How to Market with Finite Resources

The best way to understand the marketing process, the way messages are sent, received, acted upon, and spread, is to think of it as fire says Greg Stielstra author of PyroMarketing: The Four-Step Strategy to Ignite Customer Evangelists and Keep Them for Life. PyroMarketing is a new way to think about marketing—one that acknowledges and accommodates human nature and society’s new realities.

If you have a couple of minutes watch the video below.

Does Word-of-Mouth Lead to Sales

I have read the book Pyromarketing and thoroughly enjoyed the read. So it was with interest that  I came across Greg Stielstra’s Blog. In his article on “The relationship between Awareness and Sales” he mentions a study by the Barna Group which revealed that most Christian leaders are virtually unknown to most Americans.

Advertsing for many years was built on the premise that awareness of the product was the first step towards an actual sale and that once a large segment of the population knew about the product, repeated advertsing would create a brand preference. He goes onto to point out that:

Under that scenario awareness should grow at a much faster rate than sales, but that isn’t what we see with Rick Warren.  Only 17% of the population (about 51 million people) is even aware of Rick Warren, despite the fact he authored The Purpose Driven Life (PDL), the bestselling hardcover book in American history.  PDL has sold more than 28 million copies since October 2002.  Instead, we see record-setting sales accompanied by limited awareness.

He suggests that this would mean that:

1. Word-of-Mouth (WOM) is not indiscriminate: When people buy a product they love they don’t recommend it to everyone they know. So instead of creating broad awareness it only creates awareness among very specific social networks. These networks usually incorporate people who share a common interest and awareness rarely if ever spreads beyond this group.

2. Some Customers are more valuable than others: It would be a flawed assumption to believe in a 1:1 ratio between prospects and sales. With only about 5 million Americans aware of Rick Warren some 28 million copies of PDL were sold. According to a Zondervan survey conducted on those who read the book 46.5% bought additional copies to give away. Their impact can be increased by focusing a large amount of advertisng on this group of people.

3. Awareness does not lead to sales: Some of the bestselling Christian books were written by people that didn’t make the list of leaders whose awareness Barna chose to measure.

I believe that a couple of other points can be gleaned from the survey and my own findings and experiences.

4. Better the Individual Experience, better the chance of WOM: WOM is generally instigated by a very favourable or highly favourable experience on the part of the consumer. With PDL for example – I know of people talking about aspects of the book which helped with their own lives as well as in the lives of the church. WOM has thus been generated based on experiences.

5. Focus on the experience: While the book PDL was very good – life changing experiences were created in smaller groups through the release of dvd’s and study guides. These experiences enabled conversations to be created which in turn results in WOM, which resulted in more people being drawn to experience it or to create their own experiences.

5. Tangibles + Crowd Attraction leads to more sales: With the growth in popularity fo PDL and its impact – figures of church’s being involved, testimonies of peoples lives being changed, the introduction of seminars and worshops and study guides have I believe contributed to a greater impact where in those outside of the core groups as mentioned in the article by Greg are drawn in to have a look and experience for themselves. Thus leading to a bigger impact and more WOM in new social networks – eventually leading to more sales.

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