6c576module 5

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Amity Business School

Module V

Opinion Leadership Process

Diffusions of Innovations

Adoption Process.

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Opinion

Leadership

The process by which one person (the

opinion leader) informally influences the

consumption actions or attitudes of

others who may be opinion seekersor

opinion recipients.

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Opinion Leadership

OpinionLeader

OpinionReceiver

Opinion

Seeker

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Examples of Opinion Leadership

During a coffee break, a co-worker talks

about the ovie he saw last night andrecoends seeing it.

A person shows a friend photographs ofhis recent !a"asthan Desert #afarivacation and the friend suggests thatusing a polari$ing filter ight producebetter pictures.

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Special Issues

Opinion leaders are four ties ore likel% to

be asked about political issues, three tiesore likel% to be asked about coputers or

investents, and twice as likel% to be asked

about restaurants

Inforation seekers seek a &strong-tie'source when the% know little about a topic,

and &weak-tie' sources when the% have soe

knowledge

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Reasons for the Effectiveness ofOpinion Leadership

Crediility

!ositive and "e#ative !roductInformation

Information and Advice

Opinion Leadership Is Cate#ory$Specific Opinion Leadership Is a %&o$&ay Street

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Viral Mar'etin#

(u$$ )arketing

*ildfire )arketing

Avalanche )arketing

These terms describe any strategy that

encourages individuals to pass on a

marketing message to others;

The marriage of email and word-of-mouth

communication

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(ahoo)s Bu** Index

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+actors Leadin# to "e#ative ,ord$of$Mouth Behavior

Individual Factors

Product Involvement

Situational Factors

Attitudinal Factors

Negative

O!

Likelihood

ofRepurchase-

++

+

+

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,ord$of$Mouth in Action

" of

respondents

that useda referral

to make one

of these

purchases

over the

past year

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Motivations Behind OpinionLeadership

+he eeds of Opinion Leaders

+he eeds of Opinion !eceivers Purchase Pals

#urrogate (u%ers Paid (u%ers versus

Opinion Leaders

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%he "eeds of Opinion Leaders

#elf involveent #ocial involveent Product involveent

)essage involveent

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%he "eeds of Opinion Receivers

ew-product or new usage inforation

!eduction of perceived risk !eduction of search tie !eceiving the approval of the opinion

leader

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A Comparison of Motivations

-Excerpts.

O#$N$ON L%&'%RS O#$N$ON R%(%$)%RS

S%L*-$!#RO)%!%NT

!OT$)&T$ONS !educe post-purchase uncertainty or

dissonance "ain attention or status Assert superiority and e#pertise

Feel li$e an adventurer

!educe the ris$ of ma$in% a purchasecommitment

!educe search time

#RO'+(T-$N)OL)%!%NT!OT$)&T$ONS

press satisfaction or dissatisfaction

with a product or service 'earn what products are new in the

mar$etplace

'earn how to use or consume a product

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/ey 0ifferences Bet&een Opinion

Leaders and Surro#ate Buyers

O#$N$ON L%&'%R

Informal relationship with end-users

* Information e#chan%e occurs in the conte#t of a casual interaction

,omophilous (to a certain e#tent) to end-users

.oes not %et paid for advice

/ 0sually socially more active than end-users

1 Accountability limited re%ardin% the outcome of advice

2 As accountability limited3 ri%or in search and screenin% of alternatives

low 4 'i$ely to have used the product personally

5 6ore than one can be consulted before ma$in% a final decision

7 Same person can be an opinion leader for a variety of related product

cate%ories

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/ey 0ifferencesS+RRO,&T% +.%R Formal relationship8 occupation-related status

* Information e#chan%e in the form of formal instructions9advice

,eterophilus to end users (that is3 is the source of power)

0sually hired3 therefore %ets paid

/ :ot necessarily socially more active than end-users 1 ,i%h level of accountability

2 Search and screenin% of alternatives more ri%orous

4 6ay not have used the product for personal consumption

5 Second opinion ta$en on rare occasions

7 0sually speciali;es for a specific product9service cate%ory

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!rofile of Opinion Leaders

,%N%R&L$/%'

&TTR$+T%S &(ROSS

#RO'+(T (&T%,OR$%S

(&T%,OR.-S#%($*$(

&TTR$+T%S

Innovativeness

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!arket!arket!aven!aven

Individuals whose influence stems from a

%eneral $nowled%e or mar$et e#pertise

that leads to an early awareness of newproducts and services

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%he Interpersonal +lo& ofCommunication

+wo-#tep /low

0A counication odel that portra%s opinionleaders as direct receivers of inforation fro

ass edia sources who, in turn, interpret

and transit this inforation.

)ultistep /low0A revision of the traditional two-step theor%

that shows ultiple counication flows

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%&o$Step +lo& of Communication%heory

!ass !edia!ass !ediaOpinion

Leaders

Opinion

Leaders

OpinionReceivers

0the masses1

OpinionReceivers

0the masses1

Step 2 Step 3

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Multistep +lo& of Communication

%heory

!ass !edia

$nformation

Receivers

Opinion

Receivers4

Seekers

Opinion

Leaders

Step a

Step b

Step *

Step

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Issues In Opinion Leadershipand Mar'etin# Strate#y

Progras Designed to #tiulate OpinionLeadership

Advertiseents #tiulating OpinionLeadership

*ord of )outh )a% (e 1ncontrollable

2reation of Opinion Leaders

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'iffusion'iffusion#rocess#rocess

The process by which the acceptance of

an innovation is spread by

communication to members of social

system over a period of time

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&doption&doption

#rocess#rocess

The sta%es throu%h which an individual

consumer passes in arrivin% at a decision

to try (or not to try)3 to continue usin% (or

discontinue usin%) a new product

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Elements of the 0iffusion!rocess

+he Innovation

+he 2hannels of 2ounication

+he #ocial #%ste

+ie

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0efinin# Innovations

/ir-oriented definitions

Product-oriented definitions )arket-oriented definitions

2onsuer-oriented definitions

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!roduct$Oriented 0efinitions

(ontinuous

$nnovation

'ynamically

(ontinuous

$nnovation

'iscontinuous

$nnovation

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Amity Business School%elephone Innovations

Telephone

=ell Phone

Fa# 6achine

Telephone answerin% machines

=all forwardin%

=all waitin%

=aller I.

