What is 'Word-of-Mouth Marketing (WOM Marketing)'

Word-of-mouth marketing (WOM marketing) is when a consumer's interest for a company's product or service is reflected in their daily dialogs. Essentially, is it is free advertising triggered by customer experiences — and usually something that goes beyond what they expected. Word-of-mouth marketing can be encouraged through different publicity activities set up by companies, or by having opportunities to encourage consumer-to-consumer and consumer-to-marketer communications. Also called referred to as "WOMM" or "word-of-mouth advertising," WOM marketing includes buzz, viral, blog, emotional and social media marketing.

Breaking Down 'Word-of-Mouth Marketing (WOM Marketing)'

Word-of-mouth marketing differs from natural word-of-mouth references to a company's products and services in how it may come as the result of promotion, encouragement or other influence by a company, otherwise known as "seeding." When a diner has a wonderful time at a restaurant because their expectations were exceeded and later tells tweets about it, or when someone had a great experience using a product in a new way and tells everyone they know about it, those are examples of word-of-mouth marketing. Also, word-of-mouth marketing does not stop at the first interaction; it tends to lead to a cascade of follow-on interactions.

The encouragement on the part of a company may take one of several forms. The best way is to give them a reason to talk, such as exceeding expectations or providing insider skills or information about a product. Other strategies include offering consumers new ways to share information about a company's products and services, and engaging and interacting with the consumer, such as through exemplary customer service. This is especially valuable with social media-based customer service, which provides for seamless sharing and promotion.

Word-of-Mouth Marketing: Efficacy

According to Nielsen, in 2012 consumers around the world said they trust recommendations from friends and family (earned media) above all other forms of advertising. That represents a rise of 18% from 2007.

Consumers are more emotionally bonded to a company when they feel they are listened to by the company. That is why many companies will have sales representatives discuss their products and services with consumers personally or through a feedback phone line. This kind of interaction, as well as promotional events, can stimulate conversations about a company's product.

There is significant temptation to fabricate word-of-mouth marketing. Accordingly, the Word of Mouth Marketing Association (WOMMA) has crafted a code of ethics for the industry, the best word-of-mouth marketing strategies are "credible, social, repeatable, measurable and respectful" and there is no excuse for dishonesty. WOM marketing expert Andy Sernovitz has boiled down WOMMA's code of ethics into a three key rules to avoid issues:

  • Say who you are representing (always disclose a relationship)
  • Say only what you believe (be honest with an opinion)
  • Never lie about who you are (be honest about your identity)
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