Thursday, August 20, 2009

Word-of-Mouth: the Marketing Heavyweight in a Downturn

While many businesses are suffering in the current economic climate, our research shows that businesses that use online word-of-mouth are coming out stronger than ever.

When times are tough, consumers seem to be placing even more weight on word-of-mouth referrals. WOMOW's usage trends, coupled with the findings of qualitative research carried out on a sample of the businesses on the site, revealed that;
  1. Consumers are now much more likely to rely on word-of-mouth referrals before parting with their money, and
  2. Businesses listed on WOMOW with several positive ratings had seen an upward surge in business, instead of the plateau or decline economists predicted.
“Our research suggests that buyers are more discerning about how they spend their money right now, and are turning to word-of-mouth recommendations before trying a new product or service.” In the period from September last year to now, WOMOW’s members have tripled and traffic has increased by over 270 percent.

The trend towards more reliance on word of mouth is having an amazing impact on the businesses that have several positive ratings, with many attributing a good part of their recent success to the site.

For example, Albert Square dentist Joanne Flaessas said that her business had “boomed” during this recession due to word-of-mouth referrals, many found on WOMOW. “In December we were doing about two teeth whitenings a week and now we’re doing five times that amount,” she said.

Vision Finance director Nicole Seagren said the firm relied purely on word-of-mouth referrals from satisfied customers, often through the WOMOW site, for new business. “We’ve just had our best year in quite a few years – probably up about 15 percent.”

Christina Stamatopoulos from Body & Bronze said that “since we joined in February, we've had at least 25 new clients that have found us through WOMOW. Customer service is a huge part of our business - and now it's paying off! We've had a bigger year this year than any other year! I don't think we've been affected by the downturn at all.”

Adam from ADM Motors said that “WOMOW has been really great for us. In the last few months, we've had 10-12 new customers from it - and they're just the ones that mention it to us! We've got people travelling more than 20kms - just to get a roadworthy done! I guess they see our reviews and they know that we won't rip them off.”

To help people recognise the businesses that take customer satisfaction seriously, WOMOW has recently introduced stickers which are free to all businesses that repeatedly get great customer reviews. “With people now taking word-of-mouth recommendations so seriously, we want consumers to know when they’re entering a ‘dodgy–free’ service zone - and we also want the businesses that provide good service to get the recognition they deserve.”

If your business is on WOMOW with 3 or more ratings and an overall rating of 4or 5 (out of 5), please contact us for your free "WOMOW Badge of Approval" stickers.