Word of mouth effect
DESCRIPTION
Any effect resulting from word-of-mouth communication among consumers.
Any effect resulting from word-of-mouth communication among consumers.
KEY INSIGHTS
The effects of word-of-mouth communication may be positive, negative, or neutral depending on its magnitude and content. The effects may also be limited to a particular brand, product, service, promotion, or firm but may also encompass entire industries or markets. The strategic importance of word-of-mouth communication effects may also vary, where, for some firms and some products (e.g. a local manufacturer of a new popcorn snack), its positive effect is counted upon as the sole means to spread awareness and interest in the product, while for other firms and products (e.g. Coca-Cola) its positive effect may be dwarfed by ongoing advertising by the firm.
The effects of word-of-mouth communication may be positive, negative, or neutral depending on its magnitude and content. The effects may also be limited to a particular brand, product, service, promotion, or firm but may also encompass entire industries or markets. The strategic importance of word-of-mouth communication effects may also vary, where, for some firms and some products (e.g. a local manufacturer of a new popcorn snack), its positive effect is counted upon as the sole means to spread awareness and interest in the product, while for other firms and products (e.g. Coca-Cola) its positive effect may be dwarfed by ongoing advertising by the firm.
KEYWORDS Informal communication effects
IMPLICATIONS
Marketing strategists often have an opportunity to create and leverage positive word-of-mouth communication for new offerings or promotions to achieve significant effects on the awareness, interest, evaluation, and/or purchase of a particular offering, where word of mouth can be generated either to augment other marketing communication approaches or to substitute for them. At the same time, marketers should seek to understand how and to what extent possible negative word-of-mouth communication may be generated through a strategy relying upon the approach and be prepared to weather responses that are unexpectedly negative.
Marketing strategists often have an opportunity to create and leverage positive word-of-mouth communication for new offerings or promotions to achieve significant effects on the awareness, interest, evaluation, and/or purchase of a particular offering, where word of mouth can be generated either to augment other marketing communication approaches or to substitute for them. At the same time, marketers should seek to understand how and to what extent possible negative word-of-mouth communication may be generated through a strategy relying upon the approach and be prepared to weather responses that are unexpectedly negative.
APPLICATION AREAS AND FURTHER READINGS
Marketing Strategy
Mahajan, Vijay, Muller, Eitan, and Kerin, Roger A. (1984). ‘Introduction Strategy for New Products with Positive and Negative Word-of-Mouth,’ Management Science, 30(12), December, 1389–1404.
Mahajan, Vijay, Muller, Eitan, and Kerin, Roger A. (1984). ‘Introduction Strategy for New Products with Positive and Negative Word-of-Mouth,’ Management Science, 30(12), December, 1389–1404.
Grewal, Rajdeep, Cline, Thomas W., and Davies, Antony (2003). ‘Early-Entrant Advantage, Word-of-Mouth Communication, Brand Similarity, and the Consumer Decision-Making Process,’ Journal of Consumer Psychology, 13(3), October, 187–197.
Marketing Modeling
Bemmaor, Albert C. (1994). ‘Modeling the Diffusion of New Durable Goods: Wordof- Mouth Effect versus Consumer Heterogeneity,’ in Gilles Laurent, Gary L. Lilien, and Bernard Pras (eds.), Research Traditions in Marketing. Boston: Kluwer Academic, 201–223.
Bemmaor, Albert C. (1994). ‘Modeling the Diffusion of New Durable Goods: Wordof- Mouth Effect versus Consumer Heterogeneity,’ in Gilles Laurent, Gary L. Lilien, and Bernard Pras (eds.), Research Traditions in Marketing. Boston: Kluwer Academic, 201–223.
Services Marketing
Wangenheim, Florian V., and Bayón, Tomás (2004). ‘The Effect of Word of Mouth on Services Switching: Measurement and Moderating Variables,’ European Journal of Marketing, 38(9–10), September, 1173–1185.
Wangenheim, Florian V., and Bayón, Tomás (2004). ‘The Effect of Word of Mouth on Services Switching: Measurement and Moderating Variables,’ European Journal of Marketing, 38(9–10), September, 1173–1185.
BIBLIOGRAPHY
Robertson, Thomas S. (1971). Innovative Behavior and Communication. New York: Holt, Rinehart & Winston.
Robertson, Thomas S. (1971). Innovative Behavior and Communication. New York: Holt, Rinehart & Winston.