Are we seeing the fall of advertising?

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For some time now I’ve firmly believed that word of mouth marketing and social media have been becoming much stronger as effective marketing tools for companies to use to promote their products. However, I have never really had any strong proof to back it up, other than the usual statistics from surveys and reading other people’s opinions.

I read an interesting article on CBC (Newspaper print ad revenue falls at record pace in 2007, online ads rise) that highlighted how, in New York, newspaper print advertising fell by a record percentage in 2007 whilst online newspaper advertisements increased but at a slower pace (the slowest pace from 2003), leaving quite a big gap in amounts spent.

Although the article does not mention word of mouth or any other forms of marketing it makes me think that surely these have been partly to blame.

I know there are threats of a global slowdown and a possible recession but I don’t believe that marketing teams will have just stopped spending money by reducing their advertising budgets. I think they will have just found much more tactical and effective ways of promoting their goods to their consumers.

Something must be filling the gap where advertisements used to be and in my opinion word of mouth marketing and social media will probably be somewhere in there eating up these big budgets.

Get Paid for Social Networking?

When I got an email inviting me to sign up to Yuwie I couldn’t help but be curious, I usually screen out these invites but the possibility of getting paid for social networking really caught my attention. Yuwie is apparently like Myspace, You tube, Facebook, Bebo and Hi5 with one big difference- you get paid to do everything!

I was surprised when I read that Facebook makes over $8million a month from  advertising alone and Myspace makes almost $25million! It makes sense that the users- the people who are making the pages, writing the blogs and creating this advertising space should somehow benefit from this. That is Yuwie’s message.

I’ve been doing some research and am convinced it’s not a scam, it doesn’t promise to be a get rich quick scheme but just pays its users small amounts that build up over time. You get paid for uploading pictures, videos, blog posts, inviting friends, starting clubs and basically everything you normally would do whilst social networking. The minimum payout is £50 and payments are handled by Paypal, a trusted and well known site. Even though I still love Facebook and I’m not entirely sure how long it takes to earn the minimum payout, I’ve decided to give Yuwie the benefit of the doubt and sign up, after all even if it takes months its still £50 for spending time on the internet, which I would be doing anyway.

Save Scrabulous!

I have never been a big fan of board games, Scrabble in particular was definitely my least favourite, I could never understand how the slow pace and debates over if a word was real or not could be called fun.

After turning down numerous invites to an application called Scrabulous on Facebook I finally gave it a try the other week. This game looks almost like Scrabble, it has the same board, numbered letters and the same set of rules. I presumed that it had been made by the same people as an attempt to reach new markets. I ended up spending most of my evening on it and now can’t help playing every time I’m near my computer, its more addictive than Facebook.

Over the weekend I read an article in The New York Times about how this new phenomena was actually made by two brothers who had nothing to do with the creation of the original game. Hasbro and Mattel (the joint owners of the Scrabble trademark) have denounced Scrabulous as piracy and threatened legal action against its creators hoping to have it shut down.

I’m finding myself torn between who I agree more with. On one hand I can understand the anger and frustration of Hasbro and Mattel and why they want it to be shut down. But, at the same time, this new development has shown them a great market opportunity that they might not have realised. Scrabulous currently has 658,461 daily active users, that’s 22% of the total users of Facebook. Tens of thousands of users have joined ‘Save Scrabulous’ groups, threatening to boycott Hasbro and Mattel products if this application is removed. As an addict myself I am hoping that they will somehow find some common ground, realise that this is a fantastic piece of new software that has attracted a lot of users and try to use it to their advantage. perhaps using it to advertise their other products or learning from Scrabulous’ success, reinvent some more of their games? Social networking has made this game popular to thousands of new users that might have never found it entertaining before.

Ads vs WOM

Is Word-of-Mouth Marketing (WOM) becoming more effective than Advertising? After reading through many a debate on the internet on this subject I decided it was time for me to do my own research on the matter so I could formulate my own well-informed opinion.

Advertising has been the most popular form of marketing for a number of years. Almost everywhere we look there is a blatant form of advertising, so much so that we are becoming desensitised to it. Ads are appearing in absolutely every medium imaginable and this saturation is turning people off the message. ‘76% of people don’t believe that companies tell the truth in advertisements.’ This shows that audiences are becoming more cynical and developing resistance to advertising, of course companies are going to say their product or service is the best, but with hundreds of these messages being fired at us every day it is hard to know who to believe.

