Thursday, January 25, 2007

WOM impact on brand conversions, is it growing?

Tuesday in class we discussed outcomes of WOM, one result being brand conversions. A study conducted by Katz and Lazarsfeld in 1955 found that WOM was 7x more effective in branding switching than newspaper or magazine ads. Additionally, Day found WOM 9x more effective than ads in converting negative or neutral attitudes to positive attitudes. It is obvious from these results that WOM has a profound impact on consumers relative to other media forms. But how much of this has changed over the past 50 years?

I would argue that the effectiveness of word of mouth has greatly increased. In a world where everything is saleable, we are inundated with media messages. The consumer has learned (or tried) to ignore this ad clutter. We have become ad skeptics, not just because of the volume of advertisements but also because of the values they are being paired with brands.

Advertisements have changed drastically from fact/product based to more value based. With the increase in brands that sell similar products, companies must distinguish their product from another by marketing its associated ideals. Through this, we sometimes loose the original intent of the product. Thus a recommendation from a friend or trusted person would be far more influential than a traditional advertisement.

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1 comment:

softech said...

Very interesting article, I like your thoughts about content generation using Twitter. Thanks for this information.

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