Word-of-mouth (WoM) marketing is a powerful driver for business success. A recent survey conducted for the Chatter Matters report found after receiving a verbal recommendation from a friend or family member, 83% of Americans are more interested in purchasing the discussed product or service.
The report found 66% of those surveyed received their information on products and services they were considering to purchase from online sources. This was followed by family members (46%) and “friends I know in real life” (45%). The rating for “friends on social media” was far lower, at 22%.
In addition, the report, which surveyed 1001 American consumers, found women are more engaged in WoM than men, with women relying on offline word-of-mouth from friends and family 22% more often than men. The survey found 51% of women relied upon WoM from family and friends, in contrast to 40% of men.
Interestingly, novelty or difference in a product appeals more to women more than men, with women being “49% more likely than men to discuss products or services they perceive as ‘different’ from the norm”.
Variation across categories and demographics for WoM
Another aspect of the report’s findings is the influence of WoM varied significantly not only between men and women but also across different age demographics, as well as product and service categories. As the report’s authors, Jay Baer and Daniel Lemin, noted:
“In many situations, word of mouth is far more persuasive than advertising, and not by a small margin. But perhaps the most interesting aspect of word of mouth in 2018 is that its effects vary considerably based on purchase category and age.”
Online WoM worked best in categories such as electronics and home improvements, while offline WoM was most persuasive for entertainment, children’s products, and restaurants. Millennials weighed in more often than any other category with WoM recommendations to their peers.
Maybe the oddest finding was that “66% of Americans trust an anonymous, online review more than they trust a recommendation from an ex-boyfriend or ex-girlfriend”. Not especially surprising, but a strange stat all the same!
Influencers and celebrities have little effect on consumers
The report also calls into question the effectiveness of ‘influencer’ marketing. It mainly looked at trust in celebrities and found that few of the people surveyed turned to a personality for product or service recommendations.
Businesses are spending more and more money on influencer marketing, hitching their promotional wagons to famous or semi-famous people who will (in theory) increase exposure and drive consumer behaviour. This report suggests those efforts may be in vain, at least with regard to top-tier, major celebrities.
Of those surveyed about the celebrities they trust, 4% said they would consider purchasing something recommended by Oprah Winfrey, while 25% said they trust no celebrity or famous person’s recommendation.
Trust in figures like authorities, experts and celebrities is in decline. People have always generally put more stock in the word of those they know, such as friends and family, than external sources of information. Trust in family and friends has increased to fill the void left by authority figures.
The pattern for most consumers is quite clear. They will first often go to source information on a product (for example, a company website, Facebook page, YouTube videos, comparison sites) and then to their trusted adviser for further insight or verification on what they have learnt.
If you think about it, for many of us there is that one trusted adviser among our family, friends and extended network we turn to when we are thinking about purchasing in a specific area.
- ‘John is pretty up with computer stuff, I’ll ask him.’
- ‘Jane has done a lot of travelling, I’ll ask her opinion.’
- ‘Rachel has a great eye for interior design, she’ll probably have some great tips.’
Sure, we’ll also weigh things up by looking at online reviews and maybe even watching a promo or demonstration video on YouTube. But it’s often the case that we go to our personal trusted adviser for verification and guidance on alternatives.
We might say something like: ‘I saw this video on YouTube for X product and it seems like a decent product for the price. What do you think?’
And the response from our trusted adviser will then affirm or critique what we might have been told. For example: ‘It’s a decent product but not designed for what you are doing. Maybe have a look at the Y product instead’.
Most consumers don’t see the need or are wary of an intermediary ‘celebrity’ or ‘influencer’ trying to sell them on a product or service. Companies are better off putting the time and effort into making their content as strong as possible, so when consumers do come to them, they can properly inform and hopefully sell to the consumer.
Companies also want to ensure they live up to their pitch and back up their products.
Getting the basic hygiene right on maintaining your company’s reputation at least ensures you are in the game when it comes to WoM, because nothing spreads quicker than bad news, especially poor customer experiences. It’s a fall-back defensive strategy that ensures that at the very least, trusted advisers might end up saying something like ‘I haven’t had much experience with that company, but I’ve never heard anything bad about them’.
Of course, you’d prefer people to rave about your product. Keep doing the right things, and I’m sure they will. And that’s when you will reap the dividends of a great WoM strategy.