Research on Online Consumer-to-Consumer Communication Yields Key Findings

Whether you are looking for a car, a refrigerator, or the best day care in town, the process of researching goods and services as a consumer has changed vastly with the availability of online reviews and discussion from fellow consumers. Today, a consumer’s first stop on the way to purchase is most often the Internet.

Dr. Kelley O’Reilly, assistant professor of marketing, researches the influence of online, consumer-generated commentary. Termed “online word-of-mouth,” these positive and negative statements about products or services may be included in consumer reviews, blogs, forums, social media or threaded discussion boards where consumers share, interact and engage with others online.

“Much of my research focuses on how consumers make assessments regarding which consumers and reviews to ‘believe’ and deem ‘credible’ through these online exchanges,” says O’Reilly. “Recognizing that most online consumer-to-consumer communication occurs among people who have no prior relationship, it is important for marketers to understand how these exchanges are evaluated and assessed as trustworthy or credible.”

O’Reilly’s research to date has centered particularly on the 18 to 25 year-old age group. So what do these younger consumers look for in assessing the credibility of online word-of-mouth?

• A high overall star rating;
• A relatively high number of reviews but very few negative reviews;
• Balanced reviews that include both pros and cons of the product or service; and
• Logical, well-written reviews.

“In certain contexts, online word-of-mouth has been shown to be more effective than traditional marketing tools like personal selling and advertising,” notes O’Reilly. “Interestingly, research tells us that more and more people are turning to the Internet than consulting experts or family members when making purchasing choices. This is really intriguing to me—the fact that young consumers are giving more credence to online strangers than to their face-to-face family and friends.”

This trend of trusting the opinions of unknown fellow consumers has important consequences for businesses, both in terms of brand management and strategy. “Because information online always has the potential for going viral, extreme review ratings can have a significant effect on a company’s brand, either for the good or bad,” says O’Reilly. “At the same time, online word-of-mouth is visible to marketers, so it also allows a company to be ‘a fly on the wall’ and passively listen to the conversations among consumers. This can be very valuable to companies that understand how to effectively monitor their brands online.”

What are best practices that companies should be considering in terms of harnessing the power of online word-of-mouth? O’Reilly notes three items
to consider:

• Share Control. “As marketers, recognize that we must share control of our brands with consumers online. Consumers are in control more now than ever since they create our brand’s stories and reviews online. Smart marketers know how to listen and appropriately respond to issues or problems raised by customers online.”
• Drive Likes. “Marketers can benefit from driving fan likes for their products as much as they can from motivating purchase behavior. Why? Because friends of fans typically represent a much larger set of consumers and can receive social-media brand impressions by way of their friends.”
• Adapt Review Systems. “Design company website review systems to adapt and customize the manner, number and polarity of reviews a particular consumer will see by matching the form and function of the review system to the appropriate decision-making style of the consumer.”

O’Reilly’s research also highlights an opportunity for marketers to better understand how technology will impact online word-of-mouth behaviors. Knowing that young, technically savvy Internet users are predictive pathfinders to the behaviors and practices of average consumers 12 to 24 months in the future, O’Reilly suggests marketers use a longitudinal consumer panel of technically sophisticated young consumers to better position themselves for future marketplace adjustments.

What’s next for O’Reilly? She has teamed up with Dr. Alhassan Mumuni, associate professor of marketing, and Dr. Karen Lancendorfer, associate professor of marketing, along with Amy MacMillan from Kalamazoo College, to pursue several projects. The team is considering how gender and purchase motivation may affect online word-of-mouth credibility assessments. Additionally, some of their early work highlights that consumers may create their own systems of credibility by considering the relevance and likeness of reviews.