We can’t deny the power of word-of-mouth marketing, and now a blockchain marketing play WOM Token has been built off the back of it.
The problem: brands will spend $237 billion this year targeting their customers, yet their customers will pay more attention to the 2.1 billion daily word-of-mouth product recommendations made by peers. Without mechanisms to measure these micro interactions, word-of-mouth recommendations have largely remained untracked and unrewarded.
Enter WOM Token.
WOM claims to be the next generation of marketing which will record, track and reward word-of-mouth recommendations on the blockchain, creating a simpler, smarter and more transparent form of marketing for everyone.
How WOM works:
The WOM Token aims to be an ecosystem for all content creators, consumers, curators, publishers and brands to engage with each other’s content. This is a run-down of what happens;
- Content creators share word-of-mouth recommendations online
- Curators identify and validate the recommendations and earn WOM Tokens
- Consumers engage with the WOM content and the creators earn WOM Tokens
- Publishing platforms earn WOM Tokens as consumers engage with content on their platforms
- Brands use WOM Tokens to access user-generated content
- Smart contracts are dynamically generated between brands and content creators
- Brands can track word-of-mouth performance across their content creators’ networks.
WOM have one Gen Z focused platforms signed up so far called YEAY who have 170K registered users, which is very solid. However, WOM are creating 1 billion tokens and selling 350 Million of them via ICO later this year by holding a (very confusing) Dutch auction. The max they will raise is $350 Million and the min will be $10 Million.
Basically, WOM have a lot more platform relationships to build, a lot of members to attract and a lot of marketing ahead of them if they’re going to create enough meaningful demand for WOM Token which will offset the 350 Million tokens they’re planning to sell at ICO.
My Opinion: the reason word-of-mouth is so effective is because the person giving the recommendation is usually a family member or friend who aren’t being paid for their recommendation. As soon as a company monetises word-of-mouth this brings the credibility of the recommendation into question, making it immediately less effective.
Take Instagram for example; it’s very cluttered with both macro and micro-influencers from mummy-bloggers to beauty bloggers to Vloggers and more. The lines between advertising, sponsored content and paid PR are blurred as brands and influencer platforms alike have jumped on the bandwagon of monetising content. Now that consumers have caught on, and the influencer market is flooded, the content has lost much of its impact and consumers have lost trust in the recommendations. Consumers always turn back to genuine word-of-mouth; a trusted, credible, personalised unpaid source of information.
Great idea from WOM, and I really do wish people could be paid for their recommendations because they actually do drive the highest conversions, however the monetisation of word-of-mouth has the potential to undermine the concept unless executed very cleverly.
Stacey Lyons is the Marketing Director at Loyalty & Reward Co, a leading loyalty management consulting agency based in Sydney. Stacey has years of experience within loyalty, marketing and eCommerce across multiple channels and business models. Most recently, Stacey has been managing the investor, member and retailer communications for blockchain loyalty company EZToken Rewards.