Why Word of Mouth Is the Most Important Form of Advertising

It used to be that customers wanted to hear from you; today they want to read about you online.

With the advent of smartphones, social conversations have become our primary form of communication. Social proof is the currency of the new generation. According to Nielsen, 92 percent of respondents trust word-of-mouth over other types of media.

The quest for social proof has even fueled the popularity of a new form of internet trolls, elegantly labeled as “influencers.” It is hard to fathom the power that such influencers have today, given that their opinions can be bought and sold by the highest bidder. Sounds a bit like a Russian election.

This is best explained by understanding the underlying psychology. At the core of every buying decision is fear, and word-of-mouth validation removes uncertainty.

I speak from experience. I have built a firm with over 130 clients, almost all through referrals. One reason referrals are so powerful is that their social proof is embedded in the introduction, and both the referrer and the referred feel a responsibility to one another.

Once clients are referred to us, the first thing they do is validate the initial information, which we craft through client testimonials and thought leadership and strategy books I have written. In our case our digital assets are not intended to drive lead generation, but to focus on providing credibility.

Social proof takes on different forms depending on the audience. The role of social proof in ecommerce is pretty well understood. According to Bright Local, two thirds of shoppers read six reviews before feeling confident about a purchase. Startups and small businesses leverage social proof as the great equalizer, as any provider with an offer and a clever SEO strategy can compete with the likes of Amazon or Walmart.

The use of social proof in B2B (business to business) enterprises is only now emerging. LinkedIn tried to be the repository for such validation, but its recommendations provide little more creditability than Kanye’s Twitter feed. Similarly, Glassdoor has become a bitchfest without much in the way of constructive information about employers. Today there is a wealth of information available to your customers, just a click away.

Here are some keys to mastering social proof as currency:

Proactively manage your online narrative.

One of our clients, a girls fashion retailer with an enthusiastic audience, received some poor reviews after shorting customers during the Christmas season. They sent every one of those customers a written apology and a coupon for their next purchase, wrestling away the conversation with a stream of comments about how well the company responded. As quickly as bad comments drag down a site, the response is an opportunity to shape the conversation.

Use social proof to amplify your message.

Social proof should not be the primary message, but the context by which your message is magnified. In other words, use strong online content to make claims about the utility of your offer. Use social as evidence that you can be trusted. Startups have been known to do projects for free (with big brands) in order to gain street cred.

Promote similarity.

Customers respond to social proof most favorably when it comes from people just like them. It is for this reason that companies should have landing pages for industry verticals; so the testimonials, white papers and case studies can resonate deeply with readers. For example, a client in the technology sector will value reading about experiences of other technology companies.

Utilize experts and third parties.

Companies often use third parties to validate for everything from quality (ISO) to sustainability (Higg Index). But there is an opportunity to go further. We have seen clients hire physicians to be their spokespeople about the health benefits of products, and others have universities conduct research on the effectiveness of their products. Just ensure the influencers or spokespeople you leverage are credible.

Utilize multiple channels and media types.

Consumers of your content are influence by its quantity, but also the variety in which it is presented. Video testimonials, online reviews, animations and other rich media can be coordinated to demonstrate a well-rounded campaign that spreads your message.

Let the truth set you free.

The most meaningful content is the truth. Do not try to game the system. Providing great service and customer experiences is still the best way to build an audience and fuel its growth. One of our clients displays performance statistics on its website, implying the experience of various other customers. The fact that the data is offered in real time gives credence to its credibility.