In case you still had a question about it, there are a lot of people participating in consumer generated media (CGM). Recently published research reports include some mind-boggling statistics. Here are just a few.
As of today, there are 21.2 million blogs listed in Technorati. Blog Herald claims that as of the end of October, there were 100 million blogs worldwide. A report by comScore Networks earlier this month shows that 50 million US Internet users visited blogs in the first quarter of 2005. That is roughly 30% of all Internet users and 1 in every 6 of the total US population. According to a study released in October by Intelliseek, users are on track to post nearly 2 billion comments this year alone.
There’s a proliferation of ways to engage in Consumer Generated Media, whether it’s publishing a blog with TypePad, sharing bookmarks with del.icio.us, swapping photos with Flickr or ranking local restaurants with Yelp. And it seems there’s a steady stream of new services announced daily. TypePad reports that its traffic is increasing 10 – 20% per month, and that they’re pushing 3 terabytes of data through their pipes every day.
In addition to the sheer volume of it, Consumer Generated Media is increasing its impact while other forms of media decline. The Intelliseek study shows that consumers are 50% more likely to be influenced by word-of-mouth (WOM) recommendations from their peers than by radio or TV ads. Active “ad-skippers” are 25% more likely to create and respond to CGM via Internet message boards, forums and blogs. Bernstein Research estimates that in five years the negative impact of ad-skipping and piracy on major media companies will be about $9 billion in revenue – a $155 billion hit to overall equity. Both positive and negative word-of-mouth are equally influential and have nearly twice the impact of TV, radio or print advertising.
The industries most susceptible to CGM are what we used to call “considered purchases” – health, automotive and technology-oriented products/services (e.g.: games, video, music, etc.). And the recent profiles of bloggers show that they have an average HHI of $75k or more and are between the ages of 35 – 54. In other words, they’re at the demographic sweet spot for most marketers.
Given all of the evidence of the importance and impact of Consumer Generated Media, what are the implications for “Joe-Six-pack” marketer?
The most obvious is that marketers need to give up their old ideas of control and start testing this new model for consumer engagement. You’ll be in good company. A recent study conducted jointly by McKinsey and the Word of Mouth Marketing Association shows that over half of marketers will use blogs or WOM in the next six months.
It’s relatively easy and inexpensive to mount a small-scale test, and you’ll learn a tremendous amount in the process. Think about it in two phases. First, employ CGM/WOM to better understand your markets and their opinions about your products and services. Use the process of Active Listening to identify active networks of producer-participants and their attitudes about your category, your company and your competitors. Then, equipped with a better understanding of your “center of gravity” in the blogosphere, use CGM/WOM to participate in the conversations. Test blogvertising as a way to help find product/service/brand evangelists. Ask agenda-setting bloggers to write reviews of your product or service. Use these efforts to start building momentum among influentials, who in turn will spark the rest of your market. Most importantly, don’t try to create fake buzz. It’s transparent and antagonistic, particularly for topics where there are already networks of active participants. Create Commons, a nonprofit advocacy group, learned that the hard way when they created a marketing program using a buzz marketing agency and were soundly trounced in blogs of the grassroots advocates they depend on for volunteers and funding.
Consumer Generated Media is a potent combination of user participation and open source architecture. Test it, learn how it works for your category and brand. But be respectful of what it really is: a complex, often chaotic network of overlapping conversations between information seekers and sharers.
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