The Effect of Positive and Negative Word-of-Mouth on Consumers’ Brand Evaluations
The Effect of Positive and Negative Word-Of-Mouth on Consumers’ Brand Evaluations
Introduction
Traditional word-of-mouth communication (WOM) is verbal testimonials between consumers about product performance, service quality and mode of operating. WOM may be negative (NWOM) or positive (PWOM) and both employ strong influences on a consumers brand evaluations, which is the decision process to evaluate alternative brands. Previous studies have found that PWOM is likely to intensify a consumer’s brand image, while, conversely, NWOM is likely to dissuade potential buyers and impair the reputation of the relative brand. It is widely believed among marketers that negative information has stronger effect then positive information on consumers' probability of purchase and attitudes towards a product. This has potential to provide difficulty for marketers, however the effect is curtailed by the incidence ratio of the two averaging at 3 to 1 in favor of PWOM (East & Hammond & Wright 2007). There are however, several variables that will moderate the impact of NWOM, and in this essay I will focus my discussion primarily on brand familiarity and brand commitment. The aim of this essay is to examine the imbalance of PWOM and NWOM and the affect that each has on a consumers’ brand evaluations towards a product, as well as outlining factors that may be associated with impact.
The Occurrence of Negative and Positive Information
In 15 studies conducted, results indicated PWOM was more common than NWOM in every case (East & Hammond & Wright 2007). This notion has a logical explanation; products do not easily survive if they promote a dissatisfied reaction. As a result, unsatisfied products are removed from the marketplace and most product feedback is positive. In a study conducted by (East & Hammond & Wright 2007) results showed that 4/5 of WOM was positive whilst 1/5 of information was negative, correlating to the results of previous research. Their
Introduction
Traditional word-of-mouth communication (WOM) is verbal testimonials between consumers about product performance, service quality and mode of operating. WOM may be negative (NWOM) or positive (PWOM) and both employ strong influences on a consumers brand evaluations, which is the decision process to evaluate alternative brands. Previous studies have found that PWOM is likely to intensify a consumer’s brand image, while, conversely, NWOM is likely to dissuade potential buyers and impair the reputation of the relative brand. It is widely believed among marketers that negative information has stronger effect then positive information on consumers' probability of purchase and attitudes towards a product. This has potential to provide difficulty for marketers, however the effect is curtailed by the incidence ratio of the two averaging at 3 to 1 in favor of PWOM (East & Hammond & Wright 2007). There are however, several variables that will moderate the impact of NWOM, and in this essay I will focus my discussion primarily on brand familiarity and brand commitment. The aim of this essay is to examine the imbalance of PWOM and NWOM and the affect that each has on a consumers’ brand evaluations towards a product, as well as outlining factors that may be associated with impact.
The Occurrence of Negative and Positive Information
In 15 studies conducted, results indicated PWOM was more common than NWOM in every case (East & Hammond & Wright 2007). This notion has a logical explanation; products do not easily survive if they promote a dissatisfied reaction. As a result, unsatisfied products are removed from the marketplace and most product feedback is positive. In a study conducted by (East & Hammond & Wright 2007) results showed that 4/5 of WOM was positive whilst 1/5 of information was negative, correlating to the results of previous research. Their