Everybody wants to usher in the next big thing.

Could Paul Rand be onto something?

“I think that this is, in our marketplace, truly one of the most transformational shifts in marketing since the advent of television.”

Rand, president and CEO of Zocalo Group, a Chicago marketing firm, is making a very big statement about a pretty little thing.

Our mouths.

“Word-of-mouth is the fastest growing sector in all of advertising,” he added. “The tides are shifting so dramatically that we are in a bit of a what-to-do-next mentality.”

Over ninety percent of consumers say the number one place they go to get information on products and services are friends, family members or trusted “influencers.” said Rand. Traditional advertising is moving farther and farther down the list and companies are beginning to realize this, he contends.

“The ability to interrupt people into paying attention dwindles by the day,” he said. “Marketers are forced to find better ways to engage their customers and buyers.”

In 2006, $981 million was spent on word-of-mouth campaigns, a 36 percent increase from 2005.  In 2008, the number is projected to hit close to $1.5 billion, according to research by PQ Media.

Word-of-mouth doesn’t necessarily pertain to face-to-face contact only, as blogs and brand-specific Web sites are becoming an increasingly important vehicle for sharing product and service impressions.

Laphroaig Scotch, a niche whiskey produced in Islay, Scotland and distributed by Beam Global Spirits and Wine Inc. in Deerfield, Ill., is what the company’s chief marketing officer Rory Finlay calls a “tough whiskey to drink.” It’s polarizing, he clarified, the sort of whiskey an afficianado works his or her way up to – and also an apt product to run a word-of-mouth campaign with.

Beam Global began to market primarily to Laphroaig’s enthusiastic fan base in hopes of ramping up that ardor even more. Who Finlay calls “friends of Laphroaig” can sign up to receive the (free) deed to a square foot plot of land at the distillery, invitations to visit, and a free dram of whiskey among other perks.  Beam Global hosted an online whiskey tasting last December that drew nearly 12,000 viewers. Although they haven’t measured exactly what these efforts have meant in terms of dollars for Laphroiag, “My gut tells me that sales went up,” Finlay said.

He sees word-of-mouth not necessarily as something that is going to pay off in obvious ways, such as driving business up 20 percent in a given period. It’s more to create “brand fans” that are going to purchase and evangelize their product over a competitor's--and over time.

“We want people to say, ‘I love this brand more than any other,’” he said. “I’d much rather have 5 million Jim Beam brand fans than 20 million people who occasionally think about it.”

Not surprisingly, the percent share of time spent with traditional media, such as TV, radio and newspapers, has been on the decline since the early 1980s, now hovering around the 60 percent mark.

New media, such as cable TV, videogames and the Internet, on the other hand are on the opposite trajectory, moving from a zero percent share in 1981 to 30 percent in 2006.

Less expensive than traditional advertising and more transparent than campaigns using people posing as experts, word-of-mouth’s intent is to organically “influence” conversations consumers have with one another and share experiences had with a product or service, good or bad. And with sluggish 2007 ad revenues and threats of a recession looming large, brands are looking elsewhere to get the message out, Rand contends.

“That shift is actually already occurring quite dramatically,” he said. “Threats of a recession could end up driving that even further.”

With sobering economic news streaming in almost daily, people will likely be spending less in coming months, and with a dwindling base of rabid consumers, brands may have to rethink their costly methods of courting a loyal following. Television advertising may reach a large number of people, but high costs and media fragmentation may not deliver the desired return on investment.

“There are a lot of cheaper options,” said Joe Chernov, director of communications for Boston-based BzzAgent, a word-of-mouth media channel that uses people who volunteer to be agents to start brand conversations among friends and family. “They’re not just looking for cheap.”

They’re looking for effective. And word-of-mouth, the proponents say, is the answer.

Yet marketers are quick to point out that the old advertising methods aren’t going anywhere anytime soon.

“Were not saying that traditional marketing is over with,” said Geno Church, word of mouth inspiration officer for Brains on Fire, a marketing firm in Greenville, S.C. “People pick and choose what they want to listen to.”

