Beverage Ads Not Fueling Enough Word of Mouth

Study: Marketing Efforts Miss Opportunities to Spur Sales by Talking up Brand Benefits

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NEW YORK ( -- Beverage marketers aren't doing enough to get consumers talking.

So says a study out today from Keller Fay Group, a word-of-mouth research and consulting firm. The study found that marketing and advertising in the beverage category, which includes alcoholic and non-alcoholic brands, is falling short when it comes to driving word of mouth. In 47% of conversations about brands in general, marketing or advertising is mentioned as a source of information. But only 38% of conversations about beverages include a mention of marketing or advertising.
Brad Fay
Brad Fay

"Advertising for beverages could be working harder by creating more reasons to talk about the brand," said Brad Fay, chief operating officer of the Keller Fay Group. "[Nearly] half of all word of mouth involves some sort of reference to media or advertising. [That's] indicative of how big of a role advertising plays and can play in this new word-of-mouth trend that we're seeing. The beverage industry could be doing more, as so many others are."

Effective approach
Mr. Fay said that marketers are growing increasingly interested in using word of mouth as a brand-building tool because it is effective in persuading consumers to purchase new products. And it proves particularly effective in the beverage arena.

Among beverages, 53% of word-of-mouth recommendations include an appeal to buy or try the product, compared to 40% for other categories. The study notes the high amount of positive recommendations is likely reflective of the low price point, occasions of frequent use and sociability of beverages. However, the most compelling part of the study, said Mr. Fay, is the conversion of consumers to buyers. Once a beverage has been recommended, 62% of consumers say they are likely to purchase the product, compared with 49% for other categories.

"Word of mouth, in beverages, sees a very strong linkage to purchase, even more so than we see in other categories. That's why we think it would be worth the industry thinking about how word of mouth can stimulate the brand," said Mr. Fay. "These are people in effect saying they're going to run out and buy [the product]."

If beverage firms want to capitalize on word of mouth, they'll have to tweak their advertising. TV and internet advertising are particularly inept at producing word of mouth for the beverage category. Just 10% of word-of-mouth references come from beverage marketers' TV commercials, compared to 15% for all other categories. And only 6% of references result from internet advertising efforts, compared to 12% for all other categories. In-store display and video, as well as product packaging, are outperformers for beverage marketers, however.

Benefits could spur talk
While the study does not provide any specific guidance on why beverage marketing has not been as successful as other categories' advertising in driving word of mouth, Mr. Fay has a theory.

"Beverage advertising has had a tendency to be more image- and lifestyle-related and less about specific benefits," he said. "That makes it a little harder to fuel conversation."

In other words, plenty of consumers probably smile at the touching "Coke Side of Life" spots or chuckle during Budweiser's witty commercials, but that doesn't mean they're talking to friends about them.

"Our impression is that beverage advertising tends to be more image-related, and, as a result, probably a little less talk-worthy," Mr. Fay said. "Talk-worthy messages need to have a little clearer product benefit than you might typically expect of beverage advertising."
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