Why Word of Mouth?

In 1955, Elihu Katz and Paul Lazarfeld published Personal Influence: The Part Played by People in the Flow of Mass Communications. This book marked the first recognition of word of mouth marketing as an influencer in the marketplace. While word of mouth has always existed, it did not really become a focus for companies until Katz and Lazarfeld pointed out the relationship between consumer behavior changes and paid messaging versus word of mouth messaging. Now, it is widely known that word of mouth marketing is a useful marketing strategy. Word of mouth is the primary factor behind up to 50% of all purchasing decisions and 50% are very likely to purchase something after a “word of mouth” recommendation.

However, the word of mouth marketing world is still rather unexplored. Even though 73% of adults in the US are on social media, only 10% of customer recommendations happen online. Customers have much more value than you think. While there is the immediate financial gain from having a customer, the value that comes with having a loyal customer that will then get more customers in the door is better than any other form of advertising. Word of mouth recommendations obviously happen in person but when these conversations happen online, it opens up the dialogue to a larger audience. This then spreads the word about your business to the friends and family of your current happy customers to get more in the door. By utilizing social media and your loyal customers, you will expand your customer influence and acquisition.

Additional Sources:

Keller, Ed, and Brad Fay. “Word of Mouth Advocacy: A New Key to Advertising Effectiveness.” Journal of Advertising Research (2012): 459-64. Business Source Complete. Web. 18 Mar. 2014.

Ryals, Lynette. “Determining the Indirect Value of a Customer.” Journal of Marketing Management 24.7 (2008): 847-64. Business Source Complete. Web. 18 Mar. 2014.


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