A Literature Review On Online Reviews Vs Company Advertising

Question: Discuss about the Literature Review On Online Reviews Vs Company Ads. Answer: Introduction Purpose The purpose of this report is to explore on research on consumer preferences between company advertising and online reviews. It seeks to look into what mostly is preferred by the consumers, when purchasing products and services in the market and when finding the best businesses. It further explores the benefits and drawbacks of each method and gives a clear indication of what mostly is considered. It is an analysis of both the comparison and contrast of the two approaches among customers. Analysis: Online reviews In a recent research by the bright local survey, it has revealed that most consumers prefer online reviews in finding out about the performance and worth of the business. The survey revealed that in 2015, 80% of individuals admitted to trusting the online reviews more (Anon 2014). This survey revealed that consumers tend to trust the non-paid reviews by other individuals because these reviews are honest opinions of other people who have had contact with the business. These individuals believed that these online reviews could help learn about the business without bias unlike commercial advertising where the ads are paid for, and the message is more often fabricated. This survey further indicated that consumers considered reviews based on reliability, professionalism, and expertise in business mostly. With 27% percent considering reliability more. The survey indicates that 2/3 of consumers consider reading more reviews than considering the ads done by business through the media (The National Law Review 2013). Research has also indicated that, in every ten people, nine of them believe that online reviews and personal recommendation, take up an equal place. The online review has created trust in consumers the same way they would trust personal recommendations to a business by a friend or family. Benefits of Online Reviews Consumers have largely benefited from online reviews as well as the business being reviewed. Online reviews regularly offer free advertising to the company. Consumers often leave online reviews on social media platforms; this gives the business a wider exposure to more people especially if the review is positive. Secondly, according to Dennison and Montecchi (2017), 70% of consumers, trust reviews from other consumers. Thus enhancing a good relationship with consumers will make them leave, positive reviews that will attract customers in return. Thirdly, online reviews create credibility and trust towards the organization. According to a report by Bazaar Voice, customers have a high possibility of up to 82% to be converted, from the online reviews. It further reports that, when a business replies to reviews made by consumers, it increases the trust by 41% (Harrell 2009). This deed shows the business concern of its consumers. Lastly, online reviews assist the organization in improving the customer care services. This is majorly very positive to the organization when a business uses the negative reviews for constructive criticism to improve on its failures. Drawbacks of online reviews However, despite the numerous positive impacts online reviews have on business. There are a few cons. The first is the lack of negative reviews. Consumers tend to trust a business more if it has both positive and negative reviews. The National Law Review (2013) states that, if a company lacks negative reviews, 30% of consumers may consider its review as fabricated and not honest. Secondly, a single negative review could ruin the entire reputation of the organization and keep away customers. This could lead to loss of projected consumers. The last but the least, third party review sites, may be very expensive. This limits the business from using online reviews. Company advertising This ismarketing done through mass media, online media or print media, where a business pays for the charges. These ads are done to attract customers to the business. However, currently trust in these advertising methods have drastically gone down among consumers .according to research done by lab 42 (Cheung et al. 2009), it showed that consumers did not trust ads. According to the statistics gathered, 76% of consumers, termed ads as exaggerated with a lot of distortion. Another 87% of consumers believe that business ads are fabricated through either Photoshop or other means. More consumers portrayed their distrust in consumers because they believed that the company is biased when making these ads. However, a few consumers consider ads. Benefits of company advertising There are various benefits realized by business when using company advertising. For instance, in a survey in America, 86% of individuals rated T.V ads as the most influential when it comes to decisions on purchasing. Secondly, businesses have realized more sales as well from the company ads made in TVs and print media. This has been realized because they are those individuals who still are interested in ads made in the mass media. For instance, when advertising a mans product using a good-looking woman, men tend to be interested. These ads always have a way of eliciting attention and compelling consumers towards them. Drawbacks of company ads In the world today, a company's ads have more cons than pros. First, there is no guarantee. In advertising, a lot of money is used, but it does not guarantee that it will reach the targeted consumers. Secondly, consumers lack the interest in company ads. This comes from the fact that, most consumers consider company ads biased and fabricated. They find it hard to find out about the business through these ads because they do not give a clear outline about the business. Thirdly, advertising may at times pass the wrong message. Consumers interpret messages differently, and some ads may not communicate clear messages but may send the unintended message. Fourthly, advertising is an expensivemarketing method and may incur the unnecessary business costs. Lastly, most advertising messages, may not have the message consumers want to know about the business. Thus this may not assist the business much. Again repetitive ads tend to be more annoying to consumers, leading to disinterest (Harrell 2 009). Conclusion From the above analysis, it is clear that consumers prefer online reviews to the company ads when looking for an organization or in considering products and services. This is because of the various surveys were done on consumers. Due to these surveys, many more businesses have taken to include online reviews on their company websites or using third party business review sites, where they do it for the business. It has come to the realization of the consumers that 2/3 of consumers consider what other consumers say about an organization or their experience with the organization. This helps to gauge the consumers understanding of the business and acquire knowledge on the business products and services. Consumers have also taken to depending on recommendations made by consumers on social media platforms. The reason behind, the high percent of consumers who prefer online reviews is from the genuine and precise answers they find about business from other consumers, compared to the company ads that aim at making sales and attracting more customers to the organization. Consumers have been seen to appreciate both positive and negative reviews of a business made more than the companys ads that do not talk about any negativity concerning the business, making it look fabricated and one sided. From the different research made, only about 13 percent of consumers who never consider online reviews. That means the largest percent, considers more online reviews, and even have to read about six to ten different reviews to make an appropriate decision. However, some business like Deloitte has maintained, that ads still make substantial impacts on the business sales, although this does not increase the trust of consumers towards the organization. Due to the high number of reviews done on a daily by consumers; businesses have to be very careful in maintaining a positive reputation of the business. Within the last five years, there has been an increasing number of online reviews made by consumers. This has made online reviews the number one marketing technology recommended for business. Consumers are considered important aspects of the organization, and business should put more effort to ensure that consumers leave a positive review, and compel those not interested in reviewing the services of the organization each time. From the above analysis from different researchers, it is very clear that consumer satisfaction increases through reading reviews made by others and not just listening to the company ads. Consumers have lacked interes t in companys advertising messages because of the way these ads tend to be one sided. Company ads always focus on the positive side of the organization and never tell the consumers of any weaknesses an organization may possess. This leaves the consumers with a lot of unanswered questions, and thats why, consumers have shifted to online reviews, where they learn about a business on two sides. References Arnord, KJ 2014, Consumers Increasingly Reading, Trusting Online Reviews for Local Businesses. Marketing Charts, Issue Local Consumer Review. Cheung, MY Luo, C Sia, CL Chen, H 2009, Credibility of Electronic Word-of-Mouth: Informational and Normative Determinants of On-line Consumer Recommendations. International Journal of Electronic Commerce. 13, 9-38. Dennison, JA Montecchi, MA 2017, The Effects of Online Consumer Reviews on Fashion Clothing Purchase Intention. Prentice-Hall Grinberg, I 2012, Impact of online word-of-mouth on Amazon ranks in selected product categories. Available at https://hdl.rutgers.edu/1782.1/rucore10001600001.ETD.000066748. Harrell, D 2009, The Influence of Consumer-Generated Content on Customer Experiences and Consumer Behavior. London Publishers The National Law Review, 2013, Consumer Survey: 80% Say They Trust Online Reviews As Much As Personal Recommendations. National Law Review. 2013-07.