Conversational Capital: How to Create Stuff People Love to Talk About Hardcover – Aug. 7 2008
About the Author
Bertrand Cesvet is chairman and chief strategist of SID LEE, a Commercial Creativity company with offices in Montreal and Amsterdam. He provides creative and strategic leadership on marketing communications and experience design projects for clients such as adidas, Red Bull, Cirque du Soleil, and MGM Mirage. He lives in Montreal with his wife Josee and daughters Gabrielle and Emma.
Tony Babinski is a Montreal-based writer, creative director, and filmmaker. He has worked with SID LEE since 2000 and is the author of Cirque du Soleil :20 Years Under the Sun, the authorized history of Cirque du Soleil. He lives in Montreal with his wife Julie and children Sophie, Max, and Lily.
Eric Alper is a strategist for SID LEE. He has kept a blog about Conversational Capital going since 2006. He has also developed and written the Conversational Capital blog.
Excerpt. © Reprinted by permission. All rights reserved.
This is a book about why certain brands outperform the competition. Through close observation, we've determined how market leaders inject intensity into their products and services and turn them into experiences that truly matter to consumers. This is the "stuff " we refer to on the cover of this book. These highly charged experiences provide incendiary fuel for conversations that consumers engage in to define who they are. Because they have so much identity defining and affirming significance, having the power to shape such experiences is the new Holy Grail for businesses bent on leadership. And, like the Holy Grail, it is ultimately mysterious and elusive.
Or is it? We've written this book because we believe that creating such experiences is a process you can influence. It's not as mysterious as you may think. It is something you can manage through observation, insight, and, most importantly, creativity.
Our belief isn't just a matter of opinion. It's rooted in our direct experience with one of the biggest conversation-generating successes of the last quarter century: Cirque du Soleil.
In 2001, Cirque du Soleil asked us to redesign its website. The company was already an international live entertainment giant. With eight ground-breaking shows running in various traveling and permanent installations around the world, Cirque had achieved gross annual revenues of over 500 million dollars a year and counting. At the time, before user-generated content began maximizing the Internet's potential to create thriving online communities, Cirque already had a fan club boasting 300,000 dedicated members.
We soon became Cirque's main marketing communications agency and have been with the company ever since. Cirque du Soleil now has fi ve permanent shows in Las Vegas, one in Orlando, one in Macao, and nine shows on tour. Th ey have expanded into television, film, music, and, more recently, lifestyle products and experiences. Their business keeps growing and perhaps the most amazing thing about the company's remarkable evolution into a cultural icon is that it took place with almost no mass marketing to support it.
Before we began working on the new site, we had to come to terms with just how much the Cirque du Soleil brand meant to its fans. Almost everyone who had ever seen a Cirque show liked it. Many of them loved it and became repeat fans. Perhaps more importantly, a significant number of Cirque fans described the shows as life-changing experiences and became brand ambassadors, carrying the Cirque torch with them wherever they went.
All of this happened without even a nod of recognition to how things are supposed to work in conventional marketing practice. For decades, the accepted wisdom in industry circles has been that brands succeed only if a ton of money is thrown in the direction of mass marketing. Want to be noticed? Spend big on media. Make sure that television and print ads with a simple, easy-to-understand message about your brand get out there in front of as many people as possible, over and over and over again. Combining maximum reach with maximum frequency is the only way to go.
Except that didn't happen with Cirque du Soleil. Instead, the company's success grew organically, through word-of-mouth. Cirque is a success because people have taken it to heart, and made it part of their own personal narrativessomething they not only talk about with others, but that also defi nes who they are.
Nothing is more powerful than when consumers make your story part of their story. This is especially true today, in a fragmented media market that's spilling over with branded communication efforts. Obviously, mass-market communications can be meaningful and memorable, but it's getting harder than ever to break through the clutter. Even if a breakthrough happens, consumers who've grown up in the media age view "top-down" communication with suspicion and skepticism. When a message does succeed in getting across, it carries little weight.
Highly charged consumer advocacy through word-ofmouth communication represents the exact opposite. Unlike mass marketing, it's carried "horizontally" from peer to peer, so it has more power and authority. Consumers who believe in certain brand experiences and are vocal about their belief are the carriers. Like a virus, it spreads on contact fast.
Over the last several years, we've observed that, like Cirque du Soleil, the best products and experiences owe their success to word-of-mouth communication.
Data from a recent study by The London School of Economics titled "Advocacy Drives Growth" makes this clear. Th e study was conducted in the U.K., but its findings have universal implications. It found that positive word-of-mouth predicted sales growth for retail banks, car manufacturers, mobile phone networks, and supermarkets. It also revealed that companies with higher levels of word-of-mouth advocacy grew faster than their competitors and generated greater sales. 1
Word-of-mouth is valuable currency. Like any currency, we believe that its value can be managed. Build it properly and you have an asset that increases the value of your brand. Ignore it or spend it unwisely and you have a liabilityeven if you've invested millions above the line.
