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The Danger of Relying on Word of Mouth

Happy customers will tell others, they’ll in turn tell their friends and family, and then before you know it everyone in town knows how amazing your work is.

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Word of mouth used to be a major marketing tool in the small business marketer’s toolkit. After all, it does make sense right? Happy customers will tell others, they’ll in turn tell their friends and family, and then before you know it everyone in town knows how amazing your work is.

 

While great word of mouth is never a bad thing, there is significant danger when your brand image comes to rely solely on this type of marketing.

 

One of the main problems when we rely on word of mouth is that it naturally subverts our personal responsibility to do better. If our business isn’t reaching the level we’d like it to we easily brush this off, telling ourselves well our customers just aren’t getting the word out enough yet. 

 

This is a major mistake. 

 

Customers are customers, they’re not our marketing teams. They should be treated as valued customers and not expected to run our marketing departments. Of course, when a customer expresses that they’ve had a truly stellar experience, it will never hurt for them to share to their friends and family. As a small business owner you can even incentivize this type of action when you feel it’s appropriate, however; your business cannot survive on word of mouth alone.

Word of Mouth Marketing is Unreliable

Before the digital age, when social media wasn’t a daily part of life for the majority of Americans, many businesses relied heavily on positive word of mouth.

It was simply a great thing to have. People had less options for products and services and without sites like Yelp or Google reviews available, we relied heavily on the experiences of people we trusted to point us in the right direction.

While we still often give word of mouth reviews to those close to us, the way we consider these recommendations has changed. Your neighbor telling you that he gets great haircuts at a particular barber likely means nothing to you, but seeing a post on Facebook with this same information with a link to the website and then seeing the barber has 2450 positive reviews, may be enough to sway your opinion.

It is impossible to guide the conversation when you rely on a reputation built through word of mouth. Anyone can say anything for any reason.

We rarely rely on a single persons recommendation these days because there is much better data from a wider group to evaluate before we make a decision. This works the opposite way as well, your neighbor may have had a great experience, but that is a very small test group from which to form an opinion, isn’t it? 

If your neighbor raves about his barber but the Yelp review score is 1 star, with several hundred people explaining a multitude of problems and negative experiences they’ve had there, how much weight will you really place on his positive word of mouth review?

Probably not very much.

However, if your neighbor tells you the barber down the street is awful, but Yelp shows 2450 reviews of 5 stars out of 2500 total reviews, you may still give the barber a chance.

Word of mouth marketing is simply unreliable.

Many people have personal tastes, and gauge their experiences at a business through the lens of their personal expectations and histories. Think about the most unreasonable customer you have ever had. What would this person say about your brand? Would you trust this person to give a fair assessment of your business, products, or abilities to other people? Most likely you would not. 

It is impossible to guide the conversation when you rely on a reputation built through word of mouth. Anyone can say anything for any reason.

Imagine you run a pet shop that is specific to bird supplies. A man comes in looking for a new red collar for his German Shepherd. You apologize and explain that you are actually just a bird store, but let him know there is a larger pet store across town that you know sells great collars for bigger dogs. 

Later, when this gentleman is at the local dog park he remarks to another dog owner that your pet store is no good because you don’t even have dog collars. “What kind of pet store doesn’t even have dog collars, it’s the most basic thing!”.

The other person now has a negative impression of your shop, based on completely irrelevant and inaccurate information, that you never had a chance to correct. When the second gentleman walks into the office the next day and hears his co-worker explaining that her daughter just got a parrot and they need to get lots of supplies this weekend he may chime in with, “Hey, don’t go to that new pet store, I heard it’s horrible, they barely have anything there, don’t waste your time.” 

What a guy.

When your brand’s reputation relies only on the word of mouth of others, you are putting your business at a dangerous disadvantage.

But this is actually how it works in real life. You hear something negative and form an immediate opinion. 

Was this a fair assessment?

Is your bird pet store, Lord of the Wings, actually the ‘worst pet store ever’?

Of course not!

It would be much better if the person who was told this outrageous information about your store had previously seen your brand on Facebook or Instagram, and could easily remark, “Well… they didn’t have dog collars because it’s a bird store..”. 

Unfortunately, that’s not always the case, and negative word of mouth can really impact businesses. When your brand’s reputation relies only on the word of mouth of others, you are putting your business at a dangerous disadvantage.

Word of mouth marketing is slow

We have never been able to share information more quickly than we can today, at any point in human history. In 20 seconds, you can send the complete works of Mozart to your Aunt in Texas while lounging in your favorite chair in San Diego.

Word of mouth travels much more slowly comparatively today, than it did in the past. 

In decades past when there was a new restaurant in town you’d hear all about it at the PTA meeting, neighborhood social events, and many other places people gathered, simply because everyone was exposed to far less information.

