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    WordofMouth onthe Web

    The Impact

    of

    Web

    2 0

    on Consumer

    Purchase Decisions

    CATE RIEGNER

    Media-Screen, LLC

    [email protected]

    The internet stands apart from other media in enab[ing its users to interact From

    this perspective, the internet will always be, at its core, a tool for interpersonal

    communication. While consumers find emotional and practical benefits in participa

    in online discussions, these conversations have profound commercial implications

    well.Everyday consumers are wielding greater control over their media habits and

    their role in the commercial marketplace. Moreover, with the growth of online

    participation, consumers exert greater influence over the products and brands

    considered for purchase. Based on a study of over 4,000 broadband users in the

    United States, this article examines consumer adoption of Web 2.0 and the impac

    those rants, raves, comments, and reviews are having on purchase decisions today

    Findings presentedinthis article

    r

    from July 2006 Datafrom

    2007 zi ill be available startingin

    Septenjber 2007.U S. Patent

    Application Serial Number

    11/580J8X

    INTRODUCTION

    The internet stands apart from other media in

    enablingits users tointeract.From this perspec-

    tive,the

    internet will always be,

    at its

    core,

    a

    tool

    for interpersonal communication. Even

    the tag

    ging, posting

    and

    sharing

    of

    popular videos

    on

    YouTube are fundamentally community-relatedpur-

    suits. Facilitatedbycountless biogs, forums, chat

    rooms,

    and

    social networking sites,

    we now

    live

    in

    a

    24-hour rolling, emotive, media world where

    we cansatisfy our indelible need tofeelapartof

    the events that imfold aroundus.

    While there are practicaland emotional benefits

    to participating in online discussions (Piper Jaf

    fray, 2007), these conversations have profound

    commercial implications

    as

    well. Everyday

    con

    sumers

    are

    wielding greater control over their

    media habits and their role in the commercial

    marketplace. M oreover, withthegrowthofonline

    participation, consumers exert greater influence

    over

    the

    products

    and

    brands considered

    for pur

    chase. This article discusses thegrowth of user-

    generated contentorUGC, and theinfluenceit is

    bringing

    to

    bear

    on

    purchase decisions.

    First, we explore the extent

    to

    which broadband

    users of various agegroups are communicating

    online through various tools and applications.

    we evaluate

    how

    they contribute

    to the

    co

    that

    is

    online, exploring certain segmen

    demographic and psychographicthat tendto

    ticipate more than others. Next, weexamin

    influence

    of UGC on

    purchase decisions, a

    various product categories, purchase channels

    user groups. Finally,

    we

    look

    at the

    MyS

    generation13to 24 year oldsto consider

    maybe instoreforonline wordof mouth (W

    in

    the

    years ahead,

    RESEARCH OBJECTIVES

    Several objectives

    led to the

    research p resent

    this article. First,

    we

    were interested

    in

    meas

    the adoption of Web 2.0 tools and particip

    activities among broadband users. Whilethe

    dia

    are

    quick

    to

    tout

    new

    developments

    in

    nology

    and

    online user behavior,

    we

    susp

    actual usageof these toolsto be lower than

    impliedbythe pressandindustry pun dits,a

    ou r

    own

    Silicon Valley bubb le, Second

    wanted

    to

    begin tracking the influence

    of

    UG

    purchase decisions. Consumer rating

    and

    re

    sites have been in use for many years, while

    formal envirorunents for product feedback

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    WORD OF MOUTH ON THE WEB

    otive media world where w e can satisfy our indeiible

    access via a broadband con-

    passion is a requisite for

    everyday pur-

    Broadbanders (13 to 24 year olds)

    vey in the United States. We refer to re-

    sponde nts in this article as broadband

    users or Broadbanders'.

