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When was the last time you asked someone for their opinion before buying a product?
Or did you buy a certain product only because a friend recommended it to you?
We live in the digital age where we are bombarded with advertisements everywhere.
Billboards, posters, flyers, digital ads, and email marketing are ubiquitous, but the good thing is that we can tune out the noise.
Consumer buying decisions have changed over time. They do their research first before buying a product or service. They ask for feedback and opinions or they listen to the advice of people or influencers they trust so much.
People today are concerned with authenticity and are more likely to trust the word of their friends or families. After all we want to get value for our money when making a purchase decision—especially with unfamiliar products or services.
This is where the magic of word-of-mouth marketing comes into play.
What Is Word Of Mouth (WOW)?
Word of mouth is a strategy that relies on consumers' experiences with the company's products or services and recommendations and referrals they share with friends and family.
It occurs when someone is not directly affiliated with the business, but talks about your business or recommends the products to others. They may not have paid for it, but they are still promoting the company's products and services.
Word-of-mouth is an effective and inexpensive way to advertise, attract and gain customers. When someone speaks positively about your business, your company's name unconsciously becomes known and that leads to sales.
Word-of-mouth helps to build the buyer's confidence and show them that buying from you is not a mistake.
Word of mouth does not stop at a single interaction. It is like a domino effect. It continues from one person to the next, and that person will continue the chain and spread the word, making it a great tool for awareness and spreading the word if used properly.
There are 3 principal factors that are influencing word-of-mouth strategies.
- Brand loyalty - returning customers tend to buy more from a company over time. The customer continues to buy from your business not because you are the only option, but because they trust your business.
- Brand Trust - People trust friends, family members, and even strangers more than they trust your advertising. According to Hubspot 75% of people do not believe in advertising, but 90% trust recommendations from family and friends, and 70% base their purchases on consumer reviews. Therefore, word-of-mouth makes your brand recommendable in the most trustworthy context possible.
- Create a buzz - there's nothing wrong with having a budget for ads and running perfect sales funnels, but the best way to create a buzz about your brand is through customers' shoutouts and posts about your brand on their social media. It has always been proven that good word of mouth is the best marketing strategy to generate sales and grow networks. And creating a customer lifetime value.
Consider Tesla, the company has eschewed traditional advertising. According to their CEO, Elon Musk, word of mouth is enough to drive demand beyond production. They have no plans to advertise, but maybe sometime in the future, they will consider advertising, but not to advertise, just to inform people and make sure they know about the product. Considering how Tesla has evolved so far, Elon Musk is probably right. Advertising is not his thing and never will be.
Benefits Of Word Of Mouth
The following are some benefits of word-of-mouth marketing:
- Low cost - it is organic and free, meaning there is no money involved. Since you are not paying for the real word of mouth, this type of marketing strategy contributes to lower costs since others are doing the work for you. It increases sales with little advertising spending.
- Develops loyalty - since word of mouth is a recommendation that comes from people you trust, from a familiar face, or in a valid and reputable online review, it develops trustworthiness. Happy and satisfied customers become loyal to brands and stay loyal to the brand for a long time.
- Build an online community - building an excellent online brand community is one of the benefits of word-of-mouth marketing. The members of the brand community will act as advocates of your brand in digital media. This brings a positive outcome for your business. And likewise, negative word of mouth about the brand hurts the community. Therefore, it is necessary to hire professionals in this matter.
- Authenticity - Nowadays, people are always looking for authenticity. Young consumers are more inclined to associate with companies that share their values and what they believe in. They can easily identify with them, which builds trust and authenticity between them. It is much more valuable to build a relationship with people who are genuinely interested in your products and services than to advertise to the masses.
The Value Of WOM Marketing
Before social media, word of mouth was limited only by the number of places you went and the number of people you dealt with.
But thanks to social media, what you share can reach not just thousands but millions of people in just a few seconds. And it will not stop at just one interaction.
One person will tell another, and that person will tell another, and so on. With each share, tweet, forward, and post, exponential growth is possible. It's a cost-effective way to get your business and products known in online and in-person communities.
That's how powerful word-of-mouth marketing is. I personally believe that the goal of any marketing strategy is to lead to word of mouth; that is when your product market itself without any direct active marketing work.
Word-of-mouth marketing is an important factor for a growing business. It does not matter how many marketing consultants you hire or how many e-commerce conferences you attend, but if you cannot provide quality customer service to your customers, you'll be left behind down the road and miss a huge word-of-mouth marketing opportunity.
It is easier for customers to spread the word about your company's products or services if you are good at solving their problems, and sometimes they even do so unconsciously.
This can be very profitable for you as you will spend less money on marketing and more on your business.
Word-of-mouth is one of the most powerful tools for getting your message out to the public. It's a cost-effective strategy that still works today, and I doubt it will die in the future. Trust, after all, is why people will buy your product over and over.
It is also important to know that there are other strategies you could leverage to reduce customer churn.
Finally, remember that it is a double-edged sword strategy.
If you stop satisfying your customers, they might use the same approach to blow a hole in your business.
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