Impact of Electronic word-of-mouth on Brand image and Purchase Intention: A Methodological and Thematic Review

 

Sinhayna Singh Bais¹, Archana Murthy¹, Tanya Roy¹, Smita Mehendale²

¹MBA Student, Symbiosis Institute of Management Studies, Symbiosis International University, Pune, Maharashtra, India

²Assistant Professor, Symbiosis Institute of Management Studies, Symbiosis International University, Pune Maharashtra, India

 

ABSTRACT:

Electronic word of mouth is now considered one of the most reliable forms of communication in recent years. Electronic WOM is an important extension in consumer environment and is an outcome of activity on social media. This research has used a systematic review of literature methodology to present the work of past researchers on the topic and identify the methodologies and major themes which have been studied by researchers. A total of 42 research articles were reviewed. Four major themes were identified, namely customer satisfaction, communication, marketing and psychology. In terms of methods used by past researchers, non-empirical research method was found to dominate the various methodologies used. Suggestion for future research is based on Methodological and thematic review.

 

 

1. INTRODUCTION:

Word of mouth (WOM) communication is a substantial factor that plays an important role to influence the purchase intention of potential customers. (Herr 1991). Research shows that as compared to conventional sources of advertisement, word of Mouth communication is much more impactful because it is first-hand information from a person who has already experienced the service (Gruen et al., 2006). Due to the emergence of many online social networking sites and progress in the field of technology, the way information is transmitted has transformed over the years (Godes and Mayzlin, 2004).

 

This has given a platform to the consumers to voice their reviews, feedback and opinions (Godes and Mayzlin, 2004) and has been found to be a more reliable form of WOM communication as it manages to reach a larger number of people more effectively.

 

Many consumers nowadays look for online reviews before deciding on a purchase. A strong brand image positively impacts customer loyalty and is considered as a source of promise to the consumer. It not only impacts the consumers but also the employees of that particular organisation. “Brand image” is the perception a “brand” holds replicated by the way the “brand” is associated in the recollection of theconsumer (Yoo and Donthu 2001).

 

Perceptions are formed in the minds of potential consumers due to past experiences and notions formed by the reviewers that goes on to create the image of a brand in the general public. This research has been conducted to study the different forms of electronic WOM and the effect it has on purchase intention and brand image.

 

Through this research, the impact of the reviews and comments that are posted on various e-commerce websites, blogs and social networking sites will be taken into consideration, so as to study the effect on the purchase intention of the future customers and how all this goes on to build an image or perception of a brand in the eyes of the public (customers and employees).

 

2. SYSTEMATIC LITERATURE REVIEW METHODOLOGY:

Management literature reviews are usually one-sided and lacking in meticulousness, while medical reviews have become better by being more systematic and having straight-forward methodology (Tranfield, Denyer and Smart 2003). Keeping in mind basic rules of the method of systematic literature review in the below sections is introduced the room for this review, the procedure used to identify appropriate works, and the documents comprising this analysis.

 

Table 1. Database search procedure

Database	Scope and Search criteria	Date of search	Number of items
EBSCO	search: academic journal, search: empirical, language english, date of publication: 2012 and after	12th July 17	36
SCOPUS         EMERALD	Search: Academic journal Search: TI Title   keywords: 'Brand Image' E-word of mouth' Search: Academic Journal Search: Empirical Language: English Date of publication: 2012 and after	17th July 17             18th July 17	42       45
Total			123

 

2.1 Scope:

The scope can be explained by two data sets that relate to method and content. With regards to method, this review incorporates ‘academic journal articles’ that have undergone analysis by other conducting the research (Fernandez-Alles and Ramos-Rodriguez 2009). This review does not contain non-academic articles, book chapters, editorials, points of view, interviews etc. Talking about content, we have focused on online word-of-mouth, taking it as one of the crucial deciding factors of a customer’s buying intention and its impact on the brand image of a company as a whole.

 

2.2 Identification of Appropriate Literature:

The procedure of identifying and reviewing literature was initiated on 12^th July 2017, carried out in multiple phases. We examined various combinations of keywords such as “electronic word of mouth”, “brand image”, “purchase intention”, “empirical” in 3 databases: Scopus, EBSCO and Emerald in the first phase.

 

2.2 Identification of Appropriate Literature:

The procedure of identifying and reviewing literature was initiated on 12^th July 2017, carried out in multiple phases. We examined various combinations of keywords such as “electronic word of mouth”, “brand image”, “purchase intention”, “empirical” in 3 databases: Scopus, EBSCO and Emerald in the first phase. These databases were selected because of the quality and amount of academic data they offer as well as their importance in the management research field.

