demystifying word of mouth (part 3) – why customers act on referrals
DESCRIPTION
Here at Referralcandy, we're advocates of the power of word of mouth in acquiring new customers. We also believe it could be more effectively utilised with an understanding of how it works. We love how Brand Autopsy’s article “Ernest Dichter on Word of Mouth Marketing” explains the process, so we distilled the key points of the article with illustrations and statistics. Enjoy!TRANSCRIPT
![Page 1: Demystifying Word of Mouth (Part 3) – Why Customers Act on Referrals](https://reader036.vdocuments.site/reader036/viewer/2022081404/55945d061a28ab190c8b4742/html5/thumbnails/1.jpg)
Demystifying
Word ofMouthErnest Dichter
With Marketing Legend
PART THREE
Why Customers Act on Referrals
![Page 2: Demystifying Word of Mouth (Part 3) – Why Customers Act on Referrals](https://reader036.vdocuments.site/reader036/viewer/2022081404/55945d061a28ab190c8b4742/html5/thumbnails/2.jpg)
Word OfMouth
Referralsare a
Recurring3 Step Process
Why Customers Act on Referrals
![Page 3: Demystifying Word of Mouth (Part 3) – Why Customers Act on Referrals](https://reader036.vdocuments.site/reader036/viewer/2022081404/55945d061a28ab190c8b4742/html5/thumbnails/3.jpg)
Talking about
These st eps are :
Listening to
![Page 4: Demystifying Word of Mouth (Part 3) – Why Customers Act on Referrals](https://reader036.vdocuments.site/reader036/viewer/2022081404/55945d061a28ab190c8b4742/html5/thumbnails/4.jpg)
Acting on the Referral
AND
![Page 5: Demystifying Word of Mouth (Part 3) – Why Customers Act on Referrals](https://reader036.vdocuments.site/reader036/viewer/2022081404/55945d061a28ab190c8b4742/html5/thumbnails/5.jpg)
In this 3 part series, find out why each step
happens
and
how to use this knowledge to acquire more
customers through word of mouth
referrals...
With the help of marketing legend,
Ernest Dichter
![Page 6: Demystifying Word of Mouth (Part 3) – Why Customers Act on Referrals](https://reader036.vdocuments.site/reader036/viewer/2022081404/55945d061a28ab190c8b4742/html5/thumbnails/6.jpg)
Why customers
act onReferrals
![Page 7: Demystifying Word of Mouth (Part 3) – Why Customers Act on Referrals](https://reader036.vdocuments.site/reader036/viewer/2022081404/55945d061a28ab190c8b4742/html5/thumbnails/7.jpg)
Authentic Passion
![Page 8: Demystifying Word of Mouth (Part 3) – Why Customers Act on Referrals](https://reader036.vdocuments.site/reader036/viewer/2022081404/55945d061a28ab190c8b4742/html5/thumbnails/8.jpg)
“The real meaning of a product and of its effect to the user is revealed not only
through the choice of the speaker’s words, but also through the discharge of
emotions in inflection, face, and body expressions,
and gestures.”
Ernest Dichter writes
![Page 9: Demystifying Word of Mouth (Part 3) – Why Customers Act on Referrals](https://reader036.vdocuments.site/reader036/viewer/2022081404/55945d061a28ab190c8b4742/html5/thumbnails/9.jpg)
Having an awesome product and a
devoted fan base will encourage
passionate referrals.
![Page 10: Demystifying Word of Mouth (Part 3) – Why Customers Act on Referrals](https://reader036.vdocuments.site/reader036/viewer/2022081404/55945d061a28ab190c8b4742/html5/thumbnails/10.jpg)
your business is still on it sway there?
But what if...
![Page 11: Demystifying Word of Mouth (Part 3) – Why Customers Act on Referrals](https://reader036.vdocuments.site/reader036/viewer/2022081404/55945d061a28ab190c8b4742/html5/thumbnails/11.jpg)
You could back a charitable
cause customers can get REALLY passionate about.
(Choose carefully!)
