The marketing world is constantly evolving. However, this doesn’t mean classic methods like word of mouth marketing (WoMM) no longer do the trick.
In the competitive world in which we live, word of mouth marketing is more important than ever. Why? Let’s take a look at the facts.
Jonah Berger, the author of Contagious, explains that word of mouth marketing is so powerful because of the trust element, such that “we trust our friends more than we trust ads.”
Another reason why word of mouth marketing works is it allows for better targeting. Berger explains how your friends and family only tell you about things they think are somewhat relevant to your interests.
Word of mouth marketing is incredible since it can work for everyone, even smaller brands or startups.
It may seem counterintuitive, but many e-commerce platforms rely heavily on word of mouth marketing.
Take Ugmonk, for instance. The minimalist productivity provider estimates that 50% of the customers they convert originate from word of mouth marketing.
Ugmonk’s founder, Jeff Sheldon, explains how his company’s word of mouth strategy is straightforward: “It’s all about making remarkable products where people can’t help but tell their friends about them. So we spend a ton of time on product design and development to make products that people truly love and want to talk about.”
What is Word of Mouth Marketing?
Word of mouth marketing is a promotional strategy that uses individuals to spread information or opinions about a brand, product, or service through their networks. It involves encouraging and facilitating customers or users to share their positive experiences with others, creating positive buzz, and generating new business through referrals.
This can be done through various tactics, such as incentivizing customers to refer their friends, encouraging social media sharing, and creating customer advocacy programs. It is a highly effective marketing strategy as people tend to trust recommendations from friends, family, and peers more than traditional advertising or marketing messages.
Word of mouth marketing can also be amplified through online reviews and ratings, significantly impacting a business’s reputation and search engine rankings. Therefore, it is essential for businesses to actively engage with customers and encourage positive feedback to fuel their word of mouth marketing efforts.
Here are a few stats that support the importance of word of mouth marketing:
- 93% of consumers say online reviews influence their purchasing decisions
- 78% of consumers look up local businesses online at least once a week
- 13% of consumers don’t trust online reviews as much as they trust reviews from family and friends
Two Types of Word of Mouth Marketing
There are two primary types of word of mouth marketing: organic and amplified.
Organic word of mouth marketing is when happy customers recommend your brand on their schedule and per their free will. Amplified word of mouth marketing, on the other hand, is when brands motivate customers to spread the word via user-generated content and influencer marketing.
Let’s take a look at Tesla, for example.
Most consumers are familiar with Elon Musk’s organization, yet it doesn’t spend a king’s ransom on advertising — its success is primarily due to word-of-mouth marketing.
When Musk spoke with YouTuber Marques Brownlee, he shared: “The key to selling a product is having something people love and will talk about. If you love it, you’re going to talk and that generates word of mouth.”
Why Does Word of Mouth Marketing Matter?
Consumers today are savvy since they can research products via user-generated content, reviews, and social media posts. In short, they care what people say about your product.
There are additional benefits to word of mouth marketing, such as:
- It’s free: If you’re a startup with a small budget, you can use word of mouth marketing to promote your brand and build a strong reputation.
- WoMM extends beyond the first interaction: when happy customers talk about your brand, they keep talking and promoting your business.
- It provides crucial feedback: customer reviews help improve your product and help you learn from mistakes.
- WoMM promotes customer loyalty: in certain sectors, even a 5% customer retention rate can add at least 25% to the bottom line. Loyalty isn’t just a bonus—it impacts your bottom line.
- It builds credibility and connectivity: word of mouth marketing increases your brand’s credibility and helps you connect with new leads via social media.
The History and Evolution of Word of Mouth Marketing
Some believe that word of mouth marketing has existed since the dawn of time. However, psychologist and author George Silverman is commonly known as the pioneer of word of mouth marketing due to his development of “teleconference peer influence groups,” or focus groups, in the 1970s.
In the 1990s and 2000s, word of mouth marketing evolved with the rise of social media. Today, many contribute their two cents regarding recent purchases via social media, and most everyone turns to social media for reviews.
