Tara Hall

design. write.

Contact me at
hello@TaraHall.me

Aug 31, 2016

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Word-of-mouth marketing The good and bad

Word-of-mouth marketing is considered by some to be the holy grail of marketing. You win over a handful of clients with your products or services, and in turn, they rave about you to their peers.

Without spending a cent, your brand and marketing takes off thanks to a small cadre of evangelists who can’t seem to say enough good things about you or your business.

Clients line up to work with you or to buy your products. You may even become so popular that you have a waiting list. What could be better?

The advantages of word-of-mouth marketing

The obvious advantage of word-of-mouth marketing is that it costs you nothing. You don’t need to purchase ad space or run a costly marketing campaign. It even saves you time because your loyal customers do the legwork for you, especially on social media.

If a client who’s passionate about your work can convince others to love it just as much, then one Instagram photo, Tweet, or Facebook post could be more valuable to your business than a paid search ad.

Word-of-mouth inspires more consumer trust

Another primary advantage of word-of-mouth marketing is that it inspires trust. And trust is critical to a business relationship. After all, you wouldn’t work with or buy from a business that you didn’t trust.

A true friend wouldn’t lead us astray with a bad recommendation. When a friend recommends a product or service, we’re more likely to trust his or her judgement. We assume that if the product or service worked so well for them, then it can do the same for us.

From the Forbes.com article, “Why Word Of Mouth Marketing Is The Most Important Social Media”:

According to Nielsen, 92% of consumers believe recommendations from friends and family over all forms of advertising.

The disadvantages of word-of-mouth marketing

There are a few disadvantages to word-of-mouth marketing, and the first is cultivating influencers. In an ideal world, clients would enjoy working with or buying from us so much that they wouldn’t need incentive to spread the word.

They’d simply do it out of sheer love of what our services or products do for them. They’d share what they love because they want to help their friends and family. And maybe they want to see our businesses succeed too.

Unfortunately, this isn’t the case. Companies with deep pockets can hire celebrities to promote their goods on social media in the hopes of convincing a celebrity’s legions of followers to go out and buy these products.

Most small businesses like myself can’t afford to pay Kylie Jenner $50K for an Instagram post, however. So the alternative is to ask a client to recommend you.

Some may recommend you on a one-to-one basis with a friend or colleague who needs what you offer, which can be effective in winning one client at a time. But how many of us have had clients with tens or even hundreds of thousands of friends, fans, and followers who are willing to promote our businesses to the masses?

You can’t control the message

Another disadvantage of word-of-mouth marketing is that you don’t control the message. Your advocates decide your message for you.

If you’ve put any time and thought into your branding and marketing, you risk having those distorted, however unintentionally, through word-of-mouth marketing.

Let’s say you’re a wedding photographer. You offered a bride a discounted photo package lower than your usual rates. Maybe you liked the bride and wanted to work within her budget.

Each time that bride shares her lovely wedding photos on social media, she also mentions the price that she paid for your services. In your marketing efforts, however, you prefer to focus on the quality of work and personal service to your clients.

Suddenly, you’re hearing from brides whose budgets don’t match those of your ideal client, and you’re not interested in lowering your prices to reach a different market given the time you spend with each client.

In the same vein, when you don’t control the message, you can’t control when someone makes negative comments about your services or products. You can always respond to a negative comment, but you can’t always delete it or rewrite it.

You can’t track the results

Unlike online marketing and some other forms of marketing, you can’t track the results of word-of-mouth marketing, unless of course new clients tell you that so-and-so recommended them. But a client who hears about your business second or third hand probably won’t know who to credit for the referral.

Without reliable metrics, it’s difficult to know how effective word-of-mouth marketing really is for your business. However, because this type of marketing doesn’t have to cost you anything, metrics aren’t going to change whether or not you use it.

In fact, organic word-of-mouth marketing is going to occur whether or not you want it to.

You’re not choosing the clients

For better or worse, word-of-mouth marketing is going to reach those who aren’t your ideal customers, so you may find yourself, like in the previous wedding photographer example, approached by those whom you don’t want to work with.

You hope that someone who’s referred to you will take the time to investigate your work, offerings, or products before contacting you. As nice as a referral is, it’s not a guarantee that you’re right for every potential client or that every potential client is right for you.

Someone may reach out to you assuming that you’re a good fit because you worked with a friend of a friend, and it just so happens that she needs the same service. In which case, the onus is on you to determine if she’s the right client for your business.

You often hear freelancers say that one of the reasons that they work for themselves is the opportunity to choose their clients and their projects. If you rely on word-of-mouth as your only form of marketing, you may find yourself with clients you don’t want to work with and with little time to market to the ones you do.

How to influence word-of-mouth marketing

Although you can’t control what, when, where, or to whom your clients speak of you or your business, there are a few things that you can do to influence clients for better word-of-mouth marketing.