The Power of Consumer Stories in Digital Marketing

FRONTIERS

[MARKETING] The Power of Consumer Stories in Digital Marketing New research finds that sharing consumers’ positive stories about a brand can be a highly effective online marketing strategy. BY RENÉE RICHARDSON GOSLINE, JEFFREY LEE, AND GLEN URBAN

on important opportunities to connect in a meaningful way with potential buyers. Increasingly, the locus of power in the digital marketplace is moving from the brand itself to a combination of the brand and the consumer. In traditional TV advertising, brand-to-consumer marketing messages have dominated. However, in a “multiscreen” marketplace, the traditional marketing model faces tough competition, as companies use brand websites and social media to deliver messaging with greater impact. Direct brand messages that have narrative structures can significantly increase persuasion and brand connections in both old and new media. But as consumer-to-consumer storytelling becomes increasingly ubiquitous on social media, hen we think of storytelling, for shaping cognitive processing, recall, previous notions of direct brand influence we tend to conjure up memo- brand image, and choice. However, rela- are being replaced by more nuanced W ries of childhood — fairy tively little is known about how this notions of brand-to-consumer and tales, fables, and campfires. Stories are an process works in digital marketing. Over consumer-to-consumer marketing. essential form of human communication the past five years, we pursued field re- This allows for complex combinations in and are often among the first conveyors of search with two companies, BMW AG, which consumers share creative content cultural norms and values. There’s a reason the German automaker, and Suruga Bank with companies and then both the com- why many childhood lessons are conveyed Ltd., based in Numazu, Japan, to explore pany and the brand users share that as stories: Research has shown that the the role that story authorship plays in content further on social media. human brain likes to encode, store, and consumer choice. Through this research, Companies, too, have become more ac- retrieve information in narrative form. we learned that stories significantly tive in sharing consumer stories and even When consumers prepare to make increase consumers’ engagement with facilitating the creation of consumer- purchase decisions, stories can deliver websites and that stories originating from generated content. For example, in 2009 important information and shape the consumers are especially powerful in and again in 2013, Ford Motor Co. created decision and the overall brand experience. shaping brand attitudes in social media. a media buzz by loaning 100 new Ford With the advent of consumer-to-consumer Indeed, companies that aren’t offering ex- Fiestas to select individuals for free for six social media platforms such as Facebook periences that leverage consumer input in months; in return, the recipients were and Twitter, stories can be powerful tools brand-related narratives are missing out asked to document their experiences with

