The Article “What Marketers Misunderstand About Online Reviews” by Itamar Simonson and Emanuel Rosen on Harvard Business Review’s website touched on several good points, in which we wanted to elaborate on here.
In this article, they make the point that many marketers are not marketing with social media in mind. Instead, they are marketing in a way that reflects they way they have always done marketing, regardless of their growing awareness of the prevalence of online reviews and other sources of peer-to-peer informational exchanges.
They stress the importance of knowing your influence mix:
“Customers’ purchase decisions are typically affected by a combination of three things: Their prior preferences, beliefs, and experiences (which we refer to as P), information from marketers (M), and input from other people and from information services (O). This is the influence mix. Think of it as a zero-sum game: The greater the reliance on one source, the lower the need for the others. If the impact of O on a purchase decision about a food processor goes up, the influence of M or P, or both, goes down.”
So as an example, a purchase one might make regularly, such as bread, may fall under the ‘P’ category. While a purchase that one may make less often, such as a television, may fall under the ‘M’ category, since they are “most likely to be swayed by packaging, brand, pricing, and point-of-purchase messages.”
The one key takeaway is that marketers should be asking themselves, “How can we get our marketing strategy to lean more toward the ‘O’ category?” Granted, not every industry will be as well-suited to tailor themselves to fit this category (such as a bread maker, like in the example above), but perhaps this is one of those things that could serve to benefit every industry, though it may not be readily apparent.
Regarding a lean toward O-category strategizing, “Companies in O-dependent markets can also diversify more easily than others, because new peer-to-peer information can overcome long-held conceptions about what a company is (and isn’t) good at. LG and Samsung have taken full advantage of this capacity, moving beyond their original core products (electronics) into a broad array of tech goods and home appliances.”
With such rapid change occurring in various industries daily, it has long been known that the ability to diversify is a necessary evil. While you may be excellent at producing high-quality bespoke suits, you never know when a need will arise to also start producing wedding gowns. It can be very challenging to get a pulse on the market, but once you do, as cliché as this may sound, it is important to set your sails to move with the wind.
Overall, it is important to firmly have a grasp on what your marketing mix is and be really aware of the key influence that online reviews, which are essentially the digital, modern-day form of good-ol’ word-of-mouth, are continuing to have on your bottom line.
What are your thoughts? Let us know in the comments below!