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The Value of Customer Recommendations

Stacy Wood
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With new channels of communication and old, marketers can deliver a dizzying number of advertising messages to consumers—by many accounts, the average American sees between 3,000 and 5,000 ads a day. Yet, perhaps in response to this fusillade, consumers have learned to better armor themselves against the marketing messages they encounter. The Persuasion Knowledge Model (PKM) describes the extent to which consumers develop a radarlike ability to discern content whose aim is to persuade and, further, how they develop a set of skills to deal with such messages (Friestad and Wright 1994). Some of my own recent research (with colleagues Adam Craig, Yuliya Komarova, and Jennifer Vendemia) uses fMRI technology to explore brain activity as consumers are exposed to potentially deceptive product claims. Our findings show that consumers’ deception-detection processes involve surprisingly rapid attention allocation. Potential advertising lies seem to jump out of the marketing environment and rivet our attention like a snake on a woodland trail.

Advertisements are often informative as well as persuasive; consumers know this and don’t dismiss ads out of hand. But they do assess the extent to which they trust or are willing to use such information. First, and most critically, consumers seek to evaluate the credibility of a marketing message’s source. Source credibility is the bedrock of trust that precedes persuasion. People judge a source to be credible if the source shows evidence of being authentic, reliable, and believable. In the old days of marketing, firms sought to increase the source credibility of their ads by featuring the endorsements of doctors, scientists, and other authoritative experts. Once consumers became more aware that these experts were being paid handsomely for their testimony, the practice became less effective. Celebrity endorsers, who often were not product experts, provided warm affective responses but little in the way of believable, persuasive arguments.

Consumers themselves are particularly important endorsers via word-of-mouth (WOM) messages. Our past understanding of WOM (when one consumer recommends a product to another) was that consumers perceive other consumers as highly authentic but of dubious reliability. As when one’s Uncle Joe touts the superior performance of the Brand X computer, the recommender is clearly a real person but may or may not be knowledgeable enough about the product category to make credible claims. Now, with WOM increasingly occurring through spreadable media, it is more difficult for a consumer to assess both the authenticity and reliability of unknown recommenders. The practice of rating consumers’ online opinions and recommendations (e.g., Yahoo! Answers) is a direct attempt to resolve the audience’s uncertainty about who really knows something worth knowing.

When consumers feel positively about their product experience, they know that their experience is real, are confident that it is correct, and can absolutely trust that they have their own best interests at heart. Who else could be as authentic, reliable, and believable? Thus, it is not surprising that the use of consumer-generated testimonials is a flourishing phenomenon—especially in online environments. Marketers have found creative ways to facilitate self-testimonials and to promote them to others as WOM through spreadable media formats. For example, a firm may offer its customers the chance to write about their experiences on the product website or to compose an essay or produce a video as an ode to the brand.

Brand managers encourage consumers in their target markets to write product-related testimonials because they believe, at least tacitly, that this form of promotion provides any of several benefits. First, testimonials provide addressable household information that can be used for data-mining purposes and provide text that can later be employed as copy input for advertising campaigns. Second, consumer testimonials promote brand involvement and drive positive WOM, especially through spreadable media. Finally, through the act of writing testimonials, there is the chance that participating consumers might be expected to strengthen their positive attitudes toward a brand.

This last assumption, that the mere act of writing a testimonial might increase a consumer’s already positive attitude, offers a powerful premise. Terry Shimp, Laura Smarandescu, and I recently investigated this potential for consumer testimonials to serve as self-generated advertisements (Shimp, Wood, and Smarandescu 2007). The data from our research show that consumer testimonials can act as a surprisingly effective form of advertisement, significantly increasing consumers’ brand attitudes. The mechanism by which this works seems to be one based on self-perception theory—a psychological theory that posits that we infer our attitudes from our past behaviors. In essence, a consumer may ask himself how much he likes Brand X and, recalling that he once wrote a testimonial for the product or created a YouTube montage, infer that he must feel especially positive about the brand—must, in fact, be in a relationship with the brand (Fournier 1994) or be connected to the brand community (for example, Muñiz and Schau 2005; Kozinets 2001).

However, our data also show evidence that, in some conditions, consumer testimonials can be a double-edged sword with the power to significantly lower brand attitudes. Our research found that the danger is easily avoided because the condition that leads to negative testimonial effects is one that the firm typically (and obviously unwittingly) creates itself. We found that prize-oriented incentives to participate in testimonial writing (such as contests, sweepstakes, and other competitions)—things firms commonly do in order to promote their collection of testimonials—create a situation in which consumers are motivated to exaggerate their experience in order to increase their bid for the prize. Even with a chance-based prize (e.g., sweepstakes), consumers tend to believe that a lackluster testimonial will not be allowed to win. In such situations, and again in accord with basic self-perception theory, consumers infer that their positive attitude toward the brand is not a function of their true feelings but rather a function of the prize for which they are competing. This leads consumers to later discount their original positive attitude.

What does this suggest to firms that want to benefit from the self-generated advertisements created by their consumers’ testimonials? First, this research says that the effort to encourage testimonials is well worthwhile—the testimonial writers are likely to find that their own attitudes become even more positive as they reflect on and publicly share their feelings. However, firms must be careful to create a testimonial-giving space that is clearly not linked to prizes or other financial benefits, a space that highlights the voluntary nature of testimonial contributions. In this way, the facilitation of consumer engagement and testimonials must occur in the social economy (moral/gift) rather than in a traditional commodity-based economy. This acts as a signal of credibility, not only to the testimonial writer but also to other consumers who read the resulting testimonies.

Finally, this research highlights a larger theme in persuasive messages and brand building. As consumers become increasingly discriminating in their interaction with messages from brands—with a sensitive and effective radar that seeks persuasive intent—it may be that the words consumers find most persuasive are their own. The tension for marketers will be to let consumers have the freedom to speak their own truth and to avoid either punishments or rewards that too directly attempt to manage that truth or to spread it to others. Firms may have to get used to the idea that, in the future, the marketing messages that build their brands will increasingly be not of their own construction but in the consumer’s voice.

 

References

Fournier, Susan. 1994. “Consumers and Their Brands: Developing Relationship Theory in Consumer Research.” Journal of Consumer Research 24 (4) (March): 343–373.

Friestad, Marian, and Peter Wright. 1994. “The Persuasion Knowledge Model: How People Cope with Persuasion Attempts.” Journal of Consumer Research 21 (1) (June): 1–31.

Kozinets, Robert V. 2001. “Utopian Enterprise: Articulating the Meanings of Star Trek’s Culture of Consumption.” Journal of Consumer Research 28 (1) (June): 67–88.

Muñiz, Albert M., Jr., and Hope Jensen Schau. 2005. “Religiosity in the Abandoned Apple Newton Brand Community.” Journal of Consumer Research 31 (4) (March): 737–747.

Shimp, Terence A., Stacy L. Wood, and Laura Smarandescu. 2007. “Self-Generated Advertisements: Testimonials and the Perils of Consumer Exaggeration.” Journal of Advertising Research 47 (4) (December): 453–461.

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