In recent years many online platforms have risen to the public’s eye. These platforms often exist of virtual communities created for several different purposes. Facebook brings friends and family together and focuses on the social part, AliExpress brings manufacturers and customers together and focuses on the transaction part. According to Armstrong and Hagel (1996) there are 4 different categories of virtual communities. Firstly interest communities are identified as communities that exist of people who share similar interests. Secondly relationship communities exist of people that come together to form personal relationships. Thirdly there are fantasy communities which are often focused on online games in which people come together for ‘shared experiences’. Lastly and the most important point of this article are the transaction communities. These communities are focused on the transaction of needs (products or services).
Tag Archives: C2C
Dynamics that affect consumers’ online product opinions
Have you ever given your opinion online? Most likely, your answer will be no, even though current developments in technologies have made it easier to share your thoughts online. The 90-9-1 rule entails that in any group of 100 people, there is on average one person that produces 90% of the content, nine persons that provide 10% of the content, and the remaining 90% never contributes to anything online. That is why the last group is better known as ‘the lurkers’ – they merely observe and follow the contributions of the first 10%. Much research has been going on to study the reasons for being a lurker and how these lurkers can be delurked (e.g. Xia et al., 2012). Furthermore, the applicability of the 90-9-1 rule is subject to debate and consequently changes to this rule such as 70-20-10 or 80-19.99-0.01 have been proposed. The fact remains that there are still many more people that do not contribute their thoughts online.
What drives this small number of people to publish their thoughts online and how do the previously posted reviews affect their contributions? Moe and Schweidel (2012) studied how previously posted ratings can influence someone’s posting behavior in terms of whether to contribute and what to contribute. They focused on consumers’ posting behavior after they have used the product and formed their post-purchase product assessment. The dataset used consists of 3,681 contributions of 2,436 customers of an online retailer of bath, fragrance, and home products over the course of six months. A sample of 200 products was taken, which included 100 most rated products and 100 additional products which were chosen at random. The online contributions included both a score on a five-star scale and a review text.
The results of their study are the following. In general, Moe and Schweidel (2012) observed that the tendency to post was different across individuals and individuals preferred different posting environments. Individuals who were not used to post product opinions were more positive and exhibited bandwagon behavior. Frequent posters (activists) were controlling the online product rating environment by contributing more negative and differentiated opinions compared to the opinions that were expressed before. Activists increasingly participated over time, whereas the involvement of other group decreased over time. Positive environments led to more contributed opinions, and negative environments decreased the amount of opinions contributed. Additionally, Moe and Schweidel (2012) found that the contributed content was subject to adjustment effects, which entails that the contributed thoughts affect the content of future postings. Furthermore, they found that the posting decision was subject to selection effects that can affect the composition of the posting population (Moe & Schweidel, 2012).
Previously private conversations about products have become publicly available to potential customers and the firm. Before, firms have never been able to get so close to their customers and engage them in such a relevant manner. Increasing customer insight and engagement is highly important in influencing the success or failure of a product. Knowledge gained on customer experiences can aid the firm in driving benefits throughout the value chain by forecasting demand and creating product promotions, among other benefits. Therefore, the previous results are important for consumers and firms. Consumers and firms should take into consideration that online product reviews do not always reflect the opinion of the whole customer base, but rather the opinion of the vocal and more negative activists. In addition, firms should not overreact to negative feedback because there is a high chance that the more positive majority may have chosen not to participate in the online forum. In order to deal with negative feedback, the firms could provide the most silent customers with incentives for posting reviews.
Sources:
Xia, Huang, Duan & Whinston (2012). To Continue Sharing or Not to Continenue Sharing? An Empirical Analysis of User Decision in Peer-to-Peer Sharing Networks. Information Systems Research, 23(1):247-259.
Moe, W.W. & Schweidel, D.A. (2012). Online Product Opinions: Incidence, Evaluation, and Evolution. Marketing Science, 31(3):372-386.
