The Informational Influence of Brand Communities
In today’s digital age an endless stream of information is often right in the palm of your hand. The pervasiveness of the Internet and the rise of mobile devices provides businesses with a valuable avenue to manage customer relations and gain a competitive advantage. Mobile phones and online customer feedback (OCF) enables consumers to make smarter choices much faster, because now consumers can easily find out more information about a product or service, as well as the experiences other consumers had with those products or services.
According to Nielsen’s 2013 Mobile Consumer Report, 94% of Americans own a mobile device, and 53% of own a smartphone. The Nielsen report also adds, “Smartphone owners in the U.S. are the most likely to use their device for in-store price comparison, online coupons and purchasing products,” and those activities include: “browsing products, price comparison and reading product reviews.”
Because of the availability of this information, there has been a fundamental change in the consumers’ mental model. The model is no longer stimuli, purchase, and experience; it is now stimuli, learn, purchase, experience, and share. By performing external searches for information to compare products and read reviews, consumers move from being passive to active shoppers once an advertisement or other stimuli is encountered.
Winning the Zero Moment of Truth
In his book Winning the Zero Moment of Truth, Jim Lecinski identifies this pre-purchase information search as the zero moment-of-truth, or ZMOT.
Lecinski defines ZMOT as: “A new decision-making moment that takes place a hundred million times a day on mobile phones, laptops and wired devices of all kinds. It’s a moment where marketing happens, where information happens, and where consumers make choices that affect the success and failure of nearly every brand in the world.”
According to Lecinski, the key for today’s marketers is to win this zero moment-of-truth. Why? Because marketers are no longer creating value with the product or service they provide; consumers determine what is valuable and they share that information with other consumers.
In his book The New Rules of PR & Marketing, David Meerman Scott adds, “Individuals don’t go to the web looking for advertising; they are on a quest for content. By providing information when [consumers] need it, you can begin a long and profitable relationship with them.”
To win the zero moment-of-truth, marketers should learn to facilitate and manage customer relationships and conversations to build trust and encourage word-of-mouth marketing (WOM) within online brand communities.
Brand Communities & WOM
So, what is a brand community? According to Babin & Harris, brand communities are “groups of consumers who develop relationships based on shared interests or product usage.” Consumers use the attitudes and behaviors of these brand communities as an influential source of information to help aid in his or her individual purchase decision. This informational influence is often related to experience, because consumers who have initiated the information have typically purchased the product or service in the past. Other consumers will often consult those who initiated the information before making a purchase decision to save money, time, or improve their lives in some way. The informational influence of a brand community is especially strong if they are seen as credible.
So why would people make decisions based off of complete strangers? Lecinski writes, “They don’t. They make decisions based on the opinions of people like themselves.”
Babin & Harris add, “Consumers are likely to spread WOM when a product is relevant to their own self-concept and when they are highly involved with the product category…WOM is affected in large part by the perceived value that consumers receive from products and services…The more value that consumers receive, the more likely they are to tell others about their experiences with products and services!”
By encouraging WOM through OCF on their websites, businesses become the key component of building quality relationships with their customers. Many businesses may even be hesitant at first to encourage feedback because they may think that potential negative feedback will scare other customers off, but that is almost never the case. Not every business is going to be perfect and consumers understand that. In fact, I would say that encouraging feedback (whether it’s positive or negative) is a good thing, primarily because it holds the business accountable for their products and services, which ultimately shows that they are trustworthy. If a customer trusts the business, they will trust the brand community. This, in turn, will have a positive impact on their purchase decisions whereby enhancing their value perceptions towards the business.