Word-of-Mouth, a Key Component of the Marketing Mix

So how do you find out where to get the best chicken vesuvio in town? It’s likely you’d ask a friend or colleague who knows the local restaurant scene and go try the dish?

Brand managers are harnessing that power of word-of-mouth to boost product images, company reputations and sales. Word-of-mouth marketing has become a science in its own right, founded on the principles of empowering consumers, valuing their opinions, leveraging their knowledge and experiences, and taking action in response to expressed concerns.

Lasting consumer trust can be built and expanded much more deeply and legitimately through word-of-mouth than is possible from relying mostly on traditional media advertising to get the word out. It’s all about credibility—getting it, maintaining it and growing it.

Facebook, MySpace, LinkedIn, Twitter and other social sites have fueled the stratospheric growth of word-of-mouth and brands need to be paying attention to who’s talking about them and what they’re saying. Word-of-mouth allows brands to join the crowd and participate appropriately in the dialogue.

Many veteran marketing executives and brand managers are evaluating word-of-mouth and asking, what is the strategic fit? Does word-of-mouth support or contradict a traditional media campaign? How effective is it compared to advertising? The answers lies in how technology is changing the ways consumers learn about brands and evaluate them.

“Word-of mouth marketing extends the attributes of your brands, such as confidence, trust and reliability, that have been conveyed through traditional media,” said Scott Wilder, group manager, Quickbooks Software and Business Services for Intuit. “The two-way dialogue online between consumers and brands help us better understand how customers are using our products and enables our employees to build stronger relations with them.”

With word-of-mouth marketing, it’s possible to build a network of active and mutually beneficial communications in which consumers and marketers engage in open and transparent dialogue. So word-of-mouth isn’t about creating word-of-mouth communication because that process is natural and ongoing. It’s about harnessing the voice of the customer for the good of the brand. Success comes from empowering consumers to share their experiences, voice their gripes, and, above all, making it easier to tell their friends and assure that credible and influential voices know the benefits of your brand.

Ford, for example, has been hit hard by the recession, yet it has new models it wants consumers to test drive. To spur trials of new Ford Fiestas, to be introduced in the U.S. in 2010, the company is recruiting young adults as “Fiesta Movement Agents.” They will drive the cars for a month and share their opinions and experiences with Ford and other consumers through blogs and social media. On the company says the strategy is aimed at consumers born between 1979 and 1985, who represent 70 million new drivers, and creates opportunity for Ford “to connect with a group that hasn’t established brand loyalty and is very connected to the use of technology and networking.”

As Ford is showing, more and more brand marketers realize that word-of-mouth is not a fad and is here to stay. Its value will grow because it is the most honest from of marketing rooted in the natural human desire to share ideas, opinions and experiences with friends, family and colleagues.

Skeptics say word-of-mouth is risky because there is no way to control it and to make certain that product messages are disseminated to the right audiences. They believe there’s no substitute for a well designed, creative and precisely executed advertising campaign to expose a brand favorably and generate strong consumer awareness. They question how many people really want to spend their free time engaged in online discussions about the pros and cons of airlines, cell phones, barbeque sauce, etc. They wonder if online talkers will really become respected experts whose thoughts about brands will influence purchasing decisions. And, they wonder about the return on investment. How many consumers can be reached and influenced favorably through advertising vs. the word-of-mouth approach?

Word-of-mouth consultants and practitioners advise that the tactic isn’t designed to replace or cut back on product advertising. The return-on-investment argument favoring word-of-mouth is based on reaching, dialoguing with and influencing consumers who know your brand and have opinions about it.

“Word-of-mouth marketing using social media doesn’t work by itself, it works best when merged with paid and earned media to increase awareness of the brand,” said John Bell, president of the Word of Mouth Marketing Association and managing director/executive creative director, 360 Digital Influence, Ogilvy Public Relations.

Consumers are exposed to more than 3,000 advertising and promotional messages a day and instinctively employ a personal message shield that blocks attention to most of the ads they see and hear, he said.

“The public doesn’t trust the media and we mentally surround ourselves with a shield in which advertising messages don’t get through without some type of reinforcement. Therefore, brands that provide engagement value and connect through the message shield are the ones that earn our attention,” he said.

Effective use of word-of-mouth, therefore, provides the capability to engage consumers and reinforce advertising messages. Empowering consumers to share their thoughts and experiences fosters credible dialogue that supports brand imaging in ways advertising alone can’t achieve. And, yes, the contagious dynamic of word-of-mouth communications assures that significant numbers of consumers interested in your brand will be reached and influenced.

When considering how to incorporate a word-of-mouth campaign into the brand marketing mix, marketers should realize that traditional media and word-of-mouth can be parlayed into a potent package that drives brand awareness and builds consumer good will and loyalty. A clever campaign gives consumers something to talk about online.

By the way, I’ll be in Philadelphia next month. Does anyone know a good place for chicken vesuvio?

Kristen L. Smith, CAE, is the executive director of the Word of Mouth Marketing Association. She can be reached at [email protected].