 

The first stage of researching for articles resulted in 2810 articles. The information from these comprised of the authors, title of the article, publication year and document type. From. this. pool of data, 342 duplicates were removed. Then, the search was further refined by filtering on the basis of language, year of publication, type of article and relevant subject. After this stage, we were left with 123 articles which were then screened and reviewed by all the three members of the group until we reached a consensus. 42 articles remained after removing the non-relevant articles. Joint assessment was then done for the first discussion.

 

2.3 Results of Systematic literature review:

The 42 selected articles were published from 2010 to 2017. This reflects that there has been a steady interest in search regarding electronic marketing (Chart 1). This validates. the fact that WOM, mainly in the electronic form is a viable source of information and has been consistently used by customers to decide whether they want to buy or re-buy a product.

 

 

Chart 1: Number of articles referred by year

 

3. METHODOLOGICAL REVIEW:

The aim of the methodological review is to provide a summary of the approaches utilised to research and find out the consequence of online “word-of-mouth” on brand image and customer retention without going into deep about the research designs used in the research and the procedure of the literature review. Four methodologies were identified from the sample research papers that have been categorized as (a) qualitative research consisting of case studies and interviews; (b) quantitative research by conducting surveys; (c) using qualitative and quantitative methods in the form of mixed method; (d) Non- empirical research which includes those articles or papers which are conceptual or reflective in nature.

 

 

Fig 1: Flowchart showing the Systematic Review of Literature Review was conducted

 

Out of all the papers that were reviewed, approaches to non-empirical research were seen in 66.67% of papers (n= 28), qualitative research approach in 14.28% of the papers (n=6), quantitative research method in 12% of papers (n=5) and mixed methods in 7.14% of the papers (n=3). The dominance of non-empirical research methodology can be attributed to newness of the subject being researched. The research on the consequence of online “word- of-mouth” focuses on papers or articles that are reflective, investigative and conceptual in nature. Research in this kind of new or current topics primarily concentrates on subjects which define the subject, trailed by studying the exploratory studies that have been conducted, before diverting attention towards methods, measures and theory.

 

4. THEMATIC REVIEW:

After studying the reviewed literature, four themes have been identified which are Customer satisfaction, Marketing, Psychology and Communication. These themes have been identified on the basis of shortlisted papers and examining the keywords. Out of all the articles, 16 articles had Customer satisfaction as their main theme, 12 articles had Communication as their theme of research, 8 had Marketing and 6 had Psychology as the main theme.

 

Table 2: Research methodology used by past researchers

 

4.1 Customer Satisfaction:

Customer satisfaction can be defined as the way a consumer feels about services or goods over a time period along with the evaluative and emotional response that develops for the good or product along the way (Oliver and Swan, 1989). A customer who is left dissatisfied can be a source of negative endorsement for the brand which can have many adverse effects of the reputation of the company. Customer satisfaction can be affected by the image that the company has built in the minds of its present and prospective customers.

 

Studies suggest that the acuity. of the degree to which the company participates in behaviour that is brand-oriented could have a substantial bearing on fulfilment. For example, an educational institute having a solid name would probably provide its pupils a competitive advantage in the marketplace on the completion of their studies and this in turn will lead to satisfaction. It is not being noted that in this example, the student is the customer while the university is the organization whose brand image and presence will be affecting the future of the students. A prospective customer who has not yet utilized the services of a company may still have a certain perception about the brand orientation that will have a positive impact on customer satisfaction. Strong links have been shown between customer satisfaction and loyalty towards a particular brand which is one of the key requirements for any brand to grow and remain relevant in the market. Studies in the past have also shown that customer satisfaction and brand image have a bearing on loyalty observed in the hospitality industry or sector (Kandampully and Suhartanto, 2000). The theoretical prototype (Figure 3) suggests satisfaction is the interceding variable between Perceived. Brand. Orientation(PBP)., faithfulness and post.-purchase. behaviour.

 

4.2 Communication:

Various modes of communication have been used by consumers. to interact with each other. It is known that people communicate with each other, but whether the medium of communication will affect the message or not is a little unknown. Consumers use online as well as offline modes of communication to communicate with each other. One of the online modes of communication is electronic word of mouth. Research has shown that electronic word of mouth includes things that are interesting (Berger and Iyengar, 2013). In comparison to verbal communication (offline), written communication leads to people following products and brands that are thought-provoking (Boyer, Edmondson, Baker and Solomon, 2015). Electronic.Word. of. Mouth. has been shown to affect choice, selection and loyalty towards a brand. It has been shown that people accept information about a product more easily from someone who has used the product before.

 

 

Fig 2: Satisfaction as the mediating variable

 

Communication can be enhanced using social media in a timely and cost-efficient manner and cause an upsurge in the reach and productivity of communication (Huang, Baptista, and Galliers 2013).

 

 

Fig 3: Main themes of research

 

4.3 Marketing:

Marketing is one of the most important role in any organisation when it comes to the performance or sales or revenue of the organisation. Managing the four Ps, of marketing i.e., Product (new product development, product modification), Place (distribution channels and locations), Price (the price a customer will be willing to pay) and Promotion (how the public will become aware of the product).