Android vs Apple 2.0?
When browsing the internet you normally encounter dozens of news items, blogs and other content. It is no exception that a catchy title usually makes you decide to click through and see what’s out there. And of course when the item ‘Android takes a piss on Apple on Google Maps. Seriously’ popped up on my Facebook news feed I decided to take a look at it.
If you would have searched on Google Maps on the 24th of April for certain coordinates just south of Rawalpindi, Pakistan, a giant Android could be seen urinating on the Apple logo. First thought was that it was an Android developer fuelling the old rivalry again, although later Google released that it was user-created content which was slipped through the approval filter. Because of this item I decided to dig into Google Map Maker, the tool that allows you to edit Maps, which was unknown to me since I had read the blog.
The official goal of Google Map Maker is to share information about places in user’s neighbourhood, like companies or university campuses. Places which are inaccessible with Google street view cars can thereby be edited by Map Maker users. It is actually even more elaborate, because users are also able to add roads, railways or other places and add new languages. Once an edit is sent to Google, it can be reviewed by other users by giving a thumb up or thumb down. This score is considered by the Google algorithm to accept or reject the edit. As we can see with this case users can, with enough peer user support, fool the algorithm.
If we look into the business model of Map Maker more closely we can link it to the first phase of consumer co-creation, namely recommend and develop products. Instead of only browsing through Google Maps to find by Google pre-defined places users can now develop new elements and recommend them to each other. The wisdom of the crowd is the most prominent reason for delegating (crowdsourcing) products. Best known comparable platform that uses this is Wikipedia. At Wikipedia every edit is implemented immediately and can be removed by higher ranked users if they incorrect, offensive or silly.
During our course we learend that controlling quality of submissions can be done by having specific terms and conditions, clear guidelines peer evaluation of content and punishment or public shaming (Tsekouras, 2015). However, the first thing that teenagers do when joining Wikipedia is to make a page about themselves or another try to edit a celebrity’s page. We now have seen that this can also be the case with Google Maps. Google claims that ‘the vast majority of users who edit Maps provide great contributions’, however internet users show that a manipulation is easy to make. What do you think of user generated content on the internet? Should it be better monitored or are we allowed to have a joke every once in a while?
References
- Google (2015). ‘Google Map Maker’. [Online] Available at: https://support.google.com/mapmaker/answer/157176. [Accessed on: 26-04-2015].
- Tsekouras, D. (2015). ‘Consumer Centric Digital Commerce session 3’. Business Information Mangement. RSM Erasmus University.
- Weir, A. (2015). ‘Android takes a piss on Apple on Google Maps. Seriously’. [Online} Available at: http://www.neowin.net/news/android-takes-a-piss-on-apple-on-google-maps-seriously [Accessed on: 26-04-2015].
Marketingfacts, watch out, the students are coming
We’ve got the content, we can create visibility, let’s go make this blog big!
If you are reading this blog post, great chances are that you are a student at the Erasmus University. If you are not, welcome to the CCDC website, where content is created by students and mostly written by students as well. The idea behind this website is to make long and extensive articles accessible and to highlight the USP’s of consumer driven companies and online networks, like Created on Friday and Skillshare. It is meant to be a learning tool, but if you scroll down the homepage, the generated content could also be compared to that of an online marketing platform, like the Dutch website Marketingfacts.
If you compare the CCDC website to Marketingfacts, two big differences appear. First, the content is created differently. In the case of Marketingfacts, the content generated by a team of professional bloggers (Marketingfacts, 2015), and in the case of the CCDC website, this content is generated by students. Second, the incentive of the content creators differ. Were the professional blogger may want to share his or her knowledge online, the student blogger will be obliged to create content, since they will be graded for the blog posts. That said, traditionally articles created by students will not have a purpose after the articles were graded. Now, their created content will live on as blog posts, what can cause for online visibility, next to serving the student’s graduation.