Because word-of-mouth advocacy is organic and democratic and because consumers control so much of its power, it can appear scary and unpredictable to marketers. It shouldn't be. What we've seen, time and again, is that positive word-of-mouth happens when a certain number of key factors are present in a brand story. We call these factors the engines of Conversational Capital. By becoming aware of and managing these engines properly, you can turn Conversational Capital into a toolbox that builds value into your product or service.
People are talking. We're writing this because we want you and your brand to be part of the conversation.
WE'RE COMMITTING SUICIDE HERE - We're advertising people, yet, in stumbling upon Conversational Capital, we have unearthed a truth about the branding process that boots the cornerstone of our business right out from under us. Th e discomfi ting thing about Conversational Capital is this: When word-ofmouth works well, traditional advertising and design become much less important. When the engines of Conversational Capital are built into your consumption experience, positive word-of-mouth is likely to follow. So we're stuck with a quandary: Do we spill the beans or shut our mouths and keep billing for the same old same old?
Too badMom always told us to share.
NO, NEVER MIND: WE'RE TOO LAZY! - On second thought, self-immolation requires too much energy. The truth is, advertising people are lazy by nature (otherwise, we'd be novelists, nuclear physicists, or whatever). The second truth about Conversational Capital is that it makes our jobs easier because it turns consumer experiences into tight, compelling stories. And the better the story, the simpler it is to write a great brief, come up with a killer strategy, and produce award-winning creative.
So let's work on that story together. It may be against our essential nature, but we'll do the heavy lifting (promise).
EXCUSE ME, BUT YOU'RE CALLING A LITTLE LATE - We consider ourselves storytellers by trade. We take your consumer experience and distill it into a narrative that's relevant to your target market. Most of the time, however, clients call us too late. By the time they do, they come to us with products and experiences that are already designed and with fully developed stories. And those stories...well, sometimes they're not as compelling as they could be. It's the curse of our business. Conversational Capital enables us to rework with you the narrative that informs your consumer experience, and it helps make that story one that people want to tell.
So, we don't have to spend a lot of time turning the sow's ears into silk purses.
When products and services become intense experiences, something powerful happens. They become fuel for conversations that consumers engage in to define who they are.
That process turns brands into market leaders. More importantly, what we've observed about market leaders like Cirque du Soleil and others tells why and how it happens.
Turning that process into something you can manage and control is what this book is about.
QUESTIONS FOR DISCUSSION
Is this just another book about word-of-mouth?
We don't think so. Although this book acknowledges the fundamental importance of word-of-mouth in today's economy, it goes further than anything we've read in describing why and how word-of-mouth happens in the first place.
We think most people will agree, but this book is not intended as a closed discussion. We know there are intelligent and perceptive doubters and nay-sayers out there, and we welcome their points of view. Conversation about Conversational Capital can and will extend outside of this book!
Find out what other people are saying and tell us what you think at www.conversationalcapital.com.
1 Marsden , P., Samson, A., and Upton , N. "Advocacy Drives Growth." Brand Strategy. Nov/Dec 2005.
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- Publisher : FT Press; 1st edition (Aug. 7 2008)
- Language : English
- Hardcover : 208 pages
- ISBN-10 : 0137145500
- ISBN-13 : 978-0137145508
- Item weight : 480 g
- Dimensions : 16.51 x 1.91 x 23.5 cm
- Best Sellers Rank: #522,608 in Books (See Top 100 in Books)
- Customer Reviews:
Top reviews from Canada
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Good fundamentals on branding, the 8 engines that they call, good stuff. Not to take literally, but there's some good advices, mostly at the end of the book. They show you good and bad examples of some brands.
Most of Creative capital discussed the eight engines of Conversational Capital. These are what the authors point out as 'experience amplifiers,' being:
2-Exclusive Product Offerings
4-Relevant Sensory Oddity (RSO) (particularly interesting and important concept)
These eight engines are particularly important to marketers working on marketing plans to tie in both Social Media elements and customer conversations ' into their marketing strategies and tactics.
Cesvet, Babinksi and Alpers, were wise to compare conversational capital to Buzz marketing. In their words, 'Buzz is about getting attention at all costs, Conversational Capital is about meaning, integrity and interaction.' P46. This line alone was a nice clarifier to point out the importance of worthy marketing rather than just attention grabbing efforts.
Well written. Solid, sound arguments presented to the reader. A great read for any marketing professional focused on growing the brand/product value through its advocates.
