lecture 9

Question 1

what is word of mouth marketing

Answer 1

consumers interest in a companys product or service is reflected in their daily dialogues

Question 2

organic word of mouth

Answer 2

People become advocates for a product and have a desire to share their views

THIS IS OUR FOCUS

Question 3

Ampliefied word of mouth

Answer 3

Marketers launch campaigns designed to encourage or accelerate WoM in existing or new communities

Question 4

social media word of mouth matters

Answer 4

consumers now spend more than 135 minutes per day on social media

Social media fostered growing importance of WoM marketing

Chief marketing officers think online WoM matters

Rationalized by ocnsumers trust in online info from peers

64% of marketing executives believe word of mouth is the most effective form of marketing

only 6% say they have mastered it

Question 5

Mechanisms at play (word of mouth might matter)

Answer 5

1) awareness
2) Buzz
3) social learning
4) Consumption complementarities

Most often we see this operationalized as

Awareness & buzz –> volume of tweets

Social learning -> sentiment in tweets text
Sentiment often called valence

Consumption complementarities –> nothing

Question 6

Social media can generate awareness, buzz and information diffusion that ultimately influences demand. This is important when

Answer 6

1) relying on “hyped release strategies”
2) Uncertainty about a products quality

Question 7

valence (aka sentiment)

Answer 7

how positive/negative the reviews are

Question 8

Why is “how does volume, valence and variance of online user reviews impact product demand?

Answer 8

volume vs valence effects are widely debated
(generally) hard to measure

Relevant for new products, experience goods

Movie industry is a good laboratory for these products

Question 9

Takeaway from valence vs volume paper

Answer 9

emphasize the role of valence/sentiment of online reviews in influencing new product demand in experience goods markets

In contrast to volue
Which is what previous studies emphasized

Marketers should find ways to spread positive online WoM to boost demand

Question 10

virality

Answer 10

achieving a large number of views in a short time period due to consumers sharing content online

Question 11

What do marketers and managers care about virality

Answer 11

ability to reach vast audiences in a short period of time at a low cost

Increases brand visibility and recognition –> brand equity

INcrease in sales

Lurking differences: seeded virality vs non-seeded virality

Question 12

ads are more likely to be shared when

Answer 12

they are creative and informative

Even more liekly for more socially connected individuals

Driven by socially connected individuals desire to elevate (perceived) social status

Question 13

emotional ads

Answer 13

increase sharing

Question 14

Informative ads

Answer 14

increase brand evaluation and purchase intention

Question 15

Emotional (brand) integral ads combine both effects (emotional, informative)

Answer 15

This is the value virality the authors care about

They argue this is by
(a) creating positive inferences about persuasion and
(b) increasing brand knowledge

(…but I cant see a competing story being thoroughly tested)

Question 16

summary

Answer 16

Much debate about volume vs sentiment of user generated content and their impacts on demand for products

Know which paper pushes which story and (intuitively) how

Older estimates are large, new estimates are much smaller but significant

Ads more likely to be shared when they are creative and informative

Driven by socially connected people seeking to increase social status

Trade off between shareability and KPI performance of ads

Valuably viral ads use emotional and branding to try and balance shareability and performance

Question 17

how to design ads to seed a viral advertising

Answer 17

creativity and informativeness positively correlatve with views (propogators too, measured by number of comments… so take this with a grain of salt)

Higher creativity associated with higher intent to disseminate propogators even mroe likely when highly informative and highly creative

Propagator defined as “having friends” and “talking to them a lot”

High creativity positively associated with intent to share

High creativity and highly informative even more so for propagators

Ads more likely to be shared when they are creative and informative

Even more likely for more socially connected individuals

Driven by socially connected individuals desire to elevate (perceived) social status

Question 18

Can a firm create shareable ads that benefit brands

Answer 18

emotional ads are shared more than informative ads

Informative ads are shared more when brand integral to narrative

Brand integral-ness not important in adds that emphasize emotional appeal

Emotional ads increase sharing
Informative ads increase brand evaluation and purchase intention

Emptional (brand) integral ads combine both effects

That is the valuable virality the authors care about

they argue this is by
a) creating positive inferences about persuasion, and
b) increasing brand knowledge
(… but I cant see a competing story being thoroughly tested)