Small Biz Watch: Studies show effectiveness of word of mouth
By James Pethokoukis
Posted 12/2/05
Turning your customers into "evangelists" for your product or service is the focus of "Spreading the Word" in this week's issue of U.S.News & World Report. It's a business philosophy dependent on the power of word-of-mouth advertising and marketing. Does WOMA really work? Here are the results of some studies just compiled by the Word of Mouth Marketing Association:
- 40 percent of marketing executives in 2005 plan to use word of mouth during the next six months. (Only E-mail marketing scored higher.)
- 26 percent of holiday shoppers in 2004 bought online gifts because of a friend's recommendation. TV or website ads scored 15 and 14 percent, respectively.
- 76 percent of United Kingdom consumers in 2004 said a friend's recommendation made them feel most comfortable about a product and service vs. 15 percent who said advertising.
- Recommendations from friends rank right after convenience and customer service for consumers choosing financial or travel services.
- 71 percent of consumers, 86 percent of manufacturers, and 93 percent of salespeople in 2003 thought word of mouth was the most important promotion factor affecting car purchases.