Written by: Sunyoung Kim

Abstract

People have through all times expressed their views on current events and the latest trends. This article will look into how word of mouth travels in the modern day era of constant social media exposure. How are you as a consumer affected by other people and are you aware of the mechanisms that lies behind your buying decisions? Marketing professionals are well aware of how you make these decisions, but are you? The effect can be different depending on the type of products and brands in question, and we will see that what type of consumer you are, whether you are a novice or an expert for a specific product, will also have an impact. Lastly, we have reviewed a case that tells us more about whether the information that we receive via for instance via Instagram is authentic or not.

Introduction

Since Web 2.0 was introduced in 2004 (BusinessDictionary.com, 2016a), it has allowed consumers to easily access online content that are produced by both marketers and consumers (Labrecque, vor dem Esche, Mathwick, Novak & Hofacker, 2013). People can create “a stage for self expression” for whatever they want to and upload through simple Web 2.0 interfaces, which serves as the base for broader information (Labrecque et al., 2013, p259). By introducing these Web 2.0 interfaces, the use of social media has increased significantly, and these online platforms have impacted consumer attitude to change from a “passive observer” to an “active participant” throughout using social medias that are related with brand by word-of-mouth (Chu & Kim 2011; Riegner 2007; Zhang and Daugherty 2009). Therefore, it is nowadays widely regarded as an important method to use social media in marketing communication with consumers.

Today, you can see many social media users who are doing reviews of how products work and how effective these products are. This may provide you with a solution, if you are interested in the same product that other users review, whether you will buy that product or not. These kind of reviews can let you know what attributes can affect you when buying a product and through reviews, you can be a wiser consumer. For this reason, this article will give you the information and insight on how does electronic Word-of-Mouth (referred to as eWOM hereafter) within social media's affect your opinion and how much you can rely on their review.

Electronic word-of-mouth (eWOM)

The emergence of social media has developed variable communication ways enabling consumers to connect, create, publish, share their contents through medias such as Facebook, Youtube, Twitter, Instagram, etc (Daugherty & Hoffman, 2013). According to Bennett (2012 cited in Daugherty & Hoffman, 2013, p82), “every 60 s consumers share more than 600,000 pieces of content, upload 48 h of video, text greater than 100,000 messages, and create over 25,000 posts within social media”. This reveals how much people can get influenced by social media and the review of other’s and we call this phenomena Word-of-Mouth (referred to as WOM hereafter).

Arndt (1967, 295) defines traditional WOM as “‘person-to-person communication between a receiver and a communicator whom the receiver perceives as non-commercial regarding a brand, product, or service”. WOM is considered as the one of the powerful factors that serve a marketing purpose for both consumers and companies since this is a big influence on consumer decision-making. In fact, WOM is not only regarded as a crucial element of marketing (Brown & Reingen 1987; Buttle 1998), but also consumer perceive it as credible and more authentic assessments (Dellarocas 2003; Ha 2006; Keller 2007; Phelps et al. 2004).

According to Henning-Thurau et al (2004, 39), eWOM is defined as “any positive or negative statements made by potential, actual, or former customers about a product or company, which is made available to a multitude of people and institutions via the Internet”. However, as Goldsmith and Horowitz (2006) state, eWOM is frequently unsolicited by recipients and unintentionally attended to.

Figure 1(3x5.in,2016). Electronic Word Of Mouth (eWOM)

Depending on what attention contains on WOM, it can be divided into two different kinds of WOMs. If the WOM contains negative information, it is called negative Word-of-Mouth(NWOM), and vice versa if the WOM contains positive information, it is called positive Word-of-Mouth(PWOM) (Buttle 1998; Carl 2008). PWOM provides favorable reviews which advocate consumers to try a product or service (Daugherty & Hoffman, 2013). On the contrary to this, negative word of mouth (NWOM) provides unfavorable reviews and it urges recipients not to buy a product or service (Daugherty & Hoffman, 2013). The negative effects of NWOM includes reduction of sales and a decrease in consumer loyalty, but it can also have a larger impact on the brand itself and even the overall company image (Daugherty & Hoffman, 2013). An important aspect is that studies have shown that NWOM has a larger impact on consumer buying decision than PWOM. This is valid online as well as offline (Daugherty & Hoffman, 2013).

The power of eWOM

In traditional studies of the WOM, consumer attention has been focused on affection attention for single product marketing rather than multiple product marketing (Daugherty & Hoffman, 2013). There are however some conclusions that can be made from these studies. The factor that seems to have the largest impact on consumer behavior as it pertains to WOM is image-based elements (Rossiter 1981; Singh et al. 2000) which can in part explain the success of such platforms as Instagram has had as a channel for eWOM. Previous studies have not focused on attention; however, it becomes important for eWOM on social media platforms as these platforms has a very quick message delivery. When eWOM within social media is considered consumer attention can be affected by a diverse type of attributes such as other consumers, content, and product attributes (Daugherty & Hoffman, 2013).