 

The feedback and inputs taken from the customers have a huge bearing on the way the company performs as it will help the business in its performance and will create value co-creation, build brand loyalty and retain customers. This will lead to customer retention and building or strengthening of brand loyalty as repeat purchases will be high (Chang and Taylor, 2016). Through the reviews and thoughts shared on the various online platforms such as Youtube, blogs, vlogs, social networking sites, websites, etc. customers give their inputs as to what they want and the features expected by them in a product, and if the company is successful in making such a product. A very important driver of customer participation is customer brand engagement as it enhances customer brand satisfaction. Cognitive, emotional and intentional engagement of the customers in brand activities leads to them participating more with the brand and hence with the company (Andrine and Solem, 2016).

 

4.4 Psychology:

Studying the psychology of the customers is very important as without fully understanding the needs of the customers we cannot offer them the solutions. By studying this, the organisation will get to know what exactly they need to do to enhance this participation by them and create a win-win situation for both so that both the parties are satisfied (Bendapudi and Leone, 2003). Marketing personnel need to constantly analyse the patterns in the buying behaviour and purchase decisions of the customers to predict the future trends. Customers tend to follow a herd like mentality when it comes to buying products, especially products whose brands are relatively new or are unknown to them. In this age of technology, if one customer has a bad or negative experience with a brand or a product, the information about the same is made online for the world to view. People then tend to form their own perception and opinion about that brand based on the experience of another customer and this affects the purchase intention of the prospective customer as well. This is very harmful and dangerous for the company in both the long and. Therefore, insight of the customers regarding the class of service has a direct impact on the brand image (Aydin and Ozer, 2005). It is not possible to evaluate intangibles. such as after-sale services before the customer experiences them; therefore, buying intangible products and services involves advanced risk, so consumers are more trustworthy of the relational. influence of e.-WOM. (Lewis and Chambers, 2000).

 

5. LIMITATIONS:

The major limitation found in the research relates to the keywords that have been used. “Electronic word of mouth” was used as the major keyword along with “empirical” and “brand image”. Over the course of analysing the articles, it was observed that several terms are used to refer to what is officially known as “Electronic word of mouth”. This might have caused us to overlook some important literature. For further research, the following keywords should also be considered: “e-word of mouth”, “E-WOM” and “online word of mouth”. One more major limitation of E-WOM is that the information may be hoax and may be a result of an intent of spreading malicious content. The personality and the psychology of the customers may also affect the quality and the type of the E-WOM. Therefore, the data collected through this mode may not be reliable.

 

6. SCOPE FOR FUTURE RESEARCH:

Electronic word of mouth has been a widely studied topic over the last few years. This paper tries to see the effect it has on brand image and customer intent to buy a product. An area on further research could be the relationship between different sources of online word of mouth and the efficacy that each has on brand image. For example, it is possible that a seeding programme may be used initially to create awareness about a new product following which a discussion forum may be set up to understand if customers have any major complaints. (A. Mishra, 2016)

 

Electronic word of mouth may also be used to study the efficacy of online marketing at different levels of the product life cycle and how strong a brand is in the market (Ho-Dac et al., 2013).Scholars could study the relationship between usage of electronic word of mouth and how it affects the length of each stage in the product life cycle (PLC). Social networking sites can be studied to see how theories related to sociology can be used to analyse the relationship between the societal structure and its virtual equivalent on the web.

 

The customers’ electronic word of mouth intention, social, functional and emotional motivators are interrelated and can be connected to the customers’ life style or life stage. This information can help the marketer to study the targeted market of the particular product. (Lovett et al., 2013)

 

7. CONCLUSION:

Through the collection of data from various research papers and articles published over the last 15 years, this study has analysed the current status of electronic WOM on the image of the brand and purchase intention of a customer. The traditional approach to marketing has been revised to utilize the power of the internet. Customers have a lot more power with them due to the emergence of social media and internet. Many customers now indirectly if not directly make use of the internet before buying any product. They participate to provide their firsts hand review of a product or service and give pros and cons as well that can be utilized by the future customers. E-WOM also helps organizations to build up their brand image, improve sales and other performance related parameters. It also provides direct feedback to the marketers to make improvements in their products and service.

 

After analysing the literature, it was revealed that that a significant number of journals have been published in marketing journals. It is very clear to see that E-WOM affects the brand image and this is an emerging and current research area for businesses. Even though this mode of communication is young, it is rapidly growing in the recent years. Although the study done through this research paper has some limitations, it provides an overview of the current scenario of the research done in this field and identifies various opportunitiesfor additional introspective research on e-WOM communication.

 

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Received on 30.12.2017                Modified on 07.01.2018

Accepted on 06.02.2018           ©A&V Publications All right reserved