Why Word-of-Mouth Marketing Still Holds Importance in 2022

No other marketing strategy may be more powerful than word-of-mouth marketing.

Studies suggest that word-of-mouth marketing is five times as effective as PPC campaigns. This is more staggering considering that you spend nothing when a loyal customer spreads the good word.

However, building those initial relationships is a more complicated endeavor.

This article will explore:

• What is Word-of-Mouth Marketing?
• Why WoM Marketing is Still Important in 2022?
• How to Motivate Your Audience?
• Effective Strategies for WoM Marketing

What is Word-of-Mouth Marketing?

Word-of-mouth marketing refers to any time an existing or previous customer speaks positively about and promotes interest in a brand.

All of us experience word-of-mouth marketing daily. Any time we share our interest in a product or service, friends or family may share recommendations.

These word-of-mouth exchanges happen all the time, cost nothing, and generate valued business.

Why Word-of-Mouth Marketing is Still Important in 2022?

The benefits of word-of-mouth marketing are abundant. Here are just a few to convince you of just how powerful this advertising channel can be.

1. Word-of-Mouth Marketing Builds Trust

Think about your perception of a typical advertisement.

They’re often noisy, intrusive, and abundant. Even if an ad might teach us about something we’re interested in, we ultimately understand that a business is trying to profit off of that interest. We’re much less likely to trust a paid ad or promotion from that perspective.

Nielsen, an audience measurement and analytics company, finds that 92% of consumers trust personal recommendations over all other marketing.

That’s a level of confidence that’s simply possible to recreate on your own. While you may strongly value a customer’s well-being, your brand survives on profit, meaning that your motives will always be questioned.

2. Referred Customers Have a Higher Customer Lifetime Value (CLV)

Customer lifetime value is a metric businesses use to determine the actual value of a customer over their lifespan.

You can calculate CLV with the following formula:

We also know that, on average, it costs a business five times the amount to secure a new customer than to retain existing ones.

Here's how word-of-mouth marketing fits into this picture.

Whenever you invest in a loyal customer, they're much more likely to share recommendations with others based on positive experiences. Those consumers may then become customers based on the referral.

That means that you gain value from new customers without spending anything to acquire them.

Furthermore, the data shows that a referred customer has an average 16% higher CLV than a non-referred customer that features the same attributes. Referred customers also show roughly an 18% lower churn rate than their non-referred counterparts.

For brands that wish to improve revenue and grow sustainably, generating quality word-of-mouth marketing is non-negotiable.

3. Generate Compelling Content with Loyal Customers

Satisfied customers generate social proof for your brand.

We know that outside recommendations generate better results than paid advertisements. Therefore, there is an opportunity to combine customer stories with your marketing vehicles to create compelling user-generated content.

UGC can come in the form of text, photos, videos, or creative works that speak positively about your brand. The work still comes from an outside source, you're just leveraging your following to give it greater reach.

How to Motivate Your Audience for Word-of-Mouth Marketing?

While word-of-mouth marketing generates free results, you still need an important component - loyal customers.

If you're struggling to generate solid WoM, you need to first invest in your existing clientele. While you may provide a useful product or service, it takes exceptional customer care to generate a passionate, loyal following.

Here are some quick tips for motivating your audience to speak up about your brand.

1. Focus on Connections, Not Numbers

Most modern digital marketing primarily focuses on data collection, and for great reason.

Between PPC platforms, Google Analytics, Google Search Console, and other analytics tools, we can easily collect insights about our daily visitors.

Paid ads specialists then utilize this data to curate marketing campaigns directed at key demographics. Segmented marketing will generate superior results than campaigns with less focused targeting.

However, many experts get too caught up in viewing their users as mere data. Customers feel the disconnect, and that's why you aren't developing relationships.

The good news is that you can correct this process by training your sales teams accordingly. Your brand should be striving to give each new prospect an exceptional buying experience. Listen before you speak, prioritize their needs, and think about what you can do to make their lives better.

Each person is different, so results can be unpredictable. However, we can start by focusing on the key qualities of a genuine individual. This includes kindness, humility, compassion, and empathy.

In a transactional sense, you can provide a better experience than your competitors by rewarding both new and loyal customers. Exclusive discounts, gifts, and thoughtful service are often enough to get people talking.

2. Deliver an Exceptional Product or Service

This may be intuitive, but it's a point worth acknowledging.

The entire reason customers come to your brand is for your offerings. If your goods or services are substandard or worse than a competitor's, there's nothing worth sharing with friends or family. An experience that fails to hit the mark may earn negative word-of-mouth marketing, which can rapidly tarnish your reputation.

Get back to the basics. Focus on building a team that's genuinely passionate about what your brand aims to provide to others. Work hard to make something exceptional that's worth the buzz.

Finally, listen to your audience. Even amid complaints or negative reviews, they are telling you how you can improve. Taking your lumps and utilizing that feedback may be the first step in fostering goodwill with alienated customers.

