Some companies rely on product placement in movies or the endorsement of a sports star or pop singer to help create a buzz about their brand. But while the publicity generated through such routes can be powerful, it is also regarded as difficult to control.
However, according to INSEAD professor of marketing, Amitava Chattopadhyay, companies may have more control than they previously thought possible over the buzz about their new products - it is just a matter of being more systematic. In a recent working paper, Chattopadhyay and co-authors Jacob Goldenberg and Sarit Moldovan explored how managers can create a positive buzz about an innovative product. In addition to examining the buzz created by a product's perceived uniqueness and novelty, the authors of the study also looked at the impact that perceptions of product 'usefulness' had on its buzz.
They found that although originality is important in generating buzz about a product, if the product is perceived as 'useless', the content of the buzz will be harmful and will have a negative impact on consumer adoption and, ultimately, market share. Since managers have control over both the originality and usefulness of their products, they can have a considerable degree of control over word of mouth about the product as well.
"What we found was uniqueness or newness drives the propensity (for consumers and others) to speak about a product, but usefulness drives what they say about the product," Chattopadhyay says. "The evidence is clear - usefulness determines whether word of mouth is positive or negative; when you have a new product that is not useful then negative word of mouth spreads quickly and leads to that product dying quickly."
Negative reviews from influential sources of information such as friends or colleagues, if they gather momentum, can kill off a product: "Newness per se is not good, newness accompanied by lack of usefulness is downright dangerous. In the internet age, with email and blogs to speed up the spread of word of mouth (WOM), the rapid death of a new product is a virtual certainty, if it is perceived as not useful and worse still as useless and novel!"
The authors believe that understanding how to control WOM has important implications for managers. They say that as factors such as originality and usefulness are within the control of managers, they should focus on both when products are being designed and developed, as well as later on when they are promoted and positioned in the market.
Managers should "not be blindsided by just the novelty element," Chattopadhyay says, but they should make sure the products they are bringing to the market serve a purpose for the consumer. "Or to put it another way, that the consumer perceives this novelty to be useful. If it fails on the usefulness criterion then you will not succeed."
You can find the working paper: ‘What Drives Word-of-Mouth? The Roles of Product Originality and Usefulness' at www.msi.org.
Amitava Chattopadhyay holds the L'Oréal chair in marketing, innovation and creativity at INSEAD and is programme director of INSEAD executive education programme, Delivering Outstanding Services.