Word-of-Mouth has been (and still is) the most powerful form of sales and marketing…PERIOD. No one can argue with its effectiveness. The current numbers show that 90% of the people believe the recommendation of someone they know or are connected in-person and on social media.
Word-of-Mouth becomes even more important when you consider that TIME is viewed as the most important component in everyone’s life (77% of the people believe time is the most important factor in their life…Forrester). If someone can recommend something to us without us having to “spend the time” researching it we are much happier and choose this option ahead of spending (wasting) time doing searches and other “discovery” activities. But I digress…how can this be bad for you?
Word-of-Mouth is BAD FOR YOU when it happens with the WRONG AUDIENCE.
If you are trying to get your product or service in front of a particular audience, your desired Persona, then you specifically target your offerings, messages, and delivery for this audience. You build your customer experience to WOW this audience (hopefully you have one that does) and invest heavily in doing whatever you can to help this audience be better at what they do…you are like a laser beam focused on helping them improve their lives and/or business. This is the RIGHT STRATEGY.
But what happens when someone outside of this persona comes along and buys your product. They are NOT THE RIGHT PERSONA yet for some reason, usually because you offered a discount or special deal, and they became a customer. There are TWO BAD THINGS that happen when this happens.
- They tell their networks…this wrong persona now goes out to their social networks, friends, colleagues and others and tell them about you. This is NOT what you want to have happen. Most people think this would be a good thing…but it isn’t. Why isn’t it? Because everyone knows someone else like themselves. We hang out with people like ourselves…people that like the same things, do the same things, behave in similar ways, and have similar demographics. So when you attract this audience today, they tell more of the WRONG AUDIENCE to come over and see you and maybe buy from you. You might be thinking this is a good thing because you are getting more sales from a different audience. It’s not…in fact it can be a silent killer of your business if not controlled early on because you can eventually replace the “right targeted audience” with the “wrong audience.” What makes them right (and wrong) is how you have identified early on the right audience and BUILT YOUR BUSINESS/EXPERIENCE TO SERVE THEM. You created your processes, communication, delivery, and of course your experience to serve the right audience…not the wrong audience. So attracting more of the wrong audience will eventually drive away your right audience…and erode your margins. But there is one more BAD THING that happens…see Number 2 below!
- They won’t be happy…when this is the wrong persona for what you have created inside your organization, your custom designed customer experience won’t appeal to them…you are providing the right experience for your company to the wrong audience. You are designed to provide your incredible experience and other processes for a different persona audience. This means you are out of alignment with this audience…what you do won’t make them happy…in fact it might actually make them angry. When you build a company to deliver an incredible experience to a certain audience(s) and through other offers and deals you attract a different audience, you can’t deliver happiness to them. They will be upset…they will then think you have a terrible experience (which you do when it’s not the right audience) and guess what they do…TELL EVERYONE. They spread word-of-mouth to their audience…and it isn’t positive word-of-mouth.
Let’s take an example to make the point. Let’s say you are Nordstrom (an awesome business that delivers an amazing experience) and you now your “right audience” of customers. These are people who don’t mind spending more money than they would somewhere else because you deliver a variety of services to them and an experience they truly enjoy…they will pay more for this experience. But one day you decide to offer a super special deal on some items…these items are now half-off from the regular prices. This is an amazing deal…you might think this will be great because we can bring in all kinds of new people to buy our products. It’s a huge mistake…
All of a sudden, the regular shoppers of discounted merchandise show up to buy your products. They would never go to Nordstrom and pay regular prices…they are not the targeted audience persona. But now the prices are so low they say this is great, let’s go get some deals. When they show up, they are out of their element. This is not where they normally shop…this is not the experience they are used to getting where they normally shop. When they show up, the delightful Nordstrom employees are trying to go out of their way to give them fashion advice and spend time with them…not what they want. They want to know where the rounder is with all the deals so they can rummage through there grabbing everything that is a super deal. The experience Nordstrom is “designed to offer” is not the experience they want to have.
Refer back to the two things listed above. According to number 1, they immediately text all their friends and say there are these great deals at Nordstrom so get over here and snap them up. So hordes of their friends show up at the stores and start cleaning out the racks of discounted clothes. So many of the “wrong audience” that if you were one of their “targeted personas” and regular Nordstrom customer and you walked into the store you would say to yourself, “What is going on, this is crazy and I don’t want to be here.” You would leave.
If you refer to Number 2 above, they don’t like the experience the Nordstrom employees are designed to offer…assistance, fashion advice, options, and an overall awesome experience. The wrong audience is annoyed by this and just wants to be left alone to find the best deal, not the best fashion advice. Besides, if they spend time with the Nordstrom consultant, someone else might grab the deal from them. So they tell their friends that Nordstrom is pushy, wastes their time, bothers them…and they tell others about it. This hits the social airwaves and can be picked up by anyone…even a prospective “right persona” potential customer. They simply say they had a bad experience at Nordstrom.
This is where WORD-OF-MOUTH GOES BAD for a company. The goal is to avoid this from happening at all costs because neither of the things that happen in this situation helps the company.
For Nordstrom, they got smart. They created a division of their stores called “The RACK.” It is designed to alleviate this from happening to their main stores. They created an entire line of stores to stock this discounted merchandise so they can target two different personas…brilliant. Now if you want the top shelf Nordstrom experience, you go to a main store. If you want to rummage through racks of clothes on your own and find super deals, you go to The Rack. Rather than mix the two persona audiences, they build different venues for these audiences. Most businesses can’t do this which is what causes the issue.
I encourage all business owners to really think about their strategies of attracting new customers. Offering super deals can add additional purchases…but this strategy has the potential of destroying your core business. The goal is to avoid Number 1 and 2 above. These can cause significant hardships on a business to the point of extinction. You can avoid it with some careful planning before marketing tells you to offer an incredible deal and we can attract a lot more customers. This is not always the best answer. If it doesn’t fit your targeted personas, I highly recommend you focus and invest more on attracting more of the right personas instead of wasting time…and potentially costing you your business.