So why is this proposition, the student driven online marketing and C2C platform, currently so interesting? Why am I dedicating my blog post to a online platform which nowadays only can attract 1000 up to 2000 views a month? Because there are two things which make this platform unique compared to a more traditional online (blog) platform: secured content delivery and worldwide university connections. Since students currently are obliged to create articles, the amount and subject area of content can be determined by the professor, an advantage which is hard for a normal platform to copy. Besides, in-between universities and professor’s alliances are easily made. Professors from multiple disciplines and universities could join, and hereby add students to the creation group, which makes increasing the amount and diversity of the content easily done. These unique advantages make a quite interesting case for becoming a large online platform.
So, if the professor of this CCDC course decides to make this blog to go big, what should he do to control content quality and to create online visibility? Again, let your students do the work. Visibility can be created by individual sharing of the content on social media. Of course a platform account can start sharing the posts, but a large group of students together can cause for even a greater amount of views (LinkedIn, 2015). High quality can be maintained by letting the students rate the newest articles (Hu et al., 2009; Tsekouras, 2015). The ones with high rates stay on the home page for a certain time, making sure they are written, and the silly ones die in silence, so that they will not harm the platforms reputation. All-in-all, the ingredients are there, now we have to execute it right. Marketingfacts, watch out, the students are coming..
Click here to read the former post of this author: “Can we all start drinking beers all day long?”
- Hu, N., J. Zhang and P. A. Pavlou (2009). “Overcoming the J-shaped distribution of product reviews.” Communications of the ACM 52(10), 144-147.
- Tsekouras, D. (2015). VARIATIONS ON A RATING SCALE: THE EFFECT ON EX-TREME RESPONSE TENDENCY IN PRODUCT RATINGS.
- Marketingfacts, (2015). Colofon | Marketingfacts. [online] Available at: http://www.marketingfacts.nl/colofon [Accessed 26 Apr. 2015].
- Business.linkedin.com, (2015). Employee Activation | LinkedIn Elevate. [online] Available at: https://business.linkedin.com/elevate [Accessed 26 Apr. 2015].
Fire your sales team, Boost e-WOM participation!
Imagine, you’re on a birthday party without a mobile phone, tablet or laptop but you would like to have some information about a certain experience good because you’re considering a buy. I guess you might ask your friends or family relatives about their findings and opinions. Think again how you’re purchase decision looks like after they share a negative story about that related product….
In contrast with the traditional word of mouth ( face-to-face context ) , consumers use blogs, search engines, internet communities, social media, and consumer review systems to gather information and make informed purchase decisions. Due to the rise of internet and the development of phones, tablets or laptops, traditional word-of-mouth interactions are replaced/substituted by electronic word of mouth. So e-WOM, defined as “any positive or negative statement made by potential, actual, or former customers about a product or company, which is made available to a multitude of people and institutions via the Internet” (T. Hennig-Thurau, 2003) is an important source used during the path to purchase or so called customer journey. Upon that, previous research conducted by Bickart and Shindler, show that customers actually pay more attention to the information provided by other customers rather than those of the salesperson or marketers because they have used the product and is considered as more trustworthy.
Understanding the importance of e-WOM, e-commerce sites attempt to encourage their customers to produce more e-WOM because consumer-produced information provides potential customers with a sense of trust. But how can firms (Online retailers), encourage their customers e-WOM participation, what are customers motivations and how does it affects e-Loyalty (customer loyalty in the internet market) ?
Research done by Yoo, C.H et al. in order to examine the impact of e-WOM participation on e-loyalty, has shown that both intrinsic and extrinsic motives have an impact on e-WOM participation. Specifically, it was found that internal motivation most influences customer’s participation (fig 2). Customer’s participation is operationalized as the actual level of involvement and frequency in e-WOM writing and reviews. Customers participation behavior does have a significant impact on formation of Site identification. Site identification can be devided in (1) Personal site identification; the extent to which a customer thinks the image of an online shopping site matches his/ her own image, and (2) Social identification which refers to the identification that a customer feels with respect to interactions, via the e-WOM system, with other customers on the same online shopping site.( C.H, Yoo, 2013)
e-WOM participation behavior enhances social identity among customers. Additionally social identity plays a role in using the e-WOM system. It is for this reason important to maintain an e-WOM system for customers so they can develop a strong social identity on the site through enhanced interaction with other customers.
