To begin with, we need to get something straight. Word-of-mouth advertising is a misnomer. The dictionary definition of “advertising,” according to Webster is:

“The action of drawing something to the public’s attention with a paid announcement, often through a printed notice or a broadcast.”

Therefore, WOM is NOT advertising. It is neither bought nor controllable, to any large extent. Spreading WOM advertising is more akin to allowing the wind to control a kite. Sometimes it goes up and often times eventually, comes down. When a consumer uses your product or service, your job is done. Then the person has a variety of choices. They can (a) tell a friend or relative how great the experience was, (b) tell them how awful it was, or (c) tell nobody at all.

It depends on the result. More often than not, if your business has simply met their expectations, they will likely do nothing. If you produced a superior product or service, they may tell a few people. Ah, but if you have done a lousy job, watch out. They’ll tell the world about the awful item or event. Therefore, WOM has a 66% chance of not working in your favor. It works exactly like the news. A terrible situation with a tragic outcome has a far better chance of making the news than a warm and fuzzy, feel-good piece. It’s human nature. People are fascinated by horrible traffic accidents and will gawk for minutes or hours. They still discuss Princess Di, John F. Kennedy, Jr, and John Lennon’s death, even decades later. But, do they celebrate the living with the same enthusiasm?

Knowing all that, why would any business continue to ignore traditional advertising channels and rely solely on WOM? At least with the media, they can structure their own program, target their market, and track the results. It’s not just a matter of money. Sure, advertising costs money, but it’s an investment in the company. WOM is free promotion, but is it positive? From what I’ve just written, you tell me.