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Home arrow Engineering arrow Measuring Electronic Word-of-Mouth Effectiveness: Developing and Applying the eWOM Trust Scale

Practical Importance

The development of a valid and reliable scale to measure eWOM trust is also beneficial to marketers and communication experts. In the current shopping environment, the role of the Internet is continuing to evolve. The rise of Web 2.0 applications is only one indicator of the fundamental changes that take place in this environment and these changes will accelerate within the next years. Today’s Internet is characterized by user control and ownership of information (e.g., consumer empowerment), collaborative networks, and social networks which have evolved out of communities. Revolutionary phenomena have taken place such as MySpace and Facebook, blogging, online brand and anti-brand communities, customer review and complaint sites. As the era of social shopping (i.e., an e-commerce method that combines social networking and shopping) characterizes the mode of purchasing, it is imperative to understand (1) which consumers are most likely to be influenced by online customer reviews; (2) how consumers use and evaluate eWOM information about products, brands, and firms; as well as

(3) how peer information consequently affects consumers’ attitudes and purchasing decisions - both online and offline.

Firms have recognized the potential of WOM and make major efforts to introduce the concept to online marketing strategy by offering instruments of active consumer participation (e.g., customer feedback mechanisms) on their own websites as well as the most popular social networking sites such as Facebook. These communication efforts often parallel traditional marketing instruments such as advertising - but increasingly, eWOM instruments take a dominant role in firms’ communication strategy as they try to organize online communities. However, these efforts are often based on relatively small, or no, knowledge about consumer psychological backgrounds and the effects of such factors. In most instances, companies introduce active consumer participation mechanisms simply because doing so seems to be the industry’s doctrine. In contrast, firms should make such decisions based on exact knowledge about the effectiveness of eWOM communication. As trust plays a central role in consumers’ adoption of information conveyed in fellow shoppers’ opinions and comments, its measurement can be considered a prerequisite to effective “buzz management” (Godes & Mayzlin, 2004) and to anticipating its effects. Here, it seems reasonable to paraphrase W. Edwards Deming: “you can’t manage what you can’t measure”. A better knowledge concerning consumers’ trust in eWOM will enable firms to better target the right audience with adequate integrated marketing strategies and to better interact with their clients, as most influential eWOM communication channels (e.g., on which platforms shall the firm foster consumer interaction?), messages and reviewers (e.g., which people shall be furnished with additional product information or experiences?) can be identified.

Being able to adequately measure the level of consumer trust in eWOM will also enable better integration of a firm’s communication instruments. In the era of information overload, the topics of “share of voice”, advertising effectiveness and accountability are matters of heightened interest for both marketing researchers and practitioners (e.g., Breuer & Brettel, 2012; Clark, 1999; McDonald, 2010; Rust, Lemon & Zeithaml, 2004). Various studies have strived to investigate the variables that contribute to advertising effectiveness in the online/offline environment. Meanwhile, much is already known about the conditions that make ads work (e.g., Tellis, Chandy, McInnis & Thaivanich, 2005). For instance, Park, Chung, and

Ho (2009) suggest that the matter of a person’s trust in advertising information should be considered, as it is a key determinant of ad persuasiveness. Further support comes from various researchers (e.g., Goldsmith & Lafferty, 2002). Another key to online advertising effectiveness is the segmentation of the target audience (Iyer, Sobereman & Villas-Boas, 2005; Reutterer, Mild, Natter & Taudes, 2006): Advertisements - be they from marketer-to-consumer or consumer to consumer - are most influential when they are offered to the most open-minded target groups. Segmenting individuals according to their trust in online advertising as well as eWOM - the two major forms of today’s market communication - enables firms to effectively adapt their online communication strategies and target responsive market segments with the right communication vehicles. The research at hand makes a first contribution towards a better understanding of online information recipients, as it provides answers to the question: which online consumers are most likely to be susceptible to consumer- vs. marketer-released information? How responsive are they? Or, simply speaking: does online advertising make sense anymore in the era of consumer enforcement and collaboration? The answers provided should make strategy enhancements possible and scope out the opportunities as well as limits of company-issued online market information. Moreover, in-depth knowledge of consumers’ general trust in and perceptions of online inter-shopper communications allows companies to identify the advantages and perils of eWOM for their current and prospective customers. Here, the anticipation of positive (negative) eWOM consequences in diverse eWOM channels as well as consumer segments seems to be especially valuable.

In addition, the new eWOM scale provides a source of reference for the measurement of other, but conceptually related, constructs (e.g., eWOM trustworthiness), which can be used to evaluate and better design online recommendation systems. The developed measures might also provide the ground for sub-scales that would be of practical use in situations where use of the full scale would be inappropriate or impractical. While the scale at hand has been developed in the context of text-based online customer reviews, it might be also applicable in slightly different contexts or “forms of eWOM” - like communication in online brand communities - which would make it possible to anticipate their impact but also the participation of its members.

Despite the latent need of practitioners to understand what causes consumers to trust (or not trust) eWOM information and what makes them apply the conveyed information, research to- date has not fully explored the concept nor the measurement of trust in eWOM. To overcome this shortcoming is the target of this thesis.

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