Business
The Risks of Relying on Word-of-Mouth in Local Marketing
Rafael Somera notes that 75% of small businesses lack a digital presence and explains why referrals undermine predictability.
Relying exclusively on word-of-mouth compromises revenue predictability and client selection for service providers and small businesses. Data shows that most small companies still lack a structured online presence.
Rafael Somera, CEO of Solutudo Brasil, analyzed the proximity marketing challenges facing small and medium-sized enterprises and the risks of operating without structured digital channels during an interview with Bruno Gimenes on Marketing - The Podcast.
In the video above, Somera and Bruno break down local consumer behavior and discuss why relying solely on organic reputation restricts operational growth.
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The Paradox of Businesses That Rely on Referrals
The discussion centers on the disconnect between consumer search behavior and the digital presence of micro and small businesses. Sebrae data from 2024 cited in the conversation shows that only 34% of Brazilian micro and small businesses maintain an active, structured digital presence, even though 87% of consumers research online before making local purchases. Furthermore, Google data from 2025 indicates that 76% of searches with local intent lead to a store visit or direct contact within the same day.
Somera points out that businesses with the weakest digital footprint are often the ones with the highest ratings for in-person service. "Do you know which companies generally invest the least in digital marketing, based on what we've studied and seen at Solutudo? The ones that survive almost entirely on referrals," he says. Because clients recommend the service organically, these businesses—such as masons, gardeners, painters, grocery stores, and bakeries—neglect building their own channels.
The Loss of Predictability and Client Selection
This exclusive reliance on word-of-mouth creates two primary management vulnerabilities. The first is a lack of demand control. "You have zero predictability; you depend entirely on a client remembering you or someone asking them for a recommendation," Somera explains. He adds that social behavior has shifted, with customers asking neighbors or acquaintances less often and searching directly online instead.
The second vulnerability is the inability to choose clients and higher-margin projects. Without a consistent inbound pipeline, professionals are forced to take on whatever work comes their way. Somera also emphasizes that even prospective clients who receive a referral still search online before closing a deal. If they cannot find information about the company, they often abandon the contact entirely.
Listing Errors and the Digital Blackout of Service Providers
The reach of small businesses online is also hindered by search platform requirements, which often demand forms of verification incompatible with the daily routines of self-employed professionals. This friction pushes a large share of service providers away from location tools.
According to Somera, this absence is widespread across the domestic market. "The data we have at Solutudo shows that 75% of service providers and small businesses simply do not exist online—it is not that they perform poorly, they do not exist at all," he notes. Among the 25% that do have some public online record, Somera reports that nearly 40% have inconsistencies, such as outdated phone numbers, incorrect addresses, and obsolete details.
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