Word of mouth/referrals are, indeed, powerful with all ages of consumers. As John Jantsch puts it in his description of his new book, “The Referral Engine:”

The power of glitzy advertising and elaborate marketing campaigns is on the wane; word- of-mouth referrals are what drive business today. People trust the recommendation of a friend, family member, colleague, or even stranger with similar tastes over anything thrust at them by a faceless company.

Effectiveness of Referrals in Health, Travel and Financial Services Industries

Referrals have an impact in all stages of a purchase decision, from when consumers decide which products to consider, to when they evaluating options to when they make a decision to buy.

The reality is that there is no way you can “test drive” a holiday to Bali. There are no in-store samples when it comes to choosing healthcare or financial services. The statistics below show the importance of recommendations and word of mouth in those industries where product/service “demos” aren’t easily come by.

• 50% of the 17 million adults who found a new primary care physician in the past year relied on recommendations from friends and relatives. More than 25% used such recommendations as their only information source. (Center for Studying Health System Change)

• At AAHSA in 2008, a presenter shared statistics from Shouldice Hospital which counted 49% of new patients as referrals from past patients. (American Association of Homes & Services for the Aging)

• 34% of UK vacationers told consumer research group Mintel that they chose their destination on the basis of a face-to-face recommendation. Another 27% used online word of mouth sources such as user reviews. (TravelWeekly)

• And, in financial services, an Alliance Bernstein study of people with a minimum net worth of $25 million found that 100% of respondents used referrals when searching for a financial advisor. (Advisor Perspectives)

Are Retirement Communities Leveraging Referrals?

Like many health-related businesses, our CCRC clients note that referrals are their best sources. Prospects who are introduced to them through current or past residents are most likely to purchase.

So why aren’t more CCRCs taking better advantage of good ol’ fashioned referral marketing?

It’s not because retirement communities or assisted living facilities are failing to earn fans.  McKnight’s Long Term Care News reports that most nursing home workers would recommend their facility to others – as would 85% of the residents of these homes and their families.

It’s not because older adults are stingy with praise. In fact, they are asked for their recommendations with great frequency. Here are some Baby Boomer statistics to consider: A 2007 Weber Shandwick studyfound that 57% of 50+ers were asked to recommend a product or service nearly twice a week. And recommend they do – 89% of Boomers surveyed had given advice on products or services.

What do you think?

Are businesses in general – and retirement communities in particular – spending enough time on generating referrals?

Please share your thoughts … or examples of groups effectively using personal referrals from Boomers and seniors in their marketing … below.

Each piece touches on Boomer/senior marketing best practices and contains a number of actionable tips.  Keep reading for a link to the Sherpa case study and a PDF of the ICAA article.

MarketingSherpa: MultiChannel Marketing to Retirees Lifts Leads 267%

As reporter Adam Sutton wrote:

The latest marketing tactics might connect with younger audiences, but not necessarily with retirees. Sometimes straight talk from their peers and a simple registration process can work best.

See how a retirement community’s marketing team lifted leads 267% with direct mail and advertising that featured testimonials from current residents, and a simple registration process for email communication. Includes samples of the ads and emails they used.

MarketingSherpa’s case study details the four steps our team followed to drive online registrations with 70+-year-old prospects.  The online/offline campaign drove web traffic as well.  Check out this chart showing the increase in unique online visitors.

Read the full MarketingSherpa case study on the integrated CCRC campaign here. 

(Open access for a limited time. Not a Sherpa subscriber? We recommend it.)

ICAA: Photography Can Make Mature Marketing More Effective

In the November/December 2009 edition of the Journal of Active Aging, ICAA’s terrific publication, Todd Harff puts it plainly:

Our economy may finally show signs of recovery, but in 2010 many marketers of wellness/health facilities and services to age 50-plus adults will continue to be challenged. They’ll be asked to connect, motivate and inspire Baby Boomers and beyond with advertising, websites and other communications. All with potentially smaller budgets, reduced staff and less time.

How can your team rise to the challenge? One way is to harness the incredible power of pictures.

The ICAA has graciously allowed us to post a reprint of the article – click here to learn why and how the right imagery can actually speed sales with members of the Baby Boom and Silent Generations, and to get 5 tips to guide your photography choices in 2010.