Daugherty and Hoffman (2013, p88) constructed a conceptual framework and defined the following factors.

Consumers will devote more attention to negative eWOM than (a) positive or (b)neutral eWOM when navigating social media.
Consumers will devote more attention to eWOM pertaining to non-luxury brands than luxury brands when navigating social media.
eWOM message valence and brand type will interact to influence consumer attention with a stronger effect (i.e., differences) for non-luxury than luxury brands.

Another study result shows that the effect of cognitive fit, such as the type of reviews on purchase intention is stronger for experts than for novices while the effect of the number of reviews on purchase intention is stronger for novices than experts (Park & Kim, 2008). Since, how many reviews one product receives can be extra information that increases product popularity and provides less risk for novices (Park & Kim, 2008).

In conclusion, consumer attention towards eWOM within social media tends to depend on the type of brand or product. For example, whether the product is from a luxury brand or non luxury brand or whether the product being marketed are e.g. automobiles or a service (Daugherty & Hoffman, 2013). In addition to this, negative eWOM appears to attract more consumer attention than positive eWOM for non-luxury brands, while for luxury brands the effects on consumers’ attention are equal. The different types of consumers are determined by “the characteristic of consumers (expertise), a quantitative characteristic of reviews (the number of reviews), and a qualitative characteristic of reviews (the type of reviews)” (Park & Kim, 2008, p408).

Instagram: a case study

Instagram has had a meteoric rise in just a few years among social media services since it launched in 2010. It is simple and easy to share pictures and videos with hashtags that allow other people to find your posts. Instagram is a clear and useful marketing tool even for retail marketers as they provide a pragmatic function for advertising (Abovethefoldmag.com, 2016). The resulting photos that are uploaded by users are terrific advertising fodder for retailers(Abovethefoldmag.com, 2016). For example, if he or she posts a photo of a pair of pants with a hashtag of the brand name, he or she is performing a marketing activity for that brand. Many big international brands actually are using those photos as in their marketing strategies (Abovethefoldmag.com, 2016).

Although uploading pictures on Instagram related with your brand can be part of a company’s marketing strategy, people spy with enthusiasm on others to see photos of people who have the same interests. According to Goldsmith and Horowitz (2006), consumers who seeks for eWOM are interested in getting information before buying products in order to reduce risk and to facilitate the purchase decision. Especially on Instagram, people want to get more authentic images of the products that are uploaded by consumers. It is more trustworthy if the common opinion and experience come from other consumers because it is not from outspoken brand marketing activities and normal people just share their experiences and satisfaction with what they purchased(Abovethefoldmag.com, 2016).

However, In November, 2016, Essena O’Neill, an Australian Instagram star with more than 612,000 Instagram followers, spoke out about the truth behind her Instagram posts. She has deleted around 2,000 pictures from her Instagram account and revised the captions of remaining photos to tell the truth behind every story. In her revised captions we learned about how much she was paid to do promotional posts, how her makeup made her more “picture perfect” and how many re-takes it took before getting a shot that was good enough to post on Instagram (Mail Online, 2015). This issue resonated with the wider public that was made aware as an actual social media star revealed the truth and illustrated the dark side of using social media and how you can be affected as a consumer.

Conclusion

Is social media an accessible and efficient way for a consumer to become more aware and will that facilitate a buying decision that is perceived as more beneficial? As we have learned there are a number of pitfalls when using social media to gather information about a product or a service. Corporations are aware of the power that eWOM possesses and are naturally trying to influence the public opinion online as they have continuously done offline for decades with methods that have not always been considered as fair play. The more sophisticated our way of interacting becomes, it is natural to assume that B2C marketing departments trying to gain an edge will follow suit. Essensa’s Instagram case illustrates this but it also shows us that as easy as it is for a company to try to impact us as consumers, it is equally easy for a consumer or even a paid blogger to speak out without any possible filtration from these companies. Social media platforms have indeed a dark side, but the power of providing authentic information from actual consumers is even stronger.

From the reviewed studies we can conclude that the visual aspect of traditional WOM has a high impact which can have an even stronger impact in eWOM via social media. We have learned the negative remarks have a higher impact for non luxury brands which gives more power to the consumer when posting a negative remark on social media and can be seen on a global arena. However, as a consumer you can be affected even on a subconscious level as you causally surf around on social media with no planned consumption in mind. If you are a novice, you should be careful as you are easily influenced by the opinion of the greater mass which can impact your buying decision.

