02.02.04
Procter & Gamble has assembled a stealth sales force of teenagers--280,000 strong--to push products on friends and family. A brilliant move--or marketing gone amok?
Caitlin Jones is Hollywood's kind of pitch gal. Several months ago the 16-year-old received an e-mail announcing DreamWorks SKG's new teen flick, Win A Date With Tad Hamilton!, and was asked to help the studio pick the movie's logo. A few weeks later when she went to a movie theater, she was thrilled to see a trailer for the film and discover that they'd picked the logo she liked. "Oh, my God," she told a friend who was sitting next to her, "I voted for that logo!" She beamed. "So they do listen. It does matter."Jones, a junior at St. Joseph Hill Academy in Staten Island, N.Y., couldn't wait to spread the word. "I told a bunch of friends at school," she recalls. "I told my next door neighbor. I told well over 10 or 20 people." And, of course, she plans to see the film, taking a handful of pals with her.
Gina Lavagna was tapped through snail mail. After receiving a $2 minidisc for Sony's Net MD and six $10-off coupons, she rushed four of her chums to a mall near her home in Carlstadt, N.J. to show them the digital music player, which sells for $99 and up. "I've probably told 20 people about it," she says, adding, "At least 10 are extremely interested in getting one." Her parents got her one for Christmas.
Madison Avenue was once known for men in gray flannel suits. Today some of its most credible foot soldiers wear T shirts and sneakers. They are 280,000 strong, ages 13 to 19, all of them enlisted by an arm of Procter & Gamble called Tremor. Their mission is to help companies plant information about their brands in living rooms, schools and other crevices that are difficult for corporate America to infiltrate. These kids deliver endorsements in school cafeterias, at sleepovers, by cell phone and by e-mail. They are being tapped to talk up just about everything, from movies to milk and motor oil--and they do it for free.
Manipulation? To some extent. Some kids aren't even aware that they're participating in a word-of-mouth marketing effort on an unprecedented scale. Roughly 1% of the U.S. teen population is involved.
They are selected and organized by P&G, which has kept many details about Tremor, created in 2001, under wraps until now. It is a remarkable little business, partly because P&G helped pioneer traditional TV advertising--soap operas were sponsored by Tide--and partly because it has unleashed Tremor's forces on brands it doesn't make, including AOL, Coca-Cola, Kraft Foods and Toyota Motor. (A third of Tremor's activities are devoted to P&G products--Pantene shampoo, CoverGirl cosmetics and Pringles potato chips among them.) It's taken two years to build a national network. The kids, natural talkers, do the work without pay, not counting the coupons, product samples and the thrill of being something of an "insider." Without being asked, Lavagna, the New Jersey teen, hosted a gathering last year so her gal pals could try P&G beauty products, including Clairol Herbal Essences Fruit Fusions Shampoo and Noxzema face wash.
The effort grows out of a profound dissatisfaction among advertisers with conventional media, particularly network TV. Audiences are fragmented, and ever more viewers are using devices like TiVo to zap commercials. Teens, in particular, are maddeningly difficult to reach and influence through advertising, even though they are a consumer powerhouse that will spend $175 billion on products this year. When they do catch TV commercials or print ads, these jaded consumers often ignore the marketing message. Hence the emphasis on friendly chatter among peers to deliver targeted messages. "The mass-marketing model is dead," says James Stengel, P&G's global marketing officer. "This is the future."
He's getting a little ahead of the story; Tremor's revenues this year might top $12 million, a drop in the $266 billion U.S. advertising market. But P&G seems to be onto something. Valvoline, the motor products unit of Ashland, is using Tremor as part of its marketing push for SynPower premium oil. Spending around $1 million--P&G charges that and more for a national campaign--Valvoline will focus on guys and gals who are 16-plus, or 65% of the Tremor empire. "This generation is much more influenced by peer behavior than baby boomers were," says Walter Solomon, senior vice president at Valvoline. "If we can make an impression, it will have tremendous long-term effect."
P&G used Tremor to make a sensitive point about Head & Shoulders it couldn't have broached in mainstream ads: that the dandruff shampoo kills the fungus that causes dandruff. "That's a message that won't survive in the mass market," says Ted W. Woehrle, Tremor's chief executive. "But it's perfectly appropriate to give it to 1% of teen boys and let them talk about it."
Some of this is old wine in new bottles. Word-of-mouth marketing, after all, predates even the apostles. It explains a large part of the rapid diffusion of hybrid corn seed among Iowa farmers from 1928 to 1941. Distillers and pharmaceutical companies have long understood the usefulness of bartenders and physicians. The Internet has been an ideal medium for the proliferation of promotional blather, especially among nonexperts. Word of mouth helped make My Big Fat Greek Wedding a much bigger hit than dozens of heavily advertised films.
Focus groups aren't exactly new, either; P&G has lived by them for decades. But Tremor combines the virtues of both--testing the likely acceptance of products and sending out thousands of eager missionaries to secure converts--on an epic scale. A lot is hit-or-miss. While P&G screens the kids it taps, it doesn't coach them beyond encouraging them to feel free to talk to friends; it does follow up with random phone interviews to monitor changes in brand awareness and image. Other, smaller companies keep tighter tabs on their acolytes (see Cross-Pollinators).