If I want to go out for a nice meal with my boyfriend I very rarely go somewhere that hasn’t been recommended by a friend, this is because I don’t pay attention to ads because I am very aware that they are bias and I trust my friends as a more credible source of information. Also if I am watching the TV I tend to flick channels during the ad breaks or do something else until I hear what I want to watch coming back on, almost everybody I know does exactly the same thing. This proves to me that advertisements are not the most effective use of a marketing budget.

A smarter, more creative way to market is WOM. WOM is growing, thanks to factors such as the rise of communications on the internet. Customers are getting smarter and now need to know that something is good before they will pay money for it. They are in control. ‘92% of people trust word of mouth as the best source of new product ideas ­ up from 67% in 1977.’

It seems to me that WOM is becoming the most influential media source, WOM is not about telling consumers what is good but about letting them discover it themselves, formulate their own opinions and spread them to their social networks. I for one appreciate not being commanded what I should think and I like the element of control that WOM allows. I am much more likely to act upon a recommendation from a friend or  at least search for customer reviews on the internet than I am to act upon a flyer or an ad I see on the TV, radio, or newspaper.

Cabbies spread the word via WOM

Just over a month ago when I first joined the team at Wolfstar I had never really heard about Word of Mouth (WOM) marketing or social media. It didn’t take me long to realise how major they have become and I have started to notice how quickly they are growing in the UK.

While flicking through The Times I noticed the article “Spiel at the wheel? You must’ve had that adman in the front of your cab.” This article is about how London’s black cab drivers are becoming the latest channels for word of mouth advertising. This caught my eye because I find it to be such an unexpected, but clever, way of marketing.

Tourist boards such as the Tourism Authority of Thailand, and the Tourist Board of Melbourne have been sending taxi drivers on all expenses paid holidays. These are paid for out of their marketing budgets, in the hope that they will promote it to people. Taxi Promotions UK are currently launching a new service: WOMAD (Word of Mouth Advertising). They believe that many more products will eventually find a way to use this channel of promotion.

Intrigued by this I started to research further into the world of WOM and learned from various websites such as WOMMA that word of mouth marketing seems to be becoming one of the most effective form of marketing. It is constantly formulating new strategies, tactics and channels to reach all audiences instead of sticking to traditional ways of advertising such as on the TV or billboards.

I personally think this form of marketing is really clever and disagree that this is a way of deceiving people. Audiences in this country becoming more cynical and less receptive to straight up advertising and clever methods such as this one are needed to get a message across and it seems to be working.

The ‘lovely’ Rosalind O’Rourke joins the Wolfstar Pack

Hi! My name is Rosalind O’Rourke and it’s my first day of work experience here at Wolfstar. I am currently a third year student at Leeds Metropolitan University studying public relations.

Originally, I come from a tiny little village in Ireland called Derryvale (the sort of place where everybody knows everybody and everybody’s business) and I was dying to escape to somewhere more interesting, so I decided to do my studies in England.

I’d heard about the city of Leeds from family and friends who had visited and loved it. So I thought it would be a good place for me to go and I have never looked back since. I love everything about it, the city lifestyle, the student life and the shopping of course!

Unlike most of my friends I am not doing a placement year. I chose not to do one because I had a lot going on during my second year at home and found myself spending most of my free time travelling back and forth. Because of this I didn’t think it would be fair on either party, as I wouldn’t have been able to put as much effort as I should into a full-time role. I don’t regret this decision at all - I chose to concentrate on my work instead and came through second year with marks that I was really pleased with. And I’m certainly not wasting my year out, I’m fitting in as much work experience as possible and building up my portfolio, so I can go my into my final year with one as good as my course mates.

I spend a lot of my spare time doing typical student stuff, drinking, shopping, and generally spending money that’s not mine! I also work in the Arc in Headingley to help fund this lifestyle. I have been there for over a year now and really enjoy it, everybody that works there is such good friends and most of us are students so the social side of it is great!

Before coming to university I didn’t know a lot about public relations, I originally wanted to be an actress but my careers advisor introduced me to it and told me I had the perfect personality for the job, and I have to say he was right.

I instantly loved the world of public relations and I knew I had a natural enthusiasm for it. Wolfstar is now introducing me to social media and WOM marketing, which I am already developing a massive interest in. I really like their attitudes and views on public relations and engaging with the consumer - so I am hoping I will learn a lot from the team during my time here.

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