Finally, both personal and social site identifications have a significant influence on customer e-loyalty. Remarking, that personal identification has a stronger impact on e-Loyalty.
Conclusive, based on the conducted research, when e-WOM is well managed, it was shown that it has positive effects on the customer evaluation of the company and on intentions to repurchase.
Created by : Luut Willen
References :
Bickart, R.M. Schindler, Internet forums as influential sources of consumer information, Journal of Interactive Marketing 15 (2001) 31–40.
Hennig-Thurau, G. Walsh, Electronic word-of-mouth: motives for and consequences of reading customer articulations on the internet, International Journal of Electronic Commerce 8 (2003) 51–74.
Chul Woo Yoo, G. L. (2013). Exploring the effect of e-WOM participation on e-Loyalty in e-commerce. Decision Support Systems :DDS (2013)
Does Chatter Really Matter?
Let’s say you are planning to buy a new HP laptop. You have spent quite some time comparing laptops online and you have found that the HP Pavilion 17-f240nd perfectly matches your needs. The reviews that you have read seemed truthful and you have a feeling that you will be satisfied with your new laptop. You are glad to know how other consumers experience the HP Pavilion and what they all use it for. The internet with its online product reviews and ratings have made your life so much easier! After you have used your new HP you might even contribute a review, as you want others to know how you feel about the product. Even when you are dissatisfied with it, you might write a review as you want to prevent others from buying it. Clearly, product reviews can help consumers in making decisions and thus affect firm sales. However, are these product reviews also related to other important performance metrics of the firm?
Tirunillai and Tellis (2012) studied the relationship between user-generated content (UGC) and stock market performance of the firm. They examined product reviews and ratings (chatter) because these are rich in product-related information. Consumers frequently post videos or blogs about certain products, however these often contain too much information which is not always relevant to a specific product. Tirunillai and Tellis (2012) argued that the signal-to-noise ratio is too low in these types of UGC and is therefore not taken into consideration in their research. Various markets were taken into account over a period of four years (from June 2005 to January 2010). These markets range from personal computer and data storage, to toys and footwear. Among other, consumer reviews for HP, SanDisk, Mattel, and Nike were examined.
To start with, they found that most of the online chatter was positive. This result was found across all markets with an average of 75% of chatter being positive. Moreover, the volume of both positive and negative chatter showed an upward trend. This is beneficial for firms and investors, because the other findings show that the volume UGC predicts abnormal returns and increases in trading volume on the short-term as well as on the long-term. However, negative chatter has a significant negative effect on returns, whereas positive UGC has no significant effect on returns. Offline television advertising can be used to increase to volume of chatter and decrease negative chatter at the same time. Lastly, negative consumer chatter increases idiosyncratic risk, which is asset specific risk that is not correlated to market risk. Logically, firms should keep this risk at a minimum in order to not discourage investors.
The previous results are important for investors and managers. Investors that experience information asymmetry should turn to UGC in order to find more information about the firm’s performance. UGC often includes information that is not (yet) widely known and more importantly, when UGC includes a lot of negative chatter, investors should now know they should not invest in this particular firm. For managers it is important that they trace the negative chatter and take corrective action as soon as possible, in order to prevent losses in shareholder value. For instance, to counter negative chatter about a product, the firm can start broadcasting television ads. Based on the study and our own experience, we can conclude that consumer chatter is not only informative for other consumers, but also for firms and investors.
Source:
Tirunillai, S., & Tellis, G. J. (2012). Does chatter really matter? Dynamics of user-generated content and stock performance. Marketing Science, 31(2), 198-215.