When there is 1 new restaurant opening in your town every 3 years, it is actually news.

Today though, by noon we have already been exposed to hundreds of topics, articles, blog posts and dozens of expert opinions, breaking each of these topics further down into minutiae that we become numb to things unless we truly care about them.

A much quicker way to harness the spirit of word of mouth marketing is by turning the conversation onto social media.

If someone tells you about a new restaurant they tried recently, you are likely to forget all about it a few minutes later.

It becomes a passing piece of information, in a day of information, in a week/month/year of information, in a world where we are bombarded with information constantly.

A much quicker way to harness the spirit of word of mouth marketing is by turning the conversation onto social media. People are much more likely to post a Facebook status or send out a Tweet about the great new place they just discovered, than they are to tell 200 individual people all about it in person.

When you are present on social media you can then monitor this discussion, jump in whenever necessary to keep the record accurate, informative, and valuable to all those who read it, all while giving newly interested people a way to take action immediately by directing them to your website, business page, or blog.

Now when someone posts that Lord of the Wings is the worst pet store in town because you don’t even carry dog collars, you can quickly respond that you are so sorry but bird owners don’t generally find a need for dog collars on your shelves, but you do have tons of great bird stuff, and there’s even a sale this coming Saturday!

The nonsense is drowned out immediately by the right people, the wrong people are corrected, and this piece of irrelevant information dies right where it’s born, without hurting your business or reputation at all.

Word of mouth is often based on a personal stake and we have more choices than ever before.

If anyone but your closest friends was to go on and on raving about their new hairstylist and how you just have to go, no seriously you should call right now and make an appointment, you would quickly assume this person has a personal stake in your visit.

Maybe they’re part owner, maybe they get a discount if they refer 5 people, something doesn’t feel right when we’re pushed to a business like that, does it? 

We naturally dismiss this type of marketing from all but those we trust the most. Even if you really love a new business how much can you get that across to another person before they assume you must have something to gain?

If another person believes your intentions are completely honest, how much do they really care what you think? Will they take your word over that of reviews, rankings, etc? 

The problem is that as consumers, we have more choices now than we’ve ever had before. If you want a specific pair of shoes and they don’t have them at your normal shoe store, there are likely 50 other shoe stores within 10 miles of your house.

If none have them in stock they will all be able to cross check inventory at all other locations, in other cities and states and ship them to you, often for free. If these were extraordinarily difficult shoes to find you have access to the global stock of shoes right on your phone by visiting Amazon, Walmart, Target, or eBay online.

Think back to the last time you casually mentioned to an acquaintance a television show that you absolutely love.

The issue that word of mouth marketing runs into is limited reach. When this is the only promotion your business gets it is often going to be reaching the same people over and over.

“You have to check it out, it’s on Netflix, it’s so great, there’s this spy, and he’s sort of undercover except they kind of know already, you just HAVE to watch it!”.

Your acquaintance probably forgot the name of the show before you even stopped talking. Or worse yet, have you ever excitedly described something to someone who didn’t get as excited about it as you were? You might keep telling them more and more to see their face finally light up once they get it, finally changing the subject when you realize they don’t understand since they weren’t there.

How often does someone tell you about a show they love and you feign interest, assuring them you’ll definitely check it out, as soon as you have time, all while knowing that you will never watch it? 

We are all guilty of this. We don’t do it to be rude or thoughtless, we just have our own circle of content, movies, shows, celebrities, authors, gyms, salons, restaurants, etc and we rarely break away from these things just because someone says they like something different.

Word of mouth marketing suffers from an inevitably limited audience

Let’s say you run a professional services business and your customers love you and what you do. 

That’s great! 

Many of them will likely promote your business through their business networks and friend groups. The issue that word of mouth marketing runs into is limited reach.

When this is the only promotion your business gets it is often going to be reaching the same people over and over. Your professional network consists of the same group of people.

Your network’s network consists of the same group of people. Once you have gained all the new customers that you ultimately will from this method, where do you go to gain new customers?

How do you scale when you need customers to tell other people how great you are in order to be found by a new customer?

When you rely solely on word of mouth marketing you don’t get to control who learns about your business. You’re limiting your brand’s potential reach to the boundaries of your customers network.

While knowing your customers and niche are very important for marketing, it’s also important to diversify and gain customers from demographics outside your immediate groups.

This way if something changes, another company begins making your customers favorite product better than you do and takes market share, you will survive because your customer base isn’t drastically reduced.

This is the unfortunate fate many small businesses suffered when Amazon began selling popular products at a third of the price as many small stores.

There was no possible way to compete. When you rely solely on word of mouth marketing you don’t get to control who learns about your business.

