Think of it like this: You pay for X impressions. But if you can get 20% more people to see the ad through word of mouth, you get 20% better response (for free).

You’re doing all this great work — but what you’re missing is the WOM bump. So here’s the quick version of everything you wanted to know about word of mouth marketing but were afraid to ask.

It all comes down to this: Happy customers are your best advertisers. If people like you and like what you do, they will tell their friends.

Lesson 1: The Definition of Word of Mouth Marketing

Word of Mouth Marketing is a) giving people a reason to talk about you and b) making it easier for the conversation to take place.

It’s CtoC Marketing—when a consumer tells a consumer about you. Actually, it’s BtoCtoC. When it comes out of the mouth of a marketer, it’s marketing. When a real person repeats it, it’s word of mouth.

It’s more than just marketing—it’s also product design and customer service. People talk about fantastic stuff and great treatment from companies they like.

Lesson 2: The Four Rules of Word of Mouth

Rule #1: Be Interesting

Nobody talks about boring companies, boring products, or boring ads. Everyone can be interesting. Before you run an ad, before you launch a product, ask your spouse about it. Trust me… if he or she finds it interesting, you’ve got a winner.

Rule #2: Make People Happy

Create amazing products. Provide excellent service. Go the extra mile. Make sure the work you do gets people energized, excited, and eager to tell a friend.

Rule #3: Earn Trust And Respect

Nobody talks about a company that they don’t trust or don’t like. Earn the respect of your customers. Be good to them. Talk to them. Honor their intelligence. Fulfill their needs. Stay honest. Every company can be nicer, and every one of us can work to make our company a little better to its customers.

Rule #4: Make It Easy

Find a simple topic that is easy to repeat. Not your formal brand statement, not your product description. Forget elevator pitch…it’s the pass-in-the-hall test. What can people tell a friend about you in one sentence?

Then do everything you can to make it easy to share that topic. Use tell-a-friend forms on your website. Put it in an email. Pass out flyers. Blog it. Stick it on a T-shirt.

Lesson 3: The Three Reasons People Talk About You

Reason #1: You. They Like You and Your Stuff.

They like you. They feel a connection to your company, they respect what you do, and they want to support you. So they bring their friends. People feel driven to share things they like with their friends, so their friends can enjoy them too. Create great products and services that inspire them. (Think about TiVo, the best album ever, the best cookie you ever ate, or the spot remover that actually works.)

Be likeable. Make great stuff. Provide great service.

Reason #2: Them. Talking Makes Them Feel Good

People talk because it makes them feel special, smart, connected, in the know, and important. (Think about the restaurant guy, the what’s-on-sale maven, the computer guru.) People also feel good when they can help others find what they need or solve problems. (Think about the guy who always knows which contractor to call or which car to buy.)

Provide reasons to talk that make your talkers feel smart and special.

Reason #3: Us. They Feel Connected to the Group

Talking about a company and being passionate about it makes us feel like part of a family. We talk about it because it makes us feel included on the team. (Think about Harley owners, Apple junkies, sports fans, and anyone who loves a great band.)

Rally the team. Give them shirts, private discussion groups, special events, and public recognition.

Lesson 4: Making it happen — The Five Ts of Word of Mouth Marketing

Talkers: Find The People Who Like To Talk

Are they your customers? Neighborhood moms? Doctors? Bloggers? Think about the people who are most likely to tell a friend about what you are doing. Make sure they know about your new topic of conversation.

Topics: Give Them a Reason to Talk

Give people a reason to talk about you. It doesn’t need to be fancy. A special sale, good service, a neat new feature, a better flavor, a funny package. (Remember the Gateway computers that came in cow-patterned boxes?)

Tools: Help the Message Spread Faster and Farther

Do everything you can to make it easy for talkers to pass along your topic. Include postcards and stickers in the box when you ship a package. Put up a chat room so people can talk to each other. Join a blog conversation. Hand out samples. (Did you ever get one of those emails with a “secret” coupon that was supposedly for employees only? Did you forward it?)

Taking Part: Join The Conversation

Conversations die out when there’s only one person talking. When people are talking about you, answer them. Reply to their email. Comment on blogs that write about you. Send a lot of thank-you notes.

Tracking: Measure and Understand What People are Saying

The word of mouth conversation is the best feedback you’re ever going to get. It’s far better than any other kind of market research, because it is the authentic voice of the consumer. Hear what people are saying, learn from it, and use it to be a better company.

Ready to get great at all of this?

Come to Word of Mouth Supergenius: The “How to be Great at Word of Mouth Marketing” Conference on July 20 in New York where you’ll experience 12 how-to classes, 12 real-world case studies, and 6 brilliant authors — all in one amazing day. Shop.org readers can use the code SHOP to take 15% off registration.

About the author:

Andy Sernovitz is author of Word of Mouth Marketing: How Smart Companies Get People Talking and the fantastic blog Damn, I Wish I’d Thought of That. His company, GasPedal, teaches word of mouth techniques and runs the Social Media Business Council, a peer-to-peer support group for the heads of social media at very large organizations. He taught Word of Mouth Marketing at Northwestern and Internet Entrepreneurship at Wharton.

There’s a signal in this for all etailers: Consumers want to be heard. They want to be part of the process. They want to share what they think with you … but more important they want to talk to your other shoppers.

400,000 reviews represents more content volume than any marketing team could ever generate. That content fills the site with richness — richness that is a magnet for search engines.

More important: That review content has credibility that no marketer could ever have with corporate written copy. Each review sends key messages to shoppers:

1. Real consumers just like you are shopping here. Every review is an implied endorsement of the entire site.
2. This company cares about what we think.
3. The products are good. If they weren’t, why would the company let us review them?

(QVC’s review technology was provided by BazaarVoice. Disclosure: I’m an advisor to the company.)

Posted by Andy Sernovitz, Author, “Word of Mouth Marketing: How Smart Companies Get People Talking” – blog: http://www.damniwish.com