Word of mouth advertising is by far the most common marketing technique used by the thousands of independent businesses I’ve called on and worked with. For too many businesses, it was the sole marketing technique. Let’s take a look at word of mouth advertising/marketing.
The Good
Word of mouth can be highly effective. It can give a prospect a favorable view of a business before the business is even contacted. It gives the prospect comfort in knowing someone trusted used and was happy with the business being referred.
Additionally, the cost of word of mouth advertising can be ridiculously low to nothing but doing the good job you said you were going to do. To many business owners, a referral or a word of mouth lead, is the highest form of flattery and appreciation a client can show for a business.
The Bad
Word mouth advertising is uncontrollable. It can’t be scaled up or down at any given time. Word of mouth is also NOT dependable. You cannot depend on a referral being there when you need it most. Furthermore, messaging can also suffer with word of mouth advertising. A one time low price or other concession given to one customer can be broadly communicated to others setting up a false expectation upon contact.
In my view, marketing is one of, if not the most important, activity a business can endeavor. Leaving it to chance and others not even in your company can lead to grave consequences. Like no or not enough business for example.
The Ugly
Word of mouth can work against a business as easily as it can work for a business. While the vast majority of any business’s clients are usually sane and reasonable people, all it takes is one disgruntled customer for word of mouth to have a vastly negative effect.
As a member of a very large networking group, I was always amazed at the over-reliance on word of mouth advertising by very smart and successful people. Word of mouth becomes ugly when it is used at the expense of controllable, affordable and effective alternative marketing techniques. There is no way to assess the lost opportunity costs associated with such an over-reliance.
Effective Word of Mouth Practices
- Show your appreciation for the referral
- Let the referrer know of the outcome – good or bad
- Check in frequently (at least once per month) with your referral sources.
- This is where you use promotional items (coffee cups, pens, calendars, etc.)
- Let your prospects know from the outset that you are going to create a client experience so good that they’ll want to refer their friends and relatives. This is a highly effective technique for getting both the referral AND the sale
- Break bread with your reference centers as a show of appreciation
- Don’t rely heavily on word of mouth advertising; consider it a bonus for doing a good job
I’ll be writing more on word of mouth in the future. Feel free to reach out with questions or comments using our contact form.
