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Are You Leveraging Word-of-Mouth Effectively?

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Are You Leveraging Word-of-Mouth Effectively?

Updated: March 27th, 2020

A picture that represents the power of word of mouth - Are You Leveraging Word-of-Mouth Effectively?

Ask any fellow small business owner across the country what their most effective source of customer acquisition is, and the vast majority (64% according to a recent Alignable poll) of them will tell you that word-of-mouth trumps any other form of marketing that they have tried. Social media, email, flyers and online deal sites just don’t deliver the ROI that many small businesses expect.

Word-of-mouth for your business comes from building and maintaining relationships with your customers and fellow small business owners within your community, and making it easier for them to share “the word” about your business.

There are a plethora of different tactics you can implement to generate word-of-mouth for your business. Understanding how to leverage different channels for word-of-mouth is key to any small business owner’s success.

Feet on The Street: Customer Word-of-Mouth

Your regular customers typically have the strongest relationship with your brand and are willing to recommend your product or service to their friends and family. These are people you have built trust with and want to stay in contact with you. Because of this, they are one of the best echo chambers for your marketing efforts. The more customers you build that trust with, the more word-of-mouth potential you generate for your business.

As you nod your head while reading this, it appears obvious.  “Of course!”, you say.  But how many small businesses are actually doing this?  Many might believe this, but fewer actually execute.  So how do you gain their trust? Through good ol’ surprise and delight.  It’s not enough anymore to simply create positive interactions between your customers and your business. For the repeat customers, who choose to spend time with you vs. a competitor, think of something to go above and beyond for them. These people will become your evangelists. For the new customers or prospects, cater to their needs and help them make the best buying decision possible.  By doing so, you demonstrate how your business benefits them. After doing this successfully, they are more likely to want to stay in touch (via email marketing or a CRM tool), making it the perfect time for you to ask! The request can come in many ways, from a simple, “Hey, if you’re on Facebook, it’d be great to like our brand so you can see our specials a day in advance”, or, “If your friends ask where you got your shirt, please tell them about my store, and have them tell me they are a friend of yours, so I can take care of them.”  It’s up to you, and it needs to fit your personality and your business style.

Shop Talk: Other Businesses Word-of-Mouth

There are many ways to help get the word out about your business, and they can vary in effectiveness based on business type (business-to-consumer vs. business-to-business), business size, business age, and the like.  Think of all the potential human touch points you have with respect to your business: existing customers, delivery services, other ‘Main Street’ neighbors, partners, support services, … and, other businesses!

Other businesses are a powerful vehicle for getting the word out because they engage with their customer base, just as you engage with yours.  Connecting with other business owners in a symbiotic way helps everyone.  But it’s not necessarily a flyer of discounts.  It could be – as long as that’s what your respective audiences are looking for.

Better still, think of ways to offer or create value to the multiple customer bases. For example, if you’re selling lawn and garden tools, offer a workshop on how to use the tools the correct and safe way. And if you partner with a local landscaper or junk removal company, as an example, invite them to your Saturday morning tutorial on backyard and house cleanup. Your partners can jump into the conversation, all the while meeting potential new customers.  Just be sure they return the favor.

Just like your customer relationships, staying top of mind with other small businesses unlocks a wealth of word-of-mouth opportunities. Of course, these relationships will take time to build and need to be nurtured so that you see real tangible benefit in the long run.

Finding efficient ways to communicate and work together is difficult for business owners. One of the reasons why business owners have trouble working together is because they lack the time necessary to walk across the street or pick up the phone and plan something with another owner. Leveraging platforms like Alignable can help business owners work together more efficiently to reach their goals.

Relationship Access: Owning vs. Renting

Social media is a fast way to build up a following because it’s easy to like/follow/fan a brand.  However, you’re playing on rented land with these networks. They do indeed serve a purpose and can rapidly expand reach, but they can also change the rules at any given time.  As an example, take a look at this quite and image below, courtesy of

Facebook organic reach for business pages is plummeting, and will drop even further because Facebook is a public company that has fiduciary responsibilities to their shareholders to maximize returns.

The efficacy of staying connected with customers through Facebook came to an abrupt end when Facebook changed their algorithm, all but requiring businesses to pay to have their most of their posts viewed by their followers.  The size of the reach, coupled with an advertising model, resulted in drastically reduced “organic”, or natural/unaided reach, that for a brand to even reach a fan some of the time, money was and is required to elevate the visibility of a post.

Unfortunately for business owners, this meant that they no longer truly owned their Facebook page and fans – they were renting them for price.

Social media has made it easier for customers to give and display a vote of confidence. These platforms give your customers the ability to like, follow, recommend, and share your pages and updates. In theory, it’s a perfect way to structure word-of-mouth through technology. However, you don’t own these relationships – the social network does. They’re more like acquaintances that you can engage with the blessing of the social media provider you are leveraging.

There is no substitution for owning the path to you customer. Email marketing tools like Mailchimp and Constant Contact, as well as CRM tools like Insightly and Pipedrive make it easy and affordable to not only build your customer relationship asset, but also maintain regular contact that generate repeat sales and word-of-mouth referrals.

Make sure that you are being opportunistic about growing your customer list by including a prominently displayed email sign up at your place of business, on your website, Facebook page, and wherever else you interact with them. Showing customers a copy of what they will receive and setting expectations of how frequently you will contact them (weekly / monthly) will help you build trust and increase sign-ups.

Nurture Your Relationships With Snackable and Shareable Content

Regularly sharing insights with your customers will give them something to talk about with others, and ideally mention you in the process.  For example, if you are a tax professional, you could offer up new changes to the tax code in “human-readable” format in an email to your existing customers. Encourage them to share it with their friends who might want to know the same information. By having your customers share a message that has inherent value, with your name on it, they are tacityl endorsing you and your services. As another example: if you are a liquor store, you could suggest mid-market price wine-and-cheese pairings in advance of big holidays, and help the less-educated wine drinker take the guesswork out of making a critical host decision. Make it easy for your customers and other business owners to spread the word about what you are doing. That’s real Word-of-Mouth.

Sharing insights in your industry that are helpful, compelling and applicable to your customer’s lives will establish you as a leader – and a resource – in your field. If your own a wine store, give your customers perspective on the historical significance of a particular new bottle of wine. If you’re an attorney, share tips about contract law or give other legal advice that small businesses may find valuable.

The best content you can share with your customers and other business owners is short, actionable, and insightful. Most people have a short attention span, so keeping your insights brief and straightforward is encouraged because it will be easily digestible for your audience.

The Final Word on Word-of-Mouth

As a small business owner, generating word-of-mouth should be a top priority for you, because it is the number one way most of your peers acquire new business. Understanding how to leverage your two best sources of referrals is the golden ticket to being a successful small business. Those two sources are your customers (probably the most obvious) and your other small business peers. By connecting with your local business community and keeping them up-to-date on what you are doing, they are more likely  to share that with their own customers and refer you business. Just remember to return the favor and stay knowledgeable about what your peers are doing. Your customers will appreciate it and view you as a trustworthy source of local information.

Eric Groves is the co-founder and CEO of Alignable provides small business owners with a free place online to gather, make connections, collaborate, and work together to find answers to challenges and paths to new customers.


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