A marketing approach that leverages consumer word-of-mouth (WOM) to spread awareness and reputation of products or services. Real user voices carry higher credibility than one-way corporate advertising messages and strongly influence purchasing decisions. The proliferation of social media has dramatically expanded the speed and reach of word-of-mouth.
Types of Word-of-Mouth Marketing and the Structure of Trust
Word-of-mouth marketing is broadly divided into "organic" and "strategically promoted" types. Organic word-of-mouth consists of reviews that users voluntarily post on social media or review sites. While uncontrollable by companies, it carries the highest credibility. Strategically promoted word-of-mouth involves companies encouraging review generation through review campaigns or product sampling programs. Note that Japanese law requires clear disclosure when content is PR-related, to avoid stealth marketing violations.
The credibility of word-of-mouth varies significantly by source. The most trusted is "direct recommendation from friends and acquaintances," followed by "ratings on third-party review sites," then "posts from general users on social media." Corporate advertising messages rank lowest in trust. Understanding this trust hierarchy, invitation codes and referral programs can be positioned as systematized versions of the most trusted word-of-mouth channel - "recommendations from acquaintances."
Practical Strategies for Promoting Word-of-Mouth and Key Considerations
Strategies for systematically promoting word-of-mouth are diverse. Representative approaches include requesting review submissions through post-purchase follow-up emails, incentivizing social media shares, soliciting user-generated content (UGC) through campaigns, and identifying Promoters through NPS surveys to guide them toward referral programs. In all cases, designing pathways that make it easy for users to post reviews is what determines success or failure.
Handling negative word-of-mouth requires careful attention. Deleting or ignoring negative reviews is counterproductive - responding sincerely actually builds trust among other users. In fact, many users report that seeing a company's thoughtful response to a negative review influenced their purchase decision. Additionally, with Japan's stealth marketing regulations that took effect in October 2023, clear disclosure is mandatory for any word-of-mouth involving corporate involvement. Violations are subject to corrective orders under the Act against Unjustifiable Premiums and Misleading Representations, making compliance essential.
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