I’ve been reading some very interesting commentary over the last few weeks regarding McKinsey’s article on word-of-mouth equity (such as this and this). It’s interesting stuff, putting aside the fact that they’re arguably trying to re-brand “social capital” as “word-of-mouth equity”.
And it’s useful – particularly during those conference panels or client meetings when you know people will listen that bit harder when you mention that a heavyweight organisation such as McKinsey has recently published an article on the importance of word-of-mouth and how it can be measured.
But I believe this article demonstrates that too much of our time is based on defining theoretical models rather than practical, day-to-day indicators of the impact of social capital.
The table below is taken from the McKinsey article and attempts to explain how the effect, or impact, of word-of-mouth can be measured.
The theory behind this table is simple and compelling. However, my issue is that I just don’t see how ‘impact’ can be practically and cost effectively measured.
Earlier this week, I received the following email from McKinsey, explaining to me just how active their own online community is.
It’s interesting to see that they seek to demonstrate the importance of the dialogue on their own site in terms of the ‘volume’ of mentions, rather than its ‘word-of-mouth equity’, rather suggesting that they too find it hard to measure ‘impact’.
Measuring ‘impact’ in practical and cost effective ways is undoubtedly a challenge. But I believe our goal in this area needs to shift from building theoretical models to defining useful indicators of impact that can be measured on a daily basis.
[...] McKinsey’s social theory is better than its practice [...]