Word of mouth is when information is shared through conversations between people, and it’s one of the most effective forms of marketing out there. In fact, over 50% of purchasing decisions are based on recommendations from friends and family. But why is this method so powerful?
Well, it’s simple really, it all comes down to trust. When a friend or family member recommends something, we’re more likely to try it because we trust their judgment. According to a Nielsen study, 92% of consumers trust recommendations from friends, family, and online communities more than any other form of advertising.
In his book, Contagious, marketing professor and author Jonah Berger identified six principles of word-of-mouth marketing that contribute to its effectiveness. These principles include social currency, triggers, emotion, public behaviour, practical value, and stories. For example, we’re more likely to share something if it makes us look good (social currency) or if it’s something that’s top of mind (triggers).
So how can you harness the power of word of mouth? One proven effective way is through online reviews. According to a Podium report, by 2023, 93% of online shoppers tend to read reviews before making a purchase decision. That’s why online reviews are essential for businesses today. However, here’s the kicker, users are three times more likely to leave a review after a negative experience than a positive experience, so it’s important to offer great service and encourage customers to leave feedback.
To encourage customers to leave reviews, you can offer incentives such as a discount on their next purchase or a chance to win a prize. But managing online reviews is just as important as soliciting them. Responding to both positive and negative reviews in a thoughtful and authentic manner is key. For positive reviews, express gratitude to the customer for using your product or service and acknowledge the customer’s contribution to the positive experience. Be sure to leverage positive reviews to showcase the great experiences your customers have had with your product or service.
Now, let’s talk about the elephant in the room: negative reviews. In today’s world of social media and instant communication, negative reviews can spread like wildfire and harm a brand’s reputation if not managed well. That’s why it’s crucial to manage online reviews effectively and respond to them in a professional manner by being diplomatic whilst de-escalating the situation. But don’t let negative reviews get you down – just remember, every bad review is an opportunity to turn the situation around and show your brand’s commitment to customer satisfaction.
So how would you deal with a negative review? Try these tips:
- Never delete a bad review.
- Address the point politely and empathetically.
- If needed, apologise for the experience or at least for the inconvenience.
- Explain your side of the story but be cautious to not come across as defensive or dismissive, your goal is to de-escalate the situation.
- Invite the individual to reach out directly to discuss the issue further and take the conversation offline.
Remember, your response to a negative review is just as impactful as the review itself – so be sure to handle it with care and professionalism. Check out Dom’s blog on community management where she unpacks why you should engage with your online community and how to do so.
Another effective way to generate word-of-mouth marketing is through referrals. Referrals are when a customer or client promotes or recommends your business to potential new customers through word of mouth. Referrals can become an effective lead-generating engine and often results in high-quality leads whilst reducing your customer acquisition cost. Many businesses incentivise referrals by offering discounts or rewards to customers who refer their brand to others.
In conclusion, word of mouth is an incredibly powerful form of marketing that can help businesses build trust, decrease customer acquisition costs, and ultimately drive sales. By leveraging online reviews, and referrals, and effectively managing reviews, you can build a positive brand reputation and stand out in a crowded marketplace.
At Yellow Door, we understand the power of word-of-mouth marketing, contact us to learn more about how we can help your business stand out in a crowded marketplace.