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The Impact of Ewom in Social Media on Consumer Purchase Decisions

Merve Turkyilmaz

International Burch University

Bosnia and Herzegovina
[email protected]

Mersid Poturak

International Burch University

Bosnia and Herzegovina
[email protected]

Abstract: Marketers define their social media platform as an essential piece to reach their consumers. The
flock of web users turning to social media to receive and convey their thoughts, opinions, and suggestions
has made social media an integral part of digital marketing. Using traditional media to advertise had
restrictions in placement and outcome while, nowadays, social media has liberated this obstacle. It has
created a platform which allows information to spread freely and at a fast pace. Using electronic word-of-
mouth in social media permits a constant connection to a vast audience. The purpose of this study is to
explore the effect of electronic word-of-mouth within the context of social media on consumer purchase
decisions. More precisely, how the familiarity of the eWOM source, the way of communication, writer’s
expertise and the popularity of a product affects the consumer's purchase decision. The data has been
gathered using quantitative research method. The sample consists of students studying in Timisoara,
Romania. The surveys were e-mailed to students’ e-mail addresses. Due to the lack of response from e-mails,
the responses were gathered using a mixture of door-to-door and online surveys methods. The questions
were answered by 200 students within a month. The results will provide the extent of impact eWOM in social
media has on the purchase decisions.

Key Words: Electronic word-of-mouth, Social media, Digital marketing, Purchase decision

Introduction

The constant escalation of the internet usage drove companies to mend their marketing strategies to
include the digital interactivity of their customer base. Digital marketing is defined as; “a
subcategory of marketing which uses digital technology to place and sell products.” It is the
marketers’ use of technologies such as; emails, social media, and word-of-mouth to engage with
their target group and generate sales. What sets digital marketing apart from traditional marketing is
the ability to comprehend the efficiency of the marketing campaigns while they are still being
served to the online viewers.

The choice procedure and psychosocial movement are involved in the phases of assessing, buying,
devouring or requesting any good or service. As the Internet advanced, along with globalization, the
buyers started to confront the issue of "perplexity by over-decision". The various brands accessible
for a similar item perplexes the customer to make up his/her mind on which brand to choose. Thus,

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there is a solid requirement for a medium to slice through the advertising "mess" and help shoppers
pick an item that will fit their needs. Electronic word-of-mouth plays the role of this medium.
Customers that decide to utilize this method for correspondence may have their buy goal adjusted,
particularly by individuals who has had a shopping background with that good or service (Nawaz et
al., 2014).

The way individuals see data sources influence their process of acknowledging the information
being provided (Hu, 2015). By the enhancements in web based shopping the significance of
electronic word-of-mouth has extremely increased. When shoppers get recommendations from their
closest or colleagues on social media they are able to instantly go to the websites which provide the
product or service. If the person thinks about the suggestions given by someone he or she knows,
the visit to the website can finish with purchase. This is one of the crucial elements which make
eWOM better than traditional WOM (Evans & Erkan, 2014). In other words, ads posted by firms on
social network sites is probable to be overlooked by the individuals because these advertisements
are created by the firm, and in this way seen as deceitful (Diffley et al., 2011).

Consumers are now in the position where they can immediately express their thoughts, give input,
acknowledge or question the activity of a brand (Chiosa, 2014). These actions are possible because
of the digital world we live in. By participating in web-based social networking, brands can create
showcasing techniques that improve customer dedication and carry on the positive picture of the
brand.

Literature Review

Numerous definitions of electronic word-of-mouth (eWOM) have been made throughout literature.
Hennig-Thurau et al. (2004) have defined this marketing strategy 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”. The sole difference
between Electronic word-of-mouth (eWOM) and traditional word-of-mouth (WOM) is identified as
the platform of communication being the Internet (Sørensen, 2010).

It is vital to comprehend the thought processes directing the online influencers to use electronic
word-of-mouth. Understanding the motives is fundamental for those seeking to urge the influential
individuals to spread messages. Knowing the thought processes in conveying online word-of-mouth
can help organizations to create messages that will improve the viral movement and focus on the
targeted customers.

The work of Hennig-Thurau et al. (2004) demonstrates the factors affecting the number of visits
and the frequency of these visits on online platforms. Their findings indicate that the dominant
reason for site visits is the social benefit. Furthermore, the number of comments is positively
correlated with the social benefit motive. The probability to advise a product based on an online
review depends on where the reader has found the comment (Lee & Youn, 2009). Readers are more
inclined to suggest the product when they have read it on and independent review website or the
brand’s own website. From another perspective, a negative correlation exists between the consumer
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expertise and consumer involvement. The consumer expertise has a negative impact, while the
consumer involvement has a positive impact on the potential buyers of the product in question
(Cheung et al., 2012). Figure 2 shows the motives of word-of-mouth communication identified in
the literature.

