Chapter 1: The Power of Success-Story Marketing™

Whether we’re aware of it or not, as humans, we tend to follow certain patterns of trust and decision-making. Success-Story Marketing—using customer, beneficiary, or member stories to advance a product, service, idea, or cause—caters to some of the fundamentals of human behavior:

• We trust what others say much more than what a business itself says
• We look to others to determine how we should act
• We love to hear about other people

In Friends and Strangers We Trust

Think back to the last time you tried a new restaurant or watched a movie. How did you choose where to eat or what to see? You probably saw newspaper advertisements, and maybe even interviews with stars of the show. But chances are, you really picked the place or the movie on the recommendation of a friend, family member, or coworker. If not one of those, then it was likely due to a good review in the newspaper or online from people you trust as authorities on cuisine or cinema.

And what about your latest electronics or vehicle purchase? Maybe you talked with others who have brands and models you’re considering, consulted Consumer Reports for ratings, or checked online sites with customer reviews. Likewise, you probably wouldn’t select a realtor, babysitter, financial advisor, or any other important service provider without some sort of positive third-party endorsement.

In fact, information put out by actual companies ranks low on the list of trusted sources as buyers make decisions. The business itself is good for details such as specifications, how something works, or pricing. But most of us don’t truly believe the benefits espoused by companies—unless they are verified by other trusted sources. Just about everyone else is more credible than the business itself.

The following survey by Bridge Ratings and the University of Massachusetts, published on eMarketer.com, breaks down trusted sources of information.

On a scale of 1-10, "Strangers with experience" receives a 7.9 in a survey of trusted sources of information, while a company’s own advertising receives a 2.2.

As expected, someone you know personally tops the list, with "strangers with experience" a close second, and the media falling in behind. Comparatively, advertising (vendor-produced promotional materials) scored a 2.2 on a scale of 1-10. Advertising has its place in creating awareness, but clearly must be backed up by other sources to get buyers to make a purchase. Customer stories perfectly fill the "strangers with experience" category, providing the third-party validation that buyers, donors, or others need to make a decision about products, services, or an organization.

The ‘Like Me’ Factor

As teenagers, we begin rebelling and expressing our individuality–by looking and dressing just like all our friends or the celebrities we admire. According to Robert B. Cialdini, author of Influence: The Psychology of Persuasion, that’s because the actions of others help us decide how we ourselves should act. He calls it "social proof," or the "like me" factor. "The principle of social proof operates most powerfully when we are observing the behavior of people just like us. That is why I believe we are seeing an increasing number of average-person-on-the-street testimonials on TV these days… As a rule, we make fewer mistakes by acting in accordance with social evidence than contrary to it."5 People perceive less risk when others have successfully gone before them.

James March and Johan Olsen named a similar concept the "logic of appropriateness." They say decision-making results from following a set of rules consistent with an identity.6 In other words, people ask themselves, "What would someone like me or an organization like this do in this situation?" If it’s our nature to emulate others, especially people or organizations we admire, then customer stories provide a model of behavior for audiences—even more so if the featured customer has faced similar challenges or is in the same industry as the reader. In fact, the more the story sounds like the prospective customer’s situation, the more relevant and valuable it is in the decision-making process.

We Love to Hear about Other People

People are also people oriented. On a personal level, we want to know what our neighbors are up to, or our favorite celebrities. Human interest stories in the media are always the most captivating. The same goes in business. Even when you’re talking about products and services, readers are more engaged when there’s a human element. Products and services don’t function on their own; rather, people interact with them. People encounter challenges to overcome, become heroes, find solutions, and ultimately triumph. Following the basic journalism rule, "people love to read about people," customer stories provide the perfect framework to capture the human elements of just about any situation.

Stories Make it Stick

Stories play a starring role as one of the "six principles of sticky ideas" in Chip Heath and Dan Heath’s popular book, Made to Stick. Sticky ideas or concepts leave an impression on audiences, helping them remember and understand. The Heaths assert that stories provide both simulation (the opportunity to imagine scenarios), and inspiration (which comes from seeing others’ successes and being moved to act as a result). At the same time, stories provide the opportunity to integrate three other Made to Stick principles of sticky messaging:

• Concreteness – A way of making abstract concepts more concrete and understandable, such as how technology works.
• Credibility – The opportunity to provide a level of detail, which is more convincing than a lack of specifics.
• Emotion – Again, providing specifics gets people emotionally engaged in a way that generalizations do not.