You’re limiting your brand’s potential reach to the boundaries of your customers network. Your customers are likely not marketing experts, nor do they hold a real stake in the ultimate fate of your business. 

The portrayed benefit of a word of mouth campaign is the simple multiplying numbers of those reached. If 10 people just tell 10 people each, and they each tell 10 more people, before you know it, I’ll have millions of customers! 

You can accomplish the same amplification of visibility online through social media, and you will be in complete control of what is said, and even exactly who sees it.

It’s far easier to share, more relevant, and more easily tracked when someone boasts about the amazing experience they had at your business on social media. 

This is the new word of mouth, and it even comes with extras.

Data is King

By now you know that data is everything when it comes to marketing. Whether you are a company the size of Amazon or you are the sole proprietor of a lemonade stand, the more data you have about who your customers are, their wants, and the best ways to appeal to and meet these wants, the better you will do.

Data allows us to serve our customers better, market more effectively, and do it at a fraction of the cost. 

It’s not surprising that there is absolutely no data from a word of mouth campaign. It is impossible to track which customers told who about your business, what they said, how effective that was, or how that translated to new your brand gaining new customers. 

Without any data, it makes duplicating a success, or avoiding a failure, equally impossible. 

If we are relying on a method of marketing that we can’t duplicate when it works well, or know exactly what to avoid if it works horribly, we are in dangerous territory.

The last thing you want to be as a marketer is blind. The worst possible data is no data. Word of mouth marketing doesn’t give us anything we can use to our advantage.

It is hard to counter negative views

As our previous example showed, when your bird store was unfairly mislabeled as the worst pet store in town, you didn’t have much recourse. You’ll likely never know what has been said about your business via word of mouth. 

The need to closely monitor and be in control of your brand image, at all times is vital, and cannot be ignored. 

You cannot let your business’ reputation rest in the hands of others. Not every company operates with the ethics we would hope they would. We can see this daily in the news when companies are forced to pay fines for misleading others, operating in dangerous ways, etc. 

A direct competitor may be willing to employ less than ethical tactics to take market share from your business. Often times people will read a headline and not an article, just like with word of mouth, an opinion is formed almost immediately. Some people will rush to your side to defend you, others will ready the pitchforks and torches.

Large brands have teams of people who do nothing but scour the internet to see where and how their brand is being mentioned and ensure they are never seen in a poor light.

People can say anything at all about your business to anyone, and there is nearly no way to track these things back to their source. If this is the only available method for someone to learn about your business, you’re in real trouble.

When you use tools to monitor your brand’s reputation online, you are engaging in a standard method brands all over the world use to their advantage; social monitoring.

Large brands have teams of people who do nothing but scour the internet to see where and how their brand is being mentioned and ensure they are never seen in a poor light.

Where a displeased customer has posted a negative review, they can easily remedy it immediately. When there is unfair or inaccurate information provided by others, they can set the record straight and provide the correct information to best assist their customers and potential customers. 

Social listening is not only available to large companies. Many social media agencies and managers employ this to make sure the brands they represent are never unfairly targeted by competitors, or anyone else wishing to harm their reputation.

When your business maintains a social media presence, official channels where people know they can go to find the best information, you are putting your business at a marked advantage and safeguard.

What others say here and there has little effect because it is drowned out by relevant and thoughtful information, put forth by your brand itself.

This is far more valuable than just hoping your customers are always going to get every piece of information about your business completely accurate, or that you won’t ever get that customer who is confused about what you do, or just really unhappy with you and deciding to let everyone know about it. 

When you control the conversation, and you bring it to online and on social media, even if the negative remark or review stands, you will always have the opportunity to respond.

While a negative review or remark is usually not enough to dissuade someone from your brand completely, by responding, you’re showing that you are someone who cares about your brand’s image.

This is usually the difference between giving a business a chance, or assuming they are not worth it.

The important distinction to make here is not that word of mouth marketing is bad, only it should be seen as a bonus for a job well done, not a complete marketing strategy.

Anything that is bringing new customers to our businesses is great and should be gladly accepted.

The important distinction to make here is not that word of mouth marketing is bad, only it should be seen as a bonus for a job well done, not a complete marketing strategy.

Word of mouth is too unreliable, works too slowly, has too limited of reach, is too hard to control, impossible to track, and provides no data, for us to use this as our only method of marketing our businesses.

When you have great word of mouth, take it as a sign that you are doing things well, and continue doing them well. Just don’t take it as a sign that maybe doing any marketing yourself isn’t really necessary because your customers will handle it all for you.

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The Danger of Relying on Word of Mouth

Happy customers will tell others, they’ll in turn tell their friends and family, and then before you know it everyone in town knows how amazing your work is.

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