive for January, 2011

How to make the Customer Buying Process Easier, Simpler and Faster

January 28, 2011 |  by  |  Decision Easification, Featured  |  No Comments

Examples of Easifying Customer Buying Behavior

There are always blocks and barriers to the customer decision process.

Problem: Sometimes, the “customer” is a prescriber and approver, not the end user. For instance, a pharmaceutical company came to me with a drug that physicians strongly claimed they wanted to prescribe, but wouldn’t. I interviewed physicians who confirmed that they wanted to prescribe it, but didn’t. They were very defensive. It turned out that they couldn’t get insurance companies to approve the use of the drug without a long series of other drugs first, and complex approval phone calls or form (Certificate of Medical Necessity).  These phone calls were time-consuming and intimidating, requiring physicians to engage in a scientific justification they were not equipped to engage in. The hidden decision barrier was the high burden of time and intimidation that the physician had to bear  every time he/she wrote a prescription for the drug.

The pharmaceutical company had no idea that this was a burden, since — to them — the justification was simple and obvious. A classic case of Expert Blindness.

Solution: Their solution was so technical that physicians didn’t understand it. So, I interviewed high prescribers of the drug who had obviously gotten past this barrier. Obvious, but not so obvious if you don’t know about the hidden barrier. It turned out that some of the experts in the field who had busy clinical practices had developed a simple, one-sentence script that mentioned two peer-reviewed studies in reputable journals that said that this drug was the new standard. The sentence was one that any nurse could read or put on the form to get the approval. It was worded in such a way that it put the insurance company in a legally untenable position of they denied treatment, thus compelling approval. The salespeople were sent out with materials that addressed the issue, and prominently displayed the “magic sentence.” Sales tripled. We Easified the approval decision (“Is it really worth fighting this battle?” “No.”) to a no-brainer (“Is it worth it?” “Of course, my nurse can handle it in a few seconds.”)

Secret: There is almost always a simple solution: a barrier waiting to be discovered and a simple way of removing it.


Problem: In a more complex approval situation, the technical buyers didn’t know how to answer the financial concerns of the company’s top management.

Solution: I got permission to give out a “fill in the blanks” version of the presentation and spreadsheet that a customer used successfully to convince his company’s management — one that (unlike our client’s) talked their language and actually worked! I Easified the presentation construction and persuasion decisions and collapsed the learning curve.


Problem: A product’s acceptance depended upon a crucial fact that could only be established by an accepted industry expert.

Solution: I asked potential customers to tell us exactly what reassurance they needed, from whom. I then went to the most-named industry expert and drew out of him the perfect testimonial that used the words the customers said they needed to hear — increasing sales more than tenfold, establishing an industry record that has never been broken. I Easified the fact-checking and “justification of use” barriers.


Problem: Technical web sites that weren’t connecting to real people. Several of our clients’ products and services had gorgeous Web sites that were abstract, information dense and cerebral — missing the vivid, involving language that comes from the customer’s hearts and real-life experiences.

Solution: I formed an Advisory Group that provided emotionally compelling language that we put into simplified, less Flashy, focused web sites and presentations. The usual reaction is, “Wow, you really get what it’s like to be in my shoes.” I Easified the trust-building barriers.


Problem: Customer buying cycle that took years to gather enough experience to commit.


Solution: I’ve compressed the years-long decision processes of many products into a few weeks with teleconferences that put enthusiasts together with prospects, allowing them to gather more experiences in weeks than they could have in years. I  Easified the long, tedious and risky learning, verification and trial processes that usually take so long, particularly in the pharmaceutical industry.


Problem: I often find that complex products and services aren’t understood by their customers and their bosses.

Solution: I distilled their essence into a simple phrase that replaced the page-long incomprehensible nonsense that the high-tech client and their ad agency thought was crystal clear and irresistible. I Easified the cognitive burden.

Do you have a Decision Barrier that’s holding back your product? Believe me, you do. Could you use a consultation? Probably. Find out more: Click Here.

Back to Decision Easification page

Amazing and Moving Example of Word-of-Mouth Explosion

Watch these YouTube videos for an amazing, poignant example of how word of mouth, passed on from a social networking web site exploded into a national exposure (13 Million YouTube views as of this post!), got the man national fame, a job and a house, in a matter of a day or two.

I won’t say “Went Viral.” It was an explosion, not a viral spread. See previous post on the Viral Marketing Myth

YouTube – Raw Video: Homeless Man’s Voice Gets Natl Buzz


YouTube – (HD) Ted Williams, New CBS interview – Homeless man with golden radio voice


YouTube – Ted Williams Reunites with Mother after 20 Years

[CBS does not allow embedding into a blog. Click above to go to YouTube to view it there.]

