10 case studies prove the ROI of brand advocates

 
 
 

A brand advocate is a person, or customer who talks favorably about a brand or product, and then passes on positive word-of-mouth (WOM) messages to other people.
According to Forrester, Zuberance and an infographic from Jay Baer (below), the influence of brand advocates accounts for billions of dollars in purchases for everything from cars to computers, hotel rooms, movies, enterprise software, and more. Brand advocates are:

• 5X more valuable than average customers
• Spend at least 2X as much as average customers
• Spend 3X as much as average customers over their lifetime of their relationship with a company or brand
• Reach 150 people in social media every time they advocate for a product or service
• 92% of consumers trust brand advocates

Do brand advocates generate return on investment for brands? Here are 10 case studies that prove the ROI of brand advocates.

• AMERICAN EXPRESS: To promote small business credit cards, American Express created a social media community for small business owners to share, learn and grow. They also created a holiday, Small Business Saturday. The community has 2,700,000+ Likes, 195,000 Tweets and American Express saw a +23% increase in transactions to small business merchants.
• CARS.COM: encouraged rating, reviews and sharing (versus no ratings, reviews and sharing) and it showed that pages that had ratings and reviews had a 16% higher rate of conversion and a 100% higher rate of traffic through to dealer’s sites.
• DUANE READE: A drugstore chain with 250 location in New York and New Jersey, used a VIP Blogger Team generating content via their own social platforms, DR-QR code landing page, blogs, and Google+, in addition to traditional PR tactics. The utilization of celebrity bloggers from daytime shows and one-hour Twitter parties created over 20 million impressions. From over 2000 pieces of original content, there was a 28% lift in year-over-year sales and a 5x ROI.
• FOLICA: A well-known retailer of health and beauty products, noticed they had many referrals to their website, but had no way of tracking and identifying these referrals. By engaging their customers and encouraging them to share the secrets of great hair, customers were able to share via Facebook, Twitter, email and personalized urls. After 30 days of running the new Social Referral Program, 6,000 brand advocates were identified. The average number of shares per advocate was four. 21,000 shares had been generated via Facebook, Twitter and email and a 16% conversion rate was driven by the program.
• J. HILBURN: A retail brand which was receiving many referrals from existing satisfied customers. By offering customers $50 for each friend referred and encouraging the advocates to share the offer using social media, brand advocates were identified and rewarded. Any referred customer who spent over $100 received a $50 discount on their purchase. After 45 days of running the new program, 1,000 customers had made referrals. Averaging 12 shares per advocate, the referral program produced 10,000 social shares via Facebook, Twitter and email. The bottom line result was 600 transactions which created over $250,000 in sales.
• ROKU: specializes in streaming entertainment devices for television. With 1,000,000+ units already sold, they tapped their existing and large user database into a source of acquisition. Sales increased 30% and the number of monthly referrals is now around 10,000 per month.
• SENDGRID, a cloud-based e-mail provider, contained a simple offer for existing customers which could be shared socially. The offer was made to existing customers to share referral links. This meant that when any of their referred friends became new paying customers of SendGrid, they would receive $20 cash and the referred customer would also receive a 25% discount on their first three months. SendGrid achieved a 111% ROI after six months of running thel program and a 353% ROI projected for the first year of the program.
• STARBUCKS: Since 2008, MyStarbuckIdea.com has been advocate-driven idea tank where Starbucks drinkers submit ideas for new products and coffee concoctions. It has worked as a hub for all Starbucks customers to share all their ideas, suggestion and even their frustration.  “We used to launch a new product and it cost millions of dollars. Now, when we launch a new product, we already have millions of fans,” say Chris Bruzzo, Vice President Brand, Content and Online at Starbucks.
• SUBWAY: Sponsored the “Slim Down Challenge,”  a live speaking event consisting of some of America’s hottest speakers and celebrities. Its mission was to travel from city to city across America delivering powerhouse information that challenged your mind, heart, and waistline. They used social technologies and promotion apps to raise awareness of the Slim Down Challenge and recruit speakers. The strategy included a social competition. This was part of a full marketing strategy for the campaign. They found that 71% of site traffic that went to the registration page, came directly from Facebook.
• WALMART: Has 34,000.000+ fans, more than any other brand on any social platform. They also have more than 385,000 followers. They post 6 to 7 times per day. They engage with fans, regularly. Last year, on Black Friday, Walmart received 62,000 posts from consumers, a rate of 42 per minute. The engagement with consumers who spread the work is getting a “marketing equivalent” of 10X return-on-investment (ROI) compared to other advertising spends according to CMO, Stephen Quinn.

These case studies cover brands big and small, B2C and B2B and show brand advocates can be found for any business if you look for them. Do they convince you of the ROI of brand advocates?
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Did these case studies on the ROI of brand advocates teach something new.