Today, companies throw eye-watering amounts of money at marketing campaigns to acquire new customers. But they miss one important fact:
This statistic encapsulates the power of word-of-mouth marketing and the immense impact it can have on your brand, reputation, and sales. But how do you go about creating a strategy that harnesses its power? We’ve got you covered.
In this article, you’ll learn:
But first, let’s start with a definition.
Word-of-mouth (WOM) marketing is the process of influencing customers to tell others about your brand, products, or services. This behavior can happen in two ways:
The result is that customers become an autonomous extension of your marketing department. They take care of the prospecting and converting for you – and sales take on a momentum of their own.
People are inherently skeptical of what businesses say about their own products, but they naturally trust what other people say. This makes word-of-mouth an incredibly powerful form of marketing.
Today’s customers are savvier and more discerning than ever. We have learned to see through traditional marketing and advertising tricks. Instead, we rely on our peers for content, reviews, and opinions.
Businesses that understand this and harness the power of WOM marketing will have a huge advantage over those that don’t.
Word-of-mouth has been around since the dawn of commerce. Hundreds of years ago, craftspeople who made outstanding products would gain a positive reputation in the local community through word-of-mouth.
Back then, the impact of word-of-mouth was limited to face-to-face interactions. A happy customer could share their positive experience with those in their close vicinity, but their reach ended there.
The viral effect of WOM was slow, steady, and local. And it remained that way until the internet came along. Then everything changed forever.
Today, through an array of social platforms, word-of-mouth has become the most powerful marketing tool in a company’s arsenal. A single customer can now reach anyone in the world. They can share their experiences in written reviews, videos, podcasts, and social posts. This content can be seen, shared, and saved an infinite number of times.
Make no mistake, word-of-mouth marketing is a game-changer for those companies smart enough to leverage it.
Now that we know what we’re talking about, let’s take a closer look at some of the benefits associated with WOM marketing.
People trust other people, not companies. Because trust and loyalty are deeply entwined, word-of-mouth marketing naturally generates customers that are loyal to your brand. In turn, those customers convert more customers, who convert more customers… You get the picture.
Through WOM marketing campaigns, you can gain an army of loyal fans. This is particularly true when campaigns capture the imagination on an emotional level.
Loyal customers stick around. They come back time and again to use your products and services. The impact of customer retention on your bottom line cannot be underplayed.
According to Invesp, investing in new customers is 5-25 times more expensive than retaining existing ones. Keeping existing customers happy is a necessity for any successful business, and word-of-mouth campaigns are a great way to boost engagement and build relationships.
Brand awareness is a fancy way of saying how many people know that your brand exists. In a world that’s saturated with products and services, it can be difficult to stand out and get the recognition you deserve.
Word-of-mouth marketing is the perfect tool to boost brand awareness. The more buzz surrounding your brand – the more people talking about it online - the more likely others are to take interest.
The beauty of word-of-mouth marketing is that your customers become an extension of your marketing and sales department. Give them an outstanding customer experience and the right platform, and they’ll do the rest for you.
Many companies, however, rely on outdated sales processes that focus solely on new customer acquisition and ignore the power of existing customers. This issue is epitomized by the sales funnel.
The sales funnel has been the go-to model for growing sales revenue for years. But while it’s great at converting prospects into customers, it offers little when it comes to keeping existing customers engaged, happy, and motivated to spread the word about your brand.
To implement a successful WOM marketing strategy, you need to adapt your sales processes to recognize existing customers as one of your greatest sales drivers. You need to put the post-sales customer experience at the heart of your processes, giving customers the reasons they need to share their love of your brand.
We take a detailed look at how you can do this in article about customer advocacy.
Now let’s take a look at some real examples of word-of-mouth marketing in action.
With a growing number of healthy alternatives on the market, Coca-Cola – one of the world’s most iconic brands – was struggling to grow sales, particularly among younger demographics. Then along came one of the most successful word-of-mouth campaigns ever conceived.
To connect with customers in a personal, emotional way, Coca-Cola printed popular names on their bottle labels. Finding a bottle with your name on it – or the name of a friend – was all the motivation you needed to buy it and share it.
