What is Word of Mouth marketing?
Word of mouth marketing happens when a customer experiences something far beyond what was expected. Now if you have a bad experience you will mention it to the world and if you have a good experience you will tell 10-15 people.
Most funded startups and brands have deep pockets and they want to scale fast. So word of mouth marketing is mostly the last marketing strategy they are counting on these days. But I think a lot of people are missing out because of some wrong assumptions.
Word of mouth is storytelling, a story in which the customer is the hero. The customer wants to tell how he or she is a hero by using a particular product or service to friends and family. So brands should build stories for customers, where the customer is the hero. This is the basic principle of brand storytelling, the story is never about the brand, nobody cares about your story, they care about their story.
Brands should clarify their message, clairy the brand story so that more customers will listen to your story.
What actually happens during Word of Mouth or Referral Marketing?
Brand makes a promise to a customer – that is what every brand does while selling a product or service. And when a customer tells about a product or service to someone else, the customer’s reputation is at stake. Now the promise is made by the person. Are you making it easy to make a promise for them on your behalf. If they doubt that you won’t keep your promise, they will never give you a referral, it’s as simple as that. It’s all about trust.
How word of mouth marketing works?
Ernest Dichter’s research from the mid-1960s revealed: “When the consumer feels that the advertiser speaks to him as a friend … the consumer will relax and tend to accept the recommendation.”
Why people refer your product or service?
Personal Experience – You absolutely loved the experience. Now you want to feel proud of that fact that you discovered it. So you want your friends and family to know about the same.
Self-Confirmation – Dichter details eight types of self-confirmation people seek through talking about products and services, including: “gaining attention,” “showing connoisseurship,”having inside information,” and “spreading the gospel [by] converting the listener to use the product.”
Being Nice – Products serve mainly as instruments which help to express sentiments of neighborliness, care, friendship, and love.” That is why we buy a particular brand and don’t buy another.
Influenced by Advertising – Apple ads are always a topic of discussion. Same with Nike. Entertainment value and originality of ads have become topics of talk.
Why people listen to a referral?
People listen to industry experts as they have already build authority. The core of Influencer Marketing is the same. We believe that they have done the research and all we need is their point of views and summaries to make a decision. People listen to celebrities as they sort of worship them and they find joy in using a product a particular celebrity endorses. Some people who are early adopter’s enjoy finding everything about a new product or service in town and talk about it. Now with the rise of digital streaming such content and content creators have a lot of influence. Then come your friends and family, if you trust them, you will trust their opinion about a product or service as well.
According to Ernest Dichter, four factors make word of mouth marketing more effective than traditional advertising. These four factors are:
1. Authentic Passion
“The real meaning of a product and of its effect to the user is revealed not only through the choice of the speaker’s words, but also through the discharge of emotions in inflection, face, and body expressions, and gestures.”
2. Genuine Compassion
“That the speaker is genuinely concerned with the listener’s well-being or has his advantage at heart becomes eminently believable in cases in which the recommendation is geared to, and takes into account, the individual needs or special circumstances of the listener.”
3. Actual Proof
“Tangible evidence” that a product works, as seen in real life, “…serves to strengthen the impact … of a recommendation in cases in which personal intention or product relationship are not sufficiently convincing in themselves.”
4. Semblance of Secrecy
When the speaker displays a “reluctance to divulge the source or brand name of a product” it can serve as sign to the listener that the product is so uniquely desirable the speaker doesn’t the want masses to know about this secret brand. “This refers to the well-known psychological phenomenon that the harder it is to get a desired object, the more desirable it becomes.”
Is word of mouth marketing scalable?
It definitely is not scalable like paid ads, or it won’t reach hundreds of people at the same time. But imagine you have 100 customers and each of them refers your product to 2 people. Now imagine it continues. After 5 times this happens you will have 3200 customers. In an ideal world this is not going to happen, but you get the point. Few of them are going to tell more people, and few won’t talk about it. But if you give them a reason to advocate about your product or service, most of them will. And this can give you a lot of exposure and loyal customers. Here the chance of a potential customer becoming a customer is very high.
If you are doing great marketing and storytelling, people may consider your product or service. Buyers aren’t purchasing products because of a nice ad, fancy landing page or smart email header.
They are asking their friends and people they hang out with, how they solve a particular issue? What products or services will they recommend?
Recommendations from friends and family they connect with often become the top of the funnel entry point, not search or paid. People trust the recommendations of thought leaders and friends they trust.
You are able to reach people who you may not otherwise be able to reach. Your reach is greater, especially if the product is good, because more people will recommend it to their friends.
In this way, it becomes a self-fulfilling cycle. Your friends recommend the product to you, and after using it for a while you recommend it to someone else, and the cycle continues.
Viral marketing is word of mouth marketing at scale.
Viral marketing generates interest in a brand or product (and therefore potential sales) through messages that spread quickly from person to person. The idea is that the users themselves choose to share the content.
7 Principles of Word of Mouth – A framework to scale Word of Mouth Marketing
- Does it solve a problem?
- Is it easy to talk about?
- Does it feel good to share?
- Does it evoke a sense that the world is an amazing place?
- Does it start a conversation?
- Is it relevant to our core target audience?
- Once experienced, does it exceed your expectations?
1.Does your product solve a pressing problem in a great way?
