Benefits of Word of Mouth Marketing (and How To Overcome Its Drawbacks)

When Word of Mouth Marketing Isn’t Enough

By Carrie DagenhardApr 2 /2019

It’s hard not to be impressed when you hear someone grew their business via word-of-mouth. After all, if a company can rely solely on customer recommendations to sustain or even scale, that’s a clear indicator its product or service is pretty damn good.

But while word-of-mouth marketing can be effective (and also usually cheap, or even free), it has its limits. Sure, it may help an entrepreneur launch their practice or earn a small retailer those crucial first sales, but it’s unlikely this tactic alone will provide the reliable, sustainable stream of business established organizations need to generate consistent revenue.

But this doesn’t mean you should trash word-of-mouth marketing strategy altogether (especially if it’s driving results). Instead, it’s important to understand when word-of-mouth alone is least effective and how you can boost your business results by including it within a more holistic strategy. Before we delve into the benefits of word-of-mouth — and what to do when it isn’t enough — let’s cover a few basics.

What is Word-of-Mouth Marketing?

Word-of-mouth marketing refers to any type of recommendation a satisfied customer provides to a prospective customer. This can be written (an online review) or oral (a casual conversation).

Because buyers are more likely to trust other buyer experiences than messages shared by a company, word-of-mouth is one of the most useful tools for establishing credibility and growing brand recognition.

Here are a few examples of word-of-mouth marketing:

  • Customer reviews on third-party sites (Yelp, Google, G2, Capterra)
  • Recommendations via social media conversations
  • Blog posts that list and link to one or more products or services
  • Satisfied customers sharing their positive experiences with personal contacts

Keep in mind, the active ingredient in word-of-mouth marketing’s success is authenticity. For example, 50 percent of consumers trust online reviews as much as personal recommendations from friends and family, according to data from BrightLocal. But as soon as it’s obvious a reviewer was paid for their feedback, reviews appear to be generated by AI, or a review is anonymous, trust levels begin to dip.

What Are the Drawbacks and Benefits of Word-of-Mouth Marketing?

Word-of-mouth has its disadvantages, particularly when businesses solely rely on this method rather than baking it into a more comprehensive marketing strategy. Here are a few of the most common drawbacks and solutions to help you experience more benefits from word-of-mouth marketing:

Drawback: Word of mouth limits your reach.

How many existing happy customers do you have? How many of those customers would be willing to review your product or service, or tell their friends about the success they’ve experienced with your business? And how many of those word-of-mouth marketing interactions will drive potential customers to your organization? And how many of those leads will actually convert?

While it’s almost impossible to earn a conversion rate of 100 percent through any single marketing tactic, it’s especially tricky with word-of-mouth marketing. These forms of referral marketing will always be limited to the number of satisfied customers willing to evangelize your brand's products or services.

Solution: Launch a customer referral program.

Rewarding your existing customers for referring peers is a great way to incentivize word-of-mouth marketing, benefit from the power of social proof, and boost brand loyalty. Referral programs can also lower the cost of acquiring new customers — especially if your business offers incentives that require little or no effort from your team, such as a free or discounted month of service. Turn your loyal customer base into brand advocates and brand ambassadors and they can become a de facto extension of your marketing team.

Drawback: It can take a long time.

Successful marketing requires the right message in the right place at the right time. While word-of-mouth marketing might tick the boxes for “right message” and “right place,” its timing isn’t always best.

Take, for example, an HR professional telling another HR professional about their positive experience using new workforce management software. While that colleague may be interested in learning about the product, or even be in the market for a new solution, it could be several months before they finally get around to following their recommendation, or longer to a purchasing decision — if at all.

Solution: Create a marketing campaign to nurture referral prospects.

In addition to encouraging customer advocacy, develop a nurture campaign to ensure your ultra-busy prospects don’t forget your offering. For example, if an HR professional refers their industry pal to your workforce management software, you can equip them with case studies, ROI calculators, and other resources to accelerate their buyer’s journey while keeping your brand top-of-mind.

Drawback: It can spread misinformation.

A simple mention of the term “negative online reviews” can send some business owners into a full-blown anxiety attack. While everyone wants more reviews, nobody wants to deal with the bad ones. And the only thing worse than a bad review is an untruthful one.

Negative word-of-mouth marketing can trigger a release of inaccurate information that’s misleading at best and reputation-damaging at worst. If you’re relying exclusively or primarily on word-of-mouth marketing and something goes amiss, you’ll be in a tight spot.

Solution: Focus on client satisfaction and reputation management.

Even the most-loved brands in the world can’t make everyone happy. But, while you can’t control what upset customers say about your business online, you can respond to reviews, flag inaccurate or offensive content, and do your best to boost your reputation by delivering positive customer experiences and quickly addressing concerns. Rare negative comments hold less weight when most customers are delighted.

Drawback: Word of mouth isn't targeted.

A positive review may go semi-viral, earning you plenty of incoming traffic from social media and highly qualified buyers, or it might land on deaf ears. A recommendation might reach precisely the sorts of buyers most likely to benefit from your product or service, or it might be shared to a network of people in an entirely different role or industry than your ideal buyers or target audience. There’s really no way of knowing.

While word-of-mouth marketing can help boost your brand, where it’s shared and who hears the message is largely out of your control. This sometimes results in unqualified leads and lengthy periods of radio silence.

