It involves two or more persons communicating directly face-to-face, person-to-audience, over the telephone, or through e-mail. Instant messaging and independent sites to collect consumer reviews are another means of growing importance in recent years. Personal communication channels derive their effectiveness through individualized presentation and feedback.
A further distinction can be drawn among advocate, expert, and social communications channels. Advocate channels consists of company salespeople contacting buyers in the target market. Expert channels consist of independent experts making statements to target buyers. Social channels consist of neighbors, friends, family members, and associates talking to target buyers. In a study of 7,000 consumers in seven European countries, 60% said they were influenced to use a new brand by family and friends.
A study by Burson-Marsteller and Roper Starch Worldwide found that one influential person’s word of mouth tends to affect the buying attitudes of two other people, on average that circle of influence, however jumps to eight or nine. There is considerable consumer-to-consumer communication on the Web on a whole range of subjects. On line visitors increasingly create product information, not just consume it. They join Internet interest groups to share information, so that “word of Web” is joining “word of mouth” as an important buying influence. Words about good companies travel fast and words about bad companies travel even faster. As one marketer noted one does not need to reach 2 million people to let them know about a new product it just need to reach the right 2,000 people in the right way and they will help to reach 2 million.
Personal influence carries especially great weight in two situations. One is with products that are expensive, risky, or purchased infrequently. The other is where the product suggests something about the user’s status or taste. People often ask others for a recommendation for a doctor, plumber, hotel, lawyer, accountant, architect, insurance agent, interior decorator or financial consultant. If we have confidence in the recommendation, we normally act on the referral. In such cases, the recommender has potentially benefited the service provider as well as the services seeker. Service providers clearly have a strong interest in building referral sources.
Communication researchers are moving toward a social-structure view of interpersonal communication. They see society as consisting of cliques, small groups whose members interact frequently. Clique members are similar and their closeness facilitates effective communication but also insulates the clique from new ideas. The challenges are to create more openness so that cliques exchange information with others in the society. This openness is helped by people who function as liaisons and bridges. A liaison is a person who connects two or more cliques without belonging to either. A bridge is a person who belongs to one clique and is linked to a person in another clique.
Many companies are becoming acutely aware of the power of word of mouth or Buzz. Products and Brands such as Converse sneakers, Hush Puppies shoes, JanSport knapsacks, KrispyKreme doughnuts and the block buster movie The Passion of The Christ were built through buzz. Companies such as Body Shop, USAA, Starbucks, Palm Pilot, Red Bull, and Amazon were essentially built by word of mouth with very little advertising. In some cases, positive word of mouth happens in a natural way.