Word-of-Mouth Marketing For Ecommerce: Everything You Need To Know
People constantly have the urge to share their experiences and feedback about everything they encounter. As an e-commerce business, you need to know how to benefit from this. There are several methods through which customers can talk about your e-commerce store. Regardless of the method, it is important to know that when your business becomes part of the customers’ chit-chat, this is known as word-of-mouth marketing.
Keep going through this article to understand the meaning of word-of-mouth marketing for e-commerce, its benefits, types, and methods through which it can be used.
Table of Content:
- What is word-of-mouth marketing?
- Top 4 benefits of using word-of-mouth marketing for eCommerce.
- Statistics about word-of-mouth marketing for eCommerce.
- Types of WOMM for eCommerce.
- How to use word-of-mouth marketing for eCommerce businesses?
What is word-of-mouth marketing for e-commerce?
Image source: brand24
Imagine being part of customers’ conversations with their friends and families. As an e-commerce business, this is definitely a scenario you don’t want to miss out on. It is known as word-of-mouth marketing for e-commerce.
Generally, word-of-mouth marketing is a marketing tactic where a brand encourages people to share their experience with a certain product or service; hence, encouraging their peers to make a purchase. With the evolving business conditions, product recommendations by consumers are now made online.
As a result, this marketing tactic for e-commerce has gained wider publicity. Social media platforms provide a space where word-of-mouth marketing for e-commerce can be done through online reviews, customers sharing their experiences, and even influencer reviews.
Benefits Of Word Of Mouth Marketing For E-commerce
There are plenty of benefits accompanying word-of-mouth marketing for e-commerce:
1- Increasing brand awareness
Getting people to talk about your brand is the first step toward achieving brand awareness. Some e-commerce businesses neglect the link between brand awareness and WOMM for e-commerce.
Simply, when someone talks about your brand, it can be shared by several people which results in even more people knowing your brand. Think about it as a snowball effect. The more people discuss your e-Commerce brand, the more these discussions will become viral which means more awareness. Around 83% of marketers rely on word-of-mouth marketing to increase brand awareness ( LXA hub, 2022)
2- Increasing brand credibility
One of the significant benefits of WOMM is increasing brand credibility. When family and friends share their positive experiences with a certain brand, customers’ concerns about this brand instantly diminish.
The customer directly perceives it as a trusted one. It has been proved that 90% of people trust and buy from a brand recommended by a friend. Also, 74% of consumers agreed that word-of-mouth marketing for e-commerce impacts their purchasing decision (Writers block live, 2022). This is compatible with a psychological phenomenon that implies that people are generally seeking social proof.
Social proof refers to seeking confirmation from others regarding a certain action or intention. Accordingly, people feel more confident and are encouraged to take such action. Social proof can be attained through word-of-mouth marketing for e-commerce which in return contributes to increased brand credibility.
Attaining brand credibility is not the easiest thing in the world. Accordingly, you should sustain it by utilizing word-of-mouth marketing for e-commerce.
3- Increasing sales
It goes without saying that brand credibility contributes to increasing brand sales. Through word-of-mouth marketing for e-commerce, your brand will be widely discussed and recommended online. A trusted brand is a brand that consumers won’t hesitate to purchase; accordingly, increasing sales.
It has been proved that WOMM leads to 6 Trillion dollars in customer sales per year (Writers block live, 2022). I can imagine how impressed you are now with this huge amount of money. In addition, it leads to a 5x increase in sales compared to paid ads (Review42,2022).
This tactic is considered a low-cost type of advertising as it increases sales yet with minimum advertising spending compared to other advertising tools.
4- Establishing an online community
By encouraging people to share their positive experiences with your business, you will be able to establish an online community.
An online community for your e-commerce business is something you really don’t want to miss. It is like having a group of advocates who discuss your brand, promote it, and provide feedback. The more interactive the members of your online community, the more their ability to attract potential customers.
Statistics About Word-of-mouth Marketing For E-commerce
We have gathered a group of statistics to showcase the benefits of WOMM for e-commerce:
- 85% of small businesses gain new customers through online reviews and shared opinions (Writers block live, 2022)
- 55% of people learn about a new product through word-of-mouth marketing ( Hubspot, 2022)
- 55% of consumers have found out about a product through word of mouth (RRD,2021)
- 40% of consumers purchased a product after discovering it through word of mouth (RRD,2021)
- 70% of people trust consumer reviews online ( Hubspot,2019)
There are plenty of other statistics that showcase the benefits. However, these statistics make it clear that word-of-mouth marketing for e-commerce is trusted by customers. Also, it increases brand awareness, brand credibility, and sales.
