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Last Updated : Sep 28, 2016 01:03 PM IST | Source: Moneycontrol.com

Is word of mouth dead or alive in this day and age?

In the current context, with the presence of a larger marketplace of ideas, can word of mouth still be a powerful tool as it used to be? The answer is, yes!

For centuries, people have made decisions and developed preferences using the simple, yet unquestionable influence of word-of-mouth. In the current context, with the presence of a larger marketplace of ideas, can word of mouth still be a powerful tool as it used to be? The answer is, yes!

With the ever-increasing number of channels enabling us to spread and receive information, the outlet for word of mouth has also witnessed an unprecedented upsurge, making it a key element for any brand’s marketing mix.

Why is word of mouth important?
According to a recent survey on consumers trust in advertising, close to 84 percent respondents said that recommendations from family and friends influenced their purchasing choices. An additional 68 percent said they relied on consumer opinions found online, even if they didn’t personally know the reviewer.

Word of mouth has become an irreplaceable tool to gain consumer trust, often ranking even higher than any other form of marketing.

Loyalty- It is obvious to note that a loyal customer can have a direct impact on business profitability. This can further be enhanced when this customer helps you connect to others within their network, thereby tapping into a market space that maybe out of the brands reach.

Studies have shown that 20% of loyal customers can bring in up to 80% of your revenue. Loyal customers breed more loyal customers.

Aspiration- The generation of word of mouth can influence the view of a product or service making it an object of aspirational value. This may happen when a product is limited in supply, is unique, or is seen as a fashion statement by existing customers. When One Plus first launched its phones, the exclusivity tied into the product with its by-invite only purchase, made it an object of aspiration for potential customers. This exclusivity fuelled the impact of word-of-mouth, driving remarkable recognition for the brand.

Marketing tool- Your customers’ word is more influential than all your marketing strategies combined, and it can be yours at a minimal cost. Word-of-mouth has been shown to improve marketing effectiveness by up to 54%. However, it is important to design the correct approach for your brand by tracking the effectiveness of the channels you make use of.

How to get it right?
There are many ways to target and regulate this phenomenon so that it works in your favor.

Addressing customer issues- Negative feedback propels word of mouth causing a large amount of damage if not diagnosed quickly, and managed properly.  As a brand that wants to constantly improve and better their product or service, one must view client feedback as an invaluable asset and respond to negative feedback promptly. Brand’s commitment to ensuring these issues are personally addressed helps consumer feel important, and can build more trust in your brand in the long run.

Closed Events- Organizing closed events can help create the impact one seeks to gain from word of mouth, as it builds awareness by facilitating conversations with the target audience. Word of mouth works wonders by bringing customers together whilst creating a sense of community among them. Closed events like workshops, seminars, private sales, parties and open houses create a sense of exclusivity amongst those who are selected to attend.

With the advent of the Internet, the impact of word of mouth has become one of the most powerful sources of influence and trust that travels fast, and in real time.

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First Published on Sep 28, 2016 01:03 pm
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