Tuesday, September 13, 2011

Why Word-of-Mouth Online Works

Many small businesses we speak to are somewhat daunted by terms like 'word-of-mouth online' and 'online reputation'. Or they think it's not relevant for them. Or they know that word-of-mouth is powerful, but don't know how this relates to their own marketing activities.

Before you flick the page thinking this is not for you, word-of-mouth marketing does NOT need to be a kooky stunt / viral video / give away product / or even an amazing campaign. Instead, it can simply be a consistent effort to get people talking about your business - and in the case of online word-of-mouth - doing that talking online.

In my mind, word-of-mouth marketing is undoubtedly the most powerful way for small and medium businesses to build a great reputation (by the way, this is what big business calls 'their brand'). It's a substitute for spending large amounts of money on mainstream media to generate awareness and preference for your business.

If you think about it, online word-of-mouth is perfect for most businesses. Let's break it down;

Question 1: Where is your market looking?
Answer: The Internet.

In fact, Neilsen Netratings research found that more than 80% of all purchases for goods and services start with a search on the internet, for both home and business! Did you realise that people are using the internet to find hairdressers, plumbers, mechanics, restaurants, online shops, accountants, travel destinations, dry cleaners, wedding services, doctors, gardeners, childcare - YES EVERYTHING! Even if you don't turn to the internet for everything, there's a good chance many of your target market does.
Adam Adler from ADM Motors quipped: "I never thought that so many people would be looking online for a mechanic or that customer reviews could make such a difference – boy was I wrong! We provide a good service and it means that the extra care we take is paying off."
Obviously the internet is not the only place people look, but most business owners vastly underestimate the number of people searching online for their type of business.

Question 2:
Who do they trust?
Answer: Other consumers.

This is why it is soooo important to build up a glowing reputation online.

The researchers at Nielsen also found that: 78% of people trust consumer recommendations above ALL other types of advertising and marketing. And eMarketer found that: Consumer reviews are significantly more trusted -- nearly 12 times more -- than descriptions that come from businesses.

That's right. Reviews are more believable than advertising. Or, as one business put it: "When you tell people how good you are, it's bragging; when other people say it, it's proof." Plus, the more reviews there are, the more trust consumers place in them. At WOMOW, we see a 'tipping-point' at around 10 reviews.
Dee Davies from The Clear Skin Clinic explains that for their business; "Once [people] read what our customers say about our services, they feel like they’ve found the right place and make an appointment straight away."
And Chris Dimos from Mr Verandah concurs; "The people that come to Mr Verandah from WOMOW just want to go ahead straight away. They don't need to go through the whole trust-building stage as they already see us as experts in our field. Word-of-mouth is a really good way of marketing our business - it fits really well with our business philosophy of letting our work speak for itself."
Businesses that view online word-of-mouth as too hard or not relevant, are really missing out. When people's recommendations are online, they reach millions of people, and most importantly, they reach them at exactly the right time - when the prospective customer decides they need your type of business and starts their research online.
Even boring businesses can create great word-of-mouth!
If you're interested in generating online word-of-mouth for your business, check out our Happy Customers Program here.