Newly Launched Recommendation Index(SM) Identifies Brands Most Recommended by U.S. Consumers

Word-of-mouth recommendations have long been recognized as the "holy grail" of marketing success for any product or service. Through the launch of the newly created Recommendation Index(SM), marketers now have insight into which brands are most recommended - as well as why and how - across a variety of consumer categories.

In addition to providing an overall ranking of both positively and negatively recommended brands, Recommendation Index, a joint effort between Zocalo Group and M/A/R/C(R) Research, also creates a score that marketers can use to compare against other brands in the same category.

The Casual Dining Restaurant (CDR) segment - restaurants that serve moderately priced food in a casual atmosphere - is the initial focus of what will be quarterly reports examining a variety of industries. Leading the Recommendation Index of the 10 most recommended brands are California Pizza Kitchen, Texas Roadhouse and Outback Steakhouse, followed by Applebee's and the Cheesecake Factory. Except for buffet-style restaurants, CDRs typically provide table service and comprise a market segment between fast food and fine dining establishments.

Unlike previous metrics that only ask "Would you recommend this brand?," the Recommendation Index evolves the measurement to determine why, where and how often people recommend individual brands as well as how each brand compares to the overall category.

"The recommendation of a friend, family member or expert is the number-one reason consumers buy in almost every category," said Paul M. Rand, president and CEO of Zocalo Group. "Marketers who understand where and how their category is talked about and recommended - and how their brand stacks up - gain clear competitive advantage."

The study identifies the top words or characteristics that consumers use when making a positive or negative recommendation for a casual dining restaurant. Triggers such as "fast," "variety," and "friendly" are among top indicators.

"The Recommendation Index looks not just at how consumers talk, but at their actions," noted Merrill Dubrow, president and CEO of M/A/R/C(R) Research. "We wanted to move from the hypothetical to the actual. The potential implications for brands are significant."

Recommendation Index Results

The Recommendation Index represents the proportion of positive to negative recommendations and is calculated based on the brands most often talked about positively and negatively in the CDR category. It is a single score that provides a brand with a method for benchmarking how it is being recommended in relation to specific competitors and within the overall industry.

                          Recommendation Index for the Top 10 CDRs

                        1.  California Pizza Kitchen          4.57

                        2.  Texas Roadhouse                   3.61

                        3.  Outback Steakhouse                3.16

                        4.  Applebee's                        3.04

                        5.  Cheesecake Factory                3.03

                        6.  Red Robin                         3.01



                     Average Recommendation Index for CDR Category 3.01



                        7.  Red Lobster                       2.79

                        8.  Olive Garden                      2.77

                        9.  Chili's Grill & Bar               2.71

                       10.  T.G.I. Friday's                   2.63

The average Recommendation Index for CDRs of 3.01 is the average Index value of the most recommended brands in the category. The average provides brands with a means for gauging the level of recommendation against the overall industry.

"Once marketers truly understand why and how brands are recommended in their category, they can adjust their messaging, communications - and even their operations - to ensure that they become and stay the most recommended," noted Rand.

Methodology

The Recommendation Index was created by the word-of-mouth marketing firm Zocalo Group and the research firm M/A/R/C(R) Research, and was compiled through both offline and online analysis of conversations about casual dining restaurants. A representative group of 1,020 CDR patrons were asked about brands they most often recommended positively and negatively and the attributes they use to make these/their recommendations.

The most frequently recommended brands identified in the survey research were then analyzed in online conversations occurring through blogs, forums, Twitter and other discussion venues. Online analysis focused on the naturally occurring organic conversations about those brands and the words consumers use in talking about the most recommended restaurants.

The Recommendation Index is the relationship between the volume of positive recommendations and the volume of negative recommendations. The Index will be released quarterly and focus on different industries and brands with the intent to also show the change in recommendation by industry year over year.

To learn more about the Recommendation Index, marketers are invited to participate in a webinar hosted by Zocalo Group and M/A/R/C(R) Research that will be held on Monday, Dec. 14, 2009, at 2:00 p.m. CST. To register for the webinar, please visit www.zocalogroup.com or www.recommendationindex.com.

Logos, product and company names mentioned are the property of their respective owners.

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