17+ Important Word Of Mouth Marketing Statistics, Or How to Create a Successful Advertising Strategy
Updated · Apr 04, 2022
Advertising is all around us. Our everyday life is shaped by social media marketing and personalized marketing, and PR, and retargeting, etc…
There’s even an extremely innovative field called neuromarketing—the cutting-edge combination of brain imaging and consumer psychological dynamics.
Today, however, we’ll discuss what’s possibly the oldest and most effective way to promote a product—word of mouth marketing (WOMM).
The word of mouth marketing statistics we curated below are plain proof to the enormous gains and advantages this method brings—which is why most companies, including the biggest ones, still use this tactic to promote their products and services.
Before we dive further and discuss the subject and its most interesting aspects in-depth, take a look at these:
Key Word Of Mouth Marketing Stats (Editor’s Choice):
- WOMM started its official journey in the 1970s thanks to psychologist George Silverman.
- 92% of US consumers believe and take into a consideration the recommendations of friends and family in their decision processes.
- 37% of US respondents say they rely mostly on others’ recommendations when choosing a dining place.
- WOMM generates $6 trillion of revenues to companies each year.
- “Share a Coke'' by Coca Cola was one of the most successful WOMM campaigns in the world.
- Mission: Impossible III lost $100 million in profits due to negative word of mouth marketing.
- The effectiveness of personal recommendations is highest in Latin America (87%).
What Is Word of Mouth Marketing?
Word of mouth marketing differs from word of mouth in that the former is actively encouraged by the advertiser or company, be it in the form of prizes, reimbursements, or other incentives.
However, the organically recurring by the latter is actually the end-game for most advertising campaigns anyways, even if they deploy professionals to instigate that “naturality.”
Let’s see how WOMM developed in its history:
1. There’s evidence of WOMM use in Ancient China in the 1st millennium BCE.
(Source: The Book of Chinese Poetry)
It’s very hard to track early progress of word of mouth marketing, because, well, it wasn’t written. However, some of it found its way onto paper in Ancient China in the 1st millennium BCE. One early Chinese poem depicts the selling of candy, with the help of bamboo flute-music. It’s possible that the poem itself then acted as a sort of WOM tool for marketing.
2. Word of mouth marketing stats start with the 1970s and George Silverman.
(Source: The Secrets of Word of Mouth Marketing; The Free Library)
George Silverman experimented with groups of physicians who were deciding whether to adopt a new pharmaceutical product. Most of them were neutral, with very few being strongly for or against the new product. Silverman noticed, however, that those for the adoption of the new drug were able to convince others, so much so that quickly all physicians adopted the idea.
Soon other researchers tested Silverman’s method (with teleconference groups), and found that teleconference WOMM increased the adoption of a new herbicide to 33% compared to only 6% in the control group (with participants who didn’t attend the teleconference).
However, just how effective word of mouth marketing is depends on the context and other various factors. Still, it’s widely perceived as one of the most successful marketing methods as word of mouth and personal recommendations themselves are considered with greatest force and influence when it comes to decision-making of any kind.
Though, once the word starts spreading, it’s really hard to keep track of objective metrics such as conversion rate or bounce rate. One thing is true—people are more keen on listening to what those who they trust and love have to say. TV and internet ads are in effect the “necessary evil,” most often than not seen as the thing you have to “suffer through” as you continue on with your daily activities, thus making their effectiveness dwindle day by day.
Word of Mouth Advertising
Now that we’ve gotten familiar with some of its history, let’s dive deeper into some of the most essential and interesting word of mouth marketing statistics.
3. 92% of people believe the consumer recommendations of friends and family.
This isn’t at all surprising—we are social animals and we need others’ opinions for practically everything. Not a bad thing, especially for marketers. Nevertheless, only 6% of them say they’ve mastered this craft, though it’s questionable whether organic WOMM can really be mastered. WOM advertising is very similar to rumors and hearsay which, arguably, are hard to control and are a spontaneous product of numerous individuals.
Moreover, 63% of young people (aged 18 to 34) say they believe what influencers recommend more than believe classical brand advertisement. These stats show the potential power of word of mouth marketing strategy and why it can completely replace more classical marketing tactics.
4. 37.6% of US consumers say they choose dining places according to their friends’ recommendations.
It seems that, at least in the US, the restaurants profit the most from positive word of mouth. The catering sector is followed by: Electronics (33.1%), Retail, beauty, and cleaning (32.3%), Clothing/apparel (27.5%), Home improvement (25.7%), Car/truck (22.8%), Medicine (20.3%), etc. Such word of mouth marketing stats once again show that we as humans often choose to rely on others for our decisions, especially when it comes to dining places, technology, grocery-shopping, and clothing.
