Chapell & Associates

Tuesday, October 04, 2005


Adage - October 4, 2005
The good buzz on the nascent business of word-of-mouth marketing holds that it offers a low-cost, highly effective way to drum up positive chatter around a brand. The bad is that some of its more insidious practices could lead marketers to run afoul of longstanding advertising law. As marketers more frequently look to recruit consumers brand agents to spread goodwill for brands, industry attorneys view buzz marketing as a likely area of regulatory involvement, especially around the issue of compensating people to participate in buzz programs when they fail to disclose their connections to marketers and agencies. While there is no legal precedent specific to word-of-mouth marketing, there are Federal Trade Commission guidelines for ads that are likely to apply.

The Chapell View
Every since I started looking at word of mouth marketing back in early 2004, I had some real concerns. Frankly, I was (and continue to be) less worried about the legality around disclosures than I am about the overuse of WOM. Marketing is sometimes ruled by a mob mentality - where new ideas are quickly exhausted by sheer overuse. And before you know it, we've soiled our own food dish...Too many other online marketing channels have been significantly impaired by a lack of agreed upon principles.

I give credit to Pete Blackshaw and other leaders in this space - for recognizing that WOM could easily implode if left without some sound industry best practices. To that end, I know they've setup a trade association (the Word of Mouth Marketing Association) and established their own set of guidlines.
posted by Alan on Tuesday, October 04, 2005

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