Sony Electronics, which stopped promoting Net MD in print ads and radio spots late last year in favor of Tremor, is still tallying the results of the campaign. The International Dairy Foods Association is a believer. Last spring P&G worked with association member Shamrock Farms of Phoenix on its launch of a new chocolate-malt-flavored milk. The dairy monitored sales of the new product in Phoenix and Tucson where the plan and expenditures were the same, with one exception: In Phoenix, 2,100 Tremorites received product information, coupons and stickers. After 23 weeks, Shamrock says, sales of the drink were 18% higher in Phoenix than in Tucson. Surprisingly, overall milk sales rose, too, in Phoenix--4%. Coupon redemption was an impressive 21%, the highest the dairy has ever seen, says Sandy K. Kelly, marketing chief at Shamrock. "The remarkable thing about the multiplier effect is that so few kids can affect the attitude of so many," says Thomas Nagle Jr., vice president of marketing for the dairy association, the group behind the "Got Milk?" ads.
Tremor will launch perhaps 20 U.S. campaigns this year, up from 15 in 2003. Woehrle says it will turn a profit by the end of the fiscal year, June 30. Faster expansion doesn't make sense because P&G recognizes that its stealth sales force can get bored too easily. "Sometimes it's a hassle if you get more than one e-mail, and they want you to fill things out," says Jill Markowitz, 18, a freshman at New York University, who reports she has received some 30 solicitations.
Who gets tapped? Tremor looks for kids with a wide social circle and a gift of gab. Using e-mail invitations and Web banner ads, the company trolls for members and offers them a chance to register to win a free product, like a DVD player. To register, kids fill out a questionnaire, which asks them, among other things, to report how many friends, family members and acquaintances they communicate with every day. (Tremorites have an average 170 names on their buddy lists; a typical teen has 30.) Only the most gregarious prospects, about 10% of respondents, are invited to join the network, which is billed as a way for kids to influence companies and find out about cool new products before their friends do. To help keep them interested, P&G sends them exclusive music mixes and other trinkets, like shampoo and cheap watches. The Valvoline participants just get a few car-care tips. (Like this: For a lint-free shine, use a cloth diaper.)
The network includes kids like Glendan Lawler, a freshman at UC, Berkeley who says he talks to everyone, even strangers on the bus. He has been tapped for DreamWorks and Coke. "My friends will usually agree with me. They say, ‘That sounds good; I'll look into it.'" Nicholas Smith, another Berkeley freshman, got introduced to the Toyota Matrix through Tremor. "I'd never seen a car with that kind of sound system," he says. "I'd definitely consider buying one." Jared McCullough of Newnan, Ga. acted on his enthusiasm. The high school senior bought a Tombstone Pizza and passed out Tremor coupons for the frozen Kraft product.
Information can spread like the flu in small towns. There are nine Tremor recruits in Glendive, Mont., and these aren't necessarily the coolest kids in school. That's one reason P&G likes them. Why? The hipsters who are the first to try something new don't want everyone copying them. "A lot of companies, including our own, chased early adopters for a long time, frankly with mixed business results," says Steve J. Knox, Tremor's vice president of business development. "They adopt a product early in its life cycle, but that doesn't mean they talk about it."
What makes kids want to discuss company products? "It's cool to know about stuff before other people," says Staten Islander Jones. Last May CoverGirl sent a group of gals a booklet of makeup tips in a thin round tin with some $1-off coupons. Nothing fancy, but CoverGirl wanted to see if it would give its lipstick, mascara and foundation a boost in Hartford, Conn., Jacksonville, Fla. and Norfolk, Va. It did. Claimed purchases, based on P&G interviews with teens before and after the program, rose 10% among teens in those cities.
"Teens are one of the most disempowered groups out there," says Tremor's Knox. "They are filled with great ideas, but they don't think anyone listens to them."
Coca-Cola Co., for one, does. In a recent campaign to boost sagging sales of Vanilla Coke, it asked Tremor kids for ideas of "smooth and intriguing" messages for cans it is rolling out this summer. The gimmick: As it warms in a drinker's hand, a heat-sensitive can might display such sayings as, "You are what you ride" and "Fashion is required. Taste is acquired." "That's a great thing to talk about tomorrow at lunch," says Andrew Schrijver, a freshman at Poly Prep Country Day School in Brooklyn, N.Y., one of 21,000 Tremor members in the New York metropolitan area.
George Silverman, author of The Secrets of Word-of-Mouth Marketing and an Orangeburg, N.Y. consultant, offers a caution: "It's like playing with fire: It can be a positive force when harnessed for the good, but fires are very destructive when they are out of control. If word-of-mouth goes against you, you're sunk." Says David Godes, a business professor at Harvard: "If it gets too pervasive, there could be a consumer backlash. It needs to stay on the periphery."
Another risk: Some kids may like to talk, but not to push products on their friends. Laura Skladzinski, a freshman at NYU, admits she keeps goodies and coupons to herself when she likes them and passes them on when she's not crazy about them. Her friend Jill Markowitz conceded she feels awkward hawking products. When she handed out some samples of Clairol Herbal Essences Shampoo to pals last year, "I felt a little weird."
Tremor executives admit they need to learn more about people in the network. There have been mismatches of products and pitchfolk. In May 2002 a feminine care "learner's kit" by Tampax went out to Tremor teen girls who were too old for such hand-holding; the effort fell flat. Fifteen-year-old Andrew Schrijver recently got the come-on from Valvoline--even though he doesn't have a learner's permit. His dad, Robert, is upset that Tremor portrays itself as a forum for opinion sharing when it's really trying to hawk products: "If they're going to try to sell things to kids, they need to make it explicit that this is a selling channel."
P&G can't afford to alienate parents. The $43 billion (fiscal 2003 sales) packaged-goods giant is starting to build a new network of equal or greater size, one that will focus on moms--a much bigger and more affluent target than teens--who will be asked to help flog Tide, Pampers and Bounty paper towels, among other brands. Says Stengel, P&G's marketing chief: "The possibilities are almost limitless."
Sidebars
Cross-Pollinators
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Charts
Forced Among Peers
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