Which is exactly why we read these books, right?
Although the introduction/forward took a bit to get into and caused me to skip ahead to find where the "real" book began, from chapter 1 I was hooked.
The authors use three very different companies, Cirque Du Soleil, IKEA and Montreal local delicatessen Schwartz's, to illustrate "The Engines Of Conversational Capital":
2. Exclusive Product Offerings
4. Relevant Sensory Oddity
I have to admit that I have never seen a Cirque Du Soleil production, never bought furniture at IKEA and never eaten at Schwartz's BUT I don't have to to understand what makes them three outstanding businesses.
The later half of the book explores each "Engine of Conversational Capital" individually using many major and unique brands to bring points home. The final few chapters are devoted to implementation in your own business.
I can see how this book is compared to The Tipping Point and Made To Stick although there is less storytelling and more cause and effect examples.
All in all a great Book!
Danielle Millar, Glenn Simon Inc.
When these same "expert" entrepreneurs begin describing how they intend to do the same thing, the concept immediately becomes unattainable. Why? They need a "how to" process that leads them to create such a result.
I picked up this book hoping to find such a process . . . which I didn't find. I did find a solid list of factors that can be involved in such success, defined best in terms of Cirque de Soleil which the authors represent from their Montreal base.
Conversational Capital misses three big opportunities:
1. To provide such a "how to" in more detail than simply encouraging people to brainstorm around a few principles.
2. To lead business people to other sources of information that might inspire or direct them into taking useful steps (I think that a lot of the new neurological information about how we make decisions and are influenced by our surroundings would have been very useful).
3. To write the book in such a way as to exemplify the point.
I didn't find the book demonstrated much value in those three dimensions.
The authors' main contribution is to encourage strategists to think in terms of creating an on-going source of amazement that stimulates continual discussions about offerings. That's a fine thing to do, and I was glad that I read the book for that purpose.
If you already can think of five excellent examples of how others have achieved that result, this book may add one or two more.
Knock their socks off . . . and keep those socks knocked off!
Top reviews from other countries
Bertrand Cesvet and his colleagues at Sid Lee remind us that marketing is ultimately built upon conversations, and conversations can't be meaningfully held with computers. Underneath all the gloss of technology, marketing is for human beings.
Conversational Capital is also important because it represents an early attempt to create a marketing system that invokes the power of ritual to create salient interactions between marketers and consumers. "Rituals are an essential part of how human beings create and formalize meaning. The presence of ritual marks an experience as deeper in meaning," the authors write. The deeper meaning that ritual summons in turn leads to a stronger brand, greater consumer engagement, and higher profits.
It's true that the authors' exploration of ritual dynamics in the marketplace isn't as profound or as anthropologically-informed as it could have been. However, their observations are still, years later, miles ahead of the cultural insights of conventional marketing. The team at Sid Lee deserves credit for beginning an important conversation about the qualitative human experiecne of marketing - a conversation that is still not being attended to by most agencies and corporations.
The book is a high-level description of "Conversational Capital" or what makes a consumer into an active advocate for your brand combined with the description and benefits of lifestyle brands. The key concepts are: Rituals, Initiation, Exclusive product offering (EPO), Over-delivery, Myths, Relevant Sensory Oddity (RSO), Icons, Tribalism, Endorsement and Continuity. Each concept is given examples using well-known brands to help you understand the concept. The designing process is defined at a high-level with some useful tips. However, it does not really have anything revolutionary or even barely evolutionary.
If you have taken more than basic marketing classes, you will see the validity in the concepts but will be wishing for more substance on how to make your brands into the described brands.
