Category Archives: Word of Mouth marketing

Is It Time To Kill-Off The Conversion Funnel?

What Does Behavioural Economics Tells us About Conversion Funnels?


We Are Connected:

Most conversion funnels appear to be based upon linear models of decision making such as  A.I.D.A (Attention, Interest, Desire, Action). However, this ignores the fact that people are connected and use their networks extensively to identify who they can trust. This means they don’t mindlessly go though each step in the mythical conversion funnel until they complete their task.

Behavioural economics supports the idea of a non-linear decision making process as it provides clear evidence of how important our interactions with other people are in the choices we make. We use our network to reduce the chances of our decisions being a disaster. This is because if someone is known to our network they risk damaging their own reputational capital if they sell us something not fit for purpose.  Behavioural economics also shows how underlying emotions, social norms, traditions,  and many contextual factors such as our environment influence decisions. If any of these ring alarm bells we may reconsider our goals or abandon the purchasing process.

Image of paper people holding hands


This often produces an erratic, on-off and on-again decision making process. Plus as we employ our unconscious brain when we can to conserve cognitive energy we may not even be consciously aware of many of the  factors that drive our decisions. This undermines much of the market research that organisations use to design their marketing campaigns.

Multiple Purchasing Processes:


In addition, when people are online they often simultaneously look at alternative solutions and so could be in more than one purchasing process at the same time.   This means the funnel metaphor is misleading when it comes to understanding real-human decisions as it over-simplifies the process.

A Leaking Bucket:


Image of behavioural economics decision bucket


A better metaphor may be a leaking bucket that is constantly being filled by a stream of water from a tap. People frequently swing from one decision to another and the importance of factors in our decision making can quickly shift as our emotions, social interactions and our environment alter our motivations.

Our brain filters out a lot of the information that we are targeted with and  cognitive biases  further distort our perception of the information we receive. Having a simple and compelling message is therefore essential if we wish to cut through the noise that surrounds us.

Imperfect Memory:

 Image of computer memory chips


We don’t have a memory like a computer as each time we recall a memory it has to be recreated and elements inevitably get changed or lost. This means our memories are heavily dependent upon what happened at the peak and at the end of an experience. Get these wrong and chances are customers will not recall an experience in a positive light. It also explains why we need to regularly repeat our brand messages through advertising and other media as our memory degrades over time.

There is also evidence that high advertising and promotional spend acts as a kind of costly signalling which demonstrates the organisation has long-term time horizons and is likely to be in good financial health. This behaviour may increase trust in the organisation or product as people interpret this as an indication of confidence about the future of the brand.

Goals Motivate People:

When we create an unmet need  this forms an explicit goal (e.g. I want to have a reliable car to get to work). But for our brand (or website) to be chosen we need to communicate that we can deliver on key psychological or implicit goals, such as security and enjoyment. If we can convince customers that we are the most likely brand to meet these implicit goals we may generate an emotional response which can ultimately help close the sale.

Image of implicit goals
Implicit Psychological Goals from Decoded by Phil Barden


Provided the brand is available and the experience meets our expectations this may help form a habit which creates brand loyalty. In reality though, this can be broken by lack of availability or the creation of a new habit. Indeed, if the product does not deliver what it promised we are unlikely to create a new habit and may buy another brand next time we have the same explicit goal.

Don’t Ask Why:

If asked why we purchased a product we will post-rationalise and come up with what we think are rational reasons for our choice of brand. But as we don’t have full access to our subconscious processes this is a pointless exercise.  However, there are implicit forms of research that try to tap into these underlying motivations.


The funnel is dead, or at least it should be on life-support as they are a misleading way of describing the decision-making process.  Funnels may also result in too much focus on customer acquisition and short-term thinking because they imply there is only one goal (conversion).  Instead we should be looking to ensure our product meets the needs and expectations of customers and try to create sustainable habits to encourage brand loyalty.

Dave Trott sums it up nicely in his book One Plus One Equals Three: A Masterclass in Creative Thinking:

“The product creates the experience.

The experience creates the reputation.

The reputation creates the brand.”