?an$in% by telephone

=all-promptin% systems

,old button

'ine-in-use indicator

!edial button

Auto dialin% feature

Touch-tone service

477 :umbers577 :umbers

Ability to send9receive email

Incorporate P.A functions

=alendar9Phoneboo$

@oice-activated dialin%

Switch from analo% to

di%ital

Include camera

!in%er stylesPlay %ames

Fa# modem

6obile fa# machines

,ome office systems

(combined fa#3 copier3

computer printer)

Plain paper fa#

Speed dial buttons

.elayed send

=opy function

Paper cutter

'iscontinuous

$nnovations

'ynamically (ontinuous

$nnovations

(ontinuous

$nnovations

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!roduct Characteristics %hatInfluence 0iffusion

!elative Advantage 2opatibilit%

2ople3it%

+rialabilit% Observabilit%

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Characteristics %hat Influence 0iffusion

(5&R&(T%R$ST$(S(5&R&(T%R$ST$(S %6&!#L%S%6&!#L%S

!elative

Advanta%e

Air travel over train travel3 cordless

phones over corded telephones

=ompatibility

"illette 6A=, over disposable

ra;ors3 di%ital telephone answerin%

machines over machines usin% tape

=omple#ity&lectric shavers3 instant puddin%s

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continued

(5&R&(T%R$ST$(S(5&R&(T%R$ST$(S %6&!#L%S%6&!#L%S

Trialability

Trial si;e ars and bottles of new

products3 free trials of software3

free samples3 cents-off coupons

Bbservability

=lothin%3 such as a new Tommy

,ilfi%er ac$et3 a car3 wristwatches3

eye%lasses

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%ime and 0iffusion

Purchase +ie Adopter 2ategories

!ate of Adoption

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&dopter&dopter

(ategories(ategories

A seCuence of cate%ories that describes

how early (or late) a consumer adopts a

new product in relation to other adopters

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Adopter Cate#ories

Innovators

1234

Early

Adopters

56234

La##ards

574

!ercenta#e of Adopters y Cate#ory Se8uence

Early

Ma9ority

6:4

Late

Ma9ority

6:4

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Innovators; 0escription

*/D of population @enturesome

@ery ea%er to try new ideas Acceptable if ris$ is darin%

6ore cosmopolite social relationships

=ommunicates with other innovators

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Early Adopters; 0escription

/D of population !espected

6ore inte%rated into the local social system The persons to chec$ with before adoptin% a

new idea

=ate%ory contains %reatest number of

opinion leaders Are role models

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Early Ma9ority; 0escription

D of population .eliberate

Adopt new ideas ust prior to the avera%e

time

Seldom hold leadership positions

.eliberate for some time before adoptin%

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Late Ma9ority; 0escription D of population S$eptical

Adopt new ideas ust after the avera%etime

Adoptin% may be both an economic

necessity and a reaction to peer pressures

Innovations approached cautiously

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La##ards; 0escription 1D of population Traditional

The last people to adopt an innovation 6ost Elocalite in outloo$ Briented to the past Suspicious of the new

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Sta#es in Adoption !rocess

N&!% O*

ST&,%

5&T 5#%NS

'+R$N, T5$S ST&,%%6&!#L%

Awareness

=onsumer is first

e#posed to the product

innovation

Ganet sees an ad for a new 6P player in

the ma%a;ine she is readin%

Interest

=onsumer is interested in

the product and searches

for additional

information

Ganet reads about the 6P player on the

manufacturerHs

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Sta#es in Adoption !rocess

Trial

=onsumer uses the

product on a limited

basis

Since an 6P player cannot be Etried li$e

a small tube of toothpaste3 Ganet buys the

6P player online from Ama;oncom3which offers a 7-day full refund policy

Adoption(!eection)

If trial is favorable3

consumer decides to use

the product on a full3

rather than a limitedbasis--if unfavorable3 the

consumer decides to

reect it

Ganet finds that the 6P player is easy to

use and that the sound Cuality is e#cellent

She $eeps the 6P player

N&!% O*

ST&,%

5&T 5#%NS

'+R$N, T5$S ST&,%%6&!#L%

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Amity Business SchoolAn Enhanced Adoption !rocess Model

#re-e7isting

problem or

Need

&wareness $nterest %valuation Trial

&doption

or

Re8ection

#ostadoption or

#ostpurchase

%valuation

%valuation

&doption or Re8ection

'iscontinuation

'iscontinuation or

Re8ectionRe8ection

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Amity Business School%he Relative Importance of 0ifferent %ypes of

Information Sources in the Adoption !rocess

$mportance

5igh

Low

&wareness

&doption

Trial

%valuation

$nterest

Personal and

interpersonal

sources

Impersonal

mass-media

sources

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Issues in !rofilin# ConsumerInnovators

Defining the 2onsuer Innovator

Interest in the Product 2ategor%

+he Innovator Is an Opinion Leader

Personalit% +raits

)edia 4abits #ocial 2haracteristics

Deographic 2haracteristics

Are +here 5enerali$ed 2onsuer Innovators6

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Ad Appeals

to +ashion

Innovators

6c576module 5

Documents