    The study was fielded online in July

    2006 to a panel-based sample representa-

    tive of the U.S. internet population aged

    13 and older. A proprietary online sam-

    pling methodology was applied to en-

    sure the profile of respondents taking the

    survey was representative of the U.S. in-

    ternet population by age and gender. Re-

    spondents were eligible to complete the

    survey if they indicated they accessed

    the internet via a high-speed or broad-

    band connection (any connection greater

    than 56 kbps/sec). We focus on broad-

    band users only, excluding those who

    connect to the internet via a dial-up

    connection. We do tbis for several rea-

    sons:

    First, over 70 percent of internet

    users in the United States now connect

    via broadband. Broadband adoption is

    growing at a 60 percent compound an-

    nual growth rate (CAGR), while the adop-

    tion of dial-up is dropping at 7 percent

    CAGR (Nielsen//NetRatings, 2000-2006).

    Second, although the majority ofinternet

    usersare on broadba nd, the percentage

    of ll

    mericans

    who connect to the inter-

    net via a broadband connection is still

    under 50 percent. Imagine what the world

    will be like when over 50 percent, or

    over 80 percent, of Americans are al-

    ways on? As seemingly ubiquitous as

    the internet is today, there is still incred-

    ible growth ahead, Finally, we believe

    broadba nd users represent the mod ern

    consumer. As broadband gains mass

    adoption, the attitudes and behaviors of

    Broadbanders today provide an indicator

    of where the market is heading.

    COMMUNICATION COMMUNITY AND

    CONTENT CREATION

    Based on a survey fielded in July 2006,

    the average broadband user spends 27

    percent of his/her time online on

    commu

    nication activities. This is commensurat

    with the amount of time they spend on-

    line for leisure and entertainment, and

    more than the time spent gathering news

    or information, personal productivity, or

    shopping (Figure 1).

    The most basic forms of internet-based

    communication, email and instant mes-

    saging (IM), are essentially one-on-one

    channels that exist separately from any

    related web-based content or information.

    Newer forms of internet communication

    facilitated by blogs. Forums, and social

    Communication

    Leisure or Entertainmen t

    News or Information

    i= Personal Productivity

    Shopping

    = 4.190

    Base: All respondents

    Figure 1 Allocation of Total

    Time Spent Online

    D e c e m b e r 2 0 0 7 J O U Il l l f lL O F

    l D U E T I S I f lG

    R E S E flllC H 4 3

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    WORD OF MOUTH

    ON

    THE

    WE

    networking sites depart from theemail E m a il r e m a i n s the d o m i n a n t f o r m of o n i i n e c o n v e r s a t

    model in two key ways; they provide a

    channelfor oneperson to reach many for a| | ggg r o u p S ,but the Under-25 grOUp iSa d d i n g

    (often anonymous) others, and they are

    increasingly associated with specifictopi s

    c h a t , d i s c u s s i o n f o r u m s , b l o g s ,

    and

    t e x t m e s s a g i n g

    R esearch shows that B roadhanders reg-

    ularly use

    a

    variety

    of

    emerging and

    es

    t h e ir r e p e r t o i r e . S e v e n t y - t h r e e p e r c e n t of 13 to 17 y

    tablished digital communication channels.

    Of course, email

    is

    ubiquitous. More

    in

    o i d s

    and 68

    p e r c e n t

    of 18 to 24

    y e a r o l d s

    us e IM or

    c h

    teresting is the finding that 4 out of 10

    B roadbanders regularlyIMor chat Other c o m p a r e d w i t h j u s t 26 p e r c e n t of B r o a d b a n d e r s 45 a

    channels, such as voice-over-internet pro-

    tocol (VoIP), have been around for the

    o l d e r .

    past 10 years, but are just emerging as

    viable mass market options. VoIP is one

    of the most recent examples of the inter-

    ,, , The internet has also brought a partici- But to what extent has this vision ec

    net s ability to consume older media, es-

    , , , . patory qual i ty to

    any and

    every onl ine realityfor thebroader broadband popula

    sentially movmg 100-year-old telephony

    r J -t > j j j r r

    ,.

    . . , , pursuit. Communities arise, allowing peo- To understand how, and to what ex

    to the web, a digital mternet-based proto-

    ,

    ,, . , . . , . , pie to connect personally, professionally, Broadbanders are using one-to-many

    col.

    Video conterencmg, a relative staple

    ^ , . , and culturally with others. Web 2.0 sites line communication tools, we asked

    for busmess communication, has yet to

    ^.

