Buzz Metrics and Mazda

Beyond Blogs and Social Networks

New Technologies & New IdeasDecember 1, 2005

Jonathan CarsonPresident & [email protected](646) 253-1901

[Private and Confidential]2

BuzzMetrics Overview

About BuzzMetrics• Proprietary software to identify, gather, process millions of unaided online

conversations (forums, blogs, email lists, review sites, etc.)

• BuzzMetrics has performed WOM research and planning for 50 F1000’s.

• Clients include GM, HP, JetBlue, Comcast, Whirlpool, Mazda, 14 of top 15 pharmas, 7 of top 10 food companies, etc.

• Recognized leaders: co-founders of Word of Mouth Marketing Association; featured in CBS News, NY Times, WSJ, Economist, NPR, many more.

• SEPTEMBER 2005: BuzzMetrics acquired by Trendum, emerging competitor backed strategically and financially by VNU.

About WOMMA• Founded 2004; over 120 member companies.

• Hugely successful inaugural conference in March 2005.

• Main priorities: Standards & Metrics; Ethics guidelines; industry education.

How important are these

New Technologies & New Ideas?

How important are blogs?

A new blog is created every second

Source: Technorati

How important are social networks?

MySpace has 50% more traffic than Google

It should surpass MSN and AOL within a few months

Only Yahoo will have more

Source: Comscore

How important are wikis?

Wikipedia is #1 online reference site

By a long shot

Double the traffic of #2 Dictionary.comFive times the traffic of Encarta

Source: Hitwise

How important are podcasts?

5 million U.S. podcast users in 2005 (up 500%)

Forecasted to grow to 63 million by 2010

XM and Sirius have about 7mm subscribers…… and a combined market cap of $16 billion

Source: Bridge Ratings, Yahoo! Finance

How important is photo sharing?

June 2205: Flickr had 19.5 million photos, 80% of which are shared publicly

At current growth rate, over 75 million photos available for public download by end of 2005

Getty Images, world's largest image archive, has 70 million images for sale……And a $5.7 billion market cap

Source: Internet News, Yahoo! Finance

How important are these

New Technologies?

?

The bigger point:

The role of consumers

in media and marketing

has fundamentally changed.

A powerful global conversation has begun. Through the Internet, people are discovering and inventing new ways to share relevant knowledge with blinding speed. As a direct result, markets are getting smarter—and getting smarter faster than most companies.

These markets are conversations.

-- The Cluetrain Manifesto (1999)


Word of Mouth: Dominant new marketing force

Official WOMMA Definitions

What is “word of mouth”?

One consumer passing marketing-relevant information to other consumers.

What is “word of mouth marketing”?

Any marketing effort designed to affect the ways in which one consumer passes information to other consumers.


Why is WOM an important media channel?

Consumers trust WOM dramatically more than other media.

67%Word of Mouth

53%Advertising

47%Editorial

1977

Factors make you most comfortable purchasing a product?- Mediaedge

76%A friend recommended it

22%Newspaper/Magazine recommended it

15%Advertisement

8%The website

Best source for advice on a new product:

- Yankelovich67%Another consumer

35%Info services (e.g. Consumer Reports)

26%Newspaper/Magazine

21%Television

Best source for new ideas about products:

- NOP92%

Word of Mouth

50%Advertising

40%Editorial

2005


Why is online WOM becoming so powerful

1.) Channel is large and growing• 44% of online U.S. adults – over 50 million Americans – are “content

creators” [Pew Internet]

• Virtually all online consumers encounter consumer generated content.

• 8% of online adults blog; 27% of online adults read blogs [Pew Internet]

2.) Internet increases power of consumer influencers• Consumer influencers able to dramatically increase their reach.

• Consumers seeking help from consumer experts can find them much more easily.

3.) Consumer content increasingly dominates Internet content.


Consumer content dominates Internet

Corporate content, 18%

Media content, 12%

Expert content, 22%

Consumer generated content,

26%

Other (affiliate, etc.), 22%

Source: Jupiter Research

Jupiter Research found that 26% of top search results for world’s twenty largest brands is consumer-generated.

FACT #1:

Consumers trust the opinion of other consumers

more than they trust

advertising,

spokespeople,

unbiased “expert” third parties,

or the traditional media.