Stories help people imagine scenarios and gain inspiration from seeing others’ successes—and they are moved to act as a result.

The 3 Roles of Success-Story Marketing

With the science of stories behind us, let’s talk about the practical aspects of using customer stories to help persuade audiences to buy a product, try a service, or support a nonprofit:

• Credibility
• Education
• Validation

Credibility: A Real Company with Real Customers

As the graph on trusted information sources indicates, it’s hard to establish credibility in buyers’ minds without third-party evidence. Otherwise, they find it too much of a leap of faith. And the need for evidence is directly proportional to the price tag, perceived level of risk involved, and importance of the decision to the buyer or company. We don’t need nearly as much information or validation to make a decision about which ice cream to try as we do about which car to buy.

In recent years, the need for credibility has only accelerated. In the ’90s and 2000s, the business world saw a number of shake-ups that have left buyers understandably leery about the companies to do business with. In the early part of the new millennium, quite a few major companies were discovered to have unethical or illegal business practices. Enron was the most high profile of the bunch, with irregular accounting procedures bringing the company to bankruptcy in 2001. Its accounting firm, the once prestigious Arthur Andersen, fell soon after. And then came Tyco and WorldCom.

About the same time, the high-tech bubble burst after many heady years, resulting in countless corporate casualties. Companies were open one day and closed the next. They would spend years developing a product, with no income, until finally they had to close their doors. Venture-capital firms and banks couldn’t keep throwing money at businesses taking too long to reach a profit.

After all that, buyers are understandably hesitant about the products and services they choose. Will the company be around next month to create new-product releases and provide adequate product support?

"The need for documented customer successes has been largely driven by the technology sector," says Steven Nicks, Partner and Cofounder of Phelon Group (www.phelongroup.com), a firm that focuses on customer retention, referability, and repurchase. "In the late ’90s, we saw people making major technology purchases that didn’t pan out, so in subsequent years people demanded to hear from those individuals who had already successfully deployed the solution. And for the savvy tech company, it was a way of gaining credibility and a competitive edge."

While having real customer stories doesn’t ensure a business won’t go under, it does demonstrate that an organization has actual customers using products and services—and seeing results. That goes a long way toward establishing peace of mind for audiences.

Education: Show, Don’t Tell

Marketers and business owners put a lot of thought into how they communicate about their offerings. But as much as they detail how their products and services work for users, there’s often a gap between those descriptions and readers’ understanding of how they will actually work in their environments—all the more so when the products or services are complex. Remember the lesson from high school English class, "Show, don’t tell?" You have to show readers what you’re talking about, descriptively and in context, rather than just telling them that your product or service accomplishes this or that. Mark Twain put it another way, "Don’t say the old lady screamed—bring her on and let her scream."

Buyers have a lot of questions. How will services be delivered in our environment? How is this vendor different from others? How long does an implementation take and who’s involved? How will a product generate time-savings in our workflow? What can we expect in terms of ongoing support? What does the vendor do that gets the results we want?

Customer stories answer many of their questions. They are especially effective when they mirror the reader’s situation. A growing manufacturing company wants to hear how another similar manufacturing company reduced production time. A small business needs to understand how a search-engine optimization firm increased Web site traffic for a similar business. Customer stories offer the perfect opportunity to show a product or service in action for a customer, making them very valuable marketing and sales tools. It’s just the type of information buyers are looking for as they learn about a solution or organization.

A survey by KnowledgeStorm (www.knowledgestorm.com) and MarketingSherpa (www.marketingsherpa.com) sheds light on the role of case studies, particularly in IT purchase decisions. The survey, with results published in How Technology Marketers Meet Buyers’ Appetite for Content, asked nearly 4,000 B2B marketers, and technology and business professionals, what buyers want and what marketers deliver. The survey revealed that buyers expect you to educate them. In fact, 84% said they want content that educates them and expect vendors to provide it.7

Customer stories provide critical education about how solutions actually work in real environments.