5. 68% of WOMM in Australia is conducted in person.
(Source: Statista; Statista)
It is followed by WOM on social networks (14%), email (12%), while 4% goes for other mediums. In the UK, the situation is similar: 69% for in-person, 10% for social networks, 14% for email, and 3% for other mediums.
6. 22% of French people find word of mouth promotion interesting.
19% said they think it’s practical, 17%—relevant, 14%—pleasant, and 9%—smart. At the same time, WOMM was found to be intrusive and invasive by 4% of the respondents.
We can see opinions about WOM advertising are overwhelmingly positive. However, and what perhaps is left out of most other word of mouth marketing statistics, some people think that it’s rather unpleasant, intrusive, and invasive. That’s most probably pointed towards blatantly obvious promotions or influencers who are basically hoping to score a marketing deal or profit from affiliate marketing, not real recommendations.
7. Organic word of mouth marketing is fairly prevalent in Columbia and Mexico— 23% of people talk about their favorite products to others every day.
Recent word of mouth advertising statistics show it’s a popular and rather organic occurence in countries such as Mexico and Columbia. 44% of people talk about their favorite products a few times per week, 11% mention them once per week, 15%—few times per month, while only 5% talk rather rarely about their favorite merchandise.
8. Effectiveness of personal recommendations is around 87% in Latin America.
Generally speaking, personal recommendations can be found pretty effective in terms of belief and results. According to Statista’s data, 85% of people living in the Asia Pacific region always or almost always trust the recommendations of their friends and family. Recommendations from close ones are an important factor for 84% of those living in Africa and the Middle East, 82% of North Americans, and 80% of Europeans.
It seems that people living in more individualistic societies (i.e. North America and Western and Central Europe) are a bit more independent in their decision-making processes, at least when it comes to buying products such as electronics, cosmetics, and groceries.
We can see, however, that word of mouth effectiveness is pretty high all around the world. We’re social animals and much more likely to listen to what our friends and family (or generally people we trust and look up to) have to say, as opposed to what we see on TV and the internet.
That’s why in today’s context, WOM’s related more to conversations about certain products and more specifically about consumer recommendations. However, to answer just how effective word of mouth advertising is is kind of impossible. Nowadays, it’s somewhat hard to draw a line between word of mouth marketing and social media marketing. The two are frequently merged together as numerous companies are continuously encouraging their customers to share brand-related stories online and spread the message, producing a sort of “artificial” WOM that way.
9. Word of mouth marketing generates $6 trillion annually.
If the last stat didn’t convince you in WOMM’s effectiveness, probably this will do the trick. With $6 trillion on a yearly basis, it’s no wonder word of mouth is dubbed the most effective marketing strategy there is.
Word of Mouth Marketing Examples
Now that we’ve gotten familiar with WOMM’s history and successes, let’s move on to some examples of the most interesting and roaring cases using this strategy.
10. A type of WOMM was heavily used during WWII.
(Source: Smithsonian; Atlas Obscura)
In a way, the conflicted sides act as competitors who are always trying to sway the opinions of others’ main “customers.” So during WWII we had “rumor clinics,” which worked hard on spreading (negative) word of mouth and hurting the morale of the enemy side. Sefton Delmer led one such campaign, which was broadcasted via radio to German citizens.
Numerous modern companies probably still have such “rumor clinics” and “agents” who are charged with spreading negative rumors about competitors and positive stories about their own brand.
11. Casper mattress company owes its more than a million customers to social media WOMM.
(Source: Fast Company; Jilt; Casper Blog)
The company was built by people who were planning on launching a platform that would link influencers with marketers. What they ended up doing is employing what they learned in the process, using social media to drive their success.
The contrast between organic social media word of mouth marketing and content like Facebook ads is incredible. Casper doesn’t only talk directly to its customers, it provides a platform where they can discuss their experiences together and compare different products.
It also relies heavily on referral marketing, thanks to peer referrals, social media tags, and influencers. The company encourages P2P referrals not only via social marketing, but by directly offering bonuses and discounts for each successful one.
Casper’s founders have also managed to get big names in the industry (such as Kylie Jenner) to promote its product. Moreover, the company sponsors New York Live, an NBC lifestyle show. By strategically placing their ads in a show, which discusses lifestyle and what one can buy to shape it better, Casper proves that it knows how to use traditional ads that will generate the most WOM success.
12. Dropbox built its fan base by offering free storage space for referrals.
(Source: Commerce Gurus; Dropbox)
The period of fast expansion of Dropbox closely follows the initiation of this marketing strategy. Soon after that, Dropbox became a $2 billion revenue company.