Figure 1Motives of word-of-mouth communication identified in literature

Source: Dellarocas, C., & Narayan, R. (2006, December). What motivates consumers to review a product
online? A study of the product-specific antecedents of online movie reviews. In WISE.

Park et al. (2007) emphasizes how electronic word-of-mouth has two different roles of either
becoming the channel for obtaining information or a sign of product popularity. However, the
extent to which the consumer is affected by one of these roles is based on the consumer’s intention.
Consumers tend to care more about reading the comments which give more clues about the product
when their intentions to buy are high. On the other hand, when their buying intentions are low, the
quality of the comments is not a priority. In this case, consumers are merely interest in the
popularity of the product in question. The confidence of the consumer increases depending on the
expertise of the writer and the purpose of the research (Chang et al., 2010).

Based on the findings of Hoffman & Daugherty (2013), the communication ties between firm and
consumers are not merely up to the content, the delivery effectiveness is just as important.
Apparently, customers give their time into creating eWOM via social media since they wish to have
any kind of effect by impacting product awareness and choices made by different purchasers. The
recommendations among female consumers are more effective when compared to male consumers
(Nadeem, Andreini, Salo, & Laukkanen, 2015). Even though users of a certain product or service
are unwilling to post their experience, they are likely to be affected by the comments they read on
social media sites because these sites are seen as platforms which are effective and valid (Yogesh &
Yesha, 2014).

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Research Methodology

According to the study of Perrin (2015), 90% of the teenagers from the ages 18 to 29 have a social
media presence. In this manner, the utilization of university students was considered suitable as the
sample group for the study. The aim of this research was to use descriptive statistics and gain an
insight on the importance of certain eWOM variables in social media on purchase decision.

Sampling Procedure

The research was conducted in Timisoara, Romania. At total of 200 students filled out the
questionnaire. While 172 of the replies came from Romanian students, 28 of them were attained
from international students studying in Timisoara. Female students comprised more than half of the
total responses.

Questionnaire Design and Data Collection

The questionnaire was formed using Google forms. It began with an introductory paragraph
explaining the reason for conducting the research and what their contributions meant for the data
gathering. Twenty straight forward questions were design and all besides the demographic
questions were 5-point Likert scale based. Each question was mandatory to reply while
confidentiality was promised. The survey had 6 short sections. The first three questions were asked
to understand the demographic background of the respondents; such as their age. The second
section was used to measure the impact of commenter familiarity and whether readers see known
source as more valuable. The third section focused on comprehending the importance on
bidirectional communication. The fourth section comprised of the expertise factor. Knowing that
only some of the comments are written by experts this section aimed to analyze the significance of
the writer’s background. The fifth section asked the frequency to purchase a product because of its
popularity. The final section consisted of questions directed to understand your purchase behavior
based on the comments on social media. A title and description for each section were added in order
to ease the understanding of the sections. This also helped the respondent clear any questions
regarding the aim of the research.

The students were reached by using their student email addresses and Facebook groups created by
different departments. Additionally, door-to-door survey approach was in order to reach the planned
number of responses. The survey was conducted from February 10, 2017 till April 13, 2017.

Results

Even though a total of 200 responses were achieved in this research, 172 of them were considered
to be the targeted sample. The 28 responses obtained from international students were excluded.
The three demographic questions asked to gain an understanding about the respondent’s
background profile were gender, age and their completed education level. The data was analyzed
using SPSS 18.0. The four variables analyzed were the importance of commenter familiarity, bi-
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directional communication, expertise and popularity of the product/service. Since descriptive
statistics was the only method for analyzes, the questions related to each variable were compounded
in SPSS. This enabled us to present a single descriptive table for each of the four sections.

The majority of the survey has been filled out by females with a 60.0% of response rate, leaving the
males 40.0% out of the total. 4 respondents are below the age of 18, 161 of them are between the
ages of 18-24 and 7 of them are 25 or above. These results lead to the conclusion that most of the
respondents were between the ages 18-24, making up 94% of the surveyors. Out of the total 172
respondents, more than half of them have finished high school and are studying undergraduate. 46
respondents have finished undergraduate, 22 of them have finished their master’s degree and only 1
has finished their PhD. The percentages based on the education levels of the respondents are 60, 27,
13 and 0.5, respectively.

Descriptive Statistics on the importance of the Familiarity of the Commenter on Social Media

The following questions were compounded in SPSS to obtain table 1.

