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The Honolulu Advertiser
Posted on: Sunday, August 26, 2007

Customers plug products for 'gifts'

By Alana Semuels
Los Angeles Times

Christy Lynn is a an office-supplies fanatic.

"Some women love jewelry, others love shoes," said Lynn, a Los Angeles voice-over artist. "I love office supplies."

Naturally, she's a member of Staples' frequent shoppers program. So when the office-supply company sent her a questionnaire asking her if she liked to try new products and, if so, if she normally told family and friends about them, she answered yes.

With that, she was accepted in a stealth — some would say sneaky — marketing program called Speak Easy. Now, every four weeks or so, she receives a free packet of brightly colored sticky notes or a case of no-leak pens or a coupon for a paper shredder from her favorite store.

The company is betting these incentives will prompt Lynn to recount the wonders of Staples to her family, friends and anyone else she runs into in the course of a day.

Included with the freebies are a few choice phrases to use when casually plugging the products. A rollerball pen recently arrived with bulleted talking points that included "specially formulated pigmented ink which helps prevent against check fraud" and "nice, smooth write."

Lynn is one of the millions of unpaid — in cash at least — word-of-mouth marketing agents at work in the U.S. There's a good chance you've been on the receiving end of such a plug without realizing that advertising was taking place, because these emissaries aren't required by law to tell you that they're pushing products.

Research company eMarketer estimates that in 2006, about 65 million Americans regularly gave word-of-mouth advice, both through formal programs and just in the course of normal conversations.

It's a twist on an old game. Companies used to pay ordinary people to spread the word about their stuff, planting clandestine marketers on street corners and later Web sites. Consumer advocates complained to the Federal Trade Commission and in December the agency said it was deceptive to employ ordinary people as marketers without disclosing the relationship to consumers.

The agency didn't launch a full-scale investigation, saying it would evaluate the practice on a case-by-case basis. So what's known as word of mouth 2.0 emerged: Companies enlist their biggest advocates rather than random people and, instead of money, agents receive free stuff.

Consumer advocates say it's a distinction without a difference.

"We worry about the insertion of a marketing theme into interpersonal relations," said Robert Weissman, the managing director of the consumer group Commercial Alert, which asked the FTC to investigate word-of-mouth marketing in 2005. "Don't transform every day interactions into veiled commercial messages."

Weissman is especially concerned about programs such as Procter & Gamble's, which enlists 225,000 unpaid teen "connectors" to sample products and talk to their friends about them. Teens are being "roped in" to a marketing scheme that encourages them to value materialism, he said.

In total, 725,000 unpaid "connectors" spread the word about Procter & Gamble's products. They receive coupons in the mail to share with friends, or sometimes, the product itself. They don't have to disclose that they're part of the program, a spokeswoman said, because they're free to say positive or negative things about a product.

A "connector," who P&G finds through a rigorous screening process that includes an algorithm, typically speaks to about 25 people a day, rather than the 5-6 people most of us converse with, the company says. But how to get connectors to talk about Procter & Gamble products?

P&G's word-of-mouth marketing team found that consumers talk to one another when there is "disruptive equilibrium" — that is, when something strange or out of the ordinary happens, said Steve Knox, CEO of Procter & Gamble's word of mouth division, Tremor. So it figured that moms would talk to each other about a dishwashing soap that it says makes kids actually want to do the dishes. It sent Dawn Direct Foam detergent to its connector moms, with a picture saying that the detergent makes kids want to help with chores.

Knox said the campaign resulted in a 50 percent increase in business.