Why word of Mouth Referrals are Killing Your business
Word of Mouth Referrals
Ask any business owner on how they win new business and someone is sure to come back with Word of Mouth referrals. Now this type of referral is great for a number of reasons, and why wouldn’t you want this? There are no cost’s involved with a referral and prospects are much more likely to convert into customers, after an independent and objective recommendation from an existing customer. Marketing companies even advise us to seek out Brand Advocates who can be paid or unpaid to speak positively about your products or services to generate referrals. What then could be wrong with Word of Mouth Referrals?
Well maybe this is a direct result of the economic landscape of past few years, but what I see is Word of Mouth referrals being used as an EXCUSE to not carry out marketing or lead generation. In year 2010, Coca Cola spent £2.9 billion on marketing, Microsoft spent £1.6 Billion on marketing and Apple spent £691 Million. If these huge brands still have to advertise to generate sales, why would any other business be different, and not need to advertise? Most small businesses are small because they fail to learn the lessons of big businesses. We constantly urge our clients not to waste time or energy reinventing the wheel – learn from those who have gone before, and you won’t go far wrong. Big businesses are usually very good at three things:
Branding – which allows them to charge a premium for their product, gain followers and build a repeat customer base.
Selling – whether this is via the web, via different channels or direct to the end user, big businesses don’t get big and stay big unless they can sell.
I am sure in this age of amazing technology it may be possible to build a successful business on the internet without marketing, however that does not apply to the majority of us. If we want to be big, we need to think and act big. Companies that say they cannot afford to spend money on marketing will never grow and prosper. For most of us, there are more customers out there than we could service, and the problem is they simply don’t know where to find us. Marketing creates that awareness we need, and you simply cannot afford, not to spend money on marketing. Companies that believe they cannot afford marketing are ironically the ones that need it the most. Choosing WHERE you invest your marketing money is the real question.
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