![Page 12: Demystifying Word of Mouth (Part 3) – Why Customers Act on Referrals](https://reader036.vdocuments.site/reader036/viewer/2022081404/55945d061a28ab190c8b4742/html5/thumbnails/12.jpg)
For every pair of shoes sold, TOMS’ One for One
campaign donates a pair of shoes to a
child in need.
![Page 13: Demystifying Word of Mouth (Part 3) – Why Customers Act on Referrals](https://reader036.vdocuments.site/reader036/viewer/2022081404/55945d061a28ab190c8b4742/html5/thumbnails/13.jpg)
Since 2006, TOMS has sold and
donated 10 million pairs of shoes.
SOURCE: http://style.time.com/2013/06/26/toms-hits-10-
million-mark-on-donated-shoes/
![Page 14: Demystifying Word of Mouth (Part 3) – Why Customers Act on Referrals](https://reader036.vdocuments.site/reader036/viewer/2022081404/55945d061a28ab190c8b4742/html5/thumbnails/14.jpg)
And that’s a lot of happy children!
![Page 15: Demystifying Word of Mouth (Part 3) – Why Customers Act on Referrals](https://reader036.vdocuments.site/reader036/viewer/2022081404/55945d061a28ab190c8b4742/html5/thumbnails/15.jpg)
37% of Millennials report
being drawn to products with cause campaigns
where their purchase is a form of support.
84% Share because it’s a way to support causes or issues they care about
SOURCE: http://barkley.s3.amazonaws.com/barkleyus/Amer
icanMillennials.pdf
SOURCE: http://coschedule.com/blog/why-people-share/
![Page 16: Demystifying Word of Mouth (Part 3) – Why Customers Act on Referrals](https://reader036.vdocuments.site/reader036/viewer/2022081404/55945d061a28ab190c8b4742/html5/thumbnails/16.jpg)
Genuine Compassion
![Page 17: Demystifying Word of Mouth (Part 3) – Why Customers Act on Referrals](https://reader036.vdocuments.site/reader036/viewer/2022081404/55945d061a28ab190c8b4742/html5/thumbnails/17.jpg)
“That the speaker is genuinely concerned with the listener’s
well-being or has his advantage at heart becomes
eminently believable in cases in which the recommendation is
geared to, and takes into account, the individual needs
or special circumstances of the listener.”
Ernest Dichter writes
![Page 18: Demystifying Word of Mouth (Part 3) – Why Customers Act on Referrals](https://reader036.vdocuments.site/reader036/viewer/2022081404/55945d061a28ab190c8b4742/html5/thumbnails/18.jpg)
This means a Referral should address specific
needs, preferences or problems that a customer faces.
![Page 19: Demystifying Word of Mouth (Part 3) – Why Customers Act on Referrals](https://reader036.vdocuments.site/reader036/viewer/2022081404/55945d061a28ab190c8b4742/html5/thumbnails/19.jpg)
In ecommerce this comes in the form of product recommendations based on the customer’s preferences.
![Page 20: Demystifying Word of Mouth (Part 3) – Why Customers Act on Referrals](https://reader036.vdocuments.site/reader036/viewer/2022081404/55945d061a28ab190c8b4742/html5/thumbnails/20.jpg)
100% of the top 10
retailers in the Internet Retailer 500 use product
recommendations.
SOURCE: http://content.monetate.com/h/i/12311883-maximize-online
-sales-with-product-recommendations#axzz2IdJfsKau
![Page 21: Demystifying Word of Mouth (Part 3) – Why Customers Act on Referrals](https://reader036.vdocuments.site/reader036/viewer/2022081404/55945d061a28ab190c8b4742/html5/thumbnails/21.jpg)
70% of Amazon’s homepage
are product recommendations!
SOURCE: http://content.monetate.com/h/i/12311883-maximize-online
-sales-with-product-recommendations#axzz2IdJfsKau
![Page 22: Demystifying Word of Mouth (Part 3) – Why Customers Act on Referrals](https://reader036.vdocuments.site/reader036/viewer/2022081404/55945d061a28ab190c8b4742/html5/thumbnails/22.jpg)
Actual Proof
![Page 23: Demystifying Word of Mouth (Part 3) – Why Customers Act on Referrals](https://reader036.vdocuments.site/reader036/viewer/2022081404/55945d061a28ab190c8b4742/html5/thumbnails/23.jpg)
“Tangible evidence” that a product works, as seen in
real life, “…serves to strengthen the impact … of a
recommendation in cases in which personal intention or product relationship are not
sufficiently convincing in themselves.”
