Have you got a great product or service that you know people would love, but you don’t have the funds to tell everyone all about it? It’s not an uncommon problem; advertising is undoubtedly an effective way to create awareness, but it is also expensive.
That’s not to say it’s not cost effective. It’s a fair bet that seeing an ad will lead you to try something new at least once in a while. And much advertising exists to make us feel good about the brands we already patronise, with the aim that we’ll be encouraged to buy them again. For big brands in highly competitive markets – think Nike, British Airways, Volkswagen – simply keeping in the spotlight is reason enough. Consumers are a fickle bunch, so it’s vital to remind them you’re there over and over.
But if your marketing budget is five figures long, max, then spending it all on advertising probably makes little sense (there are exceptions of course, but this is a good rule of thumb). Far better then, to make the budget work harder by encouraging “endogenous” marketing.
The term comes from Didier Soernette, a clever prof at UCLA. In late 2004 he published an analysis of what he believes makes books sell, having used physics and mathematics to scrutinize 138 best sellers on Amazon from 1997 to April 2004. I have little hope of understanding the figure work, but his conclusions make a lot of sense.
He found two ways for books to achieve sales success. The first he calls "the exogenous shock", the external impact when a book receives a good review from a respected source for instance. The other is "endogenous shock," when the internal effect of word-of-mouth helps a book's sales to accelerate over time. One of his examples is the Divine Secrets of the Ya Ya Sisterhood, which took two years to reach the bestseller list.
There is a strong parallel here with tactics used in marketing. The “exo” shock of advertising delivers a fast hit of awareness, leading to a surge in sales that tends to diminish once the campaign has run its course. The “endo shock” comes from the internal effect of things that bring customers to the door without them receiving any overt recommendation to do so. In the case of the Ya Ya Sisterhood, word-of-mouth increased over time and allowed the book to rise up the bestseller charts. Soernette found that books that experience this “endogenous shock” are usually more successful, because their sales are sustained for longer.
The same is usually true in marketing; “endo shock” word-of-mouth is a great way to build awareness and sales over an extended period. There may not be the sales burst that comes from “exo” advertising, but if people are saying positive things about your product or service then it’s likely their conviction and willingness to buy will be altogether greater.
So what can you do to generate an “endo shock”?
The answer is lots of stuff – talk to the media, meet with potential customers, surprise people by appearing in unexpected locations. These tactics, and many more besides, are grouped by the catch-all term, public relations. Oh yes, PR. We’ve all heard of it, but how many know what it actually is? They may have been Absolutely Fabulous, but Eddie and Pats never really gave us a clue!
PR can take many forms, but the common feature is getting people to experience a brand independently and for themselves. Let’s take a new model of car as an example (I often do, as I like cars). You might read a review of it in the newspaper one Sunday, then you might see it displayed in a shopping centre the following week. And then it’s on the news, being used to ferry the Olympic Committee through tunnels under London as they review its Games bid. I’m talking about the new Land Rover Discovery, or LR3 as it’s called in the US.
None of these techniques are advertising. The viewpoint of the journalist writing in the newspaper (that, importantly, you bought and chose to read) you recognise as being independent, you walk past the car at the shops and get to take a look for yourself, on your own terms. The appearance on the news report was nothing to do with the car, but there it was and the reporter even mentioned Land Rover by name. Working together, all these things give you reasons to think about the product in a way that outlasts an ad. If you’ve been identified as a target customer by name, you may even find yourself invited to an event hosted or sponsored by Land Rover, with the Discovery/LR3 subtly present.
PR is the slow burn to advertising’s firework display. Fireworks have a lot of impact, but are too expensive for many to afford. Stoking up the embers of PR however, is less costly and longer lasting. Fanning the flames (perhaps I should drop this analogy now) takes patience and commitment, but if you have that great product or service that you want the world to know about, using PR to get that “endo shock” going could well be the most cost-effective way to spend your budget.
