All posts by 344068lb

Word-of-mouth: oral versus written

Word-of-mouth has always been important. It has a crucial impact on customer behaviour. If someone recommends a certain product, it is more likely (more than 50%) that in the end this person purchases the product. Currently, it becomes even more interesting because the digital era makes it easier to communicate with each other. Nowadays there are more different channels you can use to spread the word easy and fast. Different channels of communication will influence the potential customer. But is there a difference between oral and written communication? Does the way of communicating affect a certain message? And could this be an opportunity for a company?

For me there is a difference in a way that written communication feels more anonymous. This is why I first thought that this would cause low-content and less interesting messages since people feel less responsible for their own messages. However, if I think a bit further I do think that in written communication someone feels also less social pressure to answer right away, which means that they have more time to think about their message. This could result in more refined, complex and interesting messages. At the same time written communication can feel more permanent (you cannot remove it easily) and the writer can be worried about the receivers’ expectations: e.g. my audience is expecting the world from me, now I have to live up to that by writing something really valuable. This is related to your online reputation.

Berger and Iyengar (2013) were curious and therefore did some research about the difference between oral and written communication and how this affects the content of the message. The results show that if there is more time to construct and refine a message (i.e. asynchrony), people will indeed talk about more interesting products and brands. Also a higher level of self-enhancement will support this effect. When there is enough time to construct and refine a message, people with a higher level of self-enhancement will take the opportunity to use this time to choose interesting products and brands to talk about.

Knowing the fact that asynchrony improves the interestingness of the message, written communication scores higher than oral communication. If someone asks you to tell something about a certain topic, you will feel the pressure to answer within a few seconds. You probably feel less confident about the topic and would tell more straightforward, less interesting and more accessible things. However, if someone asks you to write it down, the first thing that you probably think is: how shall I formulate this? What would be the most appropriate way? etc. There are immediately multiple things to think about before you are actually writing something down. You will give yourself more time to construct the message. This supports the research, which shows that in written communication interesting products and brand are mentioned more often.

But how could companies benefit from these findings? Companies want customers to talk about their interesting products and, as we have seen, written communication is an appropriate way to do so. At the same time there is an upcoming trend of digital communication: the impact of digital word-of-mouth is powerful because of reasons such as speed and its one-to-many nature. This means that companies should respond to this trend by investing in written communication platforms and a strategy for digital word-of-mouth.
People obviously prefer to talk about interesting brands. So in addition to supporting written communication platforms, companies should also give customers a reason to talk, evoke interest and surprise people by engaging, equipping and empowering customers. Like NikeSupport is doing with responding on conversations on websites (engage). These three E’s are important for building up a digital strategy and to make sure that customers are evaluating the brand as a more interesting one. Companies should take these insights into account to spread the positive word of mouth.

Berger, J., & Iyengar, R. (2013). Communication channels and word of mouth: How the medium shapes the message. Journal of consumer research, 40(3), 567-579.

Help(l)ing Anyone

A dream came true for the start-up Helpling. They had a brilliant but simple idea and after only 1 year they are offering their service in more than 12 countries and 200 cities. But how did they get so successful? What is so special about Helpling?
There is a huge black market out there, a huge market of housekeepers that serves millions of households and a lot of these families have the same questions: Is it legal? Is this for me the cheapest and safest way? How can I find the perfect match? Everyone recognizes the issues. Millions of people need it, but it is difficult to find: a housekeeper that fits your budget, lives around the corner and you can trust. A difficult combination but Helpling has found a way to make everything more legal, transparent and they promise every customer to find the perfect housekeeper in 60 seconds.

Helpling is started in Germany when two guys presented a simple business concept to Rocket Internet. Rocket Internet liked it and one week after the meeting they already started to develop the concept. On March 29th 2014 Helpling is officially launched.
But why is this simple idea so brilliant? Partly probably because of the contemporary business model: co-creation. Nowadays customers want to contribute and support each other more and more. Helpling is making use of this trend.

Helpling is an online platform that matches customers with independent cleaning providers (called ‘Helplings’). Helplings register online, go through a registration process, choose their availability and after that they are able to receive bookings. Households who want to book a housekeeper have to make a booking online by entering their address and making an appointment. Then Helpling is matching a customer with a housekeeper based on location and number of positive reviews. So if a housekeeper is doing a great job, he gets higher rankings and he will receive more jobs since Helpling is offering jobs first to the best-reviewed housekeepers.

