Tuesday, December 4, 2012

Investing in Digital Word-of-Mouth

Posted By on Tue, Dec 4, 2012 at 9:29 AM

I recently took my car to a local repair center for the first time. My first visit was generally the same as with others except that I noticed that they seemed more interested in customer care. I was especially intrigued when I received follow up emails after my first visit welcoming me as a new customer and another asking me to provide feedback on the visit. They even offered a ‘refer a friend’ promo with $10 off my next visit. As a new customer and user of many digital channels, I found this to be a very convenient way to promote this business and get something of value in return. I’ll most likely take my car there again and tell my friends about them.

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It makes a lot of sense for local service providers, especially those highly dependent upon word-of-mouth, to use digital marketing tools to grow their business and stay competitive. And a lot of small and midsized businesses are learning how to gain benefit in shifting marketing efforts from traditional to digital marketing in a big way. There are several reasons for this.

Consumers are increasingly influenced by and want to do business through a wide variety of channels including the in-person storefront, as well as digital channels such as the website, email or social networks. According to a recent BIA/Kelsey study on local commerce, small businesses are marketing to their customers across 5 to 6 digital channels on average, and the number of online channels used for advertising by the average small business has nearly doubled in the past five years. More than half (52 percent) of small businesses now use Facebook and 25 percent use email for marketing.

Also, trends show local consumers continue to trust word-of-mouth, such as a recommendation from someone they know, much more so than traditional advertising. According to Nielsen’s recent Global Trust in Advertising Survey (PDF), almost all (92 percent) of consumers trust earned media, such as word-of-mouth or recommendations from friends and family, above all other forms of advertising. And most (78 percent) trust online reviews, while only 47 percent believe traditional broadcast and print ads.

And consumers are increasing using digital word-of-mouth to promote small businesses they like. This is especially important as most local business recommendations occur by way of word of mouth. A recent Local Consumer Review study by BrightLocal found that that 8 out of 10 people have recommended local businesses to friends, family, co-workers or other acquaintances, and most people (65 percent) that do business locally will recommend a business which provides professional and reliable service. 32 percent of them use Facebook to recommend businesses.

To get the most out of an investment in digital tools for word-of-mouth marketing, here’s a few quick tips. First, know and understand who your target customers are and connect that to your business strategy. Second, hire a digital marketing consultant to find the best tools that match your strategy and customer. These local professionals can help navigate the vast landscape of new tools that are available and provide consultation and training to put them to use for the best investment return.

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