Consumer Response to Word of Mouth Advertising

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  • Topic: Marketing, Word of mouth, Consumer behaviour
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  • Published : January 30, 2013
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ST. JOHN FISHER COLLEGE

The Importance of Word of Mouth (WOM)
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Buyer Behavior Term Paper

Chelsea Guererri
April 10, 2012

Table of Contents
Introduction…………………………………………………………………………….. 3 Can We Depend on the Knowledge of our Close Friends? ……………………………..3 Advertising Effectiveness and Post Purchase Behaviors………………………….…......4 Buzz Marketing: A Newer Way of WOM……………………..…………….………….6 Consumers Response to Peer Recommendations Online………………………………..8 Conclusion………………………………………………………………………………10 References………………………………………………………………………………11

Introduction
Word of mouth happens every day all around us. Family, friends, acquaintances, or complete strangers talk about or post opinions and information on products or services they have purchased, or new and upcoming products that people want to know and learn about. The quality of word of mouth determines the extent to which consumers trust the brand and how they react and behave. Word of mouth has and is becoming a more powerful aspect for companies, and are realizing how important it is when it comes to advertising. Can We Depend on the Knowledge of our Close Friends?

The Influence of Friends’ Opinions on Purchases
Consumers feel comfortable and tend to rely on their close friends opinions and recommendations when they are seeking to buy a product (Gershoff, A., Johar, G. 2006). Consumers take the opinions of people close to them seriously and like to believe that they know what they like and prefer when shopping for products ranging from a type of coffee brand to buying a new car for the family. The main focus here is whether or not friends have the right amount of knowledge to help determine what we should and should not purchase. Friends Perceptions of our Preferences: Correct or Not?

According to the Gershoff and Johar (2006), there are two factors causing consumers to overestimate their close friend’s knowledge of what we prefer for the different purchases we make; motivational pressures and cognitive pressures. Consumers trust the word of their close friends, and believe that they know them best and know what they like and prefer, which is where cognitive pressures come into play. Motivational pressure will happen when consumers think close friends know them well enough that they play a relatively large role in buying decisions, and in return are confirming the strength of that particular friendship. With this being said, the closer the friends are, the more likely they are to believe they have accurate knowledge about each other’s purchase behavior (Gershoff, A., Johar, G. 2006). Due to the following factors mentioned above, consumers are too confident in the input they receive from their friends. Even though two friends may be very close, they may have not had the opportunity to visually see them engage in a specific activity such as buying a car, so they mainly rely on the fact that they think they know each other best because of their closeness (Gershoff, A., Johar, G. 2006). Because of motivational and cognitive pressures that consumers may experience, undependable advice has a higher chance to occur. Undependable Advice and its Effect on Word of Mouth

Word of mouth is shown to be very powerful in this sense because consumers really will base a purchasing decision off a friend’s opinion or recommendation. This also puts great emphasis on customer satisfaction and making sure every customer is happy post-purchase. Word of mouth is spread from one person to another, so multiple consumers may depend of the opinion that was formed by one single person. Even though we are motivated to listen to our close friend’s advice, more accurate information may be provided by consumers that do not know our likes and preferences, but just want to spread useful information about a product ( Gershoff, A., Johar, G. 2006). Advertising Effectiveness and Post Purchase Behaviors

Measuring Effectiveness
It’s important...
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