Sure, commercials can be fun to watch and billboards can grab your attention for a few seconds, but how much more likely are you to remember a brand or product that has been recommended to you by a friend? A recent study done by the Keller Fay Group reveals that in order to drive sales, having a big advertising budget isn't nearly as important as you might think, especially when compared to the power of word of mouth recommendations.
Specifically, the study shows that the number one driver of consumer purchase decisions is personal recommendations. This study tested 10 product categories in every area of business from banking to entertainment and vacation travel to retail products, and all showed that advertising or online sources of company information are less important in the decision making process than word of mouth recommendations.
The overwhelming majority of purchase decisions are swayed by recommendations from friends or family. Throughout every product category, regardless of price, was influenced by friends or family rather than expert sources of advice.
The importance of this finding should be a comforting and exciting fact for small business owners and entrepreneurs who often develop close personal relationships with their customers. When you do engage with these customers, be sure to ask them if they would be willing to recommend you to their family and friends. It is surprising how just the brief mention of this can help them remember to do so in the future. You may also find it helpful to find an appropriate way to reward these customers for referring new business to you.
The findings of this study make it especially important for businesses to have an active social media presence so that customers can Like or share information with their family and friends online. While a face-to-face recommendation may hold a bit more sway, social media is an excellent way to get your business name out there and to connect and engage with your current and potential customer base.
If you need help navigating the complex world of social media, CyberMark offers social media management services that can work for you. To receive more information on the services we offer, call us today at .