Spending on word-of-mouth (WoM) marketing slowed in 2008, nevertheless increasing 14.2%, to $1.54 billion, despite the worst economic recession in 70 years, according to PQ Media's recently released Word-of-Mouth Marketing Forecast 2009-2013 report.
Though year-over-year growth is expected to slow in 2009, WoM spending is on pace to increase another 10.2% this year, placing WoM among the fastest-growing advertising and marketing segments, says the report.
Changing consumer behaviors and advancing technology, and their residual effects on the advertising and marketing sectors, will continue to fuel growth in WoM marketing, according to PQ Media, which forecasts that spending from 2008 to 2013 will increase at a compound annual growth rate (CAGR) of 14.5%.
The firm defines WoM marketing as an alternative marketing strategy that uses both online and offline tactics to encourage consumers to talk about products and services. WoM marketing is supported by research and tools, and often it is facilitated by brand ambassadors.
WoM spending increased at a CAGR of 37.6% from 2003 to 2008, according to PQ Media:
"The most influential marketer in a consumer's life is someone they know and trust, such as a family member, friend, or colleague," says Patrick Quinn, president and CEO of PQ Media.
As consumers become more connected to one another through high-tech devices such as smartphones and social media outlets like Facebook and Twitter, brand marketers have increased spending on WoM as part of their overall marketing strategies, according to PQ Media.