“And that’s where word-of-mouth can help a company in a recession,” he added.

Al Muñiz, associate professor of marketing at DePaul University in Chicago, said that any effective marketing will successfully “cut through the clutter.”

Consumers are exposed to roughly 3,000 commercial messages a day, he said. Whether it’s zipping past a billboard on the expressway or barely registering the Starbucks cup in your coworker’s hand, we are unwittingly pawns in the marketing game. Clutter begets more clutter, he said, and in times of recession those messages tend to become more heavy-handed, and annoying, in order to be heard.

“Word-of-mouth breaks through that clutter,” he said. “But a lot of people are doing it.”

When a lot of people are doing anything, he contends, that creates more clutter. Unscrupulous marketers have used the dangling carrot of trusted word-of-mouth as a manipulative way of spreading buzz about a product, whether it’s staging conversations in crowded public places or posing as enthusiastic customers on Web sites and blogs.

“You cannot poison your own drinking water,” Rand said. “The moment you get into non-transparency… you’re dead.”

This is what marketers are grappling with – creating honest, fully disclosed conversations about a brand without getting lumped in with those going about it in underhanded ways, he said. The Word-of-Mouth Marketing Association, of which Rand is a member, was formed in Chicago in 2004 to regulate marketing strategies and has asked the Federal Trade Commission to set additional guidelines to prevent dishonest or disruptive word-of-mouth practices.

Yet when marketers get it right, it can become a potent weapon in the branding arsenal.

Moreover, the feedback that consumers give on Web sites can shape a brand into creating products that they don’t just think their customers want, but they know their customers want.  When a brand changes the conversation, it can change a product.

According the Word of Mouth Marketing Association Web site, specialty pet retailer PETCO Animal Supplies Inc. began adding a customer rating and review system on PETCO.com in 2006. Using a homepage sweepstakes promotion to attract reviewers to comment on products, participation increased 800 percent in roughly one month. The company began an automated feed that would zip negative reviews to the customer service department in order to improve products and create more loyal customers.

“I think it’s a good sign that brands only become more authentic,” Church said. “They’re forced to dig into their DNA and say, ‘this is what we stand for.’”

The brands that are more authentic and are engaging customers in a dialogue have a better chance of survival in tough times, Church added.

“Advertising is the first thing to cut when things like a recession hit,” Church said. “If you’re already in that conversation, then chances are, you are that brand that the extra $100 [customers] have a month, they’re going to put towards your services.”

However, word-of-mouth is not without its skeptics. Bob Bailey, executive vice president of market research at Energy BBDO, a marketing firm in Chicago, sees its place in his business, yet not necessarily as a technique that could dethrone the traditional advertising juggernaut.

“It’s good for people that are operating on the basis of a hope and a prayer,” Bailey said. “It’s had a long, noble heritage and been part of the marketer’s tool kit forever.”

Word-of-mouth, after all, is the oldest form of advertising. Whether it was cave paintings in 3000 B.C. or telling a neighbor about a cobbler’s shop in Colonial Williamsburg, this is hardly a revolutionary concept. Bailey thinks that the amended strategy of relying on influencers to spread the word where a blast of television advertising may have been the only option before is best suited for smaller, niche brands that are just starting off

“These are brands that have an edgy image or something that is really unique or different to them,” Bailey said. “Your typical new scent of Glade is not going to get that kind of buzz.”

Joe Chernov disagrees. He said that BzzAgent’s most successful campaigns, measured comparing sales changes in regions utilizing their services, involve an everyday product that fits a certain need, such as a plain old surface cleaner.

“It’s not the breakthrough, revolutionary product that has a busload of features,” he said. “Some consumers get intimidated by that.”

The smaller, everyday items are the things consumers will likely continue to buy during a recession. If brands have poised themselves to have a dialogue with their customers while relying less on expensive traditional advertising, this may turn out to be a win-win for marketers and consumers on the potentially tough road ahead.

“The brands that already have a passionate base,” Geno Church said, “are the ones the recession is going to be easier on – if we fall into one.”