Customers believe is an important factor to making decision to buy. Believe is absolute conviction that the product will adequately satisfy ones needs. Businesses strive to increase their sales by increasing awareness, persuasion, and convincing of the target customers about their products in the market. The marketing process transfers the company’s belief and values to customers with an aim of making them believe and influence decision to purchase. Believe is linked to likability, esteem and respect that the product possess to create belief compatibility with the customers (Huh and Reid, 2007). Advertisements are public announcements or notices by an organization promoting use of a product or service or even an event. They recommend potential customers to prefer their products when deciding on products to buy. Online reviews are feedback from a customer about a product they have used. Online review is an electronic word of month from a customer evaluating the product.
The following literature review will analyze the past research on what customers believe between online reviews and advertisement when making decisions to purchase. The scope will be limited to age groups, geographical location of customers and nature of the products. The results of the literature review will be used to outline recommendations for businesses introducing new products in the market.
Literature Review: Advertisements and customer believe
Park, Lee, and Han (2007) defined advertising as a means of communicating through a certain medium to inform and persuade target consumers to purchase the company’s products. Advertisements present the most appropriate positive message of the product to create impression for consumers to purchase (Sher and Lee 2009). This has led to usage of the most creative, persuasive graphics, photos, and messages to reach and convince consumers to buy. Sher and Lee (2009) concluded that customers’ trust to information and content of an advertisement has an impact to purchase intention of a customer. They also concluded that advertisements should create trustworthiness in the target audience perception and mind in order to introduce a product and be accepted by the customer.
Park, Lee, and Han, (2007) found that less that 50% of people investigated believed advertisements. For instance, they found that only 40% believed the TV product advertisements placements. They also found that 12% of people believed that advertisements totally added no value to them. On the other side they found that 38% of people got the first impression from advertisement either from audio or visual messages.
Huh and Reid, (2007) found that 77% of male did not believe advertisements as compared to 55% that of female. They also found that target audience group less than 25years hardy believed in advertisement making 30%. This age group cited that advertisements were exaggerated and photo-shopped. People aged above 45 seemed to believe advertisements by 60%. Lastly, they found that 70% of rural residence believed the advertisements in comparison to 44% in the urban areas.
Online reviews and believe
According to Gretzel and Yoo (2008), online review is an electronic word of mouth. This communication is a consumer- consumer informational exchange that is out of experiencing a service or usage of the product. Online review is internet based communication that influences consumers’ purchase intention. The internet is increasingly being used to inform customers when making decisions to buy. Online review provides recommendations to customers when making purchase decisions.
Park, Lee, and Han, (2007) found that online review was used by 61% customers to make purchase decisions. Positive recommendations increase customers believe to the product or service. They noted that 63% of consumers were likely to buy products that had online review. Their research found that visitors who read the product reviews and interacted with product questions and answers were likely to buy by 105%. These customers also spent 11% more compared to customers who did not interact with the online review. They also found that bad reviews deterred buyers by 67%. They concluded that online customers review were 12times trusted by potential buyers compared to other description by the company.
Gretzel and Yoo (2008) found that online review was by 64% preferred for technological items and 72% for books. They found that 42.1% of hotel services potential customers read online review before making decision on choice for destination. According to Gretzel and Yoo (2008), age has impact on a customer’s visit online reviews. He recorded that 42.6% of age group between 16-22 years do visit customer review section before making decision to buy compared to 83.3% of age group 25years and above. Sher and Lee (2009) found that 47% customers in Britain reviewed products.
From the literature review, online review and advertisements are important avenues of creating believe and trustworthy to customer. Therefore I recommend the following for business introducing a new product;
The company should use informative message when advertising to avoid disapproval from potential customers.
The company should use the online review to build believe. This can be done by referring potential customers to the company’s website where products have been reviewed.
Consumer believes is based on satisfaction perceived or testified. Advertisements are less believed by customers because they are thought to be stage managed to create a predetermined impression. Customers believe online believes because they are testimonials from other customers. Customers believe electronic word of mouth and largely influence to buy. Therefore, business should pay attention to creating customers’ belief in order to increase its sales.
Huh, J. and Reid, L. (2007). Do Consumers Believe Advertising is Negatively Affected When Placed near News Perceived as Biased?. Journal of Current Issues & Research in Advertising, 29(2), pp.15-26.
The study aimed to explore if customers believe credibility of the advertisement if it placed in biased news or perceived biased. The study also aims to investigate the relationship between advertisement, credibility, and demographic characteristics. The paper used qualitative media factors and explanatory research design to meet it objectives. The study findings reviewed that the negative perception of the news did not affect their perception to advertisement. The study also indicated low consumer believes in advertisements.
Gretzel, U. and Yoo, K.H., (2008). Use and impact of online travel reviews. Information and communication technologies in tourism 2008,marketing pp.35-46.
The following study was based on the increasing importance of consumer generated content (CGC). The study aims to access how CGC informs potential customers to influence their decisions. The study uses web based survey, trip advisors and travel review websites to investigate the planning process as a recommendation from informed review. The study found that there was difference in gender, age and geographical location in usage of the review information in making of informed decisions.
Lee, J., Park, D.H. and Han, I., (2011). The different effects of online consumer reviews on consumers' purchase intentions depending on trust in online shopping malls: An advertising perspective. Internet research, 21(2), pp.187-206.
The study aimed at investigating the online consumer reviews and advertisements on the buyer purchase decision. The study also investigates the credibility perspectives of the OCRS. The study uses two way factory experimental research designs to understand the effect of trust that is in the online shopping and credibility in influencing purchase decisions. The research found that online shopping malls had higher level of believe due to customer’s review of the products.
Park, D.H., Lee, J. and Han, I., (2007). The effect of on-line consumer reviews on consumer purchasing intention: The moderating role of involvement. International journal of electronic commerce, 11(4), pp.125-148.
The journal analysis the online consumer reviews as a recommender and informants. The research aimed at investigating their impact on the purchase decision and sales of product. The study utilized elaborate likelihood model that explained levels of involvement and relationships. The paper found that quality of reviews had a positive impact to consumers purchase decision.
Sher, P.J. and Lee, S.H.,( 2009). Consumer skepticism and online reviews: An elaboration likelihood model perspective. Social Behavior and Personality: an international journal, 37(1), pp.137-143.
The study aimed to investigate the skepticism behavior of consumers online. The study is based on the the tendency of believe and disbelieve on reviews words online. The research used elaborates likelihood Model design. The study found that skeptic consumers based their beliefs on situational factors rather than the online reviews.