    , , , , like YouTube, MySpace, Wikipedia, Digg, to evaluate a list of 17 different activ

    rmd a market even among broadband-

    and Flickr all contribute to this new ba- that couid loosely be defined as "con

    equipped consumers.

    ., , ^ , , , zaar of interests. A base of freely available creation" activities. From this inquiry

    While regular users of chats, blogs, text

    , , , , _ , , , user-created content, collaborative tools, found that the average Broadbander

    messagmg, and VoIP fail to match the

    and networked communities create this forms 2.4 content creation activities r

    niimbers who rely on email, these alter-

    ,

    , , , , dynamic and participatory internet cul- larly. Approximately one-third rat

    native channels play an essential role in

    , ., , ^ , , , ture. The result is fundamental changes in review products online, but regular

    the daily lives of those who use them.

    , . , . , ,

    , . , . , , the ability for people to communicate their ticipation in activities that involve con

    With the sole exception of videoconferenc-

    , . t

    . ideas and opinions to many people. uting to entertainment contentsuc

    ing, at least two-thirds of regular users

    engage in each activity at least once a day

    (Tabie 1).

    Email remains the dominant form of TABLE 1

    online conversation

    for all age

    groups. R eg ul ar

    and

    Dai ly Use*

    of

    O n l ine C omm uni c a t i on T oo ls

    but the under-25 group is adding IM,

    chat, discussion forums, blogs, and text

    UseDaily

    messaging to their repertoire. Seventy-

    Among ThoseWho

    three percent of 13 to 17 year olds and 68

    UseRegularly UseR egularly)

    percent of 18 to 24 year olds use IM or Email 95% 88%

    chat, compared with just 26 percent of

    , ,^ ^ Instant messaging/chat 41% 70%

    Broadbanders 45 and older. Text messag-

    ing is also popular among those under 40, . 9r .'7l/ .'.|s/'?.'.S5.'J.ss|on .b ^ ^ 19% 67%

    with use peaking at 40 percent among 18 Text messaging 18 64

    to 24 year olds. VoIP and videoconferenc-

    Volr 8 68

    ing remain on tbe horizon with the high-

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    WORD-OF-MOUTH

    ON THE WE

    the

    average Broadbander performs

    2 4

    or

    review products oniine,

    but

    reguiar

    in activities that invoive contributing to

    as

    upioading

    an

    audio

    or

    in the

    singie digits

    (50 percent) and male Broadbanders aged

    18 to 24 (48 percent), Participation among

    Broadbanders aged 55 and over falls to 23

    percent (Figure 3). Active participation

    among women in online conversations sug-

    gests techie guys are no longer the rulers

    of the web. But the disparity between

    younger and older users suggests a stub-

    born generational divide in Web 2.0

    invoivement.

    A P SY C HO G RA P HIC V I E W -

    PARTICIPATION BY BROADBAND

    SEGMENTS

    2 Based on a segmentation analysis of the

    by Age

    * ' '

    popu la t i on , two segmen ts

    w e

    refer to as the Online Insiders and So-

    13-17 18-24 25-34 35-44 45-54 55+ eial Clickers are particularly immersed

    ^

    81% 90% 95% 97%^ 98%^ 99% ^ ^ communication activities on the web.

    As discussed below. Online Insiders are

    I?:^. , 9B. ,

    ^9% 38% 30% 23% ^^^y ^^^^^ ^^ t^^

    .^^^^^^^

    ^^j

    ^.ghl

    33%^ 29%/^ 26% 19% 12% 9%

    influential onlin e sho pp ers. Social Click

    28% 40%^ 29% 18%

    12 _

    5%_

    ^ ^

    ^ ^ ^ ^

    communica tors on l ine ,

    bu

    the most part ic ipatory ones tend

    to be

    6% 6% 13%^ 9% 6% 6% j , . TU

    younger and less affluent. These younger

    conferericing _5%_ 7% 10%^ 7% 5%_ 3%_ Social CHckers may not be influencing

    r e g u l a r l ym ty p i c n l m o u l h ;

