By Tom Ryan
Despite a cacophony of advertising vehicles vying for consumers' attention, word-of-mouth remains the most highly trusted among consumers worldwide, according to a global Nielsen survey.
In the survey, 78 percent of respondents said they trusted recommendations from consumers. High marks were given for WOM everywhere, although they varied by region. The highest trust levels were reached in Hong Kong, 93 percent; Taiwan, 91 percent; Indonesia, 89 percent; India and South Korea, both 87 percent; and Ireland, Mexico and UAE, all 84 percent. Europeans in general were least trustful, particularly in Denmark, 62 percent; and Italy, 64 percent.
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| Source: Nielsen Online Global Consumer Study April 2007 Base: All Respondents |
In a related ad medium, trust in consumer opinions posted online such as blogs also ranked fairly high, at 61 percent. North Americans and Asians generally found online opinions more credible than consumers in other regions, but the trust levels varied even more greatly by region. Ranking particularly high was Korea, 81 percent, Taiwan, 76 percent; India, 73 percent; Philippines, 72 percent; and Poland, 72 percent. The bottom five were Italy and Chile, both at 47 percent; Estonia and Lithuania, both at 46 percent; and Finland, 35 percent.
"The recommendation of someone else remains the most trusted source of information when consumers decide which products and services to buy," said David McCallum, the global managing director for Nielsen's Customized Research Services, in a statement. "Even though new media technologies are playing a role in 'globalizing' society, many purchasing decisions are still based on firmly held national and cultural attitudes. Furthermore, given that nothing travels faster than bad news - with estimates that reports of bad experiences outnumber good service reports by as many as 5:1 - the importance of responsive, high quality customer service is yet again highlighted."
The survey of 26,486 internet users across 47 markets in Europe, Asia Pacific, the Americas and the Middle East probed consumers attitudes on 13 forms of advertising. Other findings:
- Traditional advertising channels continue to retain consumers' trust. Newspapers rank second worldwide in credible advertising mediums while television and radio each ranked above 50 percent;
- Brand web sites were trusted by 60 percent of respondents, but brand sponsorships were only trusted by only 49 percent;
- E-media advertising received particularly low trust grades: search engine ads, 34 percent; online banner ads, 26 percent; and text ads on mobile phones, 18 percent. "E-mails I signed up for" rated 49 percent.
Discussion Questions: How important is word-of-mouth to a retailer and/or brand's sales performance? Do you think its appeal is getting stronger or weaker with globalization and the emergence of the internet? Are there retailers you can point to that have done a good job of seeking to manage word-of-mouth to a competitive advantage?