• How likely are you to be affected by product recommendations posted on social media?
• Do you think that you are more likely to purchase a product because it was recommended
by someone you personally know? Such as a friend or family member.
• Do you consider the frequency of the communication between you and the recommender of
the product as important?
• Are you more likely to remember a product recommendation from someone you know?

As stated before, the total numbers of surveyors were 172. The mean is found to be 3.747 and the
median is 3.75. Out of a 5 point range these results show that the respondents are likely to be
affected the familiarity of the commenter on social media. The std. deviation and variance are .5779
and .334, respectively.

Table 1 Descriptive results on the familiarity variable

N Mean Median Mode Std. Deviation Variance Range

2.50
Familiarity 172 3.747 3.750 3.75 .5779 .334

Descriptive Statistics on the importance of the Bi-directional on Social Media

The questions compounded in order to analyze the second variable were as follows:

• Does the online communication with the recommender motivate you to make the purchase?
• Do you feel the need to contact the person who posted a comment about the product you
were planning on buying?

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 • Do you find all the answers to your questions about a product when going through the
comments?

Table 2 shows that the mean for the questions related to bi-directional communication is 3.093 and
the median is 3.00. Out of a 5 point range these results show that the respondents are quite neutral
when it comes to the importance of communication on social media. Meaning that, having the
opportunity to communicate with the commenter does now fall under any of the two extremes. The
std. deviation and variance are .7319 and .536, respectively.

Table 2 Descriptive results on the bi-directional communication variable

N Mean Median Mode Std. Deviation Variance Range

Bi-directional 3.67
172 3.093 3.000 3.00 .7319 .536
Communication

Descriptive Statistics on the importance of the Commenter Expertise on Social Media

The following three questions were used to have a single descriptive table for the expertise variable.

• Does the level of knowledge the commenter has on a product affect your purchase
decision?
• Do you feel the need to search if the commenter is an expert?
• Does the level of recognition that the commenter has affect your purchase decision?

The mean for the expertise factor (shown in table 3) is seen to be 3.455 and the median is 3.33. Out
of a 5 point range these results show that the respondents are more likely to be affected the
commenter’s expertise when compared to the communication opportunity. The std. deviation and
variance are .6479 and .420, respectively.

Table 3 Descriptive results on the expertise variable

N Mean Median Mode Std. Deviation Variance Range

3.67
Expertise 172 3.455 3.333 3.33 .6479 .420

Descriptive Statistics on the importance of the Product/Service Popularity on Social Media

The questions listed below were used for the last variable which was the importance of
product/service popularity.

• How often do you purchase a product because of its popularity among social media
users? The popularity could be the number of likes, comments, shares or retweets.
• How often do you prefer the popular product because of its social media presence?
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 • Do you find the popularity of a product to ease your decision making progress?

The mean of the popularity variable is found as 3.484 and the median is 3.66. Out of a 5 point range
these results show that the respondents are likely to be affected the popularity of the product/service
on social media. The std. deviation and variance are .7734 and .598, respectively.

Table 4 Descriptive results on the popularity variable

N Mean Median Mode Std. Deviation Variance Range

3.67
Popularity 172 3.484 3.666 3.67 .7734 .598

Conclusion

The descriptive analysis made in the previous section shows that the four variables do not possess
the same level of importance. The results indicate that the familiarity variable plays the most
important role out of the four. Social media users are prone to rely on comments they read from
friends and other acquaintances. Becoming informed by someone who you know by first hand
eliminates the doubt of reliability. On the hand, the opportunity to communicate with the writer of
the comment is found to be the least important variable. This provides an understanding that
Romanian students are rarely the initiatives of communication to gain more information on a certain
product/service on social media. When compared with the familiarity variable we understand that
our sample takes cognizance of immediately concluding whether or not the comment is reliable and
provides most of the information needed without the extra effort of contacting. The other two
variables analyzed were expertise and the popularity of a product/service on social media. The
results of both variables have shown that even though they are not considered to be as important as
the familiarity variable their roles aren’t as small as being able to communicate with the commenter.
That is to say, they fall in between the two.

The limitation of the study is that it was conducted in a single city and could be broadened to gain a
better understanding of the topic. A comparative analysis will be possible when more than one
country is involved. This will allow the researcher to comprehend the differences and similarities of
variables found to crucial in social media. The sample size can be bigger and number of variables
can be extent. Furthermore, certain SPSS analysis can be used to find if there is a statistically
significant value for each variable.

Companies need to focus on their own needs in order to use their social media platforms to the
fullest. The sample of this paper was found to be more concerned about the familiarity of the writer
on social media. However, a broader research with an expansion in sample size, variable and
geographic location will certainly provide a clearer answer for any future researcher. Conducting an
analysis by adding various countries will allow us to see this topic from a wider perspective.

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