Impact of Price Promotion, Corporate Social Responsibility, and Social Media Marketing on Word of Mouth

-Business Perspectives and Research

Due to the increased competition among businesses in diverse markets, consumers have become more exposed to various product offerings, which would ultimately influence their decisions in selecting certain products or services for fulfilling their needs.

Among the key factors, which may enable consumers to rationally make purchase decisions is the word of mouth. According to Ghorban and Tahernejad (2012), a positive word of mouth has a powerful impact on determining brand choice, while unfavorable word of mouth impedes brand consideration. Prior research also documented that the spread of word-of-mouth communications among consumers leads to important implications for the growth of brands (Virvilaite et al., 2015).

Moreover, Ghorban and Tahernejad (2012) demonstrated that positive word of mouth represents an important marketing strategy for influencing consumer behavior and shaping purchase decision. The authors added that favorable word of mouth leads to greater brand loyalty as customers tend to trust the information shared by others who had a real experience in buying and using the offerings of certain brands. Therefore, marketing practitioners have recently focused on word of mouth for the purpose of strengthening their brands and obtaining competitive advantages in target markets.

Past research described word of mouth as a powerful marketing technique that plays an essential role in affecting consumers’ choices and brand preference (Casaló et al., 2008). Besides that, a number of organizations have utilized social media channels in the recent years for advertising their offerings in order to influence their consumers’ purchase decisions and stimulate them to develop favorable word of mouth messages about them. Farquhar (1989) indicated that providing reliable products and services, which grant customers with valuable benefits could enable organizations to generate favorable brand images and competitive strengths.

As a result, consumers tend to voluntarily participate in developing positive word of mouth with others and recommend them to buy from brands with positive images. Additionally, Jalilvand et al. (2011) argued that word of mouth represents a strong marketing tool for communicating the brand at a lower cost and reaching a larger number of customers quickly. Virvilaite et al. (2015) also regarded word of mouth as a key mechanism for improving brand strength and value. These views are inline with Hoyer and MacInnis (2001) and Cornelissen (2000) who acknowledged word of mouth as an important contributor to brand reputation.

Prior literature showed that in order to reinforce word of mouth communication among consumers, it is vital to use social media channels for reaching them. The emergence of social media channels has enabled the individuals to design their own contents with regards to their preferences granted them a space to express themselves on virtual communities (Gaber & Wright, 2014).

Organizations employ social media for communicating and interacting with their potential and current customers for the purpose of obtaining fresh insights and building strong relationships with them. Furthermore, marketing communication through social media has largely become an indispensable element of the integrated marketing program in promoting their goods and services.

However, in spite of the efforts placed by brands on marketing their offerings on social media channels, the consequences of such efforts are still not sufficiently investigated (Hoffman & Fodor, 2010). Hudson et al. (2015) stated that previous studies, which were directed for examining the effect of social media marketing on the attachment to brands and consumers’ word of mouth are limited.

Furthermore, Hoeffler and Keller (2002) considered corporate social responsibility among the foremost important factors in influencing consumers’ perception and word of mouth.

Nowadays, consumers have developed greater awareness about various environmental issues and ethical practice of businesses (Rudež, 2010). They expect the firms to act in favor of the citizens through providing beneficial services for the community where they operate, rather than focusing solely at generating profit (Crook, 2005).

Prior literature indicated that socially responsible programs enable the service providers to create desirable positions for their companies in consumers’ minds in target markets (Du et al., 2007), and such image tends to protect the brand from unexpected consequences that may occur during economic crises (Ulmer, 2001).

However, although prior studies have correlated corporate social responsibility with favorable outcomes, its effect on word of mouth is still not clear. Moreover, Eshra and Beshir (2017) stated that the prior studies on CSR activities and consumer buying behavior are scarce, particularly in emerging markets.

 

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