Marketing Multiplier #3 – Word of Mouth

Let’s add the final piece of the marketing effectiveness equation. Back in September, we introduced our advertising ineffectiveness formula and told you that advertising alone is fundamentally ineffective marketing. Here is our formula:

Where (C) = Credibility, (M) = Message, (D) = Demand, (R) = Reach, (W) = Willingness to make a purchase

The point being that when you rely on advertising as your sole marketing tool, you will get practically zero results. That’s because advertising alone is basically ineffective, thus the reason so many small businesses see no response from their advertising.

However, with the use of marketing multipliers you can increase the effectiveness of your advertising and begin to see results. We have already covered branding and the customer experience, today we will focus on word of mouth and complete the formula.

The Role of Word of Mouth In Your Marketing
It is often said that word of mouth is the most powerful form of marketing. This is true because, according to the Word of Mouth Marketing Association, 76% of consumers say that they don’t believe companies tell the truth in advertising.

The amazing thing is that 24% of the population actually believes that advertisers do tell the truth. But I guess there’s a certain segment of the population that believe people tell the truth in their online personal ads too.

So word of mouth is important because it is perceived as being impartial. It typically is communicated by someone who is perceived as unbiased. When a customer receives this word of mouth marketing, it shortens their decision-making time for buying a particular product. The business benefits by getting more sales sooner.

Where Small Businesses Don’t Get It
When it comes to word of mouth, most small businesses believe that good talk happens when you do a good job. Sometimes this is true. But it’s also true that you can enhance and accelerate customer evangelism with a plan.

In their book Creating Customer Evangelists, Ben McConnell & Jackie Huba give you six ideas on how you can develop word of mouth. See a brief summary here: What is customer evangelism?

Word of mouth is about identifying the talkers, giving them something to talk about, and then giving them the opportunity to talk about it. That can only be done effectively and consistently with a plan.

The Synergy of Marketing
After you do implement a word of mouth plan into your marketing strategy, you can expect all parts of the strategy to perform better.

Your branding will have more meaning because you have a customer experience congruent to your brand promise.
Your customer experience will have greater impact because you will have people talking about it.
Your word of mouth will carry greater weight because you will have advertising that communicates your evangelizing message.
Your advertising will be more effective because your brand promise has been true to form throughout your customer experience and your word of mouth.

I guess you could call it the marketing circle of life.

The Final Formula of Advertising Effectiveness
The four marketing multipliers actually increase the effectiveness of each other. So in our formula, you don’t just add them together, you multiply them.

Branding has multiplier effect of 2
Customer Experience has a multiplier effect of 2
Word of Mouth has a multiplier effect of 3

Thus our final advertising equation looks like this:

Where (C) = Credibility, (M) = Message, (D) = Demand, (R) = Reach, (W) = Willingness to make a purchase

Now you can see that you are actually getting a positive return on your advertising investment.

In Summary
This formula is not scientific, although I believe it to be somewhat accurate. I put this marketing multiplier formula together for two reasons. The first was to show just how ineffective advertising by itself is at driving business. The second reason was to illustrate the interdependence of all your marketing activities.

When you have a complete plan, then you can really multiply the effects of your marketing.

Related Posts on Marketing Multipliers and Word of Mouth:
Marketing Multiplier #1 – Branding
Marketing Multiplier #2 – The Customer Experience
Igniting Word of Mouth: Four Hot Ideas


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  1. […] can be compounded and grow exponentially at an alarming rate. This is also known as the marketing multiplier effect and this effect further speeds up the reach to even more people and thus capturing the attention of […]

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