Why word of mouth is more important than advertising for big purchases

word of mouth vs advertising big purchases

How do you make decisions? Are you being impulsive or are you doing it on purpose? Research in behavioral economics tells us that we are all the same, depending on circumstances. We have two different systems for decision making. We think fast and slow , as Nobel Prize-winning psychologist Daniel Kahneman would say. When the deposit is low, we can use our “automatic” decision-making system.

Think about the last time you went grocery shopping when you were hungry. Maybe you've stood there, waiting in line, waiting for the cashier and deciding, "Sure, I'll buy a candy bar." The candy bar isn't expensive, it's a brand you know, and you'll be hungry. It's easy to make automated decisions because you have pretty much all of the information you need without going through that candy bar.

For companies in the commodity industry or those that are competing at a lower price point, brands are clearly powerful — these brands need to be at the forefront because they don't have the time to get the hang of it. why you should choose their brand over others when you are using 10 seconds to make your choice.

However, in a survey conducted by Convince & Convert and Audience Audit and presented in “ Speaker Matters: The 2018 Word of Mouth Report ,” ads are only the eighth most valuable source of information when we make substantial purchases. Why so? Well, most companies have a customer journey that's 10 seconds longer than those on the checkout aisle.

That's why in his book, Youtility , Jay Baer talks about the value of content marketing in creating touchpoints and opportunities for brands to build relationships with their customers. But what if there is another avenue that marketers tend to overlook when helping customers make decisions?

The higher the stake , the more important Word of mouth Becomes

When the stakes are high, our “reflex” system kicks in. This is the kind of thinking that you use to logic through your decisions: when the price is high, the commitment is long, or the importance of the decision is significant. In fact, the study" Chat Problems ” also demonstrates that “the larger the purchase, the more we rely on the opinions of our friends and family when making purchasing decisions. ”

large purchase buying decision

No decision is more meaningful, important and – I am sure – more stressful than planning a wedding. That's why it's no surprise word of mouth Friends and family are the most cited sources of recommendations when choosing a wedding service provider, according to " Chatter's Problems .”

This results in the number of the day: 331%. This number represents the fact that Americans rely more on word of mouth recommendations triple than they rely on advertising when planning their wedding. After all, most people will only have their wedding once, right?

Americans rely on word-of-mouth recommendations 3 times more than advertising when planning their wedding. #ChatterMatters Click to Whisper

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Slow thinking: People use their reflex systems to make bigger decisions

With a reflective mindset, we're open to taking in as much information as possible: the brand's reputation, the experience and emotional resonance it provides, and the specific pros and cons. In other words, we're looking for the brand to make an overall case based on ethos, pathology, and symbolism — the building blocks that Aristotle told us make for a compelling argument.

Word of mouth, in particular, covers all three bases. The actual experiences of the people we trust tell us: whether they trust the brand or not, the emotional experiences of our friends and family (does the product/service make them feel good) good, happy, satisfied or not) and the benefits of the product/service. What's more, we're more likely to listen to people in our personal lives than to see testimonials on a landing page or read through product specifications.

So, if your company sells a product/service that involves costs, commitments or consequences, ask yourself: are we doing enough to encourage and facilitate positive word of mouth? extreme it? And download" Chatter Matters: The 2018 Word of mouth report ” for more details.