    N

    4 . 1 9 0 :

    b a s e :

    all r e s p o n d e n t s purchase ded sion s today but COuld becom e

    tendency to mesh media is still on the

    When we isolate users of four collabo-

    eaviest users

    de female Broadbanders aged 13 to 17

    0 5

    Review aProduct

    Post

    to

    Forums

    PublishaPersona l Page

    HH

    Exp re ss Op in io n ^ ^ ^ ^ ^ M

    PosttoJournal h^HI^^H

    Share viaP2P Netw ork ^ ^ ^ ^ ^

    PublishaWebs ite ^ ^ ^

    Use

    a

    Wiki

    Create/Share Audio Fi le

    Create/Share Video

    Create/Share Podcas t

    ^ H 4

    ^ 2

    10 % 15 20 25 30 35

    ^ ^ ^ H 1 5 %

    ^ ^ ^ ^ 1 4 %

    9

    8

    N= 4,190

    Base :All responden t s

    *Act ivi t ies done int yp ica l m on th

    Figure

    2

    Con ten t Crea t i on Ac t i v i t i e s *

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    WORD-OF-MOUTH ON THE WEB

    6 0 -

    5 0 -

    4 0 -

    3 0 -

    2 0 -

    1 0 -

    Base:

    13 -17 18 -24

    148

    Users of message boards,

    2 5 - 3 4

    chat rooms

    35 -44

    listservs, and

    45 -54

    wikis

    - Male

    Female

    55-f

    Figure 3 Online Talkers by Age and Gender

    strong influencers in the future (Table 3).

    The following section provides a descrip-

    tion of the attitudes and behaviors that

    characterize their orientation to the activ-

    ities that foster WOM online.

    TABLE 3

    Content Creation by Segment

    Social lickers

    rely on the internet to

    maintain relationships with friends and

    family, and to seek out new ones. While

    a generational divide runs through this

    group, all Social Clickers are active com-

    Review products

    Chat in chat room

    Post to forums

    Express opinion

    Offer advice on listserv

    Use a wiki

    Post to journal

    Publish a blog

    Share via P2P network

    Create/share audio file

    Create/share video file

    Create/share podcast

    Online

    Insider

    4

    1 8

    3 5

    1 3

    1 9

    7

    1 8

    2 1

    1 2

    6

    5

    2

    Social

    Clickers

    3 1

    1 5

    2 4

    7

    1 5

    1 7

    1 9

    8

    4

    1

    Content

    Kings

    2 4

    1 5

    2 6

    6

    1 2

    1 4

    1 7

    1 1

    2

    4

    1

    Everyday

    Pros

    3 5

    8

    1 8

    5

    1 1

    2

    1

    1

    6

    2

    Fast

    Traciiers

    2 5

    9

    1 8

    7

    1 4

    1

    8

    6

    4

    2

    Do in typical month; N

    =

    4,190; base; all respondents

    municators online, spending over hal

    percent) of their time online doing

    munication and community-oriented a

    ties.

    Older Social d ic ke rs rely strict

    email. Younger Social Clickers are

    text and instant messengers. They are

    actively engaged in

    content cre tio

    ities, for example, creating personal

    and posting comments on blogs,

    sage boards, and chat rooms. With a

    ural interest in connecting with o

    Social Clickers are poised to emerg

    a key influencer group for the pr

    theyc reabout They may not be th

    to adopt, but they vocalize their pr

    ences more readily than other users

    fluencing friends and family indir

    through their personal pages, posts

    chats.

    Online Insiders are more holist

    their use of the internet and spend ju

    much time on communication acti

    as Social Clickers and sometimes m

    Insiders do n ot IM as frequently as C

    r s but the two groups match in

    communication activities. Online Ins

    are more inclined than other group

    assume an online voice or persona

    express themselves online. In fact,

    group dominates every content cre

    activity measured in our study. O

    Insiders are also avid online shop pers

    frequently add their opinion via pr

    ratings and reviews. They are very i

    ential, the first to adopt new pro

    and to vocalize their preferences.

    ontent Kings

    tend to be young,

    and addicted to online entertainment.

    also spend the least amount of time

    municating online, aside from activ

    that support their interest in ente

    ment, i.e., peer-to-peer file trarisfers,

    sonal web pages, and posting comm

    to message boards and chat rooms. W

    Kings communicate, it is to achieve

    ultimate goal of finding more way

    have fun on the web.