Ernest Dichter writes
![Page 24: Demystifying Word of Mouth (Part 3) – Why Customers Act on Referrals](https://reader036.vdocuments.site/reader036/viewer/2022081404/55945d061a28ab190c8b4742/html5/thumbnails/24.jpg)
Proof in marketing used to take the
form of infomercials on TV
![Page 25: Demystifying Word of Mouth (Part 3) – Why Customers Act on Referrals](https://reader036.vdocuments.site/reader036/viewer/2022081404/55945d061a28ab190c8b4742/html5/thumbnails/25.jpg)
In ecommerce, customer reviews are your proof.
![Page 26: Demystifying Word of Mouth (Part 3) – Why Customers Act on Referrals](https://reader036.vdocuments.site/reader036/viewer/2022081404/55945d061a28ab190c8b4742/html5/thumbnails/26.jpg)
The average customer consult s Eleven
consumer reviews before a purchase.
61% of US consumers
have made purchases based on a blog review
SOURCE: http://www.webershandwick.com/news/article/consumer-reviewers-wield-more-power-than-professional-critics-in-driving-pu
SOURCE: http://www.social4retail.com/the-blog-econom
y-blogging-stats-infographic-2014.html
![Page 27: Demystifying Word of Mouth (Part 3) – Why Customers Act on Referrals](https://reader036.vdocuments.site/reader036/viewer/2022081404/55945d061a28ab190c8b4742/html5/thumbnails/27.jpg)
Semblance of Secrecy
![Page 28: Demystifying Word of Mouth (Part 3) – Why Customers Act on Referrals](https://reader036.vdocuments.site/reader036/viewer/2022081404/55945d061a28ab190c8b4742/html5/thumbnails/28.jpg)
When the speaker displays a “reluctance to divulge the source or brand name of a product” it can serve
as sign to the listener that the product is so uniquely desirable the speaker doesn’t the want masses to know about this secret brand. “This
refers to the well-known psychological phenomenon that the harder it is to get a desired object,
the more desirable it becomes.”
Ernest Dichter writes
![Page 29: Demystifying Word of Mouth (Part 3) – Why Customers Act on Referrals](https://reader036.vdocuments.site/reader036/viewer/2022081404/55945d061a28ab190c8b4742/html5/thumbnails/29.jpg)
By withholding the source or details
about your product, you’ll create intrigue
in customers.
![Page 30: Demystifying Word of Mouth (Part 3) – Why Customers Act on Referrals](https://reader036.vdocuments.site/reader036/viewer/2022081404/55945d061a28ab190c8b4742/html5/thumbnails/30.jpg)
The more unattainable an object is, the higher it s
perceived value is.
![Page 31: Demystifying Word of Mouth (Part 3) – Why Customers Act on Referrals](https://reader036.vdocuments.site/reader036/viewer/2022081404/55945d061a28ab190c8b4742/html5/thumbnails/31.jpg)
Gmail was highly exclusive during it’s first 3 years
of service, requiring an
invite to sign up.
Social media was abuzz with request s
for invites.
![Page 32: Demystifying Word of Mouth (Part 3) – Why Customers Act on Referrals](https://reader036.vdocuments.site/reader036/viewer/2022081404/55945d061a28ab190c8b4742/html5/thumbnails/32.jpg)
Gmail currently has
425m users and it s mobile
app experiences
29% year on year growth
![Page 33: Demystifying Word of Mouth (Part 3) – Why Customers Act on Referrals](https://reader036.vdocuments.site/reader036/viewer/2022081404/55945d061a28ab190c8b4742/html5/thumbnails/33.jpg)
Word of mouth has been shown to
improve marketing effectiveness by up to 54%!
Visit
for more tips andstrategies on using word
of mouth to acquire more customers!
SOURCE:
http://blog.getambassador.com/word-of-mou
th-marketing-statistics/
Blog.ReferralCandy.Com