I’ve gotten this question more than a few times, from people who seem to have a little bit of doubt lurking behind the question: what’s the real-world, on-the-ground ROI for word-of-mouth?
What these hard-core skeptics really always seemed to be thinking was, is this just manufactured marketing bunk, a new excuse for me to spend my money?
There’s always been the intuitive belief that word-of-mouth referrals and recommendations, the one-to-one between consumers or other prospects, are the gold standard in building consideration and intent to buy.
The problem has been measurement. Just what kind of value can we attach to WOM? What are the multipliers involved? Is there enough dependable ROI data out there to justify an investment in “social strategy” and WOM to a conservative marketer?
As a member of the Board of Directors of the Word Of Mouth Marketing Association (WOMMA), I’m obviously very invested in promoting the viability of word-of-mouth best practices. As the head of an agency, I’ve always tried to present sound, data-based rationales to clients on what channels work best to solve their needs.
Now, the research proves out what we’ve believed all along: the efficiency of WOM is real, and there’s no more guesswork or adventurism involved in making a WOM marketing investment.
Last November, WOMMA released the results of a research study executed by top research firms Analytic Partners and Sequent Partners that was a testimonial to the value of word-of-mouth, and a pretty fitting way to mark the 10th anniversary of WOMMA.
Some of the key learnings?
- WOM plays both a direct and indirect role in driving business performance; two-thirds of that is direct, with another third happening as WOM amplifies paid media.
- As you might guess, WOM has more immediate impact than paid media, with 90% of online WOM’s impact happening within the first two weeks, and 75% of offline WOM’s impact in that period.
- An offline WOM impression has a measured five times the impact of a paid media impression, and in some high-consideration categories, there’s 200 times the impact.
So what’s it all mean? It means that marketers can feel much more positive their investments in experiential marketing, social media, referral programs, influencer programs, customer service and other WOM-driving engagements are going to pay off…and pay off big.
Making sure that every marketing dollar spent equals a plus return is what it’s all about, at the end of the day!