If You Don’t Have a Word of Mouth Marketing Strategy, Here’s Why You Should

Have you heard? Word of mouth marketing (WOMM) is an organic and affordable method of generating awareness and enthusiasm for your business and brands. Unlike traditional marketing or advertising, it creates chain reactions, causing your customers and prospects to share what they have learned or experienced with others, on your behalf. One positive interaction leads to another and another with a multiplying effect.

Implementing a WOMM strategy is free or at the most, very inexpensive. Once you have your word of mouth strategy in place, it’s one of the most powerful and cost-effective ways to promote your business.

Consider these statistics:

• 75% of people don’t believe ads, but 92% believe brand recommendations from friends
• WOM generates 2X more sales than paid ads
• 74% of consumers identify word of mouth as a key influencer in their purchasing decisions
• Around 91% of B2B buyers are influenced by word of mouth marketing

• Beyond friends and family, 88% of people trust online reviews written by other consumers as much as they trust recommendations from personal contacts
• Just 33% of businesses are actively seeking out and collecting reviews

There are two types of word of mouth marketing

Word of mouth marketing can occur naturally, or with targeted campaigns. Successful WOMM businesses harness the power of both approaches with ongoing promotions:

1. Organic: This happens naturally when customers love your products, services, and the customer experience and will go out of their way to advocate your brand to their network.
2. Amplified: This happens when marketers harness the power of WOMM through marketing promotions and/or advertising campaigns to encourage and reward more WOMM.

Why is word of mouth marketing so effective?

The average consumer today is saturated with advertising messages through traditional channels including television, radio, and print. And now there’s also digital channels like online advertising, websites, SEO, email marketing, and social media marketing. If you’re old enough to remember, saturation was a problem in the 80’s and 90’s before the emergence of digital channels. Consumers had grown tired of advertising and marketing decades ago! Now they’re overwhelmed and many are shutting off the channels they trust least.

But who do they trust most? People they already know: friends, family, coworkers, industry peers, and contacts of close contacts. If you’re not using the strategy and channels that promote your brand through people your prospects and customers already know and trust, you’re not grabbing the lowest-hanging fruit with your marketing spend. Even worse, you’re leaving it for your competitors to grab.

The advantages of word of mouth marketing

Most businesses don’t realize the many positive impacts of a well-executed WOMM strategy, until these benefits start compounding:

• Grow sales more cost-effectively: The less you spend on key marketing metrics like CPA (Cost Per Action) and Customer Acquisition Cost (CAC), the more you can invest in your products and services. WOMM is the most cost-effective form of marketing.
• Create BUZZ: Remarkable products and services + consumer engagement = potential for brand buzz. That can lead to media coverage and accelerated, super-energized WOMM.
• Focus on growing a community of brand advocates: Engaged customers don’t just buy more of your goods, they engage their contacts who then become your newest customers and advocates. Engaged customers buy more often, discuss their brand experiences in person and online, recommend your products, and generate much higher Customer Lifetime Values (LTV). These audiences are self-reproducing, whereas traditional advertising audiences are relatively static.

• Build brand loyalty and trust: Positive WOMM creates a cycle of increasing brand loyalty and trust because consumers validate each other’s experiences, making them more meaningful and memorable. Consumers also enjoy the feeling of being part of a group and having a communal experience with your brand.
• Make your business more attractive to investors: Want more funding to grow your business? The previously mentioned marketing metrics are studied by banks and angel and venture funding companies. Businesses that can cost-effectively acquire customers and extract more value from their customers are worth investing in because of their growth potential.
• Overcome inevitable stumbles: Once in a while, even the best businesses produce a dud product or deliver an underwhelming service. In the age of the empowered consumer, word of your stumbles will get out, and you need a counteracting force to assure new prospects that your business can be relied upon to meet consumer expectations.

Convinced that your business should develop and implement a word of mouth marketing (WOMM) strategy? Check out our other article on the subject for seven tips to get you started on WOMM!