10 MIT SLOAN MANAGEMENT REVIEW SUMMER 2017 DAN PAGE/THEISPOT.COM the car on social media platforms such as and then measured attitudes and prefer- the story” and were psychologically YouTube, Facebook, and Twitter. Ford ences regarding BMW again. In the second involved with the consumer stories. used this promotional campaign to gener- BMW study, a consumer named Geoff Lee ate TV, print, and digital advertising for reminisced on video about the BMW 318i Evaluating the Impact the car. his parents had purchased the month he From our studies, we found that consumer- was born in 1984 (a car he referred to as based storytelling influences people to Relating to Stories his “twin”). The car, he offered, was there consider purchasing products. In fact, Traditional marketers need to understand for him during major life events growing across the three studies, there was an why consumers engage in storytelling. up (homecoming, graduations, first dates), average increase of 32% in purchasing Research studies show consumers share and it is still part of his life. This study consideration when consumer-based sto- stories and engage in social-identity signal- was based on 800 interviews and used rytelling was employed. Statistically, the ing and social comparison dynamics both measurement procedures similar to the results were highly significant in the indi- to help other consumers and to compete first study. vidual studies and also when the data from with one another. Good marketing prac- The Suruga Bank study was built the three studies were pooled together and tices today require a clear understanding of around a story video told by a well-known analyzed. Past research has shown that get- the role of consumer-generated content Japanese violinist, Iwao Furusawa, who ting consumers to consider a purchase or and ways to put it to use. described his dream of being an architect business relationship correlates to future The idea of a traditional rhetorical and how Suruga Bank helped him build sales. For example, when consumers are triangle — consisting of an author/ storyteller, an audience, and a subject/ Across the three studies, there was an context — is well-established in traditional face-to-face and print storytelling. average increase of 32% in purchasing However, little is known about how that consideration when consumer-based triangle relates to consumers’ social media storytelling was employed. experiences. To learn how storytelling principles apply to an increasingly digi- his dream second home while other banks preparing to purchase a new car, they fre- tized world, we conducted three field did not think he qualified for a mortgage. quently form consideration sets (typically experiments, two on behalf of BMW and Approximately 1,250 respondents were made up of four to six options); if a brand the third for Suruga Bank. The studies interviewed for this study and shown the is not on the list, the chance that a con- were sponsored through the MIT Initiative video after they expressed baseline mea- sumer will purchase it is very low. To the on the Digital Economy, with the compa- sures of brand preference. A total of more extent that more consumers are willing to nies providing financial support, data, and than 3,800 respondents were surveyed consider buying a BMW, the company’s managerial insights. Survey respondents across the three studies. sales should see an increase. Similarly, if were randomly selected from the compa- In each of the studies, we measured the more people are open to doing business nies’ target markets. For each study, we incremental change in participants’ per- with a bank, the number of savings used authentic brand-related story content ceptions due to exposure to the stories. accounts, credit cards, personal loans, in test environments that simulated social We tested for three things: (1) a self-brand mortgages, and investment services with media sites such as Facebook and YouTube. connection (in other words, the strength that bank is likely to rise. In the first BMW study, we used a video of the linkage between the brand and the We found that people who were exposed featuring a man named Daniel Falkenberg, consumer’s personal life), (2) trust (belief to stories about brands had significantly who spoke of his passion for collecting in the brand and sense that it delivers on higher levels of connection to, and trust in, vintage BMW 3 Series cars. The sample its promises), and (3) consideration (the those brands than people who were not ex- size for this study was 1,800 auto consum- probability that consumers would con- posed to stories; stories led to about a 4% ers. We began by measuring baseline sider the brand for their next purchase increase in trust and self-brand connec- attitudes and preferences for BMW, then in that category). After consumers were tion. In addition, respondents who were showed the video (except to those partici- exposed to a story, we also asked specific more likely to “see themselves in the story” pants who were in the control group, who questions to determine the degree to had greater willingness to consider the received a neutral article to read instead), which they were able to “see themselves in brand and felt higher levels of self-brand