Naturally, brands have taken note of just how much of an impact social media and reviews have on their reputations. Instead of leaving it to consumers to spread the word, brands actively encourage shoppers to discuss their brands.
Take Apple for example. The tech leader has word of mouth marketing down to an art. Like other premier brands, Apple creates unique and innovative products that people can’t wait to talk about.
Apple also dominates due to its ability to:
- Build excitement with pre-announcements
- Make great-looking products that buyers can’t wait to share via social media
- Create easy-to-use, intuitive products
- Reinvent its products with crisp new features to keep the conversation fresh
Any business can use these methods to generate excitement and increase word of mouth marketing.
Word of Mouth Marketing Strategies and Applications
Word of mouth marketing builds trust and improves customer confidence when purchasing a product or service. If you think about it, when everyone raves about how nifty a product is, it’s got to be good, right?
However, there’s plenty more to word of mouth marketing than stellar products. You need to give customers something worth sharing and kick-start the conversation in the right direction.
Here are a few strategies you can put into play today.
Leverage Social Media for Word of Mouth Marketing
Social media is an ideal vehicle through which you can leverage word of mouth marketing since that’s where many of us go to learn more about a company. Research from BrightLocal shows that 46% of consumers went to Facebook to evaluate a local business.
Some brands dominate on social media, and you can mimic their methods.
Take Wendy’s for example. They use several tactics, including:
- humor
- customer interactions
- memes
- pop culture references
- offering freebies
Furthermore, Wendy’s believes consumers visit its social channels for entertainment value. The brand also adapts its tone for each social media platform.
Wendy’s also:
- effectively trolls the competition
- employs a team to respond to tweets quickly
- hosts regular contests to encourage follower engagement
- doesn’t hold back on its National Roast Day
Leverage Online Reviews for Word of Mouth Marketing
There’s no getting around it – online reviews are compelling. Furthermore, they can seriously make or break your business.
With the insane number of online review sites, consumers don’t think twice about turning to platforms such as TrustPilot and Google Consumer Reviews to share their thoughts. According to research conducted by PowerReviews, 99.9% of consumers read reviews, which makes them a vital part of your word of mouth marketing efforts.
The best way to cultivate reviews is to ask satisfied customers to share their experiences online.
To get the most out of online reviews, make sure to:
- use social listening tools to see what consumers are saying and address both positive and negative reviews
- use surveys to invite feedback for the products/services you offer
- include social media links to make it easier for customers to tell their friends about their experience
- offer incentives for customers to leave reviews (make sure it doesn’t violate the terms of the review site)
- add a customer satisfaction survey as part of your aftersales strategy
Once customers leave reviews, you can incorporate them into your marketing campaign.
Reputation Management as a Form of Word of Mouth Marketing
The purpose of reputation management is to effectively manage your company’s reputation by responding to negative reviews, providing superb customer service, and solving customer problems.
Like reviews, reputation management is key to any business that wants to thrive today, and marketers understand this.
According to Birdeye, 57% of marketers prefer to develop a reputation management game plan instead of paying for ads.
Furthermore, the same survey also found that 88% of multi-location marketers report a direct relationship between a phenomenal online reputation and increasing revenues.
Dave Lehman, CEO and president of Birdeye, explains:
This survey further validates that successful businesses are seeing more customer interactions and increased profits through reviews, referrals and their overall online reputation. Marketers should focus on growing their businesses through happy customers.
David Lehman, CEO and President of Birdeye
This is why big dogs like Starbucks, Nike, and Yelp use reputation management in their word of mouth marketing. Here are a few of their strategies that you can employ:
- Starbucks provides free drink vouchers for the next visit when an order is delayed. This keeps the customer satisfied and increases customer loyalty.
- Nike responds to complaints in a flash and even has a dedicated Twitter platform to ensure customer issues are addressed quickly.
- Yelp responds in an instant and is swift to own any errors.