Guerrilla Marketing for Consultants, by Jay Conrad Levinson and Michael W. McLaughlin, stresses the importance of customer stories in helping prospects understand exactly what it would be like to work with a consultant. "These documents can answer the number one question clients ask consultants: ‘How will your team work with our team to achieve the results we need?’ Case studies also clarify approaches, strategies, and resources that you have successfully employed on other projects."8

Validation: Demonstrating Results

Everyone has competition, whether it’s another organization like yours or the current arrangement in prospective customers’ environments. In Selling to Big Companies, author Jill Konrath points out, the status quo is often your biggest competition. Even if companies have problems to resolve and opportunities for improvement, they "just have so much on their plate that they can’t add one more thing—no matter how worthwhile it seems."9 Therefore, you have to demonstrate that the short-term pain of making a change is worthwhile in the long run.

Likewise, with so many options out there, buyers are cynical and believe another solution just like yours is around the corner, maybe even at a lower price. "The only thing that seems to counteract it is real customer stories with actual, tangible, and measurable results," Konrath says.

Findings on Customer-Story Effectiveness

Customer stories and anecdotes are powerful for just about any type of organization. But because they have typically been more a marketing staple of high-tech companies, the small amount of research available tends to be related to technology purchases. The survey, How Technology Marketers Meet Buyers’ Appetite for Content10, revealed intriguing findings on the role of customer stories:

• 67% of those surveyed often read case studies (customer stories) in the buying decision—putting case studies as the #2 choice just behind white papers in terms of desired content.
• Buyers like objectivity – Customer stories, articles from industry journalists, and analyst reports are all frequently forwarded by buyers. The study indicates the perception of objectivity makes them of interest to the broadest number of individuals in the IT decision process.
• Buyers need to solve a problem – When they start the search for a new technology, nearly 72% of respondents want to find "solutions to solve a current problem." Customer examples show very clearly how a solution solves a specific problem.
• They want it targeted for them! – Nearly 82% of technology buyers prefer information targeted to their industry. Customer stories are a key way to demonstrate real-world successes with specific industries and types of problems.

Similarly, when TechTarget (www.techtarget.com) and CMO Council (www.cmocouncil.org) took a closer look at the inner workings of how information technology (IT) buyers make purchasing decisions in its 2007 Technology Buying and Media Consumption Benchmarking Survey, they found an interesting gap between case-study use and effectiveness. 28% of IT buyers surveyed use customer case studies in technology purchases. But when used, they had a 75% rate of effectiveness. The survey pointed out that customer stories showed the greatest gap between effectiveness and actual use of all the marketing communications it asked about. That led the survey writers to predict that they are poised for increased use in the future.

Minimize Live Reference Calls

It’s clear that third-party validation is critical. Many businesses turn to their best customers to serve as live references on calls with prospects. Yet, there’s only so often you can call on busy current customers to participate in these activities, and they may not be available right when you need them. When you create a written customer story, you document the details of that customer’s experience once, and then that story often replaces a live reference call. In fact, by reducing reference calls, you can look at customer stories as effective relationship management with your most valued customers.

KnowTia, maker of OasisCRM software (www.oasiscrm.com), saw a significant drop in the need for live reference calls when it began documenting its customer stories. Before, the company regularly arranged calls between prospects and current customers. "In the first year of using success stories, we only had one live reference call," said Jeffrey White, Vice President of Sales. "Those stories give prospects the detail they need to understand other customers’ experiences without having to talk to an actual current customer."

By capturing stories of customers that are just like your prospects, those "strangers with experience" serve as compelling examples to your audience, giving them the confidence to buy from or back your organization.

Chapter Take-Aways

• We trust what other people say about products and services more than what a business itself says.
• People look to others like themselves to determine how they should act.
• Even when you’re talking about products and services, readers are more engaged when there’s a human element involved.
• Stories make concepts and ideas memorable, understandable, concrete, and emotionally engaging.
• Stories accomplish three key objectives for readers: credibility, education, and validation.
• Testimonials serve mainly to establish credibility.
• Technology buyers prefer information targeted to their industry. Customer stories are a key way to demonstrate real-world successes with specific industries and types of problems.
• Customer stories minimize the need for live customer-reference calls.

5. Cialdini, Robert B., Influence: The Psychology of Persuasion.
6. Marsh, James G. & Olsen, Johan P., The Institutional Dynamics of International Political Orders.
7. KnowledgeStorm and MarketingSherpa, How Technology Marketers Meet Buyers’ Appetite for Content.
8. Levinson, Jay Conrad and McLaughlin, Michael W., Guerrilla Marketing for Consultants.
9. Konrath, Jill, Selling to Big Companies.
10. KnowledgeStorm and MarketingSherpa, How Technology Marketers Meet Buyers’ Appetite for Content.