Small Business Marketing Guide

9. How to Use Word-of-Mouth Marketing

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How to Use Word-of-Mouth Marketing

Jun 06, 2023 • 9 min read
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      If you’re in the market for a new pair of tennis shoes and scouring the internet, you might feel overwhelmed by all the different brands in your search results. However, suppose your buddy recommends a pair they bought and love. Their recommendation may simplify your search and lead you to promptly add the same pair of shoes to your cart.

      This shoe-buying scenario is an example of word-of-mouth marketing where friends and family recommend their favorite products or services to each other. It also shows how much consumers trust their friends. In one Nielsen survey, 88% of consumers said they trust recommendations from friends more than any other marketing source.

      According to this RRD survey, word-of-mouth marketing is an often-overlooked strategy. Still, it may be the most influential. This survey found that word-of-mouth marketing had the highest research-to-purchase ratio than any other type of marketing. That means if someone hears about a product or service from a friend or family, they are much more likely to purchase it.

      Setting the foundation for word-of-mouth marketing.

      To help you get your word-of-mouth marketing humming, here’s the foundation you need to get new customers through referrals and five different strategies to harness its power.

      1. You must have a great product.

      I don’t care how nice the waiters are, or how well-decorated the restaurant is, if my hamburger tastes like the heel of a shoe, I will never recommend the place to a friend. In fact, if they bring up the restaurant, I might tell them to stay away from it: “I went and it’s mediocre.” 

      Make sure your product and service are the best you can provide, and you’ll get referrals naturally.

      2. You must listen to your customers.

      This goes along with my first suggestion. If you listen to your customers and find out what they want, you’ll achieve two very important things. First, you’ll receive valuable insight into how customers view your business. Second, you’ll start building a relationship with that customer. People like being listened to, and if they feel they’re helping your business, they will develop a strong attachment. In turn, this will turn them into brand advocates, and those are the kind of people that give referrals.

      Five strategies for driving word-of-mouth.

      With a strong foundation in place, you’re ready to start building your word-of-mouth strategy.

      1. Customer referrals

      One of the first strategies for driving word-of-mouth is customer referrals. Referrals are a way to get more from your current customers. It is one of the easiest and low-cost ways to drive word-of-mouth because you’re just asking your current customers to think of their friends who might appreciate your product. It’s easy for you and should be quick and painless for your customers. 

      You can also give your customers a referral incentive, like a discount. Our neighbors recently had their windows cleaned, and the business they hired offered a deal for them and any neighbors who had their windows cleaned on the same day. My neighbor reached out to me and several others, letting us know about the window cleaner and their discount offer. That day, instead of having just one customer, this window cleaner had five, all because they offered a small discount and asked for referrals.

      2. Social media giveaways. 

      Social media giveaways are a popular strategy these days. Giveaways are when a company offers its followers a chance to win something by completing simple yet specific tasks such as tagging friends in the comments, liking and following particular social media accounts, or tagging your business account in pictures of them using your product. 

      When planning a social media giveaway, set your goal for the giveaway beforehand. Your goal could be anything from increasing your social media followers to driving traffic to your physical location. Use that goal to determine the tasks you will require to enter the giveaway. 

      For example, if you designed and sold patches for your business and wanted to hold a social media giveaway, with the goal to increase your followers, you might create a set of patches and have your followers tag a friend to whom they would give the matching patch and share your post. 

      This giveaway would expose your business to more people through your loyal customers and get them excited about your brand.

      3. Viral and buzz marketing campaigns.

      Viral marketing is where you share a message that gains popularity and is exponentially shared. In contrast, buzz marketing generates excitement about an event, activity, or message. These two marketing tools can be done separately or go hand in hand. 

      These strategies often revolve around something quirky, outrageous, funny, or remarkable. They also don’t need a specific target audience—they’re just getting the word out and getting people talking.  

      A great example of this is Blendtec. Blendtec makes and sells heavy-duty blenders. To get people talking about their brand, their CEO creates videos of himself putting random items into their blender to see if they will blend. 

      Blendtec could have just said, “Our blenders are incredibly powerful. You can blend just about anything in it!” Instead, they created these outrageous videos that demonstrated how powerful their product was and got people talking, all while playing jazzy gameshow music in the background. 

      (Note: It’s not often that my mom is the one who shares a marketing campaign with me, but this was one that she was excited about. She now owns a Blendtec blender and will tell everyone about it and that she could blend a rake handle in it if she wanted to.) 

      4. User-generated content.

      User-generated content is an excellent strategy to get your customers excited about your product and to share their excitement with their people. Your customers create and share content about your product or service. It could be anything from reviews on Yelp to a social media post of a customer wearing the adorable earrings you sold them. 

      One strategy for creating user-generated content is asking satisfied customers for reviews. My hair salon does a great job at this. Shortly after I leave my appointment, when I’m still excited about my new look, they send a text asking if I would mind writing a review for them. Since I’m still experiencing positive feelings, I’m thrilled to brag about how great my hairstylist is when I get that text.

      Social media is another excellent way to encourage and share user-generated content. You can ask your customers to create and share posts about your product (often with a small incentive), or your customers may do this naturally. 

      An example that I love for cultivating user-generated content comes from a local bike shop that builds custom bikes. When someone tags this bike shop’s social media account with a picture or video of them riding one of their bikes, they’ll comment on it and reshare it onto their main account. 

      When I was looking at buying a bike from this shop, I’d scroll through their Instagram. I’d see all the cool places and incredible people riding these bikes. It made me want to buy a bike from this shop and to get some awesome pictures of myself riding my new bike to share on social media. 

      5. Surprise and delight campaigns.

      Surprise and delight” campaigns are awesome for building word of mouth. Not only will these campaigns build loyalty with your current customers, but will bring new ones in. There’s something about getting something unexpected that delights customers and prompts them to tell their friends about it.

      One of the best examples I’ve seen of surprise and delight is a restaurant I went to recently. We were getting ready to order, and then the waiter asked if my date and I would like to try a new recipe they were working on, on the house. I agreed, and they brought out one of the best crab-stuffed mushrooms I’ve ever had. The waiter asked what we thought, and we loved it, so we told them. 

      Not only that, but anytime anyone asks about a good seafood restaurant, I recommend this place, because I feel loyal to it. (Newport Cafe in Newport, Oregon, if you were wondering.)

      Surprise and delight is a great way to bring in new customers, but it has to genuinely deliver both surprise and delight. Don’t give everyone the surprise every time, otherwise, people will come to expect it. At this point, it’s just a perk (which is good in its own right, but not a surprise).

      Bottom line

      Word-of-mouth marketing is a powerful tool that you can use to spread the word about your business. Set the foundation by having a great product and listening to your customers about what’s important to them. When your foundation is set, use some or all of these five word-of-mouth marketing strategies to get more from your current customers and bring in new ones. 

      About the author
      Erik Larson

      Erik Larson frequently writes for Lendio about SEO, Digital Marketing, Social Media Marketing, Business Loans, and whatever else strikes his fancy. He can be found on Google+ and Twitter.

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