E-WOM Issues and Challenges: A Study with Respect to the FMCG Sector

E-WOM Issues and Challenges: A Study with Respect to the FMCG Sector

Dhiraj Jain (Symbiosis Centre for Management Studies, India) and Yuvraj Sharma (Cognus Technology Ltd., India)
DOI: 10.4018/978-1-4666-9449-1.ch013
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Abstract

In the global era, Electronic Word of Mouth (E-WOM) has become an important emerging business strategy in the marketing and consumer environment. Along with the growth of digital connectivity and E-WOM, new ongoing challenges have also emerged for online users, businesses, and services. The chapter mainly aims to look closer upon how Electronic Word of Mouth faced challenges related to social, personal, psychological and human appeal in FMCG sector which influence customers as well as firms. The study used survey method to approach the respondents. The primary data was collected from 250 respondents and descriptive statistics and F-test ANOVA were used to test the significant of the association / non-association between variables. It was found that mostly customers have positive attitude towards E-WOM phenomenon. The study could help the FMCG Company in taking such steps that could make improvements in their business processes and expand their business without spending lot of money.
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Introduction

Electronic word-of-mouth (e-WOM) is a method of communicating with the customers to share their opinions and experiences on goods and services with a multitude of other consumers. It focuses on person to person contacts happening on the Internet (Hung, 2007). Marketers are also searching for low cost alternatives compared to other advertising media such as television and radio. More and more customers are sharing their online views and opinions regarding products and also exchange product experiences with other customers. E-WOM and social media have revolutionized the way in which information and experience is shared with each other in an effective manner. It has become an emerging business strategy in the evolving marketing environment. It has created a worldwide publically accessible network that is in the form of communication channels and platforms. Significant differences exist between the traditional word-of-mouth and the e-WOM.

Table 1.
Characteristics of Traditional WOM and e-WOM
Traditional Word of Mouth PublicityE-WOM
Interpersonal communication sets apart from mass communication.It makes traditional word of mouth more powerful. Information can be passed online in a quick manner with help of Internet such as text, images or even movies.
Main focus is on promoting commercial entities such as products, brands and services.It has a greater potential to reach a multitude of people at the same time in an effective manner.
Communication between the parties is perceived as unbiased and genuine.Allows people to share comments online, shape consumers’ attitudes towards a product; people’s trust on other people and the right connection and knowledge features make e-WOM more powerful (Hung, 2007).
Receivers are familiar with senders and high trust is established between them.Receivers are not always familiar with the senders and lack trust. It is informal and inorganic in spreading information among the customers about goods and services.
It provides a window of opportunity for companies to monitor and analyze word of mouth responses and enables them to share information by deploying the social sharing button compared to the traditional marketing methods (Hung, 2007).

The global community is able to access both positive and negative e-WOM comments about countless number of products and services offered by FMCG sector companies. Kavitha (2012) has opined in a study that FMCG companies in India have enjoyed a large potential market and offer a variety of products to consumers, namely soaps, detergents, healthcare products, grooming and personal care products etc. It comes fourth in terms of employment generation for more than 3 million people .The market was estimated to grow to over Rs 185,000 crore (around $37 billion) by 2014 (Kavitha, 2012).

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