SLOANREVIEW.MIT.EDU SUMMER 2017 MIT SLOAN MANAGEMENT REVIEW 11 FRONTIERS

The Power of Consumer Stories in Digital Marketing (Continued from page 11) connection and trust. (See “How campaign also included TV media case, a customer who was an avid fan of the Consumers Respond to Stories.”) advertising under the title “There are Toronto Blue Jays baseball team received an For would-be customers, we found millions of BMW stories. What’s yours?” official team jersey, a hat, and an invitation that perceived authorship is important. After interesting stories were identified, to throw out the first pitch at a Blue Jays Our research indicated that consumer- BMW sent film crews out to capture game. Another customer received airline authored stories and stories jointly au- them with high-quality video and then tickets to visit her sick daughter in Trinidad. thored by consumers and companies had presented the stories through its brand These interactions were recorded on video similar levels of impact — and both had social media channels. and were shared widely. more impact than stories authored by 2. Convert stories into high-quality companies alone. On one level, it was Leveraging Consumers’ presentations. There’s a difference be- surprising that consumer-authored Stories tween high quality and “slick.” Video stories didn’t have more impact than Our research findings indicate that con- stories about consumers on the brand’s those jointly authored by consumers and sumer storytelling is a powerful tool for social media pages are most effective companies, because we think of consumer brand preference. Given this, how does a when they are consistent with consumer stories as being more genuine. However, company implement a consumer narra- expectations for media quality. Although we found that, while people responded to tive strategy? We propose four steps. high-quality video can make strong im- consumer-sourced content, they also 1. Work with consumers to generate pressions with potential customers, there valued the legitimacy that came with the believable and compelling stories. By ex- is an important caveat: If the finished brand labeling. The good news for mar- amining comments on Facebook, Twitter, product is too polished or professional keters is that they can post consumer YouTube, and other social media sites, you looking, it may be perceived as brand stories on company-linked social media should be able to find leads to consumer sto- authored, which can undermine the pages and gain the benefits of genuine ries about your brand that you can follow up feeling of consumer authenticity. stories without completely forfeiting con- on. It’s a little like curating an art show: You 3. Embed stories in your social media trol over content. Consumers, too, gain need to find the best examples and work mix. Posting videos of customer stories on from coauthored stories because they can with storytellers to deliver the right message. your brand website means they will be be assured the stories are legitimate when Third-party fan sites provide another source perceived as coauthored by the consumer they appear on a trusted brand site. of potential content. Customer-facing em- and the brand. Use true consumer stories Such findings prompted BMW to ployees also may help identify additional and present them through your branded create a new social media campaign with material. For example, TD Bank Group, social media channels (for example, your the hashtag #BMWstories. In this cam- based in Toronto, Canada, developed a cam- YouTube channel and Facebook page) to paign, the company presented consumer paign rewarding selected customers with maximize impact. Encourage comments, stories on its website and across a full thank-you gifts that were dispensed by spe- sharing, elaboration, and the creation of range of social media — Twitter, YouTube, cial ATMs (which the company dubbed consumer-to-brand and consumer-to- Instagram, and Facebook channels. The “Automatic Thanking Machines”). In one consumer information chains across your array of social media. Complementary stories with positive messages can be HOW CONSUMERS RESPOND TO STORIES In our studies, respondents exposed to a consumer story about a brand had greater distributed across a range of sites. willingness to consider that brand and felt higher levels of connection to and trust in it. 4. Integrate paid media strategies with voluntary sharing of stories on social media. Traditional media strategies de- Trust signed for TV can effectively overlap with story-based consumer content generated

Consumers for social media. New York City-based Consumer Consumers see more likely to story selves in story consider brand Weight Watchers International Inc., for example, has integrated consumer stories from social media into its national TV ad- Self-brand vertisements. Companies can pay to include connection stories in newsfeeds on Facebook and other

12 MIT SLOAN MANAGEMENT REVIEW SUMMER 2017 SLOANREVIEW.MIT.EDU paid sites; in addition, look for synergies between social media and mass media. The social media revolution raises important questions for the future of brand marketing in the digital world — where everyone has a voice and consumers are heavily influenced by the judgment of other consumers. Our research indicates that marketers can influence consumer- to-consumer interactions by leveraging consumer-authored stories online as im- FOR MULTI-SITE portant elements of their brand strategy. Using coauthored stories can give brands a ORGANIZATIONS measure of control over their messaging while maintaining the sense of genuineness in consumer narratives. Coauthored stories shared on social media can also be synergistic with TV advertising, which can establish the company’s core brand positioning and drive Companies and universities across the world people to the company’s social media sites. Throughout history, storytelling has subscribe to MIT SMR through its enterprise been an integral way to convey attitudes subscription program. This program is designed and values, and it will remain a key source of information and influence in the digital specifcally for multi-site organizations who are world. As new technologies such as virtual not eligible for our single-site library subscription, reality evolve and improve, brands can and ensures that all your patrons or employees expect to continue to have new opportunities to use consumer storytelling in their have full access to our content, no matter where communication strategy. they are located. Renée Richardson Gosline is a senior lec- turer and data scientist at the MIT Sloan School of Management in Cambridge, Massachusetts. Jeffrey Lee is a visiting assistant professor of marketing at NYU Shanghai in Shanghai, China. Glen Urban is the David Austin Professor of Marketing, Emeritus at the MIT Sloan School of Learn more about the Enterprise Subscription program Management. Comment on this article at sloanreview.mit.edu/subscribe-enterprise http://sloanreview.mit.edu/x/58424, or con- tact the authors at [email protected].

ACKNOWLEDGMENTS The authors thank BMW and Suruga Bank for funding this study at the MIT Initiative on the Digital Economy. Special thanks to Sebastian Schwiening at BMW, Kengo Suzuki and Tetsuhiro Amma at Suruga Bank, and our team of research assistants at MIT.

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