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Is Word Of Mouth Marketing Slowing Your Business Growth?

Whenever I speak to business owners, the topic of conversation invariably turns to marketing. When I ask how they market themselves, “word of mouth” almost always comes up as the primary or only form of marketing they rely on.

This used to shock me but now I’ve come to expect it. 

Whilst word of mouth marketing is powerful, and an important part of your marketing plan it’s an extremely slow and unreliable way of building a business. Assuming you do everything right, it can take many years, even decades, to build a successful business on the back of word of mouth alone.

Word of mouth or referral marketing is the business equivalent of a free lunch. Sure it’s nice when it comes your way and you appreciate it, but do you really want to rely on it to feed your family?

By being solely reliant on word of mouth, you’re putting the fate of your business in the hands of others. Essentially, you’re hoping they like you and remember you often enough to regularly send new business your way. 

This is an extremely dangerous path to be on. Instead, now’s the time to start building a much more robust marketing system.


Then you need to market it. But not just any marketing will do. In my new 1-Page Marketing Plan Course I show you the exact techniques I've used to start, grow, and exit several multi-million dollar businesses, so you can too.


Having only a single source of new business is extremely dangerous. Being unable to control that source makes it doubly so.

I advocate having at least five different sources of new leads and new customers. This is called lead generation. You can read about the benefits here.

Further, I recommend that most of these five sources be in paid media i.e. they cost you money to market yourself. The reason paid media is so important is twofold.

1. It's Extremely reliable.

If I pay a newspaper to run my emotional direct response ad  there’s a high probability the ad will actually be run. It’s much harder to get reliable and consistent lead flow from free marketing methods such as word of mouth.

2. Paid marketing Forces you To Focus on Return on Investment (ROI).

If a paid marketing method is not working, you cut it. You don’t waste further time or money on it. Whereas when the marketing method is free, such as with word of mouth, we tend to be less ruthless and often end up wasting huge amounts of time because we didn’t have to pay anything upfront. However, there’s an opportunity cost which, if careful analysis is done, often translates to a surprisingly large amount of real money.

The art and science of being able to consistently turn a dollar of paid advertising into a dollar or more in profits through direct response marketing will make your business resilient and can help you turn the tap on to rapid business growth. 


While we don’t want to be solely reliant on word of mouth, we do want to amplify it’s power and increase it’s reliability where possible.

One of the best ways I’ve seen this done is by straight out asking for referrals from customers for whom you’ve delivered a good result. It’s amazing how many business owners hope for referrals yet rarely ask for them. Something as simple as:

“Mr Customer, it’s been such a pleasure working with you. If you know anyone who’s in a similar situation as yourself we’d love you to give them one of these gift cards which entitles them to $100 off their first consultation with us. One of the reasons we’re able to keep the cost of our service low is because we get a lot of our business through referrals from people like you.”

See what’s going on here:

  • We’re acknowledging them and appealing to their ego.
  • We’re not asking them for a favor but instead offering something valuable they can give to someone in their network.
  • We’re giving them a reason why they should give us referrals – a reason that directly benefits them.

You could also look at affiliate marketing. This is another great way to generate referrals to your business. 

Systemize Your Word Of Mouth Marketing Strategy

By putting a system around generating referrals, we’ve dramatically increased the reliability of word of mouth marketing. And while not everyone will give you referrals, many will and it sure beats just silently hoping.

Relying on the goodwill of others is not my idea of being an entrepreneur. By creating multiple sources of new leads and increasing the reliability of word of mouth marketing, you take back control of your lead flow and build a solid foundation for rapid business growth.


If you enjoyed this article, you may also enjoy our article on How to Create a Lead Magnet that Converts in 6 Steps. As a small business owner, it’s the smarter way to acquire leads for your business and build your authority. 

8 thoughts on “Is Word Of Mouth Marketing Slowing Your Business Growth?”

  1. Thanks, Allan. Yes – everyone can benefit from the unpaid form of promotion. Focus on existing customer – make them happy. Customer referrals will help, further. Word- of-mouth ‘positive’ marketing works wonders. Instead of new customer acquisition, every time – one should try to look more after current customers.

  2. When I used to service tv’s in peoples houses I always used to give them a business card as well as a receipt, I reckon it got me 25% referals as I always seemed to get repeat business in the same streets and neighbouring ones

  3. For 20 plus years I owned an operated a computer sales and repair business. I only advertised the first year, after which it was all word of mouth. At my businesses height it was nearly 2 million in sales.

    1) I never begged a client, nor did I do any interaction with them that felt like marketing.
    2) I was always very busy, and even got comments from some clients that I was like the Soup Nazi from Seinfeld, because I was often short with them when they went on an on. They didn’t go anywhere else, because I was so honest and always solved their problems no matter my own personal cost.

    It seems like you’re saying don’t put all your eggs in one basket, which I agree. However, I do not agree with asking friends for more friends. Friends should inherently desire to promote friendships because you’re cool, not because you asked, and building new relationships on price (with your coupon deal) is setting yourself up for a relationship based on a disproportional value. The value is in the service and remarkable talent, not price.

  4. I like the concepts but word of mouth can be 50% or better of your business when you have a marketing plan in place for your referral base. I call it a CAP (Client Appreciation Program). I use marketing dollars to send something of value to my referral base & create walking & talking billboards for my business. The other aspect is targeting other areas with laser focus.

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