Types of word of mouth marketing for e-commerce
Word-of-mouth marketing for e-commerce can be mainly categorized into 2 types: Organic word of mouth and amplified( paid) word of mouth.
How To Use Word-of-mouth Marketing In E-commerce?
There are plenty of methods to use word-of-mouth marketing in e-commerce. Let us walk you through some of the most important methods.
1- Referral programs
A referral marketing program is a strategy used by e-commerce businesses that involve encouraging happy customers to refer your product or service to their peers. The good thing about referral programs is including rewards.
E-commerce businesses using referral programs reward their customers for referrals by providing them with cash back, coupons, or even discounts. By using referral programs, the e-commerce business creates a win-win situation for the customer and the business as well by encouraging more referrals. One example of a referral program is used by Adore beauty, an Australian brand for cosmetics. It uses referral programs by providing customers with a 10$ discount for every referral.
2- Influencer marketing
You have definitely seen several influencers who share stories and posts about products they have tried; well, this is influencer marketing.
Influencer marketing is collaborating with social media influencers to start talking about your product with their followers and what they like about it. Accordingly, they increase brand awareness while encouraging customers to buy your products.
Currently, influencer marketing has proved to be one of the best ways for word-of-mouth marketing. As an e-commerce business, you have to choose the right influencer to talk about your product and hence, be able to reach the right target audience. Yet, it is paid WOMM for e-commerce, so you will have to ensure that you have enough budget. Also, some customers might question the credibility of the influencers' reviews.
3- User-generated content (UGC)
It is certainly understandable by now that customers trust the recommendations of their family and friends more than that of influencers. So, user-generated content comes to the rescue.
Simply, user-generated content is any picture, video, post, tweet, or story posted by customers. Imagine having your customers share content about your products; what do you need more than that for good word of mouth?!
There are plenty of methods for e-commerce businesses to generate UGC. For example, create an online contest for the best post with your product in return for gifts or discounts. Also, e-commerce businesses can utilize UGC by encouraging customers to mention them in posts in which their products are included. Additionally, creating hashtags is one of the UGC tools that can be used by e-commerce businesses. For instance, Apple utilizes the #shotoniphone hashtag for creating user-generated content.
To ensure a successful UGC, e-commerce businesses have to constantly interact with the content of their customers. As a result, businesses will ensure incredible word-of-mouth marketing.
4- Customer reviews and testimonials
Certainly, the key to successful WOMM for any business is customers’ reviews and testimonials. That’s why as an e-commerce business, you have to consider this point.
Requesting customers’ feedback post purchasing and sharing it on your business platforms is one of the key steps for word-of-mouth marketing for e-commerce. Some e-commerce businesses use applications that automate the customer reviews process.
For example, after each purchase, customers can be contacted via email to get their feedback regarding their purchase. Also, some e-commerce businesses motivate their customers to share their reviews by offering them discounts on their upcoming purchases.
5- Create a product or service worth talking about
It is not only about encouraging customers to talk about your business, but also about offering them something to talk about. Here comes your role as an e-commerce business, which is offering a high-quality product and providing a five-star service that encourages the customer to discuss it. Also, you have to offer something unique. A unique product or service is definitely worth talking about by customers.
If you want to enjoy the benefits of word-of-mouth marketing, you have to make sure that your customers are satisfied. Always remember, satisfied customers are more willing to take part of their time to recommend your products or services to their friends and families.
Word-of-mouth marketing for e-commerce has gained a lot of significance throughout the past few years. This could be linked to the growing usage of social media and its impact on e-commerce businesses. Businesses should never neglect WOMM. Accordingly, utilizing the previously mentioned methods is essential. However, all these methods cannot be implemented without first segmenting your target audience, and to make that easier, you need an automation tool.
Converted.in offers you a marketing automation tool that will help you:
- Segment your target audience, which will help you choose the right influencers for your influencer marketing campaigns.
- Automate email marketing campaigns where you can tell your customers about the rewards of your referral programs, and also ask them for their feedback on your products or services.
Request your Demo now and start enjoying all these benefits.