Dr Jeff Cornwall

One of the latest polls from the NFIB Research Foundation found that the Internet (16% of respondents) and word-of-mouth (15% of respondents) are the most common promotional strategies used my small business owners. My concern with these two strategies is that many entrepreneurs seem to view them as passive strategies — an approach of “if we build it, they will come.” Nothing could be further from the truth.
Word of Mouth
My favorite question to ask an entrepreneur who plans to use word of mouth to build their business is this: What is the last business that you could not wait to talk about with friends, family and even strangers. Most of the time they start to squirm in their chair, finally admitting that they can’t remember a specific example. Word of mouth rarely just happens. Spontaneous word of mouth is a rare event, indeed. Successful word of mouth promotion usually requires that we actively find ways to get customers to talk about a business in a positive way.
Here are the most reliable ways to encourage word of mouth:
– Motivate customers to talk about you through excellence in customer service. Customer service is not what it used to be, so if you can create an exceptional experience people will tend to talk about it. The service must be consistent, genuine, and enthusiastic.
– Create incentives to spread the word through a referral “thank you” program. Offer customers a future discount or send them a small thank you gift, such as a gift card, for each new customer they send your way.
– Ask your customer to “sell” for you. Although it is not as common and not always reliable, there are businesses that early adopter customers want to see succeed so that they can keep buying from that business. This most often happens when you fill a niche that has not been addressed in the market, thus creating a high level of pent up demand. It is a business that clearly gets early customers excited. In this case, ask them to spread the word. Let them know that you can’t succeed without their help bringing in new customers.
– Creating a “buzz campaign.” It is possible to mimic word of mouth by getting friends, family and employees to actively create a “buzz” about your business. In effect, they try to prime the pump by word of mouth. We see this being used quite a bit in the entertainment industry. Many fan groups are actively enlisted to get the word out about an artist. This can also be done through a user group, who in exchange for free service, support and education, can become a “sales force” for your business.
The Internet
Web pages do not work like the Yellow Pages. They are not localized to a particular market, and they are not structured by those advertising to assure that people will see them within specific categories of businesses. Many entrepreneurs are shocked at how hard it can be to find their own website using common search engines. Just because you put up a cool website does not mean that your intended customers will be able to find it. Given the high cost of even a simple website, it is important to have a strategy to help potential customers find your site.
There are two strategies that can drive people to a website:
– One approach is to pay to get traffic. This is a pull strategy, where you use search engine optimization or other techniques to attract people to your site. This is done through several means. While this can work, it can also become very expensive and it not always very reliable. You can end up paying for visits to your site that are not potential customers. Think of it like TV ads — most people who view them will never buy your product. By getting enough people to your site you increase the number of real customers who are part of that traffic.
– More common for small business owners is to use more targeted means to drive people to your site. This is a push strategy, where you put the address on your business cards, on brochures, or in other media ads to encourage them to go to your site to get more information or to place an order.