Word-of-mouth marketing in retail: Drive sales and build brand loyalty

Brands and retailers want the same things: build brand loyalty and drive sales. However, this is not an easy challenge. Most of the time, retailers and brands invest a lot of money in various types of promotions to increase brand awareness and sales. 

There’s an easier (and less expensive) way to connect with customers and make them love your products and services - word-of-mouth marketing. In this article, we are going to focus on this invaluable form of marketing that is actually made by your customers, not by yourself. 

What is word-of-mouth marketing?

Word-of-mouth marketing is a form of promotion that comes directly from the customer. From recommending to friends and family up to advocating for your brand’s products. Depending on the type of products and services your brand provides, the word-of-mouth technique can differ. 

Word of mouth marketing is driven by customer stories and experiences and it is provided organically through various channels and methods. In some cases, you can encourage customers to share their experiences and we will show you later on how to do so. 

Examples of word of mouth marketing

Word of mouth marketing can take various forms, including: 

  • Social shout-outs: Tagged photos, brand mentions, and engagement on social media posts shared by you are just a few examples of how word-of-mouth marketing can be seen on social media.
  • User-generated content: Users who love your products can also share photos and post about your products on various platforms, including their blogs.
  • Recommendations: These recommendations can be made on social media, by mentioning your brand in a group or a chat or directly, when your customers share more about their latest purchase with family and friends.
  • Reviews: These assets are very important for brands that sell their products online and for eCommerce platforms. Actually,  93% of customers read online reviews before buying a product. The more 5-star reviews, the more chances of other people buying your products. Great reviews can also be a good differentiator for your brand.
  • Press mentions: Renowned brands and retailers receive a lot of praise in the press and this attracts the attention of customers and increases brand awareness.
  • Employee advocacy: If your employees are happy and believe in the mission of your brand, they can become your best advocates.

  • Brand ambassadors or influencers: Content shared from this category of advocates is rarely organic. However, you need to consider the fact that influencer marketing is an effective tool. Statistics show that 49% of consumers depend on influencer recommendations.

The benefits of word of mouth marketing

1. Increase in brand awareness

The more people talk about your brand and products, the better. Even if you are not a renowned FMCG brand, people can find out about your products directly from their family and friends or from reviews on eCommerce platforms. This way, you increase brand awareness and gain new shoppers.

2. It can positively impact brand trust and loyalty

92% of people trust recommendations from their friends and family members. While they might not make a purchase right after hearing about your products, by receiving positive recommendations constantly, they will trust your brand more and won’t hesitate to select your products instead of the ones from your competitors. 

3. Connecting you with your shoppers

By sharing photos from your customers and replying to their reviews and social media comments, you engage with them. Also, you show that you care about their opinion and understand their needs and wants. This will help you better connect with your shoppers.

4. Helps you increase sales

Last but not least, word-of-mouth marketing is one of the biggest sales drivers. Once customers hear about your products and services from their friends or family members repeatedly, they are more likely to purchase to check out what their friends were raving about.

Word-of-mouth drives $6 trillion in annual global spending and is responsible for 13% of all sales. Great figures for a type of marketing that is organic, right?

However, all good things come to those who wait invest in their brand. Next, we are going to show you how you can encourage your customers to offer more recommendations and user-generated content.

How to encourage word of mouth marketing

1. Provide great products and customer service

This is a no-brainer. Of course, the better the products, the more people will end up purchasing them and recommending them to others. If shoppers like your products, they will tell their friends and family to try them. 

Also, even if your products are the best if you provide poor customer service, then your customers will never recommend your brand. Competition is fierce in retail so you need to be at the top of your game.

2. Offer an amazing shopping experience in-store

Shoppers are more likely to share out-of-the-ordinary experiences, which means that you need to change the way customers interact with your products in-store. While eCommerce platforms offer a frictionless and entertaining experience, most in-store shopper marketing campaigns tend to go unnoticed. 

By using an innovative solution like Tokinomo, you can offer an amazing experience to your customers. Just take a look at one of the most engaging brand activations implemented with Tokinomo: 

3. Curate and share user-generated content

Do you remember the Coca-Cola “Share a coke with..” campaign? By simply writing different names on a can of Coke, the brand managed to generate a great response from users. Most people purchased a can of soda and share a picture on their social media accounts. Brand representatives left comments on different posts from customers. Also, the brand shared some of the user-generated content on their social media pages. 

By engaging with customers and sharing their content, you encourage them to post more about your brand and you develop a great relationship.

4. Use incentives to boost referrals

If you want to take it a step further, why stop at word-of-mouth marketing? You can also use incentives to boost referrals. Since shoppers trust their friends and family, it’s more likely that they will make a purchase when they receive a discount code from their friends. You can offer discounted products to both the referrer and the referred to incentivize their purchases. 

Word-of-mouth is a powerful type of marketing that you can use to boost customer loyalty and sales. Engage with existing customers, offer great service in-store, and provide an amazing shopping experience if you want your shoppers to rave about your products to their family and friends. 

Read some more
In today's ever-evolving business landscape, demand creation has become a crucial aspect of success for companies across...
Programmatic advertising has revolutionized the media buying landscape, offering unprecedented efficiency and precision....
In today's digital age, the retail industry is undergoing a significant transformation. Connected retail, also known as ...
The retail value chain is a crucial concept that businesses must understand in order to succeed in today's competitive m...

Any questions or suggestions? Let's talk!