These organizations all have sizable budgets. However, any brand can own its problems, respond quickly to complaints, and offer freebies or discounts.
User-Generated Content as Word of Mouth Marketing
Due to smartphones, consumers can easily capture and share photos and videos, which is why many describe user-generated content as the “new word of mouth.”
Major players like Coca-Cola and Hilton Grand Vacations rely heavily on user-generated content.
While word of mouth marketing is critical in every sector, research has found that it’s vital to the travel industry and helps consumers:
- Make travel decisions
- Create a sense of loyalty
- Influence tourist behavior
User-generated content works just as well for other niches.
Starbucks: White Cup Contest
Whether you’re a marketing guru or a coffee lover, you’re likely familiar with the Starbucks white cup contest. If you’re unaware of the contest, it’s one of the most well-known examples of user-generated content.
Starbucks invited its customers to decorate its coffee cups using the hashtag #WhiteCupContest. In return, the customers could win a $300 gift card. Starbucks took the contest to the next level and printed the winner’s designs on a reusable cup.
The content produced loads of visually appealing social content (and resharing of those posts) and increased Starbucks’ organic reach and user-generated product design.
The contest also ignited the company’s more eco-friendly, reusable cups. The campaign is also a nod to the trend of customers decorating their Starbucks cups. This was a subtle way for the brand to show that they see and listen to their customers.
Offer Incentives for Customer Referrals
Sometimes your customers need encouragement to start referring products or sharing your content. So, why not make it worth their while and offer incentives?
Giving incentives is a great way to build word of mouth marketing. It’s a win-win situation for both the customer and the company. Offering incentives is a simple concept, but does it work?
Yes!
Airbnb’s two-pronged incentive program is among the top programs out there. One email offers $25 to the referrer, and the other gives the referrer and their friend $25.
Airbnb found that referred customers:
- make more reservations
- host more holidays
- refer more users and send out more referrals
The referral program improved booking by more than 25% in specific sectors, and its enhanced 2.0 referral plan generated an impressive 300% additional bookings.
However, this success didn’t happen by chance. Here’s how the brand achieved success:
- Airbnb used A/B testing to find the most effective advertisements
- it combined the shopping and sharing experience
- it tracked its results
So, how can you apply this strategy? Here are a few offers to consider:
- discounts on products or services
- free shipping
- a free gift with a purchase over a specific dollar amount
You can also create a process for telling customers when their friends or family join so they can discuss their experience.
Try Influencer Marketing
Word of mouth marketing is hard to manage. You have little control over who talks about your brand, what they say, and where they say it.
Influencer marketing, however, allows brands to focus on specific communities by connecting with names they already know. It’s similar to word of mouth marketing, except on a larger, more focused scale.
Brands are realizing the value of influencer marketing, which is becoming more popular daily.
According to the 2022 State of Influencer Marketing Benchmark report, the global market is now worth $16.4 billion, and 75% of marketers already dedicate or plan to dedicate a budget to influencer marketing.
If you try influencer marketing, you’ll be in good company.
Adidas works with celebrity influencers like Selena Gomez to spearhead contests. The results can be intense – in the campaign with Selena, Adidas gained 41,000 new followers, a tidal wave of hashtags, and a 24.2% increase in sales.
You can find the right influencers for your brand and work with them to generate content to help you reach your target audience and make an indelible impression.
You don’t need a-list celebrities to see results from influencer marketing. Micro-influencers with a focused audience can be highly effective for smaller brands or niche products.
Closing Thoughts
WOrd of mouth marketing has been around for centuries, but it quickly evolving due to the internet.
Consumers have shifted away from spreading the word among their friends, family, and peers and now share their experiences via social media and review websites.
Brands can leverage these trends by weaving reviews into their email marketing campaigns, running user-generated content campaigns, and influencer marketing.
Word of mouth marketing is so powerful it can make or break a brand. The best part is that any brand or marketer can use word of mouth marketing, regardless of their budget.
While the results can be dramatic, the techniques are simple and easy to implement.