At the heart of ‘Share a Coke’ was a digital campaign that encouraged customers to share those moments under the hashtag #shareacoke.
Drawing on personalization, a unique sense of fun, and the emotional act of giving, the campaign was a roaring success. By sharing bottles with friends, customers literally handed the product to new customers.
Sales of ‘Share a Coke’ bottles rose 11% in the US, and a new generation of teenage Coca-Cola fans was created.
Starbucks needs little introduction. Since opening its first coffee shop in Seattle in 1971, they are now by far the biggest cafe chain in the world. And they achieved all this with a WOM-first approach.
Do you remember the last time you saw a Starbucks commercial on TV, on a billboard, or in a magazine? No, because they focus their energy and money almost exclusively on social channels.
Starbucks has a huge social presence. They use social media to boost their brand, engage with customers, and build communities of loyal fans, creating endless opportunities for word-of-mouth marketing.
No matter where you live, chances are you remember the ice bucket challenge of 2014. The campaign, co-founded by two individuals but adopted by charities across the world, was designed to raise awareness and money for ALS, also known as motor neuron disease.
The idea was beautifully simple: get people to record themselves having a bucket of ice-cold water poured over their heads – and post it on social media.
The campaign soon went viral. People across the world scrambled to be next. Countless celebrities got involved. Hundreds of millions of dollars were raised.
Although focusing on donations rather than sales, the Ice Bucket Challenge harnessed a fear of missing out (FOMO) among the general public. The more people we saw doing it, the stronger the urge to do it ourselves. Powerful stuff.
Lush, a UK-based cosmetics company, has spent virtually nothing on traditional advertising. Yet somehow, it has risen to become a global, multi-billion-dollar brand. How did they do it? The answer, of course, is word-of-mouth marketing.
The Lush brand is synonymous with its values, centered around ethical ingredients that are friendly to both the environment and animals. This fact alone earned the company an army of loyal fans, particularly idealistic teens and young adults.
This values-first approach was coupled with an outstanding in-store experience, where staff are readily available to answer questions, offer free samples, and find the perfect product for each customer. Over time, word spread.
Today, Lush’s content is viewed, liked, and shared by a global army of fans who not only love their products but are also fully bought into the company’s ethical stance. Their brand is associated with something much bigger than just cosmetics – a movement, a zeitgeist, an issue that people feel compelled to talk about. The results speak for themselves.
So what can we learn from these examples? What made them successful? Here are a few key points to remember when creating your own strategy:
For organic word-of-mouth marketing, your strategy is ‘simple’ enough: offer truly excellent products and services that create a buzz. Your customers will take care of the rest.
While this approach is powerful enough, you can go one step further. As the previous examples show, by implementing strategies designed to whip up excitement about your brand, you can multiply the word-of-mouth effect. Here are three practical ways you can do this.
Online communities are the perfect place to amplify the WOM effect. Having all your brand ambassadors under one virtual roof allows you to get maximum engagement through digital content, competitions, and social campaigns.
Communities appeal to customers’ need to belong. They encourage stronger relationships between your customers and brand, helping to build trust and loyalty. These are all key ingredients for word-of-mouth marketing.
If people trust other people more than they trust companies, influencers have word-of-mouth superpowers.
With their reputation and social following, influencers can sway your target audience with minimum effort. Working with influencers allows you to tap into their network and harness the power of their social status.
And it doesn’t have to be complicated – a simple endorsement or product review can get countless people across the world talking about your brand.
Social media is really the home of word-of-mouth marketing. Social sharing is the catalyst that allows viral marketing campaigns to take off. Focus on building strategies that tap into this need to belong, share, and be seen.
It’s important to generate high-quality content that educates customers about your latest products, news, and events. But remember: customers naturally trust what other people say over what you say. In fact, 76% trust user-generated content over content produced by brands.
With this in mind, word-of-mouth campaigns that encourage customers to share their own content in support of your brand are highly effective – particularly on easy-to-consume channels like Instagram and Youtube.
We hope this article has given you a clear understanding of what WOM marketing is, why it’s so important, and how you can harness its power to boost your brand and sales.
Before we finish, let’s sum up the key takeaways: