Engaging Consumers Through Word-of-Mouth Marketing

Referrals, affiliates, influencers...oh my! When it comes to engaging consumers through word-of-mouth marketing, it can be overwhelming to figure out which program is best suited for your audience. 

Too often, we hear eCommerce brands tell us they need a solution for affiliate marketing and a separate influencer marketing platform. Or agencies think their clients need different systems to manage an online and offline referral program. Or B2B SaaS companies are convinced they need different platforms to manage affiliate, customer referrals, and partner programs. 

Here’s the reality: All of these referrals have the same source. They all come from word-of-mouth marketing initiatives. 

Yes, they come in different flavors, but they’re generally managed in very similar ways. Done right, these different forms of referrals all lead to the same result — increased brand awareness and revenue growth. 

How to Engage Consumers Through Word-of-Mouth Marketing

That said, each variation does have unique characteristics, and they do need to be approached in slightly different ways. 

So, to clear up some of the confusion, let's dive into the best performing (and most common) word-of-mouth marketing programs:

Affiliate Marketing

What is it?

A transaction between a company and an entity where the business receives customers (or leads) in exchange for a financial incentive.

What makes it unique?

It’s highly efficient because brands specify the cost for a specific action being driven. Examples of effective affiliate incentives include $X per lead (or app download) or Y% of a purchase. Both Netflix and Amazon leverage this strategy well.

How is it typically managed?

The challenge with affiliate marketing is that brand recognition has a big impact on success. Attracting “affiliates” is an arduous process and you often have to compete for “space” on a blog. This can sometimes lead to a bidding war, which lowers your margins.

Influencer Marketing

What is it?

In many ways, influencer marketing is a modern take on traditional affiliate marketing. Instead of a network of smaller affiliates driving traffic, influencer marketing targets specific people who have large, captive followings.

What makes it unique?

Today, someone with a million Instagram followers wields an incredible amount of power to drive interest in a product, and many brands are seeing big results by incentivizing those influencers to talk about their products or services.

How is it typically managed?

In most cases, marketers manage influencer marketing manually — handpicking target influencers, reaching out to them individually and tracking the program through spreadsheets and email. There are some software programs designed to manage this process, but they aren’t usually flexible to handle anything other than influencer identification.

Partner Marketing

What is it?

Partner marketing leverages the synchronicities of two companies - each with its own brand equity, core expertise, unique value proposition strength - to create strategic alliances that gain market share for each entity.

What makes it unique?

For B2B marketers, partner marketing plays a crucial role in acquiring new business. Engaging and building positive brand relationships with prospects via channel partners, value-added resellers, and agencies produces immediate results similar to customer referrals.

How is it typically managed?

Most partner programs are managed in-house, usually by the Sales or Business Development team. There’s usually a large amount of effort that goes into securing the right partnerships and contracts.But managing the relationship after the dotted lines are signed can be challenging. When companies neglect to focus on the partner experience, partners often look elsewhere and satisfaction, engagement and sales can suffer. The human element of building relationships is a must-have factor of partner marketing.

Referral Marketing

What is it?

Exactly what it sounds like — a strategy for encouraging passionate customers and advocates to directly refer their network to your business.

What makes it unique?

Studies have continuously shown that customers not only seek referrals, they act on them. Referral marketing takes the inherent organic and altruistic nature of referrals and gives brands the tools to incentivize and manage them at scale.

How is it typically managed?

We’ve seen companies build a referral program in-house and others who try to manage it manually through email and other basic systems. But the most successful companies automate the process by using one system to enroll, track, manage and reward their ambassadors.

The most important part of word-of-mouth marketing is facilitating two-way conversations with your customers.

Overall, brands that are successful with word-of-mouth marketing create meaningful connections with people who will talk about their brand and deliver positive messages to their networks—aka prospective customers.

Because there are so many variables to word-of-mouth marketing, it’s important to take a systematic and organized approach. Take some time to understand your audience and which word-of-mouth marketing program is the best fit for your brand.