What is the most powerful marketing strategy and the best predictor of a company's success?
This is a series of 8 articles that talk about the Future of Marketing. If you have not read the first article Start Here.
4) Word of Mouth, the only marketing that counts (4 of 8 articles)
If the product is the priest, word of mouth is the bible. Word of mouth essentially is the only form of marketing that counts, period. You would think that with all this social media frenzy it's all about Facebook likes, Instagram, Snapchat and other up and coming platforms. Guess what? Only 7% percent of word of mouth is online (Source). Yes, 93% of word of mouth is offline. If you think about it, this makes sense, think about an extraordinary service or product experience you've had in the past, your first reaction is not to go on Facebook and broadcast it to all your friends. Most probably you won't even get the urge to go on WhatsApp and tell a friend, but if you run into a friend in person, you would probably mention it, depending if it's in the context of your interaction.
However, there is EVEN more to word of mouth that meets the eye. "Word of mouth drives more than twice the sales of traditional advertising. And a dollar spent on word of mouth goes ten times as far as a dollar spent on traditional advertising" (Source). But Why? For starters, trust. People trust the advice of their friends; in general, your friends are not trying to sell to you. The other reason is that word of mouth is more targeted. Your friends know you personally, they know your interests, tastes and what stage in your life you are. In other words, they have the best knowledge of your interest and context; therefore they have the upper hand on what to recommend you. Thirdly, people tend to be friends with people who are like them, using existing customers to target new customers is extremely beneficial, more lucrative and cheaper to market, "customers who come in through referrals have 15%-20% higher customer lifetime value"(Source).
In essence, your marketing should be tracking what is generating word of mouth, more precisely what aspects of the product are people sharing or talking about. It should also identify who is creating word of mouth, who are your early adopters and pinpointing the easiest way to multiply the word of mouth that is already occurring.
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