As a kid, my extended family would gather at our farm for thanksgiving. It is a very old farm so the only animals you will find are some toads, birds, squirrels and maybe a beaver down by the river. What the farm always had (and still does have) are crab apple trees. No good for eating but according to my cousins, very good for throwing at people. Yes, your read that right. Playing a game of unofficial, unorganized dodgeball with crab apples was as much of a tradition as eating turkey. The crab apple game of "hit-anyone-in-sight-since-there-aren't-any-actual-rules" was put to an end eventually after the adults realized just how dangerous it actually was. If you were near any crab apple trees, you had better watch your back. There was an endless supply of them and they would be passed back and forth with rapid fire. And if a crab apple accidentally hit a new victim, you can be sure that new victim either picked it up and threw it back or went running to tell the first person they saw what just happened.
Something I have learned is that word of mouth works just like that game of crab apple. The only difference is Word of Mouth is very positive and those that it affects are not victims, but very happy business people!
In all seriousness, word of mouth is an amazing thing. Since I first started, every project I have had, with the exception of one, has been a direct result of word of mouth. I knew it would be helpful but had underestimated its sheer power(s). It is such a strong tool! People are much more likely to trust in a product or service if they know of someone who has had a good experience with it. The key is to making sure that your gratitude does not go unnoticed. If you learn that someone has recommended you, be sure to thank them! They basically just gave you free advertising. Free or paid, word of mouth is the best method of advertising out there.
Of course, word of mouth can work in the negative as well. If you find yourself in an unfortunate situation, it is not unlikely that people will talk about it to others and you could lose potential clients as well...
So, be smart. Be conscientious and be aware of how others are responding to your work! You will be amazed at how much it will help you :)