Marketing by word of mouth

Turning your customers into your sales force

There's no cheaper, smarter or more effective way to market than by word-of-mouth. When customers or peers discuss the benefits of your business, it generates a trust for your products or services that's worth more than any direct promotion. Think of all the times you've bought something on the recommendation of someone else. Successful word-of-mouth marketing means that everyone in the know can't wait to spread the word about your business.

This article describes three strategies for building a friendly buzz about your business. Pick one or adopt all three. Once you get started, you'll probably think of more ideas specific to your company.

Getting Started: Create the Buzz

Support for your company is usually sparked by glowing personal experiences. Maybe you delivered a superior product at the best price in town; or perhaps you impressed your customer with excellent service. Note that with good service, you can generate goodwill without having to compromise on price.

You don't have to wait for a buzz to build. Here's how you can create it:

Once you've got the buzz going, use one these strategies to help it grow.

Strategy 1: Choose Partners to Help Spread the Word

One of the easiest word-of-mouth tactics is to swap business cards with firms that attract your target customers. For instance, if you own a car body shop, why not partner with a car wash or insurance broker? They can tuck your cards into envelopes with their mailed monthly statements or invoices. They can also place a stack of your cards on their counter for customers. Obviously, you'll do the same for them.

This sort of partnership is known as affiliate, or partner marketing, and you can make it even more effective with special offers. Use the back of your business cards (or postcards), for example, to offer a special discount only to customers presenting that card from your partner's business. With this form of marketing, everybody wins: your customers feel special, your partner gets to offer an exclusive deal, and you get to see how effective the promotion is through counting visitors with cards.

You can also customise designs and create slightly different versions of your card so you can identify which customers came from which partner. Save the first one as a template to make it easier and faster to create multiple versions. That way, after some weeks, you'll discover which businesses are most effective for reeling in customers. But don't make the designs too different from each other. You want your company identity to remain consistent. Add some subtle text or perhaps a department number to differentiate each campaign. This is a classic direct marketing monitoring technique - remember those ads in Sunday magazines which say "quote 123 when you call"? Well, they do it to trace which promotion is working best. You can do the same.

Marketing Communications Made Easy

How do you keep the price down when sharing hundreds of business cards with partners? Use Microsoft Publisher to design your own professional business cards.

Microsoft Publisher is the desktop publishing tool that helps you create professional-looking marketing material, even if you have no previous design experience. Publisher comes with plenty of professionally designed templates to offer inspiration and start you on your way to creating attractive publications to help you maintain your brand.

Find out more about how to get the most out of Publisher's design tools in our Tips and Tricks section.

Strategy 2: Turn Customers Into Volunteer Sales Staff

We've already seen that customer endorsements are the best sales tool you can have - so why not help your happy customers sing your praises? By creating a referral scheme, you give your clients a reason for, and benefit from, selling on your behalf.

You might e-mail or post flyers with coupons. The coupon can offer the referring customer a discount on their next purchase if he or she recommends a completely new customer who buys from you. The new customer should also earn a discount for trying your business. The discounts you choose to offer will depend on what you sell, but the mechanism remains the same.

You'll need a way to ensure fairness, so within the coupon (or over the phone) the new customer will have to state who referred them. Similarly, you will have to be on your toes maintaining your database of customers. The form should request conventional contact information, and permission to contact them in the future - nothing too complicated or they might run away. This way, you build a preferred customer database which you can use in future. When the referred friend redeems the coupon, immediately send out a thank you postcard to the original customer and offer an additional free sample or prize.

Keep expanding your network. Create a club or system of rewards for customers who refer the most friends. Little by little, you'll create a hub of referring customers and an entire network of satisfied customers who offer recommendations about your product.

Strategy 3: Raise your Media Profile

You can generate positive publicity if you think creatively and for the long term. Remember Ben & Jerry's ice cream? Founded in Vermont in 1978 with just $12,000, the two owners created a national brand out of innovative flavours and philanthropy.

Before Ben and Jerry's, few firms took the risk of putting social responsibility near the top of their business model. Now, dozens do. Whether or not you believe in the company's causes, it gives the company an emotional profile. An ad campaign for British Gas uses the line "Doing the right thing" and highlights its free services for the disadvantaged for the same reason.

Media hooks come in all shapes and sizes. They don't need to promote causes or even make national news - you might even just tell your own story. You can also generate focused press within a business trade group, in an industry newsletter, or by becoming an expert in your field for trade shows and conferences. The secret is simply to have something to say, and to deliver it convincingly and with conviction. Here are some preparatory measures for being on top of your public relations:

What next?