Take-aways from the book:
Rituals -- "Rituals are behaviors or rites we engage in to mark certain activities as exalted. When ritual behavior becomes associated with a consumer experience, it is marked out as more resonant" (pg. 68)
Initiation -- "Initiation is a special subset of ritual. When consumers feel they have worked a little harder to acquire special knowledge of or access to a consumer experience, they feel set apart." (pg. 75)
EPO -- "EPO occurs when a consumer experience offers a notable degree of individualization. When you feel something has been designed just for you, or in a distinclty personal way, you can claim an experience as your own, it becomes more salient. EPO sings in high-end experiences, but we've also observed it in simple products such as Cracker Jack or the Kinder Egg." (pg. 83)
Over-delivery -- "Over-delivery is an aspect of EPO. It's what happens when brands make an experience feel special by going much further than they have to in terms of customer satisfaction. Over-delivery occurs when consumer experiences include features that anticipate needs and desires consumers haven't even thought they would want but end up loving. In the end, it can be understood as an attitude; the desire to be the best and keep improving, just for the sake of it." (pg. 89)
Myth -- "Myth might be the most critical engine of Converstational Capital because it embodies a brand story. Essentially, stories set brands apart because they are so important in the identity-forming and affirmation process. We are the sum of our stories and we look to myth to provide them. If your brand is powered by myth, it might be all you need." (pg. 97)
RSO -- "RSO stands for relevant sensory oddity. IT can be observed when a consumer experience surprises and delights a full range of sense. IT recognizes that human beings see, touch, hear, taste, and feel and communicates with them on that level. However, doing so in a manner tha is relevant, and resonates with the consumer experience in a meaningful way, is key." (pg. 105)
Icons -- "Icons are signs and symbols that are rich in evocative power and associations. Almost anything can take on the shorthand power of an icon: places, buildings, people, logos, labels, and more. The key is that these icons have to evoke a compelling brand story." (pg. 113)
Tribalism -- "In essense, Conversational Capital occurs when brand stories become part of the identity formation and affirmation process. Determining which tribe you belong to is a bedrock component of that process. Tribalism takes place when consumer experiences draw the like-minded together in a quest for mutual discovery." (pg. 121)
Endorsement -- "Endorsement is not a matter of well-known people speaking for your consumer experience. Rather, it is a matter of consumers advocating on your behalf in a free and unsolicited manner. This is the most powerful form of marketing there is. However, endorsement comes with a built-in caveat. If you are endorsed, you need to live up to consumer support. If they recommend you to someone who is disappointed, they look bad, too." (pg. 125)
Continuity -- "Conversational Capital demands continuity. Because it is about creating consistent brand stories, it works best when there is no disconnect between how a product is designed, marketed, and perceived. The best brands are the result of a united, cohesive strategy, and they walk the talk." (pg. 131)
The book was clearly written quickly with marginally editting. The book is a fast read where the text is concept light. So, it is good for getting some key marketing vocabulary with supporting real-world high-level examples.
1.) Rituals (formal actions that give an experience or event meaning)
2.) Exclusive Product Offering (experiencing and identifying with something unique and / or customized)
3.) Myths (stories that define culture)
4.) Relevant Sensory Oddity (stimulation and challenging of one's senses in an intense and meaningful way)
5.) Icons (this one is self-explanatory)
6.) Tribalism (draws like-minded people together in a mutual self / brand discovery process)
7.) Endorsement (not just by compensated celebrities, but by your customers as well)
8.) Continuity (alignment between what you promise, what people expect and what you deliver)
The book begins with part one by defining Conversational Capital and the above Eight Engines in detail and then is followed by three cases in the form of Cirque de Soleil, Ikea, and Schwartz's Delicatessen showing how the different engines operate for those companies. It then differentiates Conversational Capital from other non-traditional forms of marketing that it can be confused with; in the process, it makes the case that it transcends those comparisons.
Part two of the book has a chapter where it looks at each engine (and subsets of a few engines) in more detail and provides a bulleted list approach rattling off one-paragraph examples of how dozens of well-known firms demonstrate that particular engine.
Part three of the book provides solution design and implementation steps. This section falls a little short as it is 30 pages of a 170-page book. However, that might be by design as some may view the book as a sales pitch for having a marketing team or consultants compensated to examine the optimal approach.
Each chapter is concluded with a "Summing Up" and "Questions for Discussion" section (similar to what a college text would have but not as rigorous). The authors also occasionally interject shaded boxes with humorous explanations of the particular topic at hand.
The authors concede this is not altogether groundbreaking work and that they are simply building on past concepts, giving them a name and presenting them in a simple model to follow. I think the open source approach to the book and the use of their website is admirable and the authors explain the evolution of the book coming into fruition in the introduction.
I do see how individually, and collectively, the Eight Engines can act as experience amplifiers. Where I disagree with the authors is the premise this model can apply to all sizes and shapes of firms. They go out of their way to make this point by the companies they select and the illustrations they provide. While I think individual elements can apply to any situation, I don't walk away sold on the notion that all eight engines (or most) apply to every company or brand. I do think that this model is more applicable to high-margin, experience-rich categories. Bottom line is that I make my purchasing decisions (be it for goods or services) based on price and quality above all else. These eight engines might assist a brand in building an image; however, many of them are not enough to make me a return customer if I am not satisfied based on price and quality.
I found the most convincing section of the book to be chapter five where they differentiated between Conversational Capital and Buzz. They made a compelling case that Buzz is manufactured by the media, is short-term in nature and is designed to succeed at any cost. However, Conversational Capital goes to a much deeper level of peer-to-peer communication that is embedded in the experience of the product and centered on integrity. I found this particularly powerful in conjunction with their discussion of the Continuity (8th) Engine that establishes the relationship between reputation and the importance of proximity and integration of what firms promise versus what they actually deliver.