Which customer segments generate the most word-of-mouth referrals?

09Feb10

Given all the attention paid to viral and word-of-mouth marketing, lots of websites are including features to let you tell a friend about their product or service. But after completing a transaction with a popular online application, I started to wonder: which group of customers is most likely to actually refer their friends to the site? For a typical web-based application, there are three categories to consider:

– Customers who paid for the service (in other words, normal paying customers)
– Customers who got the service at a discount or for free (i.e. people using a coupon)
– Customers who not only got the service for free, but were paid in terms of extra gifts or bonuses for doing so (such as members of a focus group)

Normally, I would say the first group is the most likely to tell others about their experience, since people who pay for things tend to value them more and seek external validation for the money they spent. This is arguably why customers who pay an annual fee for American Express charge cards tend to be very loyal and vocal about AmEx, for instance.

But with all the word-of-mouth and sharing tools available online, are paying customers really the most likely to talk about a product? It’s hard to say. Perhaps the people who first got the product at a discount, but then were impressed enough to pay full price after that, will lead to the most word-of-mouth referrals. Or maybe those who got paid to try the product are your most vocal allies. No matter which group ends up being the most valuable, one thing is certain: if you want people to tell their friends and colleagues about your products, make sure to ask them to spread the word. Even if you don’t think a particular group is going to be very chatty, it usually can’t hurt to ask.



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