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Building a Word-of-Mouth Marketing Strategy

You can start to build customer motivation by utilizing related marketing channels. Here are a few strategies used by top brands to generate positive buzz around the web and in person.

1. Get Active on Social Media

If you want to focus on building connections, there's no better marketing channel than social media. It's in the name.

Platforms like Facebook, Twitter, and YouTube function differently than other parts of the web.

A website, for example, provides a solo user experience. Your audience likely found your site by asking a question or typing certain keywords into Google. They then check out your site for information and eventually leave.

Social media is different in that it's a communal experience. Thousands of updates go out every minute that allow each user to participate in new conversations. They could be discussing local happenings, national events, or viral content. They may also be talking about you.

Engaging in the conversation on social media helps to build those connections. You can alter your public perception to make your brand seem personable, rather than being a cold, profit-driven entity.

Be sure to utilize a social media expert that understands how to use the local lingo. Capitalize on trending hashtags to help your content connect with the right audience. You may quickly gain likes and shares, which in themselves are a form of word-of-mouth marketing.

2. Gather Reviews & Testimonials

This tip harkens back to our understanding of consumer-to-consumer recommendations.

Positive reviews about your brand create social proof. Even though the review isn't from a personal connection, it can satisfy the need for a trustworthy recommendation.

Reviews are so important that they act as a ranking factor in local SEO. When you search for “restaurants near me,” you get a list of results accompanied by star ratings and testimonials.

Naturally, businesses with higher ratings take precedence over results with low ratings or with zero reviews.

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Adding positive reviews to your website helps you to control the narrative. It also demonstrates that you value the customer experience and helps you forge those connections that lead to quality word-of-mouth marketing.

3. Initiate a Referral Program

Another way to motivate customers to talk about you is to reward them for their efforts.

A referral program typically offers gifts or exclusive discounts to loyal customers. Any time a new customer makes a purchase based on an existing customer's referral, the existing customer gains the reward.

Typically, referring customers can continuously gain rewards. This makes it beneficial to keep spreading the word about your brand.

Creating the ideal reward is key here. You want to offer something genuinely desirable that will not hurt your bottom line. Think about how much you stand to gain from these new free customer acquisitions. Then, compare that to the amount you're spending to provide the referral reward.

Referral rewards are powerful because a great one offers exponential gain. We know that referred customers exhibit less churn. Therefore, they're more likely to spend and pay the referral forward to even more customers.

4. Start a Content Blog

Content blogs help you market in several ways. If you're trying to improve your website rankings, content becomes a critical part of your SEO strategy.

However, great content can potentially generate positive word-of-mouth buzz.

A high-quality blog offers users educational or entertaining content for the audience. If you present something worth reading, then your users are more likely to share it with peers.

In addition to this, a blog presents the opportunity to build your authority as an industry expert. The better your content serves your readers, the more they will trust you in everything else you have to offer.

5. Promote User-Generated Content

User-generated content is any content that your customers make regarding your brand.

UGC can take many forms including stories, videos, artwork, or photos of themselves enjoying your products or services. In many ways, UGC can serve a similar purpose as testimonials or reviews.

UGC costs nothing to create but can pay dividends for marketing your brand. It establishes trust with new audiences, offers new and creative content for your ads, and shows the public that you value your customers.

All of these help you create a more sociable, genuine, and positive connection with your audience.

6. Create Entertaining Video Content

The power of video content is unquestionable. It’s far more powerful than text-based content or static images.

Wyzowl’s 2022 video marketing report proposes the following stats:

• 94% of marketers report that videos help customers better understand an offering
• 93% say that video contributes to brand awareness
• 81% say that video was a direct factor in increasing sales

Video content is stimulating. Entertaining or insightful video content gets people talking. Some of the most successful marketing campaigns ever started with a simple video that went viral. For a small investment, it can get the entire internet talking about you overnight if you’re successful.

To give your video content the best chance of success, choose a compelling emotion.

Humor is a popular way to go, but heartfelt messages can trigger a response that motivates action. There's a reason why ASPCA's TV spot with Sarah McLachlan still plays today.

Build a Word-of-Mouth Marketing Strategy That Works

Word-of-mouth marketing is desirable for every brand.

Not only is it direct feedback on your positive performance, but it also generates free publicity and lead generation. When you provide something worth sharing, the results will come to you organically.

Referred customers from word-of-mouth are not only free to acquire but statistically exhibit a higher customer lifetime value.

You can motivate your customers to share your brand via word-of-mouth with a variety of strategies.

Take advantage of modern marketing channels like social media, video, and blogs to connect with audiences. Find opportunities to utilize testimonials and user-generated content to foster trust and social proof with new leads.

All of these techniques come back to one key point - personal connection. Appeal to emotion, focus on their needs, and provide the answer to their problems. Positive word-of-mouth will follow naturally.