Monday, October 31, 2011

Amazon Starts Kindle Service Bundles


As I'm waiting for my Kindle Fire to arrive in the mail, I got my first cross-sell email from Amazon. No, it's not for extended warranty. Amazon is offering music storage for $20/year in it's cloud service. Pretty attractive offer, considering benefits: I can download to Kindle, Android, PC or Mac. 

I am expecting more offers and bundled services from Amazon in the next 3-6 months. 

No, Kindle Fire is not just $199. 

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Sunday, October 30, 2011

Netflix Will Stream Along


First Netflix, now RedBox is increasing the price of DVD rentals. One hypothesis would be that there are fewer customers for DVDs, requiring a price increase to keep the business going. If customers are not moving away from movies all together, but rather switching to alternative ways of getting entertainment on demand, then Netflix is on the right path. 

Netflix's business model switch was too painful to watch - poor external communications, bold consumer reaction to pricing, inconsistent offerings...But they will survive this ordeal - because they are aligned with the future of TV and more broadly, entertainment. They are regarded as a value add to cable services. They give people reasons to enjoy their flat screens. And early adopters, especially among younger viewers, are streaming on demand. 

Those who focus on the number of customers leaving Netflix are acting on incomplete data. How profitable were those customers who complained and dropped off? Did they order one or 10 movies a week, paying the same subscription fee? If they were infrequent users, how easily would they switch to a streaming service?If they were hyper users, are they more likely to stream or wait for the DVD in the mail?These questions need answers, before we make final claims.  

The death of qwickster was a distraction. Netflix has some patching to do to mend its reputation. With the right content library and distribution strategy, it can survive. 

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Monday, October 24, 2011

Info-Currents November Issue Coming Soon

The November issue of Info-Currents, my monthly social media newsletter is about to go out. Below is a snapshot from the previous issue. Each month, I delve into the implications of three emerging trends and provide readers with practical next steps. If you would like to subscribe to Info-Currents, please click here.

Info-Currents October 2011 Snapshot

Emerging trend: Consumer electronics buyers are as likely to consider online word of mouth as in-person conversations (29 percent, respectively), when making their purchasing decisions.* 

  •  Those relying on online buzz for their electronics purchases have been increasing steadily--from 24 percent five years ago.
  •  Video camera (44 percent), sound system (40 percent) and smart phone (38 percent) buyers have been most likely to rely on the word online.
  • Among sources of online buzz, reviews have been the most influential.

Implication: As the new holiday shopping season nears, online reviews will play a significant role in smart phone and video camera purchases.

Action: Brands need to watch their star ratings and gear for search engine optimization now. They need to activate their fan base to share and rate their experiences.


*Source: S. Radoff Associates, Large Purchase Study

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Tuesday, October 4, 2011

Online/Offline Word of Mouth Bibliography Ready for Review and Additions

More than a year ago, a group of WOMMA members got together, curious to answer the question, “What is the interaction between online and offline word of mouth?” We knew about the Keller Fay research pointing to the dominance of offline word of mouth and we were living through the social media revolution—personally and professionally. Our hypothesis was that offline word of mouth trickled online and social media found its way to face-to-face conversations.


Our search quickly revealed that few marketers had explored this question. We felt that we would do a great service to the larger WOMMA community by pulling together a bibliography of key studies and publications that explored this topic. In this document, you will find a broad range of studies, including:

·         Comparison of online and offline word of mouth (BzzAgent, Brains on Fire, Keller Fay, Peres and Shacha, S. Radoff)

·         Offline activities’ impact on social media and search behavior (Cheema, iProspect , Lauren F. Sessions)

·         Social media’s impact on offline consumer decisions (Chintagunta et al., Godes and Mayzlin)


In addition, we conducted a survey* among our members to see how they approached the topic and measured online/offline word of mouth. We found out that while they measure both types of conversations separately, a sub-set looks at the impact of online buzz on offline initiatives and vice versa. Among WOMMA members:

  • 45% measure online buzz to capture the impact of offline word of mouth campaigns
  • 35% measure offline marketing communications’ impact on online word of mouth about brands

We hope that as the word of mouth marketing field matures, marketers find innovative ways to track results across online and offline platforms, and refer to the studies included in our bibliography as guideposts.


I would like to thank Dr. Walter Carl, Brad Fay, Bithika Mehta, Martin Oetting, Tarah Remington, Jasper Snyder, and Jeanie Son for all their contributions and their ongoing dedication to the project. As the online/offline word of mouth committee, we also appreciate WOMMA’s academic advisors’ input.


We present you with the online/offline word of mouth bibliography and invite you to join our conversation. We welcome your feedback and additions.


*Survey results are representative of WOMMA’s member base, and should be used directionally when talking about the broader marketer universe.


** This post has also been published on WOMMA's All Things WOM blog.

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