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LITERATURE REVIEW
Paper 1: The impacts of Electronic Word of Mouth on Brand Equity in the Context
of Social Media
Erfan Severi, Kwek Choon Ling & Amir Nasermoadeli
In the world of social media, fast interaction and communication have steered
businesses to become more under the spot light of consumers. Through the
social media, consumers can express their views to millions of people in only
seconds in which this phenomenon indicates consumers are now more used to
having news brought to them in comparing to searching for information. Word of
mouth is one of the most powerful channels in social media. It is a powerful tool
in delivering information. The research paper aims to find out the roles of various
brand equity constructs (including brand loyalty, association, awareness, image
and perceived quality) in mediating the inter-relationship between eWOM and the
dimensions of brand equity based on the context of social media. A survey of SEL
worldwide (2008) discovers that 70% of the consumers approach social media
sites to access products and brands related information and 49% of them finalise
their purchase decisions based on info they have retrieved from the social
networking sites.
Brand Equity
It can be defined as the financial and marketing values connected to the brand in
the market place. The dimensions that encompass it and would be discussed are
as follows: brand awareness, brand association, brand loyalty, perceived quality
and brand image.
Brand Awareness
Phenomenon Created by the ongoing visibility, powerful association with the
right product classification, buying experiences and enhancing familiarity. It is a
significant catalyst in impacting customer purchasing decision making, especially
in creating three advantages, namely learning, choice and consideration
advantage. Thus, brand awareness influences consumers taste, perception and
purchasing, depending on the degree of familiarity of the products and services
offered.
Brand Association
consumers read online reviews before they buy products and that 67% of all
purchasers of consumer goods are based on user-generated content.
Approximately, consumers read at least four reviews before making a purchase.
Importantly, these reviews play a key role in purchase decisions. Hence social
media content creates empowered customers who are more led by other
customers than by advertising.
The use of social media also creates a tremendous increase in customer insights,
including how consumers are interacting with each other and the products and
services they consume. Blogs, product reviews, discussion groups, product
ratings, etc. are new important sources of information describing how customers
collect information, use that information, and how that information is used in
their decision-making, shopping behaviour, and post-purchase behaviour.
The digital revolution in society and marketing creates tremendous challenges
for firms.
Three potential challenges are most important for digital marketers:
journeys, etc. could soon begin to struggle and their functional responsibilities
may be assumed by more digitally oriented functions, such as IT.
Marketing needs to adapt to the new digital era by strongly focusing on
(1) Quantitative skill development,
(2) Fact based proposition development, and
(3) Developing brand and customer relationship strategies taking advantage of
the increasing engagement in brands of customers through social media.