Products and services that solve problems better than anything else will naturally have an organic intake of new users. At what point will the newly created efficiency be so good that people won’t go back to previous habits? Kunal Shah has a framework for founders to self assess whether the idea is going to work, whether it will create wealth or destroy wealth. The same framework can be used to figure out how to initiate the word of mouth marketing.
2.Make your marketing communication easy to talk about
Keep it simple, and it will be easy and more likely to talk about. In short — If you can’t share the core idea in less than a few sentences around the dinner table, it’s likely not going to get passed around amongst people.
The marketing communication needs to be really simple, which your customers can then take forward.
3.Feel good to share
If you really enjoyed a product and service and if the brand is a hot topic in town, you will feel great to tell your friends that you are also part of that movement.
Pride is an emotion that plays an important role in many aspects of our lives, including our consumption experiences.
In choosing products for public-use like clothes, bags, cars, or watches, we often evaluate the product by considering whether wearing it will make us feel proud, or whether the product can elegantly differentiate us in public or not. Pride is not only the emotion that drives our consumption, but also an emotion that is elicited by consumption. If we can design a way to evoke pride, that will make people share the story of how a product or service is changing their lives.
4.Evoke a sense that the world is an amazing place
Ideas that successfully evoke the sense that the world is an amazing place — especially brands, services and products that are doing well — tend to evoke precisely these good feelings. People want to talk about this. This can be about a product or may be about an ad which made them feel good. Any nike ad is an example of the same.
Their copywriting just gets to you. You feel good to see the video again and again and then you will feel like sharing it with your friends and family. This can also be called viral marketing.
5.Starting a conversation
If your marketing communication can start a conversation among people, you will hit jackpot. If your MarCom isn’t focused on establishing trust and conversations required to create a real, human connection, then your audience is by default trying to tune you out. By default, they’re treating your messaging like noise. Storytelling in marketing communication is all about getting to the point without any noise.
6.Relevance to your core target audience
If your core idea is around your core target audience, they respond. Niche marketing is a form of marketing that is geared toward a very specific population, or niche. Niche marketing is possible when a business specializes in a particular service, or serves a particular demographic within its target audience.
7.Exceeding your expectations
If you can nail the 7TH PRINCIPLE, the growth of your brand, product and its services will explode.
Everything you do affects your brand. Including how you handle complaints.
“Did you see”, “Have you heard”, “You won’t believe”, “check this out” and “Can you imagine” is what will make it to the dinner table. That’s what matters because 90% of all word of mouth happens offline.
Referrals are one of the fastest ways to grow your startup/business.
It is true that no matter how much you spend on advertising, marketing, and sales, at the end of the day “socially referenced credibility” wins.
Hearing good things about a company from a friend or colleague will always invoke trust. That trust can be used to bring in more prospects, clients, users etc. Word of mouth is the most effective form of marketing even in 2021. The only challenge is: brands need to get innovative to scale the model.
Importance of Word of Mouth Marketing
It is interesting to note what drives these personal recommendations. Consumers cited “Trustworthiness” and “Customer Service” as the two highest factors in their likelihood to endorse a brand to other people. This brings focus to an important point: No amount of marketing or storytelling is going to help your business if you’re not delivering the goods!
Word of mouth has the most impact and influence in making the buying decision.
A company’s most precious asset is the customer’s trust that it can and will perform the promised service. Breaking the service promise means breaking the customer’s trust.
How your customers feel about you and what they are prepared to tell others about you can influence your revenues and profits just as much – Value of Word of Mouth.
How AirBnB used Word of Mouth Marketing for their growth?
With the right referral strategy in place, referrals increased bookings by over 25% in some markets for AirBnB. In short this is what they did, set measurable goals, plan metrics and logging, build the product with instrumentation, measure impact, iterate.
What does Space X, Bitcoin, Spotify, Uber, Slack, .and Amazon Prime all have in common?
Incredible growth — Driven primarily by word of mouth.
People trust people. The numbers back this up, with 90% of people more likely to trust recommendations from a friend.
Digital marketing isn’t going anywhere, but neither will people stop recommending products they love. Weaving the two together is the most effective way to develop a marketing strategy today.
Brilliant marketers don’t compete in the same delta products, they create their own highway. They create new inefficiencies.
How to scale Word of Mouth Marketing?
Amplify a dialog that’s already taking place
The key to exceeding the expectation of your customers–at its very core– comes down to figuring out exactly what it is that your consumers are saying about you (that their friends, in turn, are sharing with their friends) and amplify that message. You’ll want to go beyond where the users or customers are coming from and understand the how and the why.
Get your marketing messaging done by your customers
Ask :
“What made you sign up for our service?”
“How would you describe our service to your friends?”
The answer is your marketing communication. You’ll have to analyze each response individually and look for reoccurring themes and keywords. Pay attention to the answers.
If they say they signed up because of a referral understand more about how that conversation went. What promise did the friend make?
In a sea of sameness, be unforgettable – Donald Miller. You need to make your brand unforgettable. For that you need to get your service design right.
Word of mouth Marketing is a byproduct of your Marketing efforts
If you ask is word of mouth marketing a marketing channel it is debatable. You don’t have direct access to it, but you can definitely influence.
The right market, the right product, right price, right promotion on right channels and right messaging influence word of mouth. Create content that is shapable with peers, creating a distinctive brand and positioning so people actually know wha to share, being consistent, those are few things you can do to trigger word of mouth marketing.