Find information through people
Nowadays, a lot of start-up pitches start with: “We are the Google of “fill in…”. Zeef.com did not, Zeef.com is saying they will do/are doing (a bit) the same as Google, only better. That sounds not realistic, but is it though?
Zeef.com is competing with algorithms by using us, using our knowledge. The core-thought of Zeef.com is, that people are able to come up with better suggestions than Google’s algorithm does, everyone for a specific topic/subject within his or her knowledge domain. So, they, the founders of Zeef.com, asked themselves: why aren’t people with specific knowledge of topics doing the searching and filtering (Zeef = sieve) for us with regard to web-search: “It is time for human knowledge to advance where algorithms have reached their limitations.” (Klaas Joosten – founder, 2015)
How it works? Everyone can set up a page about a specific topic. Within this topic page you can create different lists for subtopics; for example a HTML list (subtopic) within the topic web-development (example). Within this list you are able to rank different web pages based on content of HTML. Finally, if someone is searching for programming information on Zeef.com, it proposes a specific page about programming based on views, rating, etc. all in order to let him/her find the information.
So, why do they think someone will create a page? Zeef.com integrates affiliate marketing within the pages; you can earn money by creating pages without using banners and other adds. If someone will buy something or clicks on specific content redirected by your Zeef page, both you and zeef.com will get a fee (if the specific webshop is using affiliate marketing).
In first instance it sounds a bit like startpagina.nl to me, doesn’t it? The concept is the same, definitely. However, within startpagina.nl you cannot compete within topics. This competition needs to increase the quality of the pages. Besides, you can embed a Zeef-list into your own (blog) website, totally adjusted to your design (example). Zeef.com wants to concur with google Adsense in this way (frido van Driem – co-founder, 2015).
We are better than google Adsense (Rick Boerebach – co-founder, 2015)
Does it have a chance to survive? They attracted over 8000 curators/list makers within one year, besides they raised an investment of 1,2 million euro, end of 2014 in order to “take over” the US market. On top of that the adjusted lists are a lot more inviting than AdSense banners, resulting in a 15x higher click-through rate (CTR) than those AdSense banners. However, there is a huge critical mass within this market, you definitely need to collect a lot of curators in order to be the standard for someone within web searching. Besides, there is a chance that people only create pages that results in earning money for themselves, instead of sharing the “right” content of their topic (Abuse their knowledge).
All in all, I like the idea and the opportunism of Zeef.com. I often think myself, wouldn’t it be great if someone who knows everything within this subject could help me out. However, maybe I am skeptical because I really like start-ups that want to beat the big boys by focusing on quality… Do you think I am?
Van Driem, F. Co-founder Zeef (2015), Zeef – Waar hebben wij het over?, In: http://articulum.nl/algemeen/zeef-waar-hebben-wij-het/, By: Van Breda, N.
Boerebach, R. Co-founder Zeef (2015), “Zeef”, in: https://fastmovingtargets.nl/episodes/rick-boerebach-zeef-wij-zijn-beter-dan-google-adsense/, By: Blom & Stekelenburg
http://www.sprout.nl/artikel/e-commerce/zeefcom-haalt-groeigeld-op-voor-amerikaanse-markt
Joosten, K. Founder Zeef (2015) “Zeef: About”, in: https://zeef.com/about
Why do people fill in reviews on online platforms?
With the new Internet technologies, traditional word-of mouth communication has been extended to electronic media, such as online discussion forums, electronic bulletin board systems, newsgroups, blogs, review sites, and social networking sites. Everyone can share their opinion and experience related to products with complete strangers who are socially and geographically dispersed this new form of word of mouth, known as electronic word of mouth (eWOM). This research is about eWOM which has become an important factor in shaping consumer purchase behavior. In early research is found that information provided on consumer opinion sites is much more influential among consumers nowadays.
