Growing a small business is no easy feat for the entrepreneur. It takes a disciplined marketing strategy as well as a vision for the company’s future. Gail Goodman, Constant Contact CEO and author of “Engagement Marketing: How Small Business Wins In a Socially Connected World,” recommends engagement marketing as a way to grow a small business through repeat sales and customer referrals.

We picked her brain for tips that all small business owners could use, and the result is a two-part interview with actionable advice and detailed steps business owners can take to use engagement marketing strategies within their own business.

Here’s the first part of our interview with Gail.

ES: To start off, can you define engagement marketing for those who haven’t heard of it before?

GG: Engagement marketing builds on a tried-and-true basic fact — that happy customers drive word-of-mouth referrals. Engagement marketing moves online what we’ve all done offline where comments, likes, shares and word-of-mouth referrals are publicly visible — to a much wider audience — on Facebook, LinkedIn, Twitter and Google+, as well as review sites like Yelp, TripAdvisor or Open Table.

The Engagement Marketing Cycle has three steps:

  1. Deliver a WOW! experience – This means that you create memorable experiences, ones that rise about the ordinary, the kind people want to share.
  2. Entice customers to stay in touch – Extend the WOW! experience by asking customers to Like your page or subscribe to your e-newsletter. You entice them with a fabulous offer, such as a free report, coupons, special event announcements, early access to new products, etc.
  3. Engage people – This is the fun part! Using social media and email, you engage your customers by posting content that inspires participation — content that gets them to comment, like or share with their friends and networks.
ES: Why do you think engagement marketing is so important for small business owners?

GG: Growing sales is always a big challenge for small businesses.  Small businesses know that repeat sales and word-of-mouth referrals are their most reliable sources of revenue. In fact, I’ve had countless conversations with small business owners who have said that 99% of their business comes from these two channels. Engagement marketing is all about growing this 99%.

Engagement marketing enables small business owners to market to a group of people they already know — their existing customers! — using many of the tools they already have, such as a Facebook Page, an e-newsletter, a Twitter account. Engagement marketing is easier, less expensive and more trackable then trying to reel in people you don’t know.

ES: You say that small businesses can “creatively out-engage” the big guys. Can you give us an example how this has been accomplished before?

GG: One great example is Bob Tullio of Gourmet Coffee Service, a small business in Southern California. His company has to compete with the “big boy” food service companies. Tullio’s Engagement Marketing strategy begins with a huge WOW! each time a driver comes to stock a corporate customer’s pantry with coffee and other items. He also cleans the pantry and the coffee brewer. Gourmet Coffee’s tagline is, “We’re going to spoil you,” and they do. And their customers post their testimonials to Gourmet’s Facebook page – where everyone can see them.

Tullio uses email to remain connected with his customers, but instead of simply sending out an e-newsletter, he features two or three new products that customers can choose to sample for free. The driver then drops these samples off — and customers begin ordering them — month after month.

He also created a “Love Our Driver” campaign on Facebook where customers were encouraged to post comments about why they loved their drivers. The four drivers with the most “love” comments were rewarded with a nice dinner at a local steakhouse. The campaign doubled the number of Facebook fans in just a short time. Why? Because people love being the star of the show!

As you work on your marketing strategy for the next day, week, or month, what are some of the ways you can engage your customers and prompt them to share your business’s story with their online connections to expand your reach?

Would a marketing strategy like the one used by Gourmet Coffee Service work for your business? What changes could you make to fit your brand and message?

Be sure to read part 2 of Emily’s interview with Gail Goodman!