The different roles of product originality and usefulness in generating word-of-mouth

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Sarit Moldovan, Jacob Goldenberg, Amitava Chattopadhyay

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newton pda, a victim of originality

Personal digital assistant developed by Apple Inc. (February 27, 1998)

FAILURE Inadequate handwriting recognition (product not perceived as very useful).Although this inadequacy was fixed in the next model, the Newton failed.

REASONS Newton was very original It was also useless in the beninning

WOM spreaded rapidly

New product category

Negative WOM

When product originality leads to negative WOM, which can destroy, rather than promote, a product?

product originality

SURPRISE MUCH WOM AMOUNT OF WOM

The more surprising and interesting a product is, the more WOM will be generated

Original new products will generate greater levels of WOM than less original new products

It’s the level of product newness or uniqueness relative to previous offerings.

It refers to how much people talk about the product.It can be measured as the contribution of each individual or the total buzz in the market

product USEFULNESS

VALENCE OF WOM

POSITIVE / NEGATIVE

HIGH USEFULNESS

It’s the evaluation of what users say

Valence could be either positive (recommendation) ornegative (warning or derogatory)

It’s the consumer's perception that a product or service provides a benefit that fulfills his/her needs.

When usefulness is high, WOM tends to be relatively more positive in valence

Originality of new products is positively associated with the amount of womH1People are more likely to share their opinions regarding an unusual or unexpected event

Feelings of surprise are correlated with the amounts of both positive and negative WOM

Original products are surprising and interesting, so consumers will be more interested in discussing them

Higher product performance generates more positively valenced WOM, whereas product malfunction generates more negatively valenced WOM

Not useful products are likely to lead to relatively more negatively valenced WOM

Usefulness of new products is positively associated with the valence of wom

NO WOM

H2Product usefulness could affect the amount of WOM People communicate:

when a product is original

when they believe that the information can help others:

If others are already aware of this product, there is no need to inform them of the product

If the product is not available in the market, it’s useless to talk about it to others

usefulness of new products INCREASES the amount of WOM only when others can benefit from learning ABOUT THE PRODUCTH3

Surprising and interesting, they

create high expectations on new

attributes

Lead to a positive attitude

ORIGINAL USEFUL

ORIGINAL AND USEFUL

ORIGINAL, BUT USELESS USELESS

Pleasant surprise of new

and superior utilities

Consumers may be interested in talking

about them, but they would be high disappointed

Lead to a negative attitude

MUCH WOM

NEGATIVE WOMNEGATIVE WOM

POSITIVE WOM

POSITIVE WOM

The effect of usefulness on the valence of wom is enhanced by product originalityH4The valence of WOM becomes:

MORE POSITIVEwhen the product is both original and useful

MORE NEGATIVEwhen the product is original and useless

examine the relationship between originality and usefulness and WOM analyzing a range of products 1

226 MBA students

20 new products (electronics, hedonic instruments, furniture)

Dependent variables: originality and usefulness

Independent variables: amount and valence of WOM

Questionnaire: every week participants were asked to fill in a questionnaire about a product.

Another questionnaire was held at the end of the study (20 weeks).

METHODAmount of WOM:

Originality increases the amount of WOM (H1)

Usefulness increases the amount of WOM (H3)

The combination of originality and usefulness lead to even greater levels of WOM

Valence of WOM:

Usefulness had a significant effect on the valence of WOM, while originality didn’t (H2)

Originality intensified the effect of usefulness (H4)

With non original products, the effect of usefulness on the valence of WOM is weaker, as the product is not as interesting to talk about

results

EXPERIMENT CONSISTING OF A MANIPULATION OF originality and usefulness of a single product by changing the values of one attribute2

71 students

The stimulus was a netbook, first described generally, then followed by a manipulated description of its battery

Dependent variables: amount and valence of WOM

Participants were assigned one of the 4 experimental conditions and tested with 8 WOM questions on a website

METHODThe fact of using just a single product for the tests, eliminated any possibility that the findings resulted from different types of products

It is possible to control and manipulate WOM by changing one attribute

single product results

VERY INNOVATIVE ATTRIBUTE

IT CREATES EXCITEMENT

THE ATTRIBUTE IS ALSO USEFUL

MORE POSITIVE WOM

ExaminE whether and how the perceived availability of a product moderates the impact of usefulness on the intention to spread WOM3

185 students

Stimulus: 4 products rated high/low on originality and usefulness in a pre-test, and described as available/unavailable in the local market

Dependent variables: amount and valence of WOM

Participants were assigned a link with one of the 8 experimental conditions and tested with 8 WOM questions

METHOD

It’s important to tell others about it

It’s interesting to hear about it

High usefulness + high originality = more positive WOM

Low usefulness + high originality = more negative WOM

Consumers may spread WOM when the information they provide can help others learn about products that they can benefit from

MOTIVATION OF WOM

results

ORIGINAL PRODUCT

MORE INTERESTING

MORE WOM

USEFUL PRODUCT

MORE IMPORTANT

MORE WOM (ONLY WHEN AVAILABLE)

1

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effects of originality and usefulness on actual online woM USING RECENTLY LAUNCHED PRODUCTS 4

Data: 37 products of Amazon.com (electronics category - “new arrivals”), and rated by 10 judges on originality and usefulness

3 months later, all the reviews posted on each product during the 3-month period were collected

METHODIf more people write a review, more people will also spread offline WOM about that product

More positive reviews indicate that consumers are happy with the product, which will lead to more positive offline WOM as well

It was measured each product’s sales rank to control the demand for each product

Originality generated more online WOM, while usefulness didn’t have any effect on it

Original products generated WOM, whereas useful products determine the valence of that WOM

The intention to spread WOM is reflected in actual online WOM behavior

ASSUMPTIONS results

SUMMARY

Originality and usefulness affect WOM differently:

Product originality increases consumers' willingness to exchange information and WOM

Product usefulness is responsible for the valence of WOM, but it may also lead to WOM if consumers believe that it may benefit others

Originality strengthens the effect of usefulness

Positive WOM is likely to be related to product success, whereas negative WOM to product failure

Originality increases the buzz about a product, which can accelerate the diffusion of product knowledge in the market, but it’s usefulness that determines the valence of WOM, and may therefore lead to product success