I was just looking at an interesting presentation I found on SlideShare on this subject and one of the slides presented the following 2 facts
- A London School of Economic study showed that a 2% reduction in negative word of mouth increased sales 1%
- A Dell study on Word of Mouth showed that average customer is worth $210 in revenue, an average detractor costs a company $57 and an average promoter generates $32 in sales.
In tradional marketing, reputation management is somwhat easier to manager but with the lightening fast pace of social media you have to be ready for rapid reactions to negative word of mouth as well as quickly promoting good word of mouth.
Taking this into consideration, how much effort and resources do you or your clients put into reputation management in your social media efforts? As I am just heading down this road with a couple of clients we are just beginning to plan for dealing with bad word of mouth and I am interested to hear from people who are actively doing this.