Multilevel Marketing (aaproach companies like Tupperware and Avon follow) is different from Buzz!

Buzz is nothing but all the word-of-mouth that exists about a product. This buzz travels through invisible networks where each node is a person.

(see http://marketingexplorers.blogspot.com/2007/07/identify-network-hubs-for-word-of-mouth.html)

Experts said that if people can create word-of-mouth about a product, why not use them to sell the product itself. This gave rise to Multilevel Marketing (MLM) where companies like Tupperware, Avon, Amway and Oriflame create distribution channels in the invisible networks. But it is important to note that MLM is not buzz. It has very different objectives and ways in which it operates. To give a clear picture on the distinction between the two, I am including an excerpt from the book “The Anatomy of Buzz” by Emanuel Rosen:

“While these programs work for certain companies, it’s important to note that the phenomenon they’re based upon is not exactly buzz. There is a key difference between and a marketing scheme in which friends are supposed to sell something to their friends or recruit them as distributors. While buzz may be stimulated with an occasional incentive, it is usually free from any monetary transaction. A customer recommends a product because she truly believes in this product. Part of her credibility comes from the fact that she has nothing to gain by recommending the product, which is not the case when she is selling it.

Advocates of MLM love to point out the potential for exponential growth that comes with this method. (“If your friend tells two friends, and these two friends tell two friends, you reach a huge audience very fast.”) But in real life this exponential growth is hardly ever reached. Why not? Because many people don’t want to get involved in this type of business and don’t feel comfortable selling to their friends. Most people want to talk with their friends without having to sell them anything. When they meet a relative, they want to hear about the family, without thinking of how they could enroll him as part of their “downline” (the industry term for the chain of distributors one recruits).

MLM is far from gone, however. The very same trends that cause customers to rely on their friends in making purchasing decisions – information overloaded, customer skepticism, and customer connectivity – could help MLM organizations to expand, especially in product categories such as skin care, personal services, and food supplements. There is also evidence that this marketing method is more effective in certain social circles and countries than in others. But as MLM grows, it’s important not to confuse it with buzz. Don’t expect an MLM organization to grow at the rate of an ICQ or Hotmail. It’s a different phenomenon.”

Identify Network Hubs for Word-of-Mouth Marketing

The structures through which Word-of-Mouth spreads are similar to networks as shown in the figure below. There are certain hubs that are connected to other nodes and it these hubs that spread word of mouth to these nodes.

It becomes important for marketer to target these hubs to spread word of mouth to as many people as possible. In Word-of-Mouth parlance, these hubs are called Network Hubs or Opinion Leaders. According to Emanuel Posen, an expert on the subject, Network Hubs are individuals who communicate with more people about a certain product than the average person does.

To enable marketers to identify these Network Hubs, some common characteristics that are exhibited by these individuals have been observed and identified. The acronym used for these characteristics is ACTIVE:

1. Ahead in adoption
2. Connected
3. Travellers
4. Information-Hungry
5. Vocal
6. Exposed to media

By “Ahead in adoption” it is meant that Network Hubs are early to adopt or reject an idea or an offering than the others.

They are “Connected” in the sense that they are more cosmopolite i.e. more oriented towards the outside world.

It has been observed that opinion leaders generally travel more than an average individual. They make more out-of-town trips. Today, this behaviour is complemented by virtual travelling i.e. surfing more and more websites on the internet.

Opinion Leaders often serve as ‘local experts’ because they are well-informed since they always want to learn more. Because of this trait of theirs, it is not unusual to see many people approaching opinion leaders for advice on what to purchase and what not.

Network Hubs are “Vocal” not because they are necessarily out-spoken, but because they voice their opinions more often.

And finally, they are more exposed to media. This may be true because they read more magazines and watch more advertisements or because they themselves are part of the media. This is why many marketers approach personalities and experts, who are more exposed to the media, to talk about their products in person or in editorials.

Difference between Word of Mouth, Viral Marketing and Buzz Marketing

Ever tried finding out the difference between the terms “Word of Mouth”, “Viral Marketing” and “Buzz Marketing”? Not many have. And not many know whether there is any difference at all!

In an article titled “The Word on Word of Mouth” by Dave Balter, the writer beautifully delineates the differences between the three terms.

WORD OF MOUTH is the most powerful medium on the planet. It is the actual sharing of an opinion about a product or service between two or more consumers. It is what happens when people become natural brand advocates. It is the holy grail of marketers, CEOs and entrepreneurs, as it can make or break a product. The key to its success: it is honest and natural.

VIRAL MARKETING is an attempt to deliver a marketing message that spreads quickly and exponentially among consumers. Today, this often comes in the form of an email message or video. Contrary to alarmists’ fear, viral isn’t evil. It isn’t dishonest or unnatural. At its best, it is word of mouth enabled, and at its worst, it is just another interruptive marketing message.

BUZZ MARKETING is an event or activity that generates publicity, excitement, and information to the consumer. It is usually something that combines a wacky, jaw-dropping event or experience with pure branding, like tattooing your forehead or your ass, as a NYC health club recently did). If buzz is done right, people will write about it, so it essentially becomes a great PR vehicle.

Let us get this clear by a few examples.

The Subservient Chicken (http://www.subservientchicken.com/) is a website developed by Crispin Porter + Bogusky for their new client, Burger King. The website was comprised of a video with a man in a room dressed in a chicken suit. If you just typed in a word in the bar below the chicken, you could make the chicken do all sorts of things. People visited the site again and again. They talked about it and recommended it to others. The chicken was addictive! This was a great example of Viral Marketing. But what it lacked was WOM. Though everyone talked about the chicken, no one talked about how good the burgers were. The sales did not increase.

When Richard Branson wanted to launch his mobile services in America, he wanted to create a splash, a buzz. It was decided to drop Richard Branson from a skyscraper into Times Square in New York City at rush hour — naked. At the same time, have two hundred people, dressed up in red spandex suits, running around handing out product samples and information leaflets, and otherwise scaring the hell out of the commuters running for the five o’clock train. And you know what? They pulled it off. Okay, so Branson was in a nude suit and he was actually lowered on a crane. But those guys in the red spandex managed to hand out thousands of flyers and many people missed their five o’clock train. Overall, the Buzz Marketing was a raging success.

(http://www.informationweek.com/news/showArticle.jhtml?articleID=6502659)

Google did no marketing, they spent no money. They created scarcity by giving out Gmail accounts to a handful of “power users”. People started talking about the benefits of having Gmail accounts and thus they started lusting for these accounts. This was effective WOM that led to the success of Gmail.

So what is the easiest way to tell these mediums apart? Viral and Buzz marketing are the cause. They are manufactured marketing initiatives that are intended to capture people’s attention and get them talking. They can certainly be effective at cutting through today’s cluttered marketplace, but when they become pervasive, they just become part of the noise. Word of Mouth is the desired effect. It is a natural and honest occurrence, and it is very difficult for a manufactured marketing message to create it.