Analyzing the impact of E-WOM on consumers’ perception of product and purchase intention

Abstract

Electronic Word of Mouth (eWOM) is any communication that takes place on the internet where the brand/company interacts with the customers or users. This has developed a separate study area which focusses on understanding the implications of the same. The online marketplace offers a plethora of options to be explored and leveraged by brands to increase their brand recall, brand loyalty. According to a study conducted by marketplace, the social media communication of people influences those in their friend circle in 81% cases, which can have tremendous implications in marketing. In this study, we try to explore initially what are the various factors that influence eWOM. To make the experiment feasible and given the constraints, we have limited our study to product reviews on various platforms. We start with a secondary research and qualitative study to decide on the scope of the study. We then went ahead with a qualitative study which was executed by conducting exploratory research (focused group interviews) to narrow down to the major factors which influence product perception and purchase intention. The next phase consisted of developing the hypothesis. We developed four hypotheses to test which included the variables source, valence and brand response as the independent ones. Purchase intention was the dependent variable while product perception was independent as well as dependent. The hypotheses were checked by conducting surveys and experiments which were targeted at the narrowed down sample consisting of business school students. Our experiments revealed that source/ platform of review was not significant in influencing the purchase intention whereas the product perception, valence and brand reaction were all positively related to the purchase intention. We finally conclude with the managerial implications of our study as well as the limitations in our study of the same.