Word-of-mouth marketing (also called WOM, WOMM, and word of mouth advertising) is the most powerful marketing tool for most businesses.
Unlike naturally occurring word-of-mouth when a friend or relative casually recommends a product or service, word-of-mouth marketing is actively encouraged and influenced by businesses.
According to a recent “Global Trust in Advertising” study by Nielsen, 83% of people polled said they trust the recommendations of friends and family.
A similar study done a few years earlier found that 92% of people trust recommendations from other people – even strangers.
In fact, marketing statistics show that 20-50% of all purchases are influenced by word-of-mouth marketing.
Unfortunately, few companies have strategies to get the most value from word-of-mouth marketing.
Let’s look at what word-of-mouth marketing is and proven word-of-mouth marketing strategies that can help marketers and businesses to increase growth and profits.
What is word-of-mouth marketing?
Word-of-mouth marketing is a strategy in which businesses actively encourage customers to send tweets, post photos, leave reviews, and spread the love for their company in personal ways.
Many companies incorrectly assume that word-of-mouth marketing just happens naturally, without any encouragement.
Instead of promoting word-of-mouth, most marketers and business owners focus on collecting likes and social media followers.
With word-of-mouth marketing, the focus switches from collecting likes and followers to actively seeking a connection with customers.
Businesses that encourage word-of-mouth marketing recognize that 100 genuinely passionate fans are more valuable than getting 10,000 emails from people entering a contest.
With a contest, there are no real stakes for customers. There is nothing to connect them in any meaningful way to your brand.
With word-of-mouth marketing, customers are so invested in your brand that they’re willing to personally recommend your products or services to their personal network.
Word-of-mouth marketing creates brand ambassadors for your business, and that’s the secret to gain real influence in your market.
Is word-of-mouth marketing effective?
Word-of-mouth marketing is more effective than other types of marketing.
Compared to traditional advertising, media mentions, and promotional events, word-of-mouth marketing can help companies grow faster.
- 74% of consumers consider word of mouth as the most influential to their buying decisions. [Ogilvy/Google/TNS]
- 68% trust word of mouth from other people. [Nielsen]
- 84% of consumers polled reported taking action because of personal recommendations. 70% of them did so because of online opinions [Nielsen]
- 81% of people polled said they were influenced by what their friends posted on social media. [Market Force]
Word-of-mouth marketing strategies that work.
Here are 6 proven word-of-mouth strategies marketers and small business owners can use to improve their marketing:
- Encourage user-generated content (UGC),
- Add testimonials and reviews,
- Display product ratings,
- Create sharing incentives,
- Launch a referral program, and
- Create an experience worth sharing.
WOMM STRATEGY 1: Encourage user-generated content.
Encourage your customers to engage more with your brand on social media, since that’s one of the primary ways customers and prospects find out about your company’s products and services.
Create share-friendly content like contests, polls, and fun quizzes. Then, get customers to share your contest or quiz, and have them tag it with a shareable hashtag.
Hashtag marketing is a great way to boost positive impressions of your business, improve the searchability of your content, and encourage more people to talk about your brand.
As we recently wrote,
Choosing the right hashtags for a post can help it to sky-rocket in popularity – gaining your content views, likes, re-tweets, and shares. All of this social activity ultimately helps to give your content and your business exposure.
Reuse the best hashtags in your company’s social feed to help build awareness and keep the momentum going.
People can connect with brands that feel personal and authentic, and they’re willing to share their own genuine experiences with brands that reinforce those values.
Aerie’s hashtag #AerieReal is an example of how using hashtags can build positive impressions and brand awareness.
With the #AerieReal campaign, the company encouraged customers to post unretouched swim photos to help raise money for charities like the National Eating Disorders Association.
Aerie fans responded with enthusiasm and submitted thousands of dollars worth in personal photos for the brand’s campaign.
The intimate connection and invitation to share personal photos created an effective word-of-mouth strategy and propelled the brand to massive success.
WOMM STRATEGY 2: Add testimonials and reviews.
Testimonials and reviews can act as powerful word-of mouth-messaging.
For example, to make it easier for our prospective customers looking for help with custom logo design, web design, print design, packaging design and even naming businesses and products, we publish thousands of crowdspring reviews from our customers, along with crowdspring case studies, directly on our site. And of course, our customers and prospects can also find reviews on third-party sites like Reseller Ratings.
Posting testimonials or reviews can be a great way of pulling word-of-mouth recommendations onto your site or social feed.
Look on websites related to your business for reviews or testimonials. Bring them over to your site or social feed, and make sure to link back to the original review and/or identify the reviewer to help improve the post’s credibility.
Don’t forget to look for videos and other rich media posted by customers that you can repost to your site or feed.
WOMM STRATEGY 3: Display product ratings.
If your product or service is reviewed on sites that have an aggregate score (Amazon, Yelp, Facebook, Google), display the rating on your site.
It’s helpful to combine the rating with a selection of reviews from that source to help increase the credibility of the score.
Remember to link back to the original!
WOMM STRATEGY 4: Create sharing incentives.
People are more likely to post about your company and share your products when there’s something in it for them.
The incentive can be as simple as offering customers a discount if they tell their friends and acquaintances or post about your product to social media.
It can be bonuses, like additional storage (Dropbox), free premium features (Trello), or credit for future purchases (Blue Apron).
It doesn’t have to be a benefit solely to the customer. You can also create incentive and offer something more compassionate like Aerie did with their charitable donation.
WOMM STRATEGY 5: Launch a referral program.
We’ve talked about referral programs before.
Referrals from happy customers represent your best opportunity to grow revenue and profits in your business.
In fact, customers referred to a product are more valuable. A Wharton School of Business study found that referred customers have a 16% higher lifetime value and are more loyal.
At crowdspring, we encourage our customers to refer others and offer a great deal that helps both our customer and the person they refer: a discount to each of them on a future project plus a free project upgrade.
Creating a referral program may be complicated, but the benefits of having a system in place for incentivizing and tracking referrals can be invaluable.
WOMM STRATEGY 6: Create an experience worth sharing.
One of the best ways to encourage word-of-mouth is to offer something so unique or valuable customers feel inspired to share it.
Whether it’s through a great product and experience (like Apple’s highly-regarded products) or a service you can’t get anywhere else (like StitchFix’s personalized and handpicked clothing subscription), a great experience can almost literally sell itself.
For example, over the past decade, crowdspring’s community of over 210,000 creatives have helped tens of thousands of entrepreneurs, small businesses and agencies come up with a new business name.
If you’ve ever named a business or product, you know that it’s tough and takes a lot of time.
Our clients are excited when they get a fresh new business name on crowdspring and since that’s the first identifiable part of their new brand, they often share about their experience – and the new company name – with their friends on social networks. It’s a win-win.
According to Ted Wright, CEO of Fizz, word of mouth from just one excited customer can have a huge impact.
Through his research, Wright has found that 10% of the US population loves to share stories with their friends and are intrinsically motivated. Their stories get shared at a rate that will run eight factorial on average, which is 40,370 shares per single individual influencer in a year.
As we’ve seen, word of mouth is a powerful motivator for both sales and engagement.
Don’t let it be left to chance: take advantage of word-of-mouth marketing strategies and build your connections, customers, and revenue.
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