Research: Word of Mouth and Online reviews most important in purchase decisions

Many companies downplay the importance of online communities because only a few percent of all Internet users contribute to them heavily. Wh...

Many companies downplay the importance of online communities because only a few percent of all Internet users contribute to them heavily. What they don’t understand is that most other Internet users read those reviews and rely on them heavily when making purchase decisions.
Rubycon Consulting in its latest research states that word of mouth and online reviews are the most influential factors in consumer purchasing decisions. According to the study, the Internet is also important in providing customer support. The key points of the study are:
  • 80 to 90% of user-generated content is produced by less than 10% of users.
  • Young people (age 22 and under) account for about half of all the content and comments posted online.
  • Online reviews drive far more purchase decisions than newspaper articles, reviews by website editors, or advice from store employees and is second only to personal advice from a friend.
  • The influence of the web varies tremendously, according to what category of product or service the consumer is looking for. Decisions on consumer products, vacations, and movies are all heavily influenced by online information.
  • In general, younger people were more likely to be influenced by online information.
  • The Web is the #2 resource for customer support information, after user manuals. It ranks ahead of calling the manufacturer or asking a dealer.
The 90-9-1 Rule:
The findings of the research concurs with Usabilty guru Jakob Nielson's 90-9-1 rule for online communities
  • "90% of users are lurkers (i.e., read or observe, but don't contribute).
  • "9% of users contribute from time to time, but other priorities dominate their time.
  • "1% of users participate a lot and account for most contributions: it can seem as if they don't have lives because they often post just minutes after whatever event they're commenting on occurs."
This kind of research augurs well for product review portals like mouthshut or rediff product search whose large number of reviews can be used as a good place to serve product ads.
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Web Satan said...

Hey amazing insight. I personally believe that WOM is a major player. And now a days every online property makes sure that they at least have an "email this" on their property. Some of them are smarter and use a free Tell-a-Friend widget from www.Socialtwist.com

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