The Viral Marketing Myth: Mea Culpa

January 2, 2011 |  by  |  Secrets of WOMM  |  No Comments

[Excerpt from 2nd edition of Secrets of Word of Mouth Marketing — April, 2011]
Modified slightly for blog post

Our understanding of the spread of word of mouth was helped in the early 2000’s by comparing the spread of ideas to the spread of infectious diseases, specifically viruses. It was a metaphor that both illuminated our understanding and obscured some important properties of word of mouth.

Until word-of-mouth marketing, all marketers knew that advertising, salespeople, and the rest of traditional marketing based on the broadcast model increased exposure of their product or service arithmetically. If 1,000 people a day were exposed to the product, after 22 days, 22,000 people would have been exposed. Exposure was, and still is, measured in cost per 1,000.

Richard Dawkins, Malcolm Gladwell, Seth Godin, myself, and many others popularized the idea that word of mouth spread new ideas like a viral epidemic. It seemed to explain the sudden, often overnight, spread of ideas. It caused a paradigm shift.

Here’s how we thought it worked: “Carriers” are at relative equilibrium, with about as many people getting “infected” as recovering from the disease. So, let’s say 1,000 people have the flu. They come in contact with 100 people a day, but they because they don’t touch or sneeze on all of them, they infect only 1%. So, another 1,000 people come down with the flu, which runs its course with the original 1,000, who are now cured (or dead) and cease to infect anybody else. However, the disease then finds its way to a denser or faster moving population. As a result, people are coming in contact with 200 people a day, so the spread of the infection increases to 2%. Now 1,000 people infect 2000 people, who infect 4,000 people, and so on. At that rate, if you do the arithmetic, the whole world will be infected in 22.5 days. At only a 2% infection rate!

It turns out that 75 percent of the world’s population would become infected on just the last two days! Even more amazing, on the last day, as many people will be infected as on all of the proceeding days put together. So, at the end, the spread of the disease appears explosive, as though it came from nowhere. Thus, an increase in the rate of infection from one to two percent can cause an infection to go from little growth to worldwide impact in 22 days! This leads us to believe, by analogy, that if you can get people to spread the word just a little more, the message will spread like a virus and take over the world. This idea of “Ideaviruses” reaching “Tipping Points” and spreading like infections was very compelling. This idea itself “went viral” and infected (actually poisoned) our thinking.

It obviously seemed to solve the mystery behind a common phenomenon of modern life. It fit the narrative. It explained the sudden adoption of ideas, trends, products, practices, and news that seemed increasingly to come out of nowhere to suddenly appear everywhere. The idea of the exponential, or geometric, growth model, and its relatively low initial numbers that seem to explode at the end of the cycle seemed oddly compelling. It would certainly seem to explain what is happening.

In fact, it’s a pretty powerful fantasy. As my friend Bill Cope used to say, “It’s approximately true.” In other words, it’s false.

The word of mouth pioneers—myself included—almost got it right (which is a nice way of saying we were wrong). Looking back on that heady period, I now realize that we were held hostage to our own viral metaphor. If we escape from the trap of thinking of word of mouth as spreading like a viral infection, we will unlock some pretty amazing secretss that will take us to the next level, much to our practical advantage.

My Advanced Experimental Design professor, Herbert Birch, MD, PhD, used to say, “Unless you understand the underlying mechanisms, you will think the light switch turns on the lights. It does not. The light is produced by the heat produced by the resistance to the electricity flowing through the filament. The switch doesn’t turn it on or off. It just breaks that circuit or recompletes it. Look for the mechanisms underneath what you’re seeing.”

The virus is like the light switch. It’s just a metaphor for a mathematical pattern, exponential growth—one that makes the pattern real to us. I thought it was a pretty compelling metaphor at the time. Most marketers still do.

So, let’s try to look at several issues here. How fast does word of mouth spread? How fast can it spread? By what mechanisms and patterns does it spread? Where does the viral analogy break down and obscure our understanding? How can we trigger word of mouth? How can we slow it down when it’s undesirable, or speed it up to our advantage? What can we do to intervene? (That last one is the purpose of all books on word-of-mouth marketing, indeed, the whole word-of-mouth industry.)

First, the Pattern

Consider the following.

Step 1: 1,000 people hear about a Cool New Thing.

Step 2: Each, in turn, tells 25 other people. Now, we’re up to 25,000, plus the original 1,000.

Let’s make it real. These aren’t viruses, after all; these are people and ideas.

Nor is this higher mathematics. If I can understand it, you can follow along. We know that sneezing does not spread word of the Cool New Thing, so we must ask: Who are these people and whom have they called, texted, Tweeted, emailed, or buttonholed at work or at school to discuss the Cool New Thing?