13. Coca-Cola had one of the most successful social media word of mouth campaigns in the world.
(Source: Commerce Gurus)
Coca Cola’s campaign was fairly simple—in 2014, they started issuing bottles with names on them, followed by the encouragement to consumers to share the most interesting bottles they came across. Named “Shake a Coke,” it is still considered as one of the best word of mouth advertising campaigns, even now.
However, no one can tell for sure just with how much word of mouth does increase sales. What we do know is that customer recommendations account for around 12% of all purchases—taking into consideration that companies still don’t usually pay a lot for WOMM, or pay very little compared to what they invest in other marketing tactics (that is quite a lot).
14. Negative publicity can be effective for novel things.
(Source: University of Pennsylvania)
Although negative word of mouth often has pretty bad consequences for brands, there’s some truth in the common wisdom that is “All publicity is good publicity.” The experts from the University of Pennsylvania have shown that even negative fame can increase the sales of lesser-known books and decrease those of well-known books.
We can best see this kind of logic in the show business industry. Namely, numerous “stars” gained their status by going from one scandal to another. Negative publicity is, in a way, their modus operandi. On the other hand, there are many widely acclaimed and acknowledged individuals whose reputation suffers due to negative publicity. The two situations exemplify the contrast between the effect scandals have on popularity of persons like Kim Kardashian as opposed to, say, Bill Clinton.
15. Negative publicity reduced Mission: Impossible III ticket sales by $100 million.
(Source: University of Pennsylvania)
All was largely driven by Tom Cruises’ frustration with South Park and the way Matt Stone and Trey Parker made fun of him. He threatened to refuse advertising of the movie if Viacom, the then owner of the flick’s producer company and Comedy Central (the TV channel where SP is broadcasted), didn’t pause the reprise of “Trapped in the Closet,” the episode, which ridiculed Cruise.
As a response, South Park fans chose to boycott the movie. This was followed by even more news, which now accused Tom Cruise of attempting to censor SP in the way they talked about Scientology. All this turned into a huge discussion about freedom of speech, which resulted in around $100 million loss to Paramount due to bad press.
16. Inquiry rate about Kazakhstan rose by 300% after Borat came out.
(Source: University of Pennsylvania)
For those of you who haven’t watched Borat—it’s a mockumentary that depicts a Kazakh man going to US to film real-life interactions with Americans (which in reality should be translated as Sacha Baron Cohen who doesn’t miss a chance to act comical, absurd, foolish, silly, idiotic, etc.). Initially, Kazakh people and government officials were furious with SBC. However, this ended up increasing the country’s popularity immensely as most people had no idea the ex-USSR country even existed.
As we can see, the power of negative word of mouth can be quite incredible, and in some cases a greatly positive thing.
17. There’s always a rumor war ongoing between big brands.
(Source: Forbes; Reuters)
Word of mouth marketing stats perhaps don’t show this, because companies understandably want to keep these less honorable actions as clandestine as possible. For instance, a few years ago, a photo showing McDonald’s restaurants charging extra to black people spread like wildfire on social media. This incited a wave of reprimands aimed at McDonald’s. But the photo was fake. It is unclear who started it all, though we can perhaps narrow down our suspicions by finding out who are the biggest competitors of McDonald’s.
It’s extremely easy to start such rumors. This phenomenon was analyzed by psychologist Frederic Bartlett—he found out that rumors change as they spread, with emotionally-charged material being retained. So if someone hears a false rumor about cockroaches in a restaurant, he will successfully pass on this “information,” without even acknowledging or hesitating about the fact and its accuracy and truthfulness.
18. Criminals owe their fame to negative word of mouth.
(Source: New York Times)
Negative word of mouth statistics are obviously pretty insane. There’s no good reason for most criminals to become popular like Charles Manson or Ted Bundy… other than the fact that people love talking about their misdeeds. Even though most people are shocked and terrified by what, say, Bundy has done, they continue talking about him and his actions, thus helping him gain more popularity along the way.
So why is word of mouth so important? In short—most people (over 80% of them) closely follow and listen to the recommendations coming from their close ones. Its importance is clearly stated by most notable word of mouth marketing statistics—they show WOMM generates up to $6 trillion of revenue yearly.
And there you have it—all the essential info you need to know about WOMM. It was interesting to learn more and compare the effectiveness of this and other traditional or innovative marketing methods and strategies.
You have to admit, though, despite word of mouth being a pretty basic human practice, implementing it in a marketing strategy is a hard thing to do. It’s important to speak in a truthful manner without overselling and overhyping (or just straight up lying about) your products to your customers.
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