Peer Purchase Influence: Quantifying the power of word-of-mouth
Earlier this week, eMarketer published an analysis of online and offline social media/word-of-mouth (WOM) activities (“Harnessing Active Brand Advocates“). This public data provides interesting insights into the brand evangelism of the adult Internet population. How do people reflect on their past purchases? How does it impact their behavior going forward? How does it shape the type of input they have into the consumer behavior of their family, friends, coworkers, and peers in general?
We chose to go one further and analyze the data relative to its respective sample sizes. The resulting index provided us with a more objective view of the relativity of social media/word-of mouth (WOM) activity across different age and gender groups, leading to a few additional insights.
The experimental set is defined by behaviors that include input and advice on the purchase process, posting of ratings and reviews of products/services, participation in forums and blogs, and event attendance. It is based on this range of behaviors that we’ll define peer purchase influence (for the time being).
• The most common peer purchase influence activity (taking place on social media sites) is helping friends or family members make purchase decisions. More than half (54%) of adult internet users reported engaging in this behavior.
• Not surprisingly, younger internet users (ages 18-34) index high for peer purchase influence activity across social media sites. Older internet users, however, are not absent from the party. Blogging among 45-54 year olds is an example of an activity which extends beyond this highly active 18-34 set.
• Gender disparity in social media usage varies based on the nature of the activity. For many social media activities there is very little different in relative participation among female vs. male internet users. However, contributing to online forums, recommending purchases and publishing blogs all skewed significantly toward males.
• The peer purchase influence activities in which the Internet public are least active (e.g. organizing/attending events, blogging, contributing to forums) are precisely the activities for which the younger age groups skew the highest. Insight: Despite the emergence of older consumers in the social media space, 18-34 year olds are still driving much of the peer purchase influence.
Click on the chart below, to see index scores across all age/gender groups.
Given the growing sophistication of sentiment analysis within the evolution of WOM monitoring, we’d like to see eMarketer and one of its research partners study trends in sentiment as they relate to peer purchase influence. Who is most likely to bad-mouth a product or service? Who is mostly likely to take heed to these warnings? Which brands or industries meet the challenge head on by organizing and managing outlets for this kind of participation, e.g. Facebook pages, Twitter feeds, third-party forums or directly on the brand’s website?
With that level of insight into the dynamics of social media, marketers will gain a better sense of how and why to take control of the word-of-mouth space in managing their brands’ reputations.
About Paul Burani
Paul Burani - Partner, Web Liquid Group. Connect with me on Google+
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