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    WORD-OF-MOUTH ON THE WEB

    veryday Pros

    participate in activities

    we find the Everyday Pro rating or

    a

    Consequently, they are more likely

    ast Trackersare too interested in using

    to

    meet tbeir imm ediate needs

    such as checking tbe news, weather, or

    sportsto spend much time communi-

    cating or participating with others. This

    is a group tbat wants to get on and get

    off quickly, acting primarily as receivers

    of information rather than creators or

    producers.

    To sum ma rize, we find Web 2.0 involve-

    ment primarily among younger Broad-

    banders ( 1 3 to 2 4 year olds), and the early

    adop ter segment we call tbe Online In-

    siders. We do find some activity among

    older users around e-commerce related

    activities, specifically product reviews, but

    it is unclear whether their participation

    will expand into otber areas.

    INFLUENCE ON PURCHASE

    BEHAVIOREXPANDING BEYOND

    THE EARLY ADOPTERS

    If UGC is still being promulgated primar-

    ily by younger users and an elite group

    of netizens, wbat,ifany, impact has

    it had on purchase decisions? To help

    answer this question, we analyzed over

    1,300 broadband shoppers,

    subset of

    tbe total Netpop sample, and over 100

    different types of products purchased in

    the last tbree montbs. Respondents

    were asked to identify

    product they

    had purchased in the last three months,

    either online or offline, and were then

    askedtoanswer questions about the

    0

    Browsing Retail Stores

    Recommendations from Family/Friends

    Search Engines

    Retail Sites

    Brand/Manufacturer Sites

    TV Advertisements

    Coupons

    Magazine Advertisement/Article

    User-Generated Sites*

    Catal o g s B roch u res

    Store/Distributor Sites

    Comparison Shopping Sites

    Online Advertising**

    Radio Advertise me nt/Men tion

    Outdoor Advertisement

    5 1 0

    1 5 2 0 2 5 3 0

    2 7

    1 5

    1 5

    7

    2

    N 1,397

    Base: Purchased product in last three months

    *lncludes rating/review sites, blogs, forums, discussion boards, social networking sites

    **lncludes search advertisements, banner/rich media advertisements

    1 7

    Office Sou rces

    nlinP niirrpQ

    User G enerated

    e 4 Percent Saying Source Influenced Purchase

    D e c e m b e r 2 0 0 7 J D U I l l l I l L O F l U E f l T IS l O GR E S E flf lC H 4 4

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    WORD-OF-MOUTH ON THE WEB

    sources that influenced their purchase

    decision.

    First, it is noteworthy that online sources

    (e.g., websites, search engines, and com-

    parison shopping sites) compare favor-

    ably to traditional sources in terms of

    their influence on recent purchase deci-

    sions: fully balf (50 percent) of all recent

    purchases among Broadbanders were in-

    fluenced by at least one online source,

    whereas 61 percent were influenced by

    offline sources. Half of the top 10 sources

    are based onlinenoteworthy given tbat

    only one-third of the purchases were even-

    tually madeonline(Figure 4),

    With regard to the influence of WOM,

    nine percent of Broadbanders link at least

    one user-generated source to a recent pur-

    chase decision. (User-generated source is

    defined as a blog, rating/review site, fo-

    rum, discussion board, and/or social net-

    working site.) Consumer review and rating

    sites, blogs, and discussion boards are

    more likely to be a source of influence

    than IM or chat rooms. We suspect IM

    and chat to be less helpful in tactical on-

    line shopping sessions (Table 4), while

    consumer ratings and review sites remain

    the most efficient way to obtain consumer

    feedback.

