Bank of America Study Says Word Of Mouth Beats Social Media For Small Biz Marketing

I keep hearing this, over and over and over again – that word of mouth is what really brings in the sales for small business owners, not social media or other marketing such as direct mail, advertising or social media.

It’s ironic then – social media has all the buzz – yet good, old fashioned word of mouth is what’s driving sales. I think for many smaller businesses, although they “Tweet” and “have a Facebook page” they are not diving more into social media, like many large companies are because they don’t have time to develop the online content necessary for success.

They have time to service their customers and get referrals. For the larger, small businesses, they are seeing benefits of social media in a variety of ways and varying degrees of success.

I should also not, that some business owners might not realize that many of their face to face referrals could be the result of social media. Quick tip?

Small business success and challenges goes beyond technology and marketing though, it’s also about hiring, financing, our national economy and so much more.

Another challenge we all seem to have is getting paid on time. At Infusionsoft’s Infusionscon this year we heard how one creative business owner puts lottery tickets in each of his invoices. Do you think his customers look forward to receiving his invoices?

In a recent study, Bank of America surveyed 1,000 business owners with revenues from $100,000 – $5 million and employee from 2 – 99 employees and gained insight on how they are doing. Get the full report here.

While the study results are nothing new for many of you,  it’s nice to see what your peers are doing and how you measure against them.

Here’s a summary video on the findings below and here.

2 thoughts on “Bank of America Study Says Word Of Mouth Beats Social Media For Small Biz Marketing

  1. Marc R. Enriquez

    Hey Ramon,

    I followed your tweet here. I really appreciated how you said that many small business owners may not realize that their referrals may have been a result of social media.
    It has always been that a variety of direct and indirect referral opportunities can be built in to just about every marketing/sales process in a business, but in this “Social Age,” the opportunities have quite literally expanded geometrically.
    As you know – but as I share for the benefit of the small business owner that reads here – that if I announce on Facebook, for example, that I was satisfied with my barber, then a few of my friends who were online will know about it. But if they Like or Comment on my post, then so do some of my friends’ friends.
    If my barber has a business page and if I had tagged him in that post, then he has an opportunity to interact with me, my friends, and anyone else who might jump in on the conversation. And many of these 1st, 2nd, possibly even 3rd level connections may very well end up clients of my barber.

    Likewise, as my barber creates great content of his own for me to engage with, so may the viral exposure once again commence.

    Now, I don’t believe, as many social media evangelists do, that social media is now ALL you need to grow a business and that traditional marketing channels are dead – but, it’s value is proven and the opportunity cost is FAR, far too high for small business owners to MAKE time to participate in the conversation.

    Thanks for the post and the opportunity to discuss it. -=]

  2. Jerry

    Word of mouth is important, but most small business owners need more to be profitable. I happen to agree with the following quote from Dan Kennedy.

    “Bluntly, you do not (yet) understand what business you are really in – and you may NEVER find out. Once you experience Glazer-Kennedy Marketing you’ll realize that regardless of your business, you really are (and should be) in the marketing business. The first big leap in income occurs when a business owner moves from the thinking from himself as a “doer of his thing” to being a “marketer of his thing.”

    “You may resist this at first due to accumulated experiences and habit of running your business in a certain way and thinking about yourself in a certain way, but as a Member you will shortly become liberated and arrive at the proper viewpoint of what business is all about.”

    I have done numerous liquidation sales for small-medium retailers. Most of the owners primary marketing is word of mouth. The last 5 businesses happen to be in business from 40-85 years and had a good reputation in the area.

    I used to do promotional sales for retailers. Every owner was surprise at the results from their current and past customers. Every small business owner needs a strategy to keep in contact with their customers. Normally, during my promotional sales, the customer who would spend the most was a past customer or a current customer who spent little in the past. The key is to get contact info from customers and have a strategy to keep in touch.

    I strongly advise that small business owners use a variety of marketing methods to keep customers coming to their business.


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