References

3x5.in, (2016). Research Scholars Cases - Management, Computer Science, IT, Finance, Education, Law, Medicine, Fashion, Architecture. [online] Available at: http://www.3x5.in/Scholars.html#!prettyPhoto[gallery]/1/ [Accessed 20 Feb. 2016].

Abovethefoldmag.com, (2016). Instagram: The New Word-of-Mouth Advertising | Above the Fold. [online] Available at: http://abovethefoldmag.com/?q=article/instagram-new-word-mouth-advertising [Accessed 18 Feb. 2016].

Arndt, J. (1967). Role of Product-Related Conversations in the Diffusion of a New Product. Journal of Marketing Research, 4(3), p.291.

Brown, J. and Reingen, P. (1987). Social Ties and Word-of-Mouth Referral Behavior. J CONSUM RES, 14(3), p.350.

BusinessDictionary.com, (2016a). What is web 2.0? definition and meaning. [online] Available at: http://www.businessdictionary.com/definition/web-2-0.html [Accessed 19 Feb. 2016].

BusinessDictionary.com, (2016b). What is word of mouth marketing? definition and meaning. [online] Available at: http://www.businessdictionary.com/definition/word-of-mouth-marketing.html [Accessed 20 Feb. 2016].

Buttle, F. (1998). Word of mouth: understanding and managing referral marketing. Journal of Strategic Marketing, 6(3), pp.241-254.

Carl, W. (2008). The role of disclosure in organized word‐of‐mouth marketing programs. Journal of Marketing Communications, 14(3), pp.225-241.

Chu, S. and Kim, Y. (2011). Determinants of consumer engagement in electronic word-of-mouth (eWOM) in social networking sites. Int. J. Adv., 30(1), p.47.

Daugherty, T. and Hoffman, E. (2013). eWOM and the importance of capturing consumer attention within social media. Journal of Marketing Communications, 20(1-2), pp.82-102.

Dellarocas, C. (2003). The Digitization of Word of Mouth: Promise and Challenges of Online Feedback Mechanisms. Management Science, 49(10), pp.1407-1424.

Goldsmith, R. and Horowitz, D. (2006). Measuring Motivations for Online Opinion Seeking. Journal of Interactive Advertising, 6(2), pp.2-14.

Ha, H. (2006). An integrative model of consumer satisfaction in the context of e-services. International Journal of Consumer Studies, 30(2), pp.137-149.

Hennig-Thurau, T., Gwinner, K., Walsh, G. and Gremler, D. (2004). Electronic word-of-mouth via consumer-opinion platforms: What motivates consumers to articulate themselves on the Internet?, Journal of Interactive Marketing, 18(1), pp.38-52

Hunt, E. (2015). Essena O'Neill quits Instagram claiming social media 'is not real life'. [online] the Guardian. Available at: http://www.theguardian.com/media/2015/nov/03/instagram-star-essena-oneill-quits-2d-life-to-reveal-true-story-behind-images [Accessed 19 Feb. 2016].

Keller, E. (2007). Unleashing the Power of Word of Mouth: Creating Brand Advocacy to Drive Growth. Journal of Advertising Research, 47(4), pp.448-452.

Labrecque, L., vor dem Esche, J., Mathwick, C., Novak, T. and Hofacker, C. (2013). Consumer Power: Evolution in the Digital Age. Journal of Interactive Marketing, 27(4), pp.257-269.

Mail Online, (2015). Essena O'Neill on the dangerous ways she dieted for internet approval. [online] Available at: http://www.dailymail.co.uk/femail/article-3320431/Model-Essena-O-Neill-quit-Instagram-reveals-ways-dieted-internet-approval.html [Accessed 19 Feb. 2016].

Park, D. and Kim, S. (2008). The effects of consumer knowledge on message processing of electronic word-of-mouth via online consumer reviews. Electronic Commerce Research and Applications, 7(4), pp.399-410.

Phelps, J., Lewis, R., Mobilio, L., Perry, D. and Raman, N. (2004). Viral Marketing or Electronic Word-of-Mouth Advertising: Examining Consumer Responses and Motivations to Pass Along Email. Journal of Advertising Research, 44(4), pp.333-348

Riegner, C. (2007). Word of Mouth on the Web: The Impact of Web 2.0 on Consumer Purchase Decisions. Journal of Advertising Research, 47(4), pp.436-447.

Rossiter, John R. 1981. Predicting Starch Scores.Journal of Advertising Research, 21(October):63–68.

Singh, S., Lessig, V., Kim, D., Gupta, R. and Hocutt, M. (2000). Does Your Ad Have Too Many Pictures? Journal of Advertising Research, 40(1-2), pp.11-27.

Zhang, J. and Daugherty, T. (2009). Third‐Person Effect and Social Networking: Implications for Online Marketing and Word‐of‐Mouth Communication. American Journal of Business, 24(2), pp.53-64.