The conceptualization of electronic Word-of-Mouth (EWOM) and company practices to monitor, encourage, and commit to EWOM - a service industry perspective

Abstract

Objectives:

The purpose of this Master's thesis is to clarify the different elements that conceptualize the phenomenon of electronic word-of-mouth (eWOM) and analyze what may be the possible ways for service marketers to influence this recommendation-based communication.

Data and methods:

This study applied realism as a research approach. The sample collection method of Breazeale (2009) was utilized to understand the main elements of eWOM and what actions companies could implement in relation to eWOM. In total 40 articles were analyzed. In the empirical part, nine Finnish listed consumer service companies (response rate: 82 %) were interviewed with a semi-structured protocol. First, these companies needed to answer an online questionnaire, and based on these responds, questions were asked in 30-minute interviews. The online questionnaire was analyzed quantitatively, interviews qualitatively with thematic analysis. In addition, these companies' online channel practices were analyzed to support the findings.

Findings and conclusions:

Based on the literature review nine main elements were identified as part of electronic word-of-mouth: EWOM is opinion sharing between consumers about experiences (1) and opinion leaders have an influential role in the content sharing process (2). The interaction happens online via different platforms (3), is network-based, (4) and directed to multiple people (5). Electronic word-of-mouth is interaction without time and location constrains (6) and it can be anonymous (7). Because of the online environment, there may occur credibility issues that users consider (8). Still, Electronic WOM is increasingly present in consumers' decision process (9). EWOM is dynamic and distinct phenomenon.

It seems that there are ways for companies to get involved in eWOM and encourage online conversations between consumers. Based on the empirical semi-structured interviews and thematic analysis, a framework was developed to understand current actions consumer service companies are implementing to increase eWOM interactions between the consumers themselves and the brand. Sixteen elements were identified that are or will be present in interviewed companies' actions to encourage eWOM conversations. All of these elements are categorized under three main levels of companies' eWOM actions: monitor, encourage, and commit.

Meaning to the study program (IDBM): This thesis sheds light on an international phenomenon. EWOM is essential for marketers worldwide because its effects do not have geographical constraints. Also, this study focuses especially on managerial issues, which is crucial part of IDBM. In addition, this study tries to find ways for service companies to design actions that could encourage consumers to eWOM communication. EWOM should be taken into consideration in service design.