First, the initial thousand are probably an assortment of people who are at the front of the adoption curve. They are the innovators and early adopters. Some are probably influentials whom the company spent a lot of money identifying. But others are slower to adopt; they are the people who just happened to hear about the Cool New Thing by accident. Maybe it was shown to them by their daughter’s boyfriend or a seatmate in an airplane or the aunt of an employee who came to dinner. Still others are experts, mavens, infomediaries, newsies, and people with very large numbers of so-called “friends” on Facebook and Twitter. Others are neither plugged in nor particularly influential. These days, even a hermit (perhaps especially a hermit?) has 25 people he wants to email or Twitter about the Cool New Thing. Everyone focuses on these initial

1,000 transmitters. But there isn’t a lot to learn from them except their variety.

Let’s look at the 25 people they each tell about the Cool New Thing. Now, first of all, 25 is not a lot of people. Who are these 25 people? This is important. They aren’t random, as are viruses. These are people. They are the people whom the original people chose to tell about the Cool New Thing. No disputing that.

“Why that person and why that product?,” you ask. You know just as well as I do because you do it all the time. They’ve made two choices here.

1.  The product is Cool enough and New enough to tell people about.

2.  The particular person is someone who should hear about it.

Set aside for a moment how something crosses the “cool-enoughto-talk-about” threshold. The original people are going to tell people with whom there is a “fit.” Whom would you tell? People who would benefit from hearing about the Cool New Thing and who would probably appreciate hearing about it. People who may benefit from your natural inclination to be helpful to others; people who will think all the better of you for having told them; and—I think most important—people for whom the act of telling them will make you feed good about yourself. You’re not going to share your new information with people who have no use or appreciation for it, people about whom you don’t care or people who won’t appreciate your informational generosity.

I’m trying to make as real as possible the obvious “Secret” here: you share with people for whom the information is relevant and who will appreciate your telling them. And, you don’t share with people for whom the information is irrelevant, unless you’re a crashing bore.

Okay, so there is a good match between the Cool New Thing and the handpicked 25,000 people who hear about it. In fact, the match is probably a little better than it was for the original 1,000, who found out about it accidentally, randomly, or impersonally.

So, now you have 25,000 people who are probably a little more interested and excited than the original 1,000. They have a better understanding and appreciation of the Cool New Thing. They’re likely more knowledgeable. It will benefit them more, so there are more emotions around it, more excitement, admiration, and amazement.

The result: their message about the Cool New Thing is probably more articulate and emotionally engaging than the original message they received.

So the old game of “telephone” (AKA “Whisper Down the Lane”) you may have played in psychology class or with your friends taught you something that was misleading. You played it with an inconsequential message that was needlessly detailed. The message disintegrates when it’s a meaningless rumor. But when it has focused, simple, relevant, involving content that the person is interested in getting right, the receiver asks questions actively. In “Whisper Down the Lane,” people are passive.

So, the content of the information tends to build in quantity and quality and is expressed more articulately, emotionally, and enthusiastically. It reaches and is spread by people who care about the content. Now, what’s going to happen? These people are probably going to tell more than 25 other people and tell it more clearly, more meaningfully, more passionately, and more persuasively.

SECRET

The quality,  relevance, and enthusiasm of the information passed  on  through word of mouth can,  under some conditions,  actually improve through successive iterations of transmission. In addition, the ability of people  to transmit   it to the right people  often improves.

SECRET

Word of mouth is what I like to call a self-improving system.  Treasure it. There aren’t too many in this world.


Here’s what happens next in our quality and quantity journey,

Step 3: Now suppose each of these people pass the information to 50 people, on average. Don’t forget, they are much more motivated to do so. They will embellish and improve the message, perhaps adding video. Certainly they will apply their own accumulated experiences, thereby offering more than abstract facts.

Do they know a large enough number of people to select 50 for whom the message is most relevant? Of course they do. These are the people at work or at their special interest clubs, who are reading comments on websites, in their schools, from their email contacts, on their forum, and so on. None of them are hermits. Maybe they spread the word by writing articles in their association’s newsletter or on a blog or other news sources. When we say these 50 are selfselected, it means that they respond to a headline because they see Cool New Thing does awesome stuff in the headline. They’re really jazzed. They’re abuzz. Maybe they’re frenzied, like people outside an Apple store the day of a new iCoolNewThing launch, reinforcing one another’s enthusiasm. (Full disclosure: I’ve done this twice. Embarrassing, but true.)

Those 25,000 people have now each told 50 people. Wait, while I get out my calculator. That can’t be right, but wow, it is. The improved message has now reached 1,250,000 handpicked people in only three steps.

