Sorry AT&T…you have it Wrong

I was watching a football game the other day and happened to catch a few of the ads that were on during the game. While most of them were just a blur of noise in the background, one particular ad from AT&T jumped out at me. It caught me a bit off guard, so I played it again and confirmed what they were saying. I couldn’t believe what I was hearing…

The ad was talking about “effective advertising,” only they GOT IT WRONG. The AT&T spokesperson, Lily Adams, played by Milana Vayntrub, was listening to a salesperson talking to a young man about the great deals they were offering. He was amazed at these deals, so he called his mom immediately to tell her about it. As the ad goes, he made the call to a random person…a classic case of misdialing.

However, he told the salesperson this random person liked the deal so much they were going to come in and buy a phone and a plan. How convenient for AT&T. Lily’s response is what caught my attention. She said (paraphrased)…

“That’s the power of word-of-mouth, what they used to do before advertising.”

WHAT?!?

If I understood her correctly, she was saying that WORD-OF-MOUTH HAS BEEN REPLACED BY ADVERTISING. I was shocked. Granted, I have focused much of my career on helping companies GET MORE word-of-mouth because it is the MOST POWERFUL form of advertising anyone can get. Now, I’m hearing AT&T tell me that it has been “replaced” by advertising?

They got it wrong…really wrong.

There are a host of statistics out there to prove they are wrong. For example, one statistic says that 92% of the people trust the recommendations they get from people they know…that’s word-of-mouth. Only 8% Trust a company’s advertising…that’s current advertising. You’re a business leader, which would you choose? Which would you want to stake the success of your business on? Which one do you believe would help you grow faster and scale your enterprise? We all know the answer…word-of-mouth.

Word-of-mouth has been and always will be the most powerful form of advertising any company can ever get…period. It will always be the first choice we will look for when buying anything. If someone we know (and Trust) is telling us this is an excellent product/service and company, it is our first (and usually) last stop…we usually buy from them. It is the starting point for any purchasing decision. Why??? One word…

TRUST.

Word-of-mouth is a trusted source. Word-of-mouth tells us that someone we TRUST has had an experience with this product/service and the company, and it was good enough to tell others about. Or it was awful, and they want to warn you about doing business with them…either way, it’s word-of-mouth.

No one will ever tell you to buy something from someone unless there is some degree of TRUST…no one!

The only exception to this is when someone is telling you about a special bargain deal. They are telling you about a great price, not that they trust the company. They are giving you information about a “deal,” not the reputation of the company. This is the only exception.  They aren’t telling you they TRUST them. They are just telling you about a great deal. For example, someone tells me about paper towels being half-priced today at a particular store. It is word-of-mouth about the deal, not that they trust or recommend the store. This is “commodity word-of-mouth.” Powerful word-of-mouth, which is what we all want, is synonymous with TRUST.

What doesn’t make sense in the AT&T commercial is that they are saying TRUST (92%) has been replaced by a good advertisement (8%). Sorry, I don’t think so…it will never happen. An ad has not REPLACED word-of-mouth and most likely never will. Never happen.

What is happening here is that we are trading off TRUST for DISTRIBUTION.

What I believe AT&T is really saying is that what used to happen one-on-one or one-to-few has now been replaced by one-to-many. They are subtly telling me that their brand isn’t strong enough to spread far or fast enough via word-of-mouth, so they resort to mass distribution…a commercial. It tells me there aren’t enough ecstatic customers out there acting as Advocates and Marketing Agents? to grow their business, so they need to replace this with massive distribution. Massive distribution is NOT the same as word-of-mouth. It is just what it says, massive communication of a message, not word-of-mouth, and certainly not earning TRUST.

You can have both word-of-mouth and massive communication…just don’t confuse the two.

I can tell you from years of experience and with absolute certainty that you will be far better off investing your money into building more TRUST and word-of-mouth than advertising. It has ALWAYS paid off for those that invest in it. Household company names like Nordstrom, Zappos, Southwest Airlines, Alaska Airlines, and many others have used this for years and built buckets full of TRUST. The result…they get massive amounts of word-of-mouth.

One final point on why, without question, you want to invest heavily in word-of-mouth…LEVERAGE.

Word-of-mouth is highly leveraged. When you invest in it, it keeps paying you back over and over again and in larger and larger amounts. It grows over time, sometimes exponentially. It’s like you plant one seed, and it continues to grow and spread…all from the one seed. You don’t need to have millions of people to make this work for you, just people who are passionate and vocal about you. A small, passionate and committed group of Advocates will bring you more customers than any advertisement you can buy.

Contrast this with advertising. It isn’t leveraged…you have to keep feeding the beast. How do you think the large advertising agencies got so big and rich? Because you have to keep buying advertising over and over and over again and hope you reach your audience when they are ready to buy. It’s a drug. You have to keep using it repeatedly if you want to try and get the same effect. It never ends. It only ends when you change your strategy from advertising to building more word-of-mouth and TRUST. When you flip the equation, you start getting leverage from your investment.

Investing in your customers and audience is never a bad idea…it is your most powerful strategy.

Everything starts with strategy. Do you have an “acquisition strategy” or a “retention/loyalty strategy?” If you have an “acquisition strategy” where you focus on attracting and acquiring new customers, it usually falls on the marketing department. Leadership wants them to find and attract new customers. Right idea, but it’s how you decide to go about it. This is where things start to break down. From my experience, most marketing leaders are far more comfortable with acquisition through attraction (advertising primarily). They are not as comfortable (or knowledgeable) about “retention/loyalty strategies.” They are not equipped or empowered to create massive word-of-mouth from their existing or new audience.  So they default to what they know…acquisition.

Strategy starts with top leadership…it isn’t a marketing issue. If leadership focuses on acquisition, marketing is left to execute that strategy, the best way they can…and they do. However, when leadership decides they want a more leveraged and longer-term return on their investment, they will opt for a “retention/loyalty/advocate strategy instead.” When this happens, they have decided to build more TRUST with their audience and focus on creating more “Advocates.” Their goal is to build more Trust and word-of-mouth from their audience and “get their audience doing their marketing for them.”

Back to the AT&T commercial. I hope you can now see how ridiculously wrong this message is when you look just a bit deeper. Word-of-mouth was never replaced by advertising. Advertising came about because companies weren’t willing to invest in word-of-mouth advertising. It takes a strategy, a focus on building Trust by treating your customers amazingly well, and helping them improve their life. Doing this day-to-day teaches your customer what you are about and if you are worthy of the Holy Grail for any business…word-of-mouth.

My new book (see below) is focused exclusively on this strategy. It will be out shortly. The key is to determine which way you want to approach marketing and create a strategy to get there. AT&T has declared its strategy in its advertisement, and Lily stated it very clear. Word-of-mouth is something we “USED TO DO,” not what we focus on today. Today, we focus on ADVERTISING. That’s a pretty clear message. I believe they have it all wrong.

What to do next…

I hope you can change your mindset to one where advertising simply feeds your audience with helpful information so you can build more TRUST and more ADVOCATES so they can’t wait to tell others about you. So they do your marketing for you.  What would that look like for your organization? Something I would encourage every business to think about and act on. In these trying times especially, having a pack of loyal advocates is worth more than ever. It’s never too late to change your strategy.