Harnessing the Power of Buzz

When word of mouth met the Internet, a new force was unleashed. And now marketers can't get enough of it

By Karen Angel

For marketers and advertisers alike, the industry buzzword these days is buzz. What's buzz? Basically, it's old-fashioned word-of-mouth, ramped up to warp speed, thanks to the Net. With the power of e-mail and instant communication, the early take on a stock, a product, or a service can be shaped and delivered at the speed of electrons in cyberspace.

Anyone who doubts the power of buzz -- for good or evil -- need look no further than the recent case of a 15-year-old New Jersey boy who made $273,000 falsifying stock tips on Yahoo Finance message boards. Before posting his "hot tip" messages, he would buy penny stocks, then sell them when they spiked.

Indeed, in the 21st century, we ignore buzz at our own peril, three new books on the the subject say. In The Anatomy of Buzz: How to Create Word of Mouth Marketing (Doubleday/Currency, October 2000), author Emanuel Rosen says: "The Internet accelerates buzz in ways that were hard to imagine just a few years ago." Rosen's book comes on the heels of The Tipping Point, the best-seller by New Yorker writer Malcolm Gladwell (Little, Brown, February, 2000), and Seth Godin's Unleashing the Ideavirus (Do You Zoom, September, 2000).


  In contrast to Gladwell's more scholarly tome and Godin's fast, flashy approach, Rosen packs his 303 pages with research and strategy. His book may be drier, but ultimately it's a more useful read for marketers. And the book has managed to generate quite a bit of buzz itself: It hit The Wall Street Journal's business best-seller list the month it came out, and The New York Times' extended best-seller list in November. Though Anatomy has since fallen off those two lists, it remained on Amazon.com's business-and-investing best-seller list for the holidays.

Why all the buzz about buzz? Rosen, a former marketing exec for Niles Software, argues that influencing the zeitgeist is no longer the province of a handful of powerful opinion leaders making their views known. In the cyber age, information -- fact, rumor, innuendo -- moves across "information networks" of potential consumers. The marketer's job is to ferret out these networks and take maximum advantage of them.

Positive buzz can send new-product sales soaring to dizzying heights. For example, 3Com ignored traditional marketing methods with its PalmPilot. Instead, it turned the product into a hit by underpromising and overdelivering. Soon, the Net was buzzing with word-of-mouth about the handheld device. Similarly, Charles Frazier's best-selling novel, Cold Mountain, was given a major boost by its publisher, Grove/Atlantic, which circulated 4,000 galleys of the book, tirelessly talked it up to booksellers all over the country, then sent the author on an extended tour. In both cases, the product exceeded the expectations of consumers -- and that thrill of discovery prompted them to unleash even more buzz.


  Buzz works well with what Rosen calls "conversation products," innovative and highly observable items with a natural gift for sparking discussion -- computers, consumer electronics, cars, fashion, books, music, movies, and the like. "Contagious products" are ones with the highest buzz quotient of all, the best candidates to reap impressive sales.

Take Hotmail. This free e-mail service spread like a virus, amassing 12 million subscribers in 18 months as a result of the blurb offering free e-mail accounts that was pasted on every Hotmail message sent. Similarly, instant-messaging software grew like wildfire because, as more users signed on, the service's value increased to everyone who jumped on the bandwagon. So, both Hotmail and instant-messaging became effective vehicles of self-promotion, the best -- and cheapest -- kind of buzz to propagate.

Rosen cautions that nothing kills buzz faster than disappointment. He cites the Momenta pen computer in the early '90s that allowed users to scribble on their computer screens -- notes, drawings, and the like -- as if the screen were a carbon drawing board. The company mounted a smart, high-profile ad campaign. Just one problem: The product wasn't very good or useful, Rosen says.


  Similarly, Intel's stock nosedived in 1994 after a college professor discovered a flaw in its vaunted Pentium chip. Word of the flaw spread quickly on the Internet. Yet, the company refused to offer refunds. In the end, Intel had to take a $475 million write-off and change its policy regarding returns -- an illustration of the pain negative buzz can inflict.

What becomes very clear very quickly is that buzz knows no master: Even after you harness it, there's no guarantee of a return. The author calls Hollywood an admirable buzz factory with its use of sneak previews, behind-the-scenes footage, and milking of celebrity. But he also notes that movies are high among those products most prone to flop, since all the hype can lead to artificially raised expectations.

Rosen provides sound -- but hardly revolutionary -- tips on how to harness the buzz machine. Internet companies, he says, should pay attention to offline, as well as online, marketing, since nothing remains more persuasive than old-fashioned face time. He suggests ways to reach opinion leaders ("network hubs"), such as being generous with product samples ("seeding"), organizing seminars, and targeting community leaders to jump-start that vital grass-roots buzz. And Rosen also advises companies to mine customer lists to build "buzz accelerators" into marketing plans with pass-it-on promos. A "Buzz Workshop" at the end of the book summarizes these points.


  Rosen sometimes rambles off into high-concept gibberish. And the book is often a forest of jargon, crowded with terms such as megahubs (net buzz), expert hubs (industry buzz), social hubs (your friends' buzz), and clusters (thankfully, he includes a glossary). He often repeats his arguments and states the obvious. (Novelty and design matter. Stores with knowledgeable staff get customers saying nice things about them.)

But his anecdotes are almost always engaging. Consider the success of the Yomega Yo-Yo. No up-and-down here. The toymaker's execs built a $1 billion business by creating a great yo-yo, then seeding schools with great buzz, organizing yo-yo contests and promotions.

Not every company will feel its time and resources are best served by following Rosen's suggestions for marshaling buzz, which requires a lot of effort for an uncertain return. And who knows when buzz will come back to bite you? But then, advertising is much more expensive, and its effect is no easier to quantify. With the recent slide of Web-site banner ads' effectiveness to near zero, marketers clearly need to consider alternatives. Anyone for a little buzz?

Angel is an editor for Business Week Online

Edited by Douglas Harbrecht

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