The preliminary findings of their joint research effort were revealed at Nielsen's Consumer 360 Conference in Hollywood, Fla., late yesterday.
"Marketers haven't really lost control of their brands just yet," said Rob Mooth, VP-product development at Bases. "What we found were that the products that get the most buzz were the ones that were paying for it. ... Advertising agencies are probably more relevant than they've ever been for your business."
Besides media support, combined consumer ratings of whether a product was unique and how often consumers expected they would buy it were the next-best predictors of online buzz, Mr. Mooth said.
Some categories, such as food, beverage and over-the-counter medicine, were more likely to create buzz -- measured in the study as the total number of "consumer-generated media" mentions in various online forums.
Package-goods products in general weren't that buzz-worthy. "Half of new products get very little buzz at all," Mr. Mooth said. And the 10% of package-goods products mentioned most often accounted for 85% of the industry's blog mentions, he said. The two most blogged-about package-goods launches in the study -- Coca-Cola Co.'s Coke Zero and calorie-burning drink Enviga -- were mentioned at 100 times the rate of the average package-goods launch and at about the level of Barack Obama's latest biography.
Bases may not be as well-known as Nielsen Media Research, but its pronouncements are about as crucial to whether new package-goods products live or die as Nielsen ratings are to the viability of TV shows.
Bases tests new product concepts with consumer panels, then lets consumers use the products to test whether they would buy them again. The volume forecasts developed based on those consumer ratings are crucial when big marketers such as Procter & Gamble Co. decide whether a product will generate enough sales to meet financial hurdles.
Bases also factors in projected media spending to predict volume. And the fact that the service for years didn't include online media as a factor in its volume forecasts was a key reason package-goods marketers were relatively slow to move ad dollars online, according to interactive-agency veterans such as Grey Interactive founder Norm Lehoullier.
Factoring in online buzz
One goal of the Bases-BuzzMetrics collaboration is to find a way to predict how much consumer-generated media a product launch will get, based on factors in its media plan and ad copy, and find a way to factor that into the volume forecasts Bases gives to marketers, Mr. Mooth said.
A key factor, of course, is determining whether online buzz is driving new-product success or vice versa. One indication the buzz is driving the marketing success, Mr. Mooth said, is that online buzz tends to peak before a new product's sales do.
It's also clear that how much buzz a new product generates can be an important predictor of its success and improve the accuracy of Bases forecasts. Factoring online buzz into the equation can reduce the error rate in the firm's forecasts by 20% -- as much as factoring in whether consumers who use a product say they would buy it again.
"This is step one in what I think will probably be a lot of very good work in this area," said Mike Nazzaro, president of Nielsen BuzzMetrics. "The addition of buzz has as big an impact as the addition of product-use data into the forecast, and I think that's pretty significant."
But the finding that big media budgets are the most important identifiable factor behind online buzz won't do much for now to eliminate Bases' tendency to foster conventional media spending.
To be sure, just shelling out lots of money on a media campaign doesn't guarantee buzz. Several well-supported launches in the study didn't get many online mentions. And while the study didn't show any cases, anecdotal data indicate many new products and brands have been built heavily by buzz without much media support, Mr. Nazarro said.
Nielsen Connect effort
The collaboration between Bases and BuzzMetrics isn't one of the six new services launched as part of the ambitious Nielsen Connect effort to integrate the world-leading research firm's far-flung data sources, but it's part of the same process.
VNU's failure to take advantage of the linkages among its various data sources was a key reason investors in the public company became disillusioned and forced its sale to a private-equity consortium, Nielsen CEO David Calhoun said in an address to the conference. And creating those linkages was what he was hired to do, he said.
Nielsen Connect, led by the high-profile hire of former MediaCom CEO Jon Mandel last year, announced yesterday six new services to forge those links. Mr. Calhoun described the services -- which include an in-store-marketing data service and other specialized offerings in health care and combining consumer-panel and media data -- as experiments of the sort any successful company needs.
"Winners love to experiment," Mr. Calhoun said. "The willingness to build cultures around experimentation I think is huge. We're trying to instill that as well. ... Nielsen Connect is our first experiment -- six endeavors that try and marry the media franchise with our consumer franchise in ways that are creative and hopefully satisfy some need. I don't expect that we're going to go six for six. I don't think we'll go three for six. We may go one for six." He said Nielsen In-Store is the most promising.
Aside from the impact of buzz on new products, the conference provided a distinctly package-goods-flavored take on emerging media and marketing tactics. In one of the more interesting industry takes on new marketing realities, Church & Dwight Co. CEO James Craigie cited print and direct-response TV as two of the most promising media in the new era of consumer control.
Print is valuable, he said in a panel discussion, because it's portable; consumers choose when and where to use it; and it drives more traffic to websites than any other offline medium. DRTV, which Church & Dwight acquired a big dose of when it bought Orange Glo and its high-volume pitchman, Billy Mays, last year, is relatively cheap, provides instant analysis of return on investment, and lets new-product experiments "fail fast and fail cheap" without the high cost of retailer slotting fees, he said.