This is a guest post from the team at MyInfluence.
It is no secret people are more likely to trust the opinions of people they are close to. This includes not only opinions about personal matters but product and business recommendations as well. According to a Nielsen study, 92% of consumers are more likely to trust recommendations of friends and family over those of an advertisement.
Still, businesses keep pumping millions of dollars into advertising. Why not redirect those resources towards harnessing the benefits of word of mouth marketing for your business and providing incentives for your users to start conversations about your product?
Enter MYInfluence. This platform, like the blockchain of e-commerce, tracks and scripts the direct and indirect social connections of users and rewards them for sharing their personal recommendations.
Word of Mouth versus Advertising
Word of mouth has always been a powerful marketing tool and is even more important in today’s over-saturated, competitive market. 92% of consumers trust their social connections over any form of advertising and more than 4 out of every 5 people check with their peers for recommendations before making purchases.
Word of mouth also does not stop after just one interaction – one person will tell another, then that person continues the chain and spreads the word further. This provides a company great exposure and ensures high conversion rates.
The rewards of mastering word of mouth marketing are huge and can deliver a sustainable and significant competitive edge that traditional marketing cannot match. Yet, hundreds of billions of dollars are being spent annually on advertising in the USA instead.
While 60% of marketers agree that word of mouth is the most efficient way to ensure visibility with high conversion rates, these same marketers are still reluctant to change their strategic focus to word of mouth methods and instead keep on pursuing traditional marketing approaches.
One of the advantages of traditional advertising over word of mouth is measurability of results. While it is relatively easy to quantify the impact of traditional advertising and measure the return on investment, word of mouth is more qualitative than quantitative. While the gain from investing in word of mouth is higher, it may be challenging for marketers to channel funds into a strategy that is more difficult to measurably prove its worth.
However, there is plenty of reason to believe that it is worth the risk since there’s enough proof to show the great advantages of word of mouth marketing over traditional advertising. Smaller businesses tend to agree and are often more willing to invest their more limited budgets in word of mouth marketing.
Mastering Word of Mouth
Let’s assume you oversee one of the small businesses mentioned above and are comfortable with spending your marketing budget on a word of mouth marketing approach. How should you successfully do this?
Investing in providing incentives for your clients is the answer you’re looking for. 88% percent of Americans say that an incentive would encourage them to share recommendations in their social circles. Why not invest in incentives for those 8 out of 10 customers who are willing to create genuine social media content for your business and start a positive buzz around products they enjoy?
This approach was adopted as a business model by an innovative social marketplace – MYInfluence. MYInfluence allows users to earn incentives based on their recommendations. Every purchase made through a recommendation brings incentives to not only the direct referrer but their referrers and the referrers of their referrers and so on. MYInfluence calls this a perpetual commission chain.
A digital network of social connections is the main asset of word of mouth marketing. Once a recommendation is made it goes to the next social circle, and then the next one, and so on, generating organic and infinitely growing buzz around the product. This constantly expanding network of connections is vital to your plans to incentivize users.
MYInfluence found a way to offer users an exponentially growing incentive on par with the growth of both their direct and indirect social networks. This means incentives come from social circles reached not only just by a user but also by that user’s friend, by a friend of that friend, and so on.
MYInfluence tracks and scripts the digital social networks of users and keeps a ledger of references made by every member of the network. As a result, the platform can track and reward every direct and indirect recommendation by sharing the profit from every purchase with up to ten members of the referral chain.
Remember when Louis Vuitton enlisted Jennifer Lopez to endorse their leather goods in 2003? What about when Calvin Klein’s underwear ads featured Mark Wahlberg in the 1990s? These are examples of influencer marketing.
Influencer marketing may be a new buzz word, but the concept hasn’t changed much over time. What do influencer marketing and word of mouth marketing have in common? They are designed to build trust. A recommendation becomes a conversion only if it comes from a trustworthy source.
Is it worth investing in influencer marketing as part of creating a word of mouth strategy? While it may sound like the right thing to do, influencer marketing ensures great visibility and exposure but many marketers come to the conclusion that it is just not a justifiable expense in terms of actual sales generation.
MYInfluence creates equal opportunities for every buyer to become an influencer in their own social circles and get rewarded for that influence. You shouldn’t have to be an Instagram star to get rewarded for recommending products you love. On this platform, influencers are born organically and are given incentives to simply share their favorite products with friends and family.
MYInfluence is a new marketplace that is currently focused on selling books. In the future, the company is planning to expand with hopes of reshaping the way people shop and how brands spend their marketing budgets.