Solution: Amplify positive customer experiences on the right platforms.

One way to get more eyes on positive customer sentiments is to re-share them where your ideal customers spend the most time. For example, share screenshots of glowing reviews on social media sites or solicit and re-share user-generated content—like videos from happy clients sharing their favorite features.

Also, keep in mind that boosting these posts or making them part of a paid campaign can help ensure these messages reach the right audience segments. Folding positive customer experience into your social media marketing gives your brand image depth and added credibility it may otherwise lack when the messaging is only coming from your marketing team.

Drawback: It can be difficult to measure.

When it comes to tracking word-of-mouth marketing offline, it can seem nearly impossible to quantify. You can’t be everywhere everyone is talking about you, no matter how hard you try. (And in some cases, you may not want to!)

Solution: Measure wherever possible.

The good news is, there’s plenty you can measure — especially if you’re being smart about attribution. For example, giving customers their own unique referral codes or leveraging QR codes at events. And although offline measurement can be tricky, you can usually measure the effectiveness of online reviews and recommendations through analytics. Many third-party review sites give businesses access to an internal dashboard, and even if they don’t, you can check your referral sources through your marketing automation platform to determine what’s driving traffic and leads.

What to Do When Word-of-Mouth Marketing Isn't Enough

Here are a few scenarios when word-of-mouth marketing can be limiting and best practices for weaving it into a more holistic marketing strategy:

1. You're a well-established brand.

Once you’ve achieved a certain level of brand recognition, word-of-mouth may get your name on the shortlist, but it won’t make the sale. In this case, you need to delve into multichannel efforts that can help amplify the movement your word-of-mouth efforts began and ensure you remain top-of-mind. For example, you may maintain a robust LinkedIn presence, deliver a weekly newsletter with guidance on solving common challenges, and advertise on a popular podcast relevant to your industry.

2. You need to increase sales fast.

As mentioned above, seeing results from word-of-mouth marketing can take time. And if your business is in a position where you need to increase deal velocity, word-of-mouth efforts aren’t going to get you the outcome you need. Instead, you need to make sure prospects are hearing the right messages at the right times to keep them moving (quickly) through the buyer’s journey. This is where an irresistible referral offer and an effective nurture campaign can really shine and lead to more sales.

3. You need to prove your marketing efforts' effectiveness.

If senior stakeholders are bearing down and demanding results, it’s not the time to experiment with efforts you can’t measure. Instead, it’s critical you stick to marketing campaigns and initiatives you can monitor closely for the sake of performance management and reporting.

Keep in mind that word-of-mouth marketing is easier than ever to measure online, but can require some proactive efforts — like creating unique trackable links and referral codes, and setting up reporting through or integration with third-party review site analytics dashboards and your digital marketing platform.

4. You're trying to enter a new market.

If you’re attempting to break into a new sector, you may not have enough relevant customers to make a word-of-mouth campaign worth your time. While having existing clients share their success stories can be helpful when trying to stake a claim in a new market, you need to ensure you’re also creating highly targeted content tailored to the new decision-makers you’re hoping to reach.

If you don’t have positive reviews from customers in a new market, extend social circles by looking for clients adjacent to those markets or that share similar challenges. For example, a company currently serving the financial industry and wanting to break into the healthcare sector might highlight reviews that discuss their brand’s commitment to privacy and data protection.

5. You have a complex set of products or services.

If your offering is complicated to explain, you can bet your customers aren’t doing it justice. After all, it's word of mouth, not words of mouth.

While the pure delight of brand ambassadors may be enough to drive someone to check out your product or service, you need to spread plenty of factual, educational messages about your offerings to counteract any misinformation. Start with conversations with some of your most loyal customers and scanning existing reviews to better understand the language and jargon they use to discuss the challenges that your product or service solves. Then, make sure your content reflects that language.

It’s hard to overstate the impact of word-of-mouth marketing — it’s one of the most useful and cost-effective tools for organizations of any size that want to increase brand authenticity and earn prospects’ trust. However, this tactic alone is rarely enough to drive consistent qualified leads and keep your business steady and growing. By understanding the limits of word-of-mouth efforts and identifying how to build it into a larger, more holistic marketing strategy, you’ll be well-positioned to meet your goals.

Word of Mouth Is Part of a Whole: Kuno Can Help You Figure Out How To Best Utilize It.

Great brands build on their marketing efforts through encouraging clients and customers to share their positive customer experiences, incorporating that as part of a digital marketing strategy that seems word of mouth as one of multiple channels that elevates brand and lays a foundation of trust with an audience. By itself, it's a gamble. As part of a holistic approach, word of mouth is a valuable investment for every part of the customer journey or sales funnel.

We understand that any healthy marketing effort requires a thoughtful broad-based approach and tactics. Kuno's experienced team of strategists, WebOps and RevOps experts, designers, brand journalists, SEO professionals and social and paid media specialists work together to figure out how to make your brand shine, and how get your message to the right people in the right places and the right time.

Talk to us about your marketing needs, and let's see how we can build a comprehensive strategy that lets word of mouth marketing supercharge everything else.

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The Author

Carrie Dagenhard

Carrie is a seasoned content strategist who worked as a department editor and music journalist before making her foray into inbound marketing as a content analyst. Carrie works hard at crafting the perfect content strategy for clients and using her hard-hitting journalism skills to tell your brand’s unique story.