Why Is Word of Mouth Marketing so Important?

Word of mouth marketing is having a new heyday since the advent of the Internet and social media. It would be a mistake to gloss over word of mouth marketing as something which happens between people over their garden fences... After all, “viral” content is essentially word-of-mouth marketing taken to an extreme level. But beyond the initial exposure to your brand, there are several reasons why having a word of mouth marketing strategy is a good idea for any brand:

What is word of mouth marketing?

Word of mouth marketing (sometimes referred to as WOM marketing or WOMM) is the way a brand's products, services or actions encourage people to spread the word of the brand organically. WOMM is also a free form of advertising. Past whatever costs the initial action has, promotion of the brand happens through individuals who are willing to use their own social currency to promote yours. The only potential downside of word of mouth marketing is that it can also be caused by negative products, services or actions. This is why it's so vital to keep your customer service levels as high as they possibly can be. Jeff Bezos's famous Zappos brand has essentially made this the basis of their entire marketing strategy. It works!

Why is it different from referral marketing?

Referral marketing is word of mouth marketing on a more focussed, targeted level. Instead of acting, speaking or serving your clients in a certain way and gently encouraging word of your deeds to spread, you target specific individuals and proactively encourage them to refer you to their friends. This usually involves things like referral codes or vouchers to incentivise the referral process. In a way, referral marketing is a kind of WOM marketing. In another way, it's completely different.

Why is having a word of mouth marketing strategy important?

There are several reasons why a word of mouth marketing strategy is good for your business:

1) You build trust

People trust their friends. If your friend tells you something is good, you are more inclined to try it for yourself – even if you normally wouldn't.

• According to Nielsen, 92% of consumers believe their family and friends over other advertising
• Even anonymous reviewers are believed 70% of the time – which means people trust potentially fictional strangers over your advertising

This is the major element of human nature which WOMM strives to take advantage of.

2) You encourage loyalty

Customers who have had your brand recommended to them by a friend are more likely to stay with you than those who haven't. Goethe University did a study on the subject which seemed to show that people are around 18% more likely to stay with a brand that people in their peer group or friendship circles use. It might be the continual reinforcement of the initial trust and belief in the brand that their friends' recommendation sparked. It might be subtle peer pressure or herd mentality to “be like everyone else.” But the loyalty-enhancing effects of word-of-mouth recommendations have been proven to exist.

3) You make people talk

Sometimes called “buzz” or “spreading brand awareness”, planned and unplanned WOMM advertising events can get people talking about your business. Plan to take advantage of every opportunity:

• Offer fantastic products and service – and encourage your customers to show off what they do with them.
• Provide great customer service – and be seen to be doing so. Know that every interaction you have online can potentially be a public relations disaster – or a gold mine.

In the interconnected world of today, where a single comment or experience can go viral if it's picked up by enough people, having a word of mouth marketing strategy is more important than ever before.

Do you find word of mouth marketing more like a game of Chinese whispers? Local Fame helps franchises of all sizes create their word of mouth marketing strategy and execute it. Contact us today and tell us about your current WOMM woes.