                                    Dave Trott, One Plus One Equals Three

Thank you for reading my post and if you found it of interest please share using the social media icons on this page.

Recommended reading:

Decoded by Phil Barden

Herd by Mark Earls

You can view my full Digital Marketing and Optimization Toolbox here.

To browse links to all my posts on one page please click here.

  • About the author:  Neal has worked in website optimization and A/B testing  for over 5 years with online brands such as Deezer.comVery, Littlewoods, Foxybingo and partypoker.  Using  a combination of approaches including web analytics, heuristic analysis, customer journey mapping, usability testing, and Voice of Customer tools, Neal identifies opportunities to align the website design and performance with the organisation’s business goals. This may involve A/B testing  to validate the benefit of proposed changes and/or implementation of best practice recommendations.
  • Neal has had articles published on website optimisation on  and as an ex-research and insight manager on the GreenBook Blog research website.  If you wish to contact Neal please send an email to You can follow Neal on Twitter @northresearch, see his LinkedIn profile or connect on Facebook.


6 Myths About Word Of Mouth Marketing

Importance of peer-to-peer influence:

Peer-to-peer influence is of the utmost importance in spreading ideas, products or campaigns. Without visibility a new practice or technology will not spread to the wider population. As a result word of mouth (WoM) marketing has grown in importance as businesses have recognised the value of getting people to talk about what they do or what they offer. Indeed, it is estimated that WOM is the primary driver of between 20% to 50% of purchase decisions.

“Peer-to-peer influence – what people do with and to each other – is the prime shaper (of mass behaviour).” Mark Earls, Herd.

At the same time there are some common misunderstandings about WoM and how it can be used by marketers.

1. Word of mouth is the most powerful form of social influence:

Personal influence is much more important than traditional  marketing because individuals will often be willing to  comply, conform and copy the behaviour of their peers. Our natural ability to copy embeds knowledge into our social networks that can spread throughout wider society.

A widely held belief here is that such influence is defined by word of mouth (WoM). Word of mouth is not the most powerful form of social influence; it’s just the most noticeable. Measuring WoM may be a good indicator of peer-to-peer influence but it does not cover non-verbal behaviour,traditions or social norms which can be more important drivers of mass behaviour.

Leading by example is often a much more powerful form of social influence. Pedro Gardete, Assistant Professor of Marketing at Stanford University,  analysed in-flight purchasing behaviour on 2,000 flights of a major US airline between January and February 2012. His analysis found that people sitting next to a passenger who bought something on the flight were around 30% more likely to make a purchase themselves.

He also analysed the behaviour of people travelling together under the same reservation number. The propensity to buy doubled if the person next to them makes a purchase and is someone they know. This could be due to friends or family sharing the same tastes, but it could also suggest they are influenced by their travelling companion.

2. Marketing-generated WoM can be as influential asnaturally originating WoM.


The evidence suggests that naturally generated WoM is more influential than marketing-stimulated WoM. This may be because it is perceived to be more genuine and less manipulative. The key take-out here is that what people do without business involvement is more powerful at driving significant and swift change in consumer behaviour. Just look at how quickly SMS text messaging was adopted as a means of communicating with each other and yet it
was just an afterthought from the mobile networks.

3. Word of mouth as a channel for markers in relatively new.


WoM is an important channel for marketers because
it is a persuasive and to a degree, a free media. However, an appreciation of the power of WoM is nothing new. A US study in 1955 estimated that WoM was seven times more influential than print advertising at encouraging brand-switching.

WoM has long been seen as a filter on information that is received from third-parties by our social networks. This appears to becoming more important as people have learnt to trust authority less and less. Trust in Government among the public in the US stands near an all time low and in the UK Ipsos MORI research indicates that the public are less likely to trust politicians than most other professional occupations. As a result is should not be surprising that WOM is perceived to be the most trusted source for recommendations.

4. Word of mouth is less important in B2B compared to B2C markets.

The perception among some markers that B2B markets are somehow less influenced by what individuals say about brands does not stack up with the evidence. WoM is just as important in B2B as in B2C markets because people in organisations are integrated into the same social networks that the rest of the population are part of.