    Thus Ies5 than 1 in 10 purchases is

    influenced by online WOM. The percent-

    age may seem low (9 percent), yet only

    TABLE 4

    Influence of UGC Sources

    U G C sources(any)

    Consumer reviews/ratings sites 5

    Blogs/discussion boards 3

    Instant messaging/chat rooms 2

    0

    Online j ^ H

    Kurcnases P ^ ^

    Offline ^ B

    Purchases ^ ^ H

    N = 1,397

    Base

    Purchased

    5

    productin

    1 0

    ^ ^ H 8

    last three months

    1 5

    1 1 4

    2 0 2

    Figure 5 Influence of UGC by Purch ase Ch anne l

    Social networking sites 1

    Note: N = U9 ; base: purchased product in last three

    months

    one source measured in our survey influ-

    enced more than 20 percent of purchases:

    browsing in retail stores (27 percent). Rec-

    ommendations from family and friends

    influenced 17 percent of purchases. Find-

    ings suggest consumer influence is dis-

    persed, or splintered as man y would

    say, across a mu ltitu de of online and off-

    line media channels.

    However, findings suggest that online

    WOM is still in an early ado pter phase ,

    influencing particular types of products

    and certain purchase channels more than

    others. For example, products purchased

    onlineare alm ost tw ice as likely to be

    influenced by UGC as products pur-

    chased offline (i.e., retail stores or over

    tbe pbone) (Figure 5 ). Our research shows

    that online purchases tend to undergo

    greater scrutiny on tbe web, increasing

    the likelihood that buy ers would seek con-

    sumer input on UGC sites.

    An analysis of four separate product

    categoriesPricey Tech-Electronics, No

    Touch Services, High-Touch Retail, and

    Household Staplesillustrates the rela-

    tive importance of UGC sites and online

    versus offline sources in general (Figure 6).

    Pricey Tech Electronlcs

    User-generated content sites play an im-

    porta nt role in the purchase ofPriceyTech

    Electronics products such as DVD

    and computers. In fact, they are the

    s

    most influential source for purch asing

    items, influencing 24 percent of the

    ucts purchased in this category.Sear

    ginesare most influential and

    manufa

    brand sitesare third most influential.

    stores still play a major role in the

    chase decis ion , but browsing in retail

    is fourth in influence behind tbe afore

    tioned online sources. Our research s

    the more expensive and valuable an

    tbe more it is researched. The fact th at

    technology and electronics items tend

    more expensive, more complicated,

    highly coveted by their buyers contri

    to the time corxsumers' devote to rese

    ing them and considering the views of

    bm ers prior to purchase.

    High Touch Retail

    While offline sources dominate the

    chase ofHigh Touch Retail product

    as clothing, appliances, and furn

    online sources also play a surpris

    important role in this category. Over

    (58 percent) of High Touch Retail

    chases are influenced by the intern

    specifically, an average of 2.3 o

    sources. Yet only 8 percent of purc

    in this category are influenced by U

    The percentage m ay increase as retail

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    WORD-OF-MOUTH ON THE WEB

    0

    Pr icey Tech-Elec tron ics ^ |

    High-Touch Retail H

    Household Staples H |

    No Touch Services WM

    N 1,397

    Base: Purchased product in

    5

    5

    ^ 4

    last three

    1 0

    8

    %

    months

    1 5 2 0 2 5

    24

    Influence of UGC by Product Category

    rather than evaluate them more

    5 percent of House-

    ully com bine bricks-and-clicks, taking

    rs online and then fulfilling

    of Passionates who actively tout

    a product's virtues, the average customer

    is unlikely to engage.

    No Touch Services

    The internet dominates the purchase of

    No ouch Services such as travel and fi-

    nancial servicesindustries that stimu-

    lated the growth of e-commerce a decade

    a g o .

    No Touch Service buye rs rely heav-

    ily on search engines and recommenda-

    tions from family and friends, suggesting

    a desire to balance the ability to pick

    and choose from multiple options online

    with trusted advice. Yet UGC is less im-

    portant in these decisions (4 percent of

    all purchases). Buyer age likely dampens

    the influence of WOM for No Touch Ser-

    vices. Another factor that may limit the

    use of UGC in the purchase of these

    items includes the personal and confiden-

    tial nature of many financial and travel

    decisions.

    To summarize this analysis of separate

    product categories, UGC is more likely to

    influence items that are more complex,

    higher priced, and highly covetedsuch

    as technology and consumer electronics.

