Just one piece of a marketing strategy
I’m pretty sure almost every small business is guilty of this to one degree or another. “We rely on word of mouth advertising” is a mantra held by many small businesses. When I first started planning to start Full Scope Creative back in 2009, I remember sitting down with my uncle to go over some business things. He asked “What is your marketing plan?” I proudly (and foolishly) replied “We’re going to rely on word of mouth, it will be our best friend.” Every word of that statement is 100% true, but it is still a foolish and horrible marketing plan. Unfortunately for many businesses, that remains their marketing plan for far too long. Positive customer referrals are pure gold, but they should be just one piece of the whole marketing strategy.
Word of Mouth Referrals are Great
Please don’t misunderstand me, referrals and word of mouth advertising are great. GREAT. Problem is, there’s not a ton we can do to control them, spread their reach, or set the message exactly. I’m all for rewarding people who send referrals and promote our businesses, but it can’t be the only cog in the marketing plan.
One of the things that makes those word of mouth referrals so great is that they are typically easier sales to make. Less time having to be spent on why our companies are awesome and why our services or products are a great solution. Oftentimes we can jump through a few steps in the sales process. I’ll never turn down a referral, but it will never be a stand alone marketing plan for me… again.
Limited Reach
Even if you get lucky and every one of your customers love your business and the product or service and tell their friends, your message still hasn’t spread that far. You’ll end up missing out on potential clients that aren’t direct connections to a current customer. With a well thought out marketing plan that includes online tactics like SEO, social media, associations, sales schedule, paid advertising, and more, you can expand your reach for new clients beyond your immediate network.
Not only does this limit reach mean just contact of your clients, but it will limit any new geographic markets you want to break into. Full Scope Creative is based in Green Bay, but if I rely on word of mouth referrals to break into areas like Milwaukee or Madison or Chicago I’ll need to wait until I have a client who happens to have a contact there AND says great things about me. Even venturing a few miles south to Appleton or Oshkosh (30 and 45 miles south) would be tough to break into.
Unpredictable Growth
For many businesses, there is likely a point in the year or a season that is the “slow time” of year for them. If you know when these seasons or slow points are, you can scale up or increase your marketing in the months leading up to the time. If you are relying only on word of mouth, your main avenue for generating new leads in those times is less than unpredictable. Some weeks, you might see a huge influx of new clients from referrals, and others get none. This influx and lake of control can make it difficult or impossible to plan and scale your business.
Marketing campaigns and a well established marketing plan allow you to target specific audiences and markets and more actively generate leads. Best of all, that can all be in a more consistent and measurable way. As you actively market your business you can review performance, make adjustments, and make sure that new leads are always coming in.
Lack of Brand Control
It’s fantastic when our customers share their positive experiences they’ve had with us. It’s free marketing! Problem is, you have little to no control over how they describe your business and offerings. They might not phrase the certain aspects of your services that you want to highlight, they might not mention your truly best selling points, they might not mention the great sale you’re running. Word of mouth doesn’t always showcase your brand in the best possible light. Sometimes the details or sales points that people share aren’t completely accurate. A good marketing plan will keep you in control of your message and allow you to always present your brand in the best way possible.
Worse yet, sometimes, without meaning too, clients can even mention that you specialize in things you don’t specialize in at all. I met with a client once who couldn’t get her computer to work right. While I was there I used the greatest computer repair tool of all time – rebooting her computer – and it worked great. She then told someone that Full Scope Creative fixes computers. We don’t. I know that one trick, that’s all. I was glad she spoke highly of me, but it was for a service we don’t offer. Sometimes you might negotiate or strike deals for certain clients for various reasons, that doesn’t mean a referral would qualify for the same deal.
Slow Results
Waiting for word of mouth to spread is usually a very slow process. Relying on word of mouth alone will usually mean that you’re missing out on the chance to grow your business much quicker. A full marketing plan approach that includes things like search engine optimization (SEO), social media marketing, email campaigns, and more can generate leads and build brand awareness much more quickly.
Oftentimes, the first time you meet with someone they aren’t quite at the spot where they’re going to tell all their friends about your business. It likely won’t be until after the work is completed or delivered that they’ll be telling people about you. Worse yet, they likely won’t be talking about you for too long. Once a few days, weeks, or months (at best) have passed, you won’t be front of mind and those referrals will slow or stop from that one customer.
Competitors Are More Visible
You are not the only business offering your product or service. Someone else sells or offers it or a comparable option. If those competitors are investing in their marketing and reaching out to more customers at rates you’re not, they’re going to be much more visible to your target demographic. Think of it like being in a bicycle race where you’re just sitting still and the competition is out peddling. Even if you have a superior product or offering to them, they’ll still reach more potential customers and likely end up with more sales and success. If their offering isn’t as good as yours, those extra sales and success could end up being put to research and development and bring their product on par with yours or even pass yours. That’s a tough race to come back from.
In today’s digital world, customers are much more likely to do business with businesses they can easily find and learn more about online. If your competitors have a strong online presence with a website, social media, and search engine rankings, and you’re relying purely on word of mouth, you’re intentionally giving them the competitive advantage.
Build on Word of Mouth, Don’t Rely on It
There’s no denying that word of mouth is powerful and those referrals are beyond valuable to any business. A strong referral can convert a potential customer into a paying client quickly and easily. However, word of mouth marketing alone is not enough to build a sustainable and scalable business. You need to combine it with a full marketing plan that allows you to actively reach new audiences, keep control of your message, and grow at the pace your business needs. By including tactics like social media, SEO, email marketing, associations, networking, sales scheduling, and more, you’ll create more opportunities for growth and make sure your business stays competitive.