Through this way Helpling is supporting the Helpling community to review each other and the Helpling community improves the overall service by doing this. This recommendation-system supports the quality of Helpling.
Because Helpling is matching, also the perceived effort for the customer is becoming less and Tsekouras & Li (2015) found out that this means that the overall perceived quality would be higher. A customer has to put in a minimum effort and gets great results because of transparency and the Helpling’s review-based selection. Besides, because Helpling is helping customers to find the best-reviewed housekeeper, customers are more likely to do something back and are willing to write these valuable reviews as well.

Of course there are also some challenges of co-creation and the Helpling business model. It could be risky to fully rely on the individual housekeepers. They might seem reliable but housekeepers can also ruin the brand-image by misleading honest customers. Therefore, the most difficult part for Helpling is to recruit the cleaners, since one single Helpling can damage the brand, and they are now thinking about how they can safely scale this task. It is important to explore the risks and opportunities of this co-created platform.

“We would never do anything that harms Helpling as a brand. It only works if we can provide a good service. Otherwise you create hype and everyone tries it, and tries it exactly once, and you are in a really bad position.” (Benedikt Franke, 2015)

Luckily for now the quality remains good and there are increasingly more housekeepers and customers that are making use of this simple and helpful platform. If Helpling can live up to the ultimate dream to serve the world with their service? Give them one more year and we will see where they get.


Individual Self-Design vs Community Self-Design

The customer as a co-creator is becoming more important. Self-design is a new trend. Nowadays customers can customize anything; from self-designed skis (e.g. Edelwiser), to suggesting preferable food flavours (e.g. Lays). Many companies offer their customers a so-called Mass Customization (MC) toolkit to design their own products online. But isn’t it extremely inefficient and difficult to create all these self-designs separately? Isn’t it extremely costly in terms of time and money, for company and customer, to make use of this isolated, dyadic interaction process between an individual customer and the Mass Customization toolkit?

When you are less experienced in designing your own product, you will cope with a lot of difficulties. If you lack experience and/or creativity, you have to create ideas by brainstorming with other people and get inspiration from existing designs on the Internet. If someone asks an inexperienced person to design its own product, and they have to start from scratch they would definitely have a hard time figuring out where to start and what their actual preferences are. This is mainly because there are a lot of possibilities. Many people would start with designing different alternatives but this trial-and-error method is really time-consuming and not effective.

Above-mentioned statements and arguments are reasons for Franke, Keinz and Schreier (2008) to do some research about the Mass Customization toolkit. They thought about how to improve these toolkits, and they did some research whether it would be useful to include user communities.
They found out that peer-generated design solutions and peer-based feedback should be included in the existing MC toolkits because it would influence self-designs positively. More customers are able to design their own products by either adapting or getting inspired by other designs. Other users’ designs can be a great starting point for the less experienced designer. Think about the customized shoes from Nike or Vans. Before you create your own design, you will see a few designs that already have been created. There is an option to adapt these models or adapt a professional design. In other words, Nike/Vans creates a starting point for the less experienced designers and this will help customers to get a better outcome.

The peer-input can also be used as an external feedback channel. Through this way customers are able to show their preliminary product to others, who can help to improve the product. An example is SoundCloud. Anyone can upload their sounds and music and at the same time people are able to criticize and comment each other’s music. One of the community guidelines of SoundCloud is ‘Criticize, but do it constructively’. Because of the user community feedback, anyone can improve their songs. Schermafbeelding 2015-03-27 om 17.20.36 Figure 1. ‘Write your comment on SoundCloud’ (SoundCloud, 2015)

By integrating user communities in the MC toolkit, it is proved that customers are better able to create a more systematic problem-solving behaviour and it leads to self-designed products that meet the preferences of the customer more effectively.

Finally, there is one perfect example of a company that is making use of the integration of a user community: Threadless. When a potential customer starts to create their self-design, he has access to all the designs that have been created in the past. He is allowed to use and adapt other designs. After that the self-designer can ask the ‘Threadless community’ for help: ‘Do they like your design?’ and ‘Do they have any tips for improvements?’ Threadless is integrating both existing solution chunks and external feedback in the problem-solving behaviour. In the end this will lead to a more satisfied customer and the customer will value the product higher based on the perceived preference fit, purchase intention, and willingness to pay.