    But it is less likely to influence low-

    involvement products and/or those pri-

    marily purchased in stores (e.g., CPG),

    products that buyers want to see/feel/

    try-on (e.g., furniture, apparel), and prod-

    ucts that are personal or confidential in

    natu re (e.g., travel, finance). Findings from

    Netp op 2007, available starting in Septem-

    ber 2007, will identify any shifts in the

    results presented here.

    An early adop ter phase is also evident

    in the types of users who say they are in-

    fluenced by

    U G C .

    Older consumers

    4 5

    an d

    over) are less likely to turn to UGC sites

    (Figure 7) than younger users (under 45).

    And using the Netpop segmentation model,

    we find that Online Insiders are almost twice

    as likely to be influenced by UGC as other

    broadband user segments (Figure 8).

    Heavier

    W e b 2 .0

    participants

    to

    begin with.

    Online Insiders are the ones driving cur-

    rent WOM marketing. As Online Insiders

    grow in proportion to other segments, a

    trend we are already starting to see, the in-

    fluence of online WOM should logically in-

    crease. However, this assumes Online

    UGC is more likely to infiuence items that are more com-

    plex, higher priced, and highiy covetedlike technoiogy

    and consumer eiectronics. But it is less likely to influ-

    ence low-involvement products and/or those primarily

    purchased in stores

    (e.g. ,

    CPG).

  • 8/10/2019 Word of Mouth on the Web Cate Riegner

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    WORD-OF-MOUTH ON THE WEB

    0

    Content Kings

    Fast Trackers

    l ^ ^ ^ ^ l

    S ocia l C lic ke rs I j i ^ ^ ^ ^ g

    Everday Pros I ^ ^ ^ ^ H

    N 1,397

    Base: Purchased product

    in

    5

    ^ 6

    last three

    10

    9

    8

    months

    15 20 25

    Figure

    7

    InfluenceofUGCbySegment

    Insiders will retain the usage characteris-

    tics they share today. It may not be the On-

    line Insiders,

    but

    rather

    a

    subset

    of

    this

    group, that act as the primary influencers

    on the web.

    LOOKING AHEADPREPARING FOR THE

    MYSPACE AND YOUTUBE GENERATION

    In considerationofwhat might lay ahead

    for online WOM,it isuseful toexamine

    the role of UGC in online entertainme nt.

    This

    is

    an area whe re 13

    to

    24 year olds,

    the heaviest purveyors of Web 2.0, are

    highly engaged in online conversations

    today. (Online entertainment is definedas

    movies, music, games, and television con-

    tent or information that is available on the

    web.) A natural synergy exists between UGC

    and online entertainment, given that enter-

    tainment represents the cultural meme

    the water-cooler talk that draws people

    together. From a marketing p erspective, the

    relationship between WOM and online en-

    tertainmentiseven more powerful when

    we consider how indistinguishable enter-

    tainment and media have become online.

    Take short online videos or movie trailers,

    for example: are they marketing or free di-

    versions from the daily grind? Most w ould

    argue both.

    In point

    of

    fact. Piper Jaffray recently

    coined theterm Comm unitainment in

    referenceto a new formofentertai

    that combines communication, co

    nity,andentertainment online. Co

    nitainment is certainly an important

    for media companies to embracebo

    defense of declining traditional media

    its and to discover new waysofeng

    audiences. But Corrununitainment c

    profound commerci l implications

    a

    especially as theMySpaceandYo

    generation enters adulthood.

    Our study shows that one-third

    o

    learn about newentertainment th

    UGC, specifically blogs, social net

    ing sites, community sites,andpo

    (Table 5). While television remains a

    portant channel

    for

    learning about

    entertainment, the num bers of13 to 2

    olds influenced by UG C 48 perc

    far greater than the percent influence

    television (31 percent) (Figure 9).

    Findings also suggest that Broad

    ers who use these UGC sources rank

    influence fairly high. For example,

    blog and social networking sites are

    by just 19 percent

    of

    Broadbanders,

    two-thirds of these users find these so

    influential in deciding what towat

    play. The influence of UGC is fairly s

    across all genres of entertainment,

    the exception

    of

    movies where

    it

    d

    0

    13-24 ^ ^ H

    25-44 ^ ^ H

    45-H ^ ^ H

    N = 1.397

    Base: Purchased

    5

    H

    ^