FACT #2:

New technology tools have

made it remarkably easy

for consumers to create media

to share with other consumers.

FACT #3:

New technology tools have

also made it remarkably easy

for consumers to find the media

created by other consumers.

RAMIFICATION:

To effectively reach consumers in the future, companies must enter into the global conversation.

What’s the first thing you do if you want to enter a conversation?

You listen.

Four things you can do by listening…

1. See the future…

2. Dissect catastrophes in real-time…

3. Create a hit with no advertising…

4. Understand the language of buzz…





4. Understand the language of buzz…


Case Study: Nutrition buzz

The Situation

Food co’s miss several major nutrition trends b/c have no way to track grassroots, consumer-driven movements.

Opportunity

Study buzz on nutrition as predictive tool.

Solution

Identify 500 most influential nutrition consumers and study nutrition issues they talk about most frequently.


Current trend: Death of Low Carb

0%

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Q4 2003 Q1 2004 Q2 2004 Q3 2004 Q4 2004 Q1 2005

Influ

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cer

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l

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Ea

rly

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jorit

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Influencer Panel Dieters Diabetics

Conscientious Consumer Nutrition Experts Fitness Buffs

Head of Household Early Majority Panel

Percentage of Nutrition Panel who mention “Low Carb”Percentage of Nutrition Panel who mention “Low Carb”



0%

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Q4 2003 Q1 2004 Q2 2004 Q3 2004 Q4 2004 Q1 2005

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Ea

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Percentage of Nutrition Panel who mention “Atkins Diet”



Percentage of Nutrition Panel who mention “South Beach Diet”

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Q4 2003 Q1 2004 Q2 2004 Q3 2004 Q4 2004 Q1 2005

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Percentage of Nutrition Panel who mention “South Beach Diet”


Current trend: Rise of portion control

0%

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45%

50%

Q4/2003 Q1/2004 Q2/2004 Q3/2004 Q4/2004 Q1/2005

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Nutrition Panel Conscientious Consumer Diabetes

Dieters Fitness Buffs Head of Household

Nutrition Experts Early Majority

Percentage of Nutrition Panel who mention “portion control”


Current trend: Rise of portion control

Diets most frequently linked to portion control.

33%

27%

14%

9%7%

5%3%

2%1%

0%

5%

10%

15%

20%

25%

30%

35%

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4. Understand the language of buzz….


Case Study: BuzzMetrics/Pew Political Buzz

Three primary research goals:

(1) Uncover learnings about political blogs.

(5) Study increasing ability of individuals

to instigate “civic storms”.

(8) Understand affect of civic storms

on National agenda.


Cross media channel analysis

1.) Political Blogs• 40 A List political blogs.

• 18,000 posts.

2.) Citizen Chatter• 15 discussion forums.

• 2.1 million comments.

3.) Mainstream Media• 16 outlets, including print, TV, online, radio.

4.) Campaigns• Bush and Kerry blogs, newsrooms; DNC/RNC newsrooms.


Targeted discussion topic analysis

Unaided research environment allows highly targeted topic analysis.

1,400 TOTAL N

3.6%51Foreign Affairs: Europe

3.7%52Govt: Military

3.9%55Govt: Homeland Security

3.9%55Horserace: Strategy

4.1%57Horserace: VP Candidate

5.3%74Iraq: Saddam

5.4%75Govt: Policy

5.5%77Govt: Intelligence

6.2%87Iraq: WMD

6.5%91Horserace: Swing States

7.9%110Govt: Bush Admin

7.9%110Character Trait: Bush

7.9%111Iraq: US Troops

10.3%144Character Trait: Kerry

10.6%148Foreign Affairs: Terrorism

11.3%158Social: Media

11.8%165Horserace: Poll

12.3%172Horserace: Voters

12.6%176Horserace: Debate

13.1%183Iraq: General Situation

%Freq.FIGURE: Top 20 Blogger Issues


Some buzz storms are constant and intense

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100%

Ca

mp

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Conservative Chatter General Chatter Liberal Chatter Conservative Blogs

General Blogs Liberal Blogs Kerry Bush

Buzz for “Iraq”


0%

10%

20%

30%

40%

50%

60%

10/23/04 10/27/04 10/31/04 11/4/04 11/8/04 11/12/04 11/16/04 11/20/04

General Blogs Liberal Blogs Conservative Blogs

General Chatter Liberal Chatter Conservative Chatter

Bush Campaign Kerry Campaign Media

Other storms are brief and pass quickly

Buzz for “missing explosives controversy”


Buzz origination can be dissected

MEDIA

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Correlation between media channels


Buzz paths can be understood

Need to pursue our finding that topic preference of bloggers correspond more with those of the citizen chatterers and MSM than the latter two did with each other.

