Promotional

Strategy
Group Project

What Marketers
Misunderstand about Online
Reviews
Managers must analyze
whats really driving
buying decisions and
adjust their strategies

A New Shift
The importance of a brand name has been diminishing with
the growing availability of opinions from experts and users

Past

Now

Buyers typically made relative

comparisons or went by the
maxim You get what you pay
for

Purchases are now being made

by User-generated reviews and
peoples tendency to consult
social media friends

Were largely dependent on

information provided by
manufacturers in the form of
marketing

What users are now able to get

is a rich specific sense of
what its like to own or use the
good they are considering
What does all this call for -> Companies
need to dramatically shift
buying
their MARKETING Strategies to account for this new shift

Influence Mix
Customers purchase decisions are typically affected by a combination
of three things :

Prior Preference,
Beliefs &
Experiences

Information
From Marketers

Inputs from
Other people &
Information
Services

The greater the reliance on one source, the lower the need for
the others

Understanding the Mix

Increasing weightage of the Other (O)

IIn recent years the Third part Input from Other people has
been taken on increasing weight in many categories
Exceptions - >
Habitual purchases

Dominated by Prior
Preferences/experience
s (P)

Specific Consumer
Goods

Dominated by
Marketing
Information/Packaging
(M)
Firms need to see to what extent do customers depend on the
Inputs form Other People when making decisions regarding their
product

O Continuum

O Continuum
The closer the product is to the O-dependent end , the greater the
shift in how consumers gather and evaluate information about it.

OINDEPENDENT

O-DEPENDENT

The rise of online reviews and the (O) influence source has
hada number of effectson consumer decision making habits.

Consumers act more rationally; irrational purchasing

decisions are magnified when the number of sources of
information is limited.
'Compromise Effect' is lessened; when presented with all the
information and time to internalise that data, consumers
'hedge their bets' by picking the middle-of-the-range product
less often.
'Brand Loyalty' is being replaced by 'Virtue Signalling'in
certain demographics; rather than being loyal to the brand
itself these consumers are loyal to the virtues espoused by
the brand.
Influence Mix is more dynamic than ever; though online
reviews have permanently deformed the old 'Average

Products researched online before being purchased offline

Competitive Advantage
Firms in the O-Dependent markets can also diversify more easily
than others, because new peer-to-peer information can overcome
long held conceptions about what the company is good at or isnt
good at.
Example expanding the capacity :
There is greater market- share volatility in domains where
customers depend mainly on O
Example swift declines of :
On the other side, Brand Equity and loyalty can protect established
players in the O-independent domains
Example Premium Brands

Communication
For some products the manufactures would now have to change the
communication strategies to adjust ot he rising change of customers
looking forward to reviews.
Consumers are less likely to consult O about purchases that are not
very important to them
Example Towels, Detergents
Implication -> FMCG fimrs can still do persuasive marketing and
advertising

Market Research

Companies in domains that are not susceptible to O can continue to

draw on conventional market research stragies , but those in O
dependent areas need to think differently and change their
methodolgies
What Marketers can do - > Systmeatically Track, code and quantify
information from review sites , user forums, and other social media

Product Segmentation
Companies need to tailor their market strategies by analyzing
different consumer segments.
One group of consumers might rely primarily on O, another to M.
It also depends on the distribution channels used :
BRICK & MORTAR VS E-commerce
Some Situational Factors may also arise
EXAMPLE :

Some customers who rely fullly on O , might come under influence

of M like the DIWALI SALE on most major online websites.
This might lead to them picking products Impulsively rather than
taking out time and decide by consulting reviews.

Online Review business in Indian Context

Geography
Analysis
Are we important?
A country of more then one billion people with fastest growth rate
is emerging as major economy center for companies across globe.
Internet reach, is it significant?
Currently 17 million homes (1.2%) have broadband connection and
105 million individuals (7.5%) have mobile data plans which are
growing at rapid pace.
Future of Online review websites?
With government initiative to increase digital literacy more and
more people are coming to internet and a greater percentage of
them coming to see online reviews.

Online Review influence on India : Fact Check

Running on motto By the
people,for the people industry is
growing really fast.
Nearly 9 out of 10 internet users
read online reviews to determine
quality of local business.
85% of consumers report that
they read around 10 reviews
before taking final call.

The One you can trust!!

Consumer Products

One of the first online

stores which allowed
customers to post online
reviews remains one of
the most important
resource for consumer
looking to make informed
purchase decisions.

Food

Founded in 2008
Zomato emerged as
one of the popular
destination for people
looking for fine dining
place/restaurants in
India.

Travel

US based travel
website working on
user-generated
content is one of
the most popular
website for travel
enthusiasts in India.

Online review early adopters success stories:

India

Ashok Vada Pav

based out of Mumbai
has rating of 4.6/5 and
close to 288 reviews on
Zomato.

The Chaiwaala based

out of Kolkata has huge
fan following on
Zomato where close to
500 reviews are posted
for it by users with
average rating of 4.5/5.

Challenges

Disposable income with customers in India are still not very high
therefore majority of people even after going through reviews
give huge importance to their friends and relative experience
with brand/product.

Still lot of work needs to be done in order to remove fake reviews

planted by the service providers on these websites. Newly built
online review websites still dont have enough mechanism in
place to deal with such kind of frauds.

Many service providers particularly doctors and lawyers

discourage their consumers from posting review about them.
This result in lesser number of negative reviews for bad service
providers.

Due to lower employment rates in country many owners push

their employees to post fake positive reviews and ratings about
business. Not only this some are even given monthly quota to

No Going Back: Refuting the arguments

concerns
Some companies give and
one consistent
objection to the rising

power of O (inputs from other people & informational

services):
Online reviews are subject to manipulation and fraud
The notion that consumer reliance on O will decline as more shoppers
become vary of deceptive reviews
However this notion is misguided: Many sites are taking steps
to weed fake reviews out

FAKE
REVIEWS
??

State-ofthe-art
machine
learning
algorithms
to detect
fake
reviews
Constantly
learn from
the data to
discover
new
patterns of
fraudulent
reviews
Allows only
people who
have
bought
products
from their
own
platform to
write
reviews

IP tracking,
user
credibility
scores as
well as
manual
moderation
of reviews
proprietary
spam
control
algorithms
for
detecting
fake
reviews

No Going Back: Refuting the arguments

and
concerns
In India, consumers are
developing
a better sense of which
sites (and which individual reviewers) they can trust.

Study reveals that manufacturers and advertisers need to

think out-of-the-box to come up with new ways to increase
brand visibility online and use the top two categories WORDOF-MOUTH AND ONLINE CONSUMER REVIEWS to their
advantage

Nielsen
Study

No Going Back: Refuting the arguments

and concerns
It will be very difficult for consumers used to the richness of
online reviews to return to relying on traditional M
(information from Marketers)
Google Indias Tech Shopper report shows that 40 percent
Indian consumers do online research before making a buying
decision.
Research also reveals that 7 out of 10 consumers come to
know of exactly which brandthey want to buy through online
research.
Voracious information seeking has become deeply ingrained in
many consumers, and they tend to not see traditional
marketing as a better provider of product information.
The sources of O change rapidly. New review websites and
game-changing technologies can suddenly appear.
A new website or app can undercut years
of careful messaging - this is a reality that
marketers must face

Thank you