A reminder of the obvious.
Indeed, word of mouth is the primary factor behind 20 to
50 percent of all purchasing decisions. Its influence is greatest when
consumers are buying a product for the first time or when products are
relatively expensive, factors that tend to make people conduct more
research, seek more opinions, and deliberate longer than they otherwise
would. And its influence will probably grow: the digital revolution has
amplified and accelerated its reach to the point where word of mouth is
no longer an act of intimate, one-on-one communication. Today, it also
operates on a one-to-many basis: product reviews are posted online and
opinions disseminated through social networks. Some customers even
create Web sites or blogs to praise or punish brands.
As online communities increase in size, number, and character, marketers
have come to recognize word of mouth’s growing importance. But
measuring and managing it is far from easy. We believe that word of
mouth can be dissected to understand exactly what makes it effective and
that its impact can be measured using what we call “word-of-mouth
equity”—an index of a brand’s power to generate messages that influence
the consumer’s decision to purchase. Understanding how and why messages
work allows marketers to craft a coordinated, consistent response that
reaches the right people with the right content in the right setting.
That generates an exponentially greater impact on the products consumers
recommend, buy, and become loyal to.
[more]
