Conversation Economy and the Increased Value of Word of Mouth

I recently read an article on Fast Company, in which angel Investor Peter Shankman laid down a $5,000 donation bet that Yelp’s business model will fail by next year. He asks why, in the “conversation economy” that we live in, would he rely on the reviews of complete strangers when the feedback from his friends on Facebook and Google+ is so readily available. This term―conversation economy―really got me thinking. Though we’ve always placed a high value on word of mouth, social media has exponentially increased that, not only online, but in the real world. I’ll give you an example.

You can't beat these tacos.

You can’t beat these tacos.

A newer coworker at Main Street Hub recently became friends with me on Foursquare. She then began the obligatory creeping my check-ins to see what’s good (her words), when she came across a check-in at one of my favorite local Austin spots―Elaine’s Pork and Pie, and the accompanying photo. She asked me about it as we were getting coffee one morning, and I began the effusive raving that this little spot deserves. Amazing food, sweet service, and cheap prices. While we were discussing this, another coworker overheard the words “Pulled Pork Tacos,” and became interested in our conversation. Another was passing by and asked if we were talking about Elaine’s Pork and Pie, and also began talking about how much he loved the place. Remember those anti-tobacco Truth commercials, where the little asterisk appears above everyone’s head? Yeah, it’s something like that.

More than ever, now that Facebook’s Graph Search and Google+ Local search have incorporated your friends into what you’re searching for online, word of mouth is king. Positive experiences, check-ins, and good reviews from friends of potential customers (with Facebook allowing a star-rating and has teamed up with OpenTable, as well) can turn into real world dollars and ROI for a business’s bottom line. Just the opposite can happen if those experiences aren’t ideal or if poor experiences go ignored. Businesses simply cannot allow themselves to remain deaf and blind to the conversations that are going on about them. Participation is mandatory.

How has this change to the conversation economy affected your business? Have you had a similar experience like the one I describe above? Have you been to Elaine’s Pork and Pie? (If you’re in Austin, ever, GO. THERE.) Share your thoughts in the comments below.

Now go get your social on!

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Is Privacy the Cost of Convenience?

Privacy, convenience, direct mail, direct marketingAfter the recent outcry from users when Instagram changed their Terms of Service, I started thinking a little more about privacy and how much we’re willing to give up to use some of these social media platforms. I don’t operate under any delusions that there isn’t some sort of cost inherent with using these free social and online services. They are, after all, going into these start-up ventures to make money from their service, one way or the other. I try to refrain from knee-jerk reactions anymore, especially with as quickly as misinformation can spread.

Recently, a piece of direct mail showed up in my mailbox. It was for OutboxAustin.com (It’s actually just Outbox, but targeted to acquiring Austin residents). The tagline on the piece proudly stated: “This could be the last piece of junkmail you ever receive!” Needless to say, I was intrigued. Could this be like that program that allows you to unsubscribe from all the junk mail you receive in your email inbox, but in real life? I decided to look into it a little. What I found was pretty surprising:

So what do you think about this method of convenience? Is this something you’d be willing to do, or have you already given Outbox a try? If you’re a direct marketer, how does do you feel about this type of program? I’d love to hear your thoughts below, or in the comments section of the YouTube video.

Thanks for reading. Now go get your social on!

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