Liberal Blogs

Conservative Blogs

BLOGS

Liberal Chat

Conservative Chat

CHATTER

MEDIA

.78

.88

.65 .78 .4.43

Liberal Blogs

Conservative Blogs

BLOGS

Liberal Chat

Conservative Chat

CHATTER

MEDIA

.78

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.65 .78 .4.43


Bloggers used buzz to keep Rathergate alive

* 9/10 – 9/19: Conservative bloggers stayed with the forgery topic more than liberals.

* 9/21: Interest for all groups surges in response to CBS apology.

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Liberal Chatter Conservative Chatter Liberal Blogs Conservative Blogs

Media Articles Bush Kerry

FIGURE: Conversation share of Rathergate issue.







Case Study: Large appliance manufacturer

The Situation

» Manufacturer begins to receive fan mail for a washing machine.

» Seriously. They were shocked too.

» Beyond fan mail, anecdotal reports of evangelism filter in. Manufacturer turns to online to better understand this phenomenon.• How big was it?

• Who were these consumers?

• What was driving this?

• How could they leverage it?


Source: BuzzMetrics Research

WOM Strategy Takeaway

» Focus in on & amplify organic interest in product among males.

Male48%

Female49%

Unknown3%

Who Are The Most Passionate Owners?

Surprising findings about existing buzz igniters


Understand why buzz already happening


WOM Strategy Must

» Natural desire to share ‘war stories’ and proof points.

2%

3%

4%

4%

5%

7%

8%

13%

14%

18%

23%

0% 5% 10% 15% 20% 25%

FL/TL debates

Seeks Usage Tips

Give Tech Support

Request Features

Seek Tech Support

Seek/Provide Product Info

Provide Usage Tips

Complementary products

Promote/Sway

Misc Duet Banter

Provide Usage Reports

What Do Passionate Owners Talk About?

“The stuff you can wash is amazing. Stuffed animals…antique quilts, comforters, electric

blankets, 22 towels (it is true).... I'm still much in love.”

Epinions – Washing Machines, 2003-09-22

“I have played with my machine in the past. Testing its limitations.”

That Home Site, 2003-10-08


Marketing programs amplify natural buzz

Examples of what people report challenging the machine with: » 3' x 5' area rug » Satin dance/drill uniform » 10 yard piece of fabric» Sleeping bags» Stuffed animals» 22 towels» Cat/Pet Bedding» Sneakers» Little league uniforms

» Little league uniforms» Little league uniforms

The Result:

Sponsorships & grassroots activities with key little league/youth sport

organizations.







Case Study: Oprah Car Giveaway


How strongly are consumers linking GM to the Oprah event?

46%

14%

8%4%

46%

36%

10%12%

64%

14% 12%

6%

0%

56%

74%

84%

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GM Segment General Auto Segment Competitive AutoSegment

General Interest

GM Pontiac G6 No Link


Buzz tracking is crucial

AT FIRST:

“Bottom line: It was a win-win situation for Oprah and Pontiac. For whatever Pontiac paid, they'll get their money back and more.”

Car and Driver Forums, 2004-09-15

BUT THEN:

“The G6 should be renamed the Pontiac Oprah. Because of its close association with Oprah, this will be a chick car and not a guy's car.”

GMInsidenews.com, 2004-09-16

“It would've been nice for Oprah or GM to pay for EVERYTHING.”Free Republic, 2004-09-22

“So they sell the car, pay the 7G's and then use the other 20G's left to buy a different car. They can get a Civic for 14, which is a better car anyway.”

Runners World, 2004-09-22

Buzz Metrics and Mazda

Automotive

confidentialhow important

new ways

word of mouth marketing

important media channel

mouth marketing association

marketing effort

confidentiala new blog

marketingrelevant information