Can you survive on word-of-mouth alone?

The short answer is no. What!?

A blog that answers the initial question in the first line and doesn’t make you read all the way through to the call to action at the end? Crazy right!? Make sure you tell all of your friends how crazy we are.

WHY IS THE SHORT ANSWER NO THOUGH?

Word-of-mouth seems like the ideal way to get business right? It’s free, it’s organic, it’s easy. In fact, people are 90 percent more likely to purchase something that has been recommended to them by someone they trust.

While word-of-mouth is effective, it is also unreliable and restricting. You cannot control how much customers will spruik your business. Therefore you limit your exposure to potential clientele. Dan Perry, the author of the book Turn Your Skills Into Profit outlines the downsides of word-of-mouth marketing:

  • Difficulty of price increase
    If your customer base is made up of people who recommended one another, it can be tricky to navigate away from your initial prices. This is particularly true if the recommendation was as a result of your fantastic price in the first place. Mates rates anyone?
  • It’s a long process
    As we mentioned earlier, you have zero control over how often people refer you, so building a large customer base purely from positive chatter is the long play.
  • Recommended for the wrong reason
    Ever been recommended something that seems like good value only to realise that the quality of the product or service wasn’t great and therefore justifiably cheap?

WORD-OF-MOUTH IS MORE THAN SOCIAL MEDIA

Sure, Facebook is a great way to shout out a business that has done an excellent job, or even somewhere to get recommendations from friends about which plumber you should call. The more significant effect, however, is offline. Two-thirds of successful word-of-mouth impact happens in the real world.

In his book, Word of Mouth Marketing, Andy Sernovitz breaks down the marketing strategy into five types and why they are essential for good word-of-mouth:

  1. Talkers
    Identifying those customers who will spread the word and communicate directly to them.
  2. Topics
    Giving the talkers something to tell others about.
  3. Tools
    Providing a concise and consistent branding platform that people can spread the word through.
  4. Taking part
    If there is a conversation about you, be active within it and run with the pack. Why do you think everyone wants everything reviewed?
  5. Tracking
    Being aware of customer feedback and acting upon it.

NEGATIVE WORD-OF-MOUTH

Oh, you thought it was all positive? Wrong. Negative word-of-mouth is like wildfire, it spreads far quicker and does extreme damage. People love a good business fail story; they make memes about it. Humans are wired to favour negative news over positive.

Social media makes it much easier to share stories, and as a result, more people do. 54 percent of consumers will share bad experiences with more than five people with only 33 percent sharing good interactions.

The answer seems simple, be good at what you do and treat your customers well, right? Unfortunately, you can’t control people’s perception, and we live in the time where complaining is the new breathing.

MORE WORDS IN MORE MOUTHS

If we look at word-of-mouth as the goal of marketing, things start to make a little more sense. We see it all the time, and a great way of generating more chatter is the reward.

“Send your friend this discount code and get one month free when they activate it.”

You are probably very familiar with this kind of offer. These strategies are essentially trying to encourage a form of word-of-mouth. People will be more likely to spread the word if there is something in it for them and the offer has instantly more validation at the receiving end if it is co-signed by a friend or family member.

WHAT SHOULD YOU DO?

Ok, you read all the way to the call to action, so we owe you a more in-depth answer.

If you really want to sell that home gym, you don’t just put an ad on gumtree for free, you increase your chances and throw a few dollars at ebay with another ad. It’s the same for marketing your business. Word-of-mouth is great and if you can get it, brilliant, but don’t limit yourself and your exposure to purely that. There is a range of marketing strategies that can be tailored to your business and personality that will significantly increase your chances of finding new business.

The beauty of a strategic marketing plan is it goes full circle and assists with word-of-mouth! Pretty soon you will be trying to spread bad stories about yourself to try and decrease all that new business coming your way. Cuckoo can help with this, drop us a line and let’s get to work.

Share on facebook
Facebook
Share on twitter
Twitter
Share on linkedin
LinkedIn
Share on pinterest
Pinterest