Word of Mouth marketing plan
With enough word of mouth marketing, you can reach escape velocity and viral growth. It takes time, and is the equivalent of getting in shape naturally versus a crash diet, but if you do it, you’ll have a very defensible moat against your competition. In this article I want to break down the three components of a word of mouth growth strategy, so you can follow it in your business.
Product Market Fit: You want to aim for at least a 5-year time horizon when someone successfully uses your product. Our product, Interact, typically stays in use for 7 years for our ideal fit customers. Anything under 3 years is an absolute waste of your time to do word of mouth marketing, and above 7 years is ideal. Word of mouth marketing takes an extremely long time to build up, and if customers use your product but don’t need it for more than 3 years, there is not enough time for the word of mouth effect to kick in. So you want to make sure that your product has a timeline of at least 3 years, but ideally above 7, before you engage in a word of mouth strategy. If you find that’s not the case, it doesn’t mean your product isn’t good, but you may want to consider other strategies. Most of the benefit of a word of mouth approach comes after year 3, so if people stop using your product before 3 years, that will be an issue.
Customer Defined ROI: You want to know how your customers define ROI, and measure yourself against how many customers you help to achieve ROI. I say customer defined ROI because what your customer thinks of as ROI may not match up to what you see as ROI. And the only opinion that matters here is what your customer thinks. If they feel like they’ve gotten more than their money’s worth, then they’ll tell people about your product. If they have gotten ROI but don’t feel like they’ve gotten their money’s worth, they won’t tell people about your product. This one takes a while to define, and you should ask your customers to “paint done” or “define success” for you, so that you know exactly what it means for them to be successful with your product.
Customer Calls: You know it’s funny that the most famous viral loops are Hotmail and Paypal, where there was no human interaction in the loop. I think somewhere in our minds this feels satisfying because it feels easy. But for 99% of word of mouth marketing strategies, it’s completely driven by human to human customer calls, not some hands-off viral loop. Now with AI, it’s even harder to have a hands-off loop, because whatever product has that loop is immediately replicable with AI, so you have literally zero defensibility to your moat. What actually happens is that you conduct customer calls consistently over a long period of time, and if you focus on one or a few niches, then eventually you reach escape velocity wherein every time someone asks about your solution, your name gets recommended the most. Build a system of customer calls where you help customers reach their definition of ROI, run that system every day for 3 years, and you will build a word of mouth machine that no one else can take over.
