According to a new report by Zuberance, companies that systematically identify and energize Brand Advocates are getting at least a 10X ROI in media and sales value, our analysis of Zuberance-powered advocacy programs shows. In other words, for every $1 a company invests in energizing Advocates, the company gets $10 in positive WOM impressions and sales. %is 10X “Return on Advocacy” is signifcantly higher than the return that marketers get from paid search campaigns on Google and other marketing approaches.
Why Energizing Advocates Delivers High ROI
There are several reasons why energizing Brand Advocates delivers at least a 10X ROI:
• Consumers trust WOM at least 5X more than advertising, paid search, email, and other marketing tools, numerous studies show. As a result, conversion rates for WOM marketing programs that energize Brand Advocates are substantially higher than for other marketing campaigns. Companies energizing their Brand Advocates using the Zuberance Advocate Platform are getting sales conversion rates as high as 6%. This is more than 5X higher than standard sales conversion rates for traditional marketing approaches.
• Unlike paid media, companies do not pay Advocates to spread positive WOM. Advocate Media is a form of earned media, i.e., media that a company earns when customers become the channel for market communications. As we point out in this white paper, there are costs associated with a structured program to energize Brand Advocates. However, these costs are low relative to the value that companies get from these efforts and the typical investments companies make in paid media.
• Energizing Brand Advocates has staying power. Clicks and leads are perishable. But Brand Advocates will gladly continue spreading positive Word of Mouth about their favorite brands and products for years. Apple, TiVo, Harley Davidson, and Four Seasons Hotels are examplesof brands with “Lifetime Advocates.” In addition, the media created by Brand Advocates remains on the social web indefnitely, providing brands with ongoing SEO and WOM value.
Energizing Brand Advocates enables marketers to create a highly cost-effective marketing channel — the “Advocate Channel” — that they can leverage continuously and in multiple ways to drive marketing results.
Value/ROI Analysis
The company will get at least a 10X ROI from by energizing Advocates, as measured by:
1. Media value (impressions) from online and online recommendations. We estimate that this media value is $1,500,000.
2. Sales value (clicks, leads, and sales) that result from these recommendations. At a 15% margin, we estimate that the company will generate $24 million in sales and $3 million in profits by energizing its Advocates.
Sales Value
In addition to media value, the company also is getting sales value by energizing its Brand Advocates.
These sales are generated as a result of:
1. Advocates posting positive recommendations online (ratings and reviews, testimonials, comments, etc.) plus onine recommendations
2. Advocates sharing promotional offers with their social networks
Other Benefits of Energizing Brand Advocates
In addition to the media and sales value of energizing Brand Advocates, this consumer electronics company will get other benefits from turning its highly satisfied customers into a marketing force:
• Higher page rankings in natural search results from Advocate-generated media
• Important insights about Brand Advocates and their social networks
• Valuable customer feedback that can be used to guide product/service development
• Deeper relationships and engagement with Brand Advocates, a company’s most valuable customers
Developing Brand Advocates takes time and dedicatation. It's like running a marathon - you don't run 42 km never having run before. You start building slowly until running becomes effortless.
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