Sure, what your colleagues mention about a brand can be important. But you can’t divorce yourself from what your peers outside your organisation have to say, and nor can you close yourself off from
what family and friends may contribute to your perception of a supplier.  Add in what you find out when you Google the product or service and there is little difference between WoM for B2B and B2C

5. People can’t tell the difference between marketing-generated WoM and  naturally occurring WOM.

Over the years many organisations have attempted to package marketing initiated WoM as coming from an independent source, such as a blogger, with the aim of spreading their message across our social networks. This has now been outlawed in many countries. As such marketing’s efforts to generate WoM is often clearly distinguishable from the naturally occurring variety.

However, if any organisation did consider attempting to present their message as naturally occurring word of mouth the risk of damage to their reputation is massive. Indeed, Mark Earl’s in his book Herd suggests that as “super social” apes humans have innate ability to spot cheating and deception. This may be related to the wisdom of crowds that has been observed in many contexts. Whatever the mechanism though which deception is discovered you can guarantee that the consequences will have major ramifications for any brand.

6. Word of mouth is another marketing communication tool.


Sorry, but WoM is not another marketing innovation.
WoM is a naturally occurring interaction between different people that is primarily driven by our instinctive desire to establish and reinforce social bonds. We are sometimes motivated by other factors such as curiosity and survival instincts, but frequently WoM is just a means of keeping the channels of communication open. So when we say hello and chat to our neighbour about the weather we  may not be that interested in what they say, but it has benefits that are important to us from a social perspective.

To put WoM marketing into context research suggests that a majority of what we say to each other is about social relations. That is what we do with or to other people and who we can or cannot
trust. Social content (e.g. gossip and rumour) also tends to be the most memorable part of a conversation. This insight probably explains why ideas that  enable social content sharing can spread very quickly as they facilitate something that is crucial to the functioning of our social networks.

Given this insight we may see WoM as a channel or a medium to create a ripple effect in the target audience’s social network. However,because people are constantly sharing thoughts and ideas about a diverse range of topics the water into which we drop our pebble is more like a bubbling hot-tub full of lots of excited and playful people than a calm expanse of water. This means that luck and timing play a big part in whether your idea is noticed or just swallowed up in the noise of human society.

What matters most about WoM is the social system, the people involved and their desire to interact about something. Clearly endogenous or self-generating WoM is much more powerful than superficial marketing generated WoM that organisations initiate. This reflects the deep seated human characteristic of talking to each other about a topic which nourishes the interactions with other people.

People are highly motivated to share their passions and obsessions with others. We are drawn to identify with a cause. People will chat
whatever you do, and sometimes it will be about you, but more often it won’t be. The real reason for WoM is the social interactions around the topic. The subject of discussion provides the oxygen to sustain interactions rather than the purpose of our conversations.

Businesses can try to facilitate WoM, but they may also limit, prevent or intensify the interactions of people with each other. What is most influential though is what we observe others doing, what we think they are doing and how we interact with them. Rather than constantly trying to control how people interact with our brands we need to let go. We should encourage and help people to engage with each other about our products or ideas as this ultimately results in value creation.

Thank you for reading my post. I hope it generated a few ideas and if you have time you can read previous posts on how we are influenced by the behaviour of others:

 Previous posts on social influence:

1. How do social networks influence human behaviour? How people who are close to use influence our behaviour in many different ways.

2. What makes social networks tick? What set of circumstances encourages collaboration and sharing between people.

3. Are most purchase decisions the result of other’s  behaviour & opinions? What does the evidence say about how powerfully other people influence our purchasing decisions and what are the different ways that we copy other people.

You can view my full Digital Marketing and Optimization Toolbox here.


Recommended reading:

To browse links to all my posts on one page please click here.

  • Neal has had articles published on website optimisation on  and as an ex-research and insight manager on the GreenBook Blog research website.  If you wish to contact Neal please send an email to You can follow Neal on Twitter @northresearch, check out the Conversion Uplift  Facebook page or connect on LinkedIn.