Step 4: If these 1,250,000 improve it and each pass it along to 75 people, the total number of people who have now received the message is 62,000,000.

Step 5: If these 62,000,000 spread it to 100 people each, the total is now a staggering 6,250,000,000.

This is more than the adult population of the world!!!

A more accurate metaphor to word of mouth than viral growth is the exponential growth of a nuclear chain reaction. Both word of mouth and a nuclear chain reaction need to start with the right conditions, that is highly refined fissionable material. They need critical mass, sufficient density, and a jump start. Both have an accelerating growth rate and are self-sustaining reactions that feed on themselves. Both have growing energy, change form in the process, and permanently alter things. If not, it’s a dud.

SECRET

Word of mouth isn’t like a virus and doesn’t  spread like one.  It’s a nuclear explosion or a dud.

I know that I’ve made several false assumptions for the purposes of easification. But, when you take them into account, it strengthens the case:

In fact, one person will tend to get many different exposures to the same message, from many different perspectives, and from many different people. It’s not like the same advertisement repeated endlessly as it interrupts her favorite TV program. So, a lot of people hear all of their friends raving about their experiences with the Cool New Thing or see it being used (the most persuasive way of “telling” someone about a product, since actions speak louder than words.) When multiple friends pile on the message, people are tens of multiples more likely to purchase. That’s why the Zune never had a chance against the iPod, even if it had been well designed. iPads, iPhones, iWhatevers are Apple’s to lose, not for another company to take away.

Adding a Killer Ingredient: Network Effects

“Network effects” is a term in economics. It means that some things are made more valuable if more and more people use them. Not that the items have more uses, but rather that more people are using them.

For example, your neighborhood park is made less valuable as it becomes more and more crowded. But some things become more valuable. I learned of this effect firsthand around 1975 when I purchased our company’s first fax machine, the “Xerox Facsimile Telecopier.” Although it was an unwieldy, rotating drum that enabled the transmission of low-quality copies of documents, it made projects so much easier. A client made us get the machine, and it made our workflow so much more efficient that we practically required our clients to get it. The point here is that it’s of no use unless both parties have one. And, it’s so valuable that you want everyone else to get one. That, in turn, increases its value to you. So, you have a strong motivation to “push” its adoption. This isn’t just a Cool New Thing that you’d like other people to have, a situation where it may make no difference to you if they get it. This is a case where if they get it, your life (and theirs) is improved.

It doesn’t do me any good if I throw an auction and nobody comes. So, I’m going to tell everyone who’ll listen about eBay, and I’ll even help them sign up. The same is true about PayPal, LinkedIn, Twitter, Facebook, email, blogs, and the next twenty things that manage to build in network effects.

That’s the Network Effect. It’s now called the “Viral Feedback Loop,” newly discovered by the technology sector, but it’s been known for a long time. So, now we have word of mouth passing along information selectively in a highly motivated manner.

So, mathematically, we have something that appears to be more powerful than exponential growth, which is a population multiplying by a constant factor. We have a multiplying factor that is increasing, maybe even multiplying itself. I don’t know if there is a mathematical name for this phenomenon; non-mathematicians call it an explosion.

Even if I’m wrong and it’s “only” an exponential growth rate, it’s still amazing. I prepared Table 3-1 when I believed the growth rate was exponential. It always gets audible gasps. And, this is underestimating the rate. Table 3-1 shows the results of 25 people telling 25 different people, who do the same, in turn, six times. Here’s the result

Table 3-1

Exponential Growth Rate

1st Wave

25 people  tell  25 each  =

625

Neighborhood

2nd Wave

625 x 25 =

15,625

Town

3rd  Wave

15,625 x 25 =

390,625

City

4th  Wave

390,625 x 25 =

9,765,625

NY  City

5th  Wave

9,765,625 x 25 =

244,140,625

Approximate U.S. adult population

6th  Wave

244,140,625 x 25 =

6,103,515,625

Approximate world population

From 25 people to the entire world in six steps! As we’ll see, people have a much higher talking and listening threshold, so information spreads faster than viruses. If they do not think something is worth talking about, they talk about something else. Economic theory is something I like to talk about, but teenage girls like to talk about clothes and boys. There’s little danger of any of my memes infecting them. But try to stop each of them from texting 100 people a day about the latest clothing fad, with videos included.

So, word of mouth tends to be either explosive or unworthy of conversation. If it doesn’t explode, it will likely fizzle. Given the table above, in which the 25-people multiplier is probably a serious underestimation, the recently reverified “six degrees of separation” shouldn’t be a surprise. You really can get from just about any person to any other person on the planet in six steps or less.

Therefore, let’s stop using the term “viral” as a synonym for “runaway word of mouth.”