For instance, eMarketer revealed that 61% of consumers consulted online reviews, blogs and other kinds of online customer feedback before purchasing a new product or service. In addition, 80% of those who plan to make a purchase online will seek out online consumer reviews before making their purchase decision (Infogroup Inc, 2009). Some consumers even reported that they are willing to pay at least 20% more for services receiving an “Excellent”, or 5-star, rating than for the same service receiving a “Good”, or 4-star rating (Comscore Inc, 2007).
Cheung et al. (2012) stated that we do not fully understand why consumers spread positive eWOM in online consumer-opinion platforms. Among the few existing publications, eWOM behavior is primarily explained from individual rational perspective with the emphasis on cost and benefit. Consumer participation in online consumer-opinion platforms depends a lot on interactions with other consumers. But why do people participate and are what stimulates consumers eWOM intentions?
The following variables were defined in this research as influencers of consumers’ eWOM intentions: Reputation, Reciprocity, Sense of Belonging, Enjoyment of helping, Moral Obligation and Knowledge Self-Efficacy. To test their theoretical framework they conducted a research using a sample of online consumer-opinion platform users from OpenRice.com. In total they collected 203 usable questionnaires.
After this study three variables were found significant: Reputation, Sense of belonging and Enjoyment of Helping. Sense of belonging had relatively the most impact on consumers’ eWOM intention. The result is consistent with previous eWOM marketing literature, where sense of belonging is an essential ingredient that creates loyalty and citizenship in a group. Also enjoyment of helping others is crucial in affecting consumers’ eWOM intention. Intentions to write about dining experiences in OpenRice.com demonstrate enjoyment of helping others. Consumers can benefit other community members through helping them with their purchasing decisions. Reputation is a small factor affecting consumers’ eWOM intention. This can be explained by some consumers want to be viewed as an expert by a large group of consumers.
The results of this research can be practical relevant in different ways. Online consumer-opinion platform could allow consumers to create their own personal profile to create a stronger sense of belonging to the group. Also platforms could apply reputation tracking mechanisms, so ‘’experts’’ can be found more easily. And last, the platform could provide a mechanism for contributors so readers can show their appreciation for the received reviews, like a chat.
References
– Cheung, C. M., & Lee, M. K. (2012). What drives consumers to spread electronic word of mouth in online consumer-opinion platforms. Decision Support Systems, 53(1), 218-225.
– ComScore Inc., Online consumer-generated reviews have significant impact on offline purchase, http://www.comscore.com/Press_Events/Press_Releases/2007/11/Online_Consumer_Reviews_Impact_Offline_Purchasing_Behavior2007.
-eMarketer.com., Online review sway shoppers, http://www.emarketer.com/Article.aspx?R=10064042008Last accessed.
– Marketingonline.nl, http://www.marketingonline.nl/nieuws/word-mouth-marketing-blijft-last-houden-van-roi-issues
How could you trust other users when they sell?
Don’t feel like cooking yourself, but you don’t have the time nor money to go to a restaurant? Shareyourmeal.net can solve this problem! http://www.shareyourmeal.net is a website, where people can offer their (prepared) food to their neighbours. The ‘Foodie’ (or in other words, the hungry person who doesn’t want to cook) can subscribe to the website and then see all the meals in his/her neighbourhood. The tool is not meant for any commercial interest, and restaurants and professional cooks are therefore kicked out. Cooks don’t get paid (they get a small amount to cover for the expenses of the ingredients), they merely cook for love & glory.
However, these kind of C2C platforms have some disadvantages. One of the problems is anonymity. Users could create fake usernames and as a user you generally don’t know who the cook is. But then how could a user be sure that this platform is safe? How do you know whether the cook prepared the food in a right, hygienic manner, and whether all the ingredients are safe? The website clearly states that they are not responsible for damage caused by any of the parties. So how could you trust the other users on the platform?
Continue reading How could you trust other users when they sell?
Consumer Value Creation 