Word-of-mouth marketing in the digital age

Word of mouth is marketing nirvana for brands. We’re far more likely to buy something if it comes with a friend’s endorsement. According to Nielsen, 92% of consumers around the world say they trust recommendations above all other forms of advertising and a recent landmark study by the Word of Mouth Marketing Association (WOMMA) revealed that an offline WOM impression drives at least five times more (up to one hundred times more) sales than a paid impression.

Personal recommendations drive sales, and we know it. Research from the American Marketing Association and WOMMA shows that 64% of marketers believe WOM marketing is ‘more effective than traditional marketing’, yet only 6% are ‘advanced’, so why is this Holy Grail of marketing so hard to grasp?

Womm-digital

It happens in real life – the biggest (and original) social network and goes way beyond just shares, likes, reviews and the much over-used term ‘engagement’. Two thirds of WOM happens offline, so the WOMMA study tells us.

Picture the guy on the market stall; he might have an interesting story to tell about how he grows his produce, he might throw in the occasional freebie or make a suggestion to try something new. In return the customer might suggest new wares to sell on the stall or even new places to set up shop, and they’ll definitely have a tale or two to share with friends.

They go back not because his stall’s the cheapest, but because of the meaningful and trusting, two way relationship with the trader. Brand loyalty comes from feeling as though you have a stake in the brand.

According to the WOMMA study, WOM accounts for an average 13% of sales. To put that in context, all paid media accounts for just 20%-30%.

Accelerating that process and driving WOM at scale is possible by using the right online communities and platforms designed and built for this purpose (contrary to popular belief not all lend themselves to WOM engagement ) because digital enables marketers to scale the market stall scenario, by opening the dialogue between brands and people.

This belief is at the heart of collaborative marketing and word of mouth. Add to this razor sharp targeting and influencer indicators and we have a very powerful tool in our hands.

Important to consider is that the process of collaboration needn’t start when a product hits the shelf, instead consumers should be involved much earlier in the product life cycle. To revisit our market stall – imagine that sales are starting to slump, his previously loyal customers seem to frequent the stall across the way.

Our trader knows he needs to bring a new offering to the table, but what? He could spend a season nurturing a new crop of exotic and expensive veg (that it turns out his customers do not want) or he could just ask them. This way his customers once again feel valued and more invested in the stall than ever.

By involving consumers in testing ideas and prototypes you find out what they love and what needs changing. Do this at scale and you’ll have a ready-made market at launch, and a wealth of ambassadors ready to spread the word once it’s hit the shelves.

It means making your marketing truly collaborative, and putting your customers right at the heart of your campaigns.

First published 20 April 2015 on Brand Republic the Wall blog

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