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Role of Opinion Leaders in Purchase Decisions

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  • Information flows from Mass Media to Opinion leaders, opinion receivers/seekers and information receivers (who neither influence nor are influenced by others). The next step is the transmission of information from Opinion leaders to Opinion receivers/seekers. The third step shows the transfer of information & influence from opinion receivers to opinion leaders.
  • Information flows from Mass Media to Opinion leaders, opinion receivers/seekers and information receivers (who neither influence nor are influenced by others). The next step is the transmission of information from Opinion leaders to Opinion receivers/seekers. The third step shows the transfer of information & influence from opinion receivers to opinion leaders.

Role of Opinion Leaders in Purchase Decisions Role of Opinion Leaders in Purchase Decisions Presentation Transcript

  • Role of Opinion Leaders in Purchase Decisions
  • Consumer choice process is influenced by: Friends Family Opinion Leaders
  • What is Opinion Leadership?
    • The process by which one person (Opinion Leader) informally influences
    • the action or attitudes of others who may be opinion seekers or merely
    • opinion recipients.
    • How to use a specific product ?
    • Which of several brands is best ?
    • Which is the best place to shop ?
  • Impact of Opinion Leaders
    • One influential persons word of mouth tends to affect the buying attitude of two other people on an average*
    • Incase of Online, this figures goes up to 8 people on an average.
    • In a study of 7000 consumers in seven European countries, 60% were influenced to use a new brand by family and friends.
    * Study by Burson-Marsteller and Roper Starch Worldwide “ If you need to reach 2 million people then you just need to reach the right 2000 in the right way and they will help you reach 2 million”
  • Impact is Product Specific
    • Expensive, Risky & Infrequently Purchased Products
      • Laptops
      • Automobile
      • Real Estate
      • Financial Investments
      • Health Care
    • Products suggests Users Status or Taste
      • Restaurants
      • Travel Destinations / Hotels
      • Lifestyle Products
      • Golf accessories
  • How measure opinion leadership?
    • self-designating method
    • sociometric method – closed community and ask people what they think about something
    • key informant method – these are the central people
    • objective method
  • Personality of Opinion Leaders
    • They have a keener level of interest
    • More knowledgeable about the product category
    • Tend to be more innovative about their purchases than their followers
    • Are non-conforming, more self-confident, more sociable and cosmopolitan and socially higher on perceived risk.
  • Demographic Characteristics of Opinion Leaders
    • Opinion leaders tend to be younger, often with more education, higher income and higher occupational status
    • Opinion leaders for movies tend to be young and single
    • Opinion leaders for food purchase have been found to be predominantly married
    • In contrast, those for giving information and advise on medical services are predominantly unmarried
  • What Motivates Opinion Leaders?
    • Reason 1: They may use conversation as a dissonance reducing process for products for products they have bought.
    • Reason 2: They may want to influence a friend or neighbor
    • Reason 3: They want to be self-involved ,when they may want to confirm their own judgments.
  • Flow of Communication Mass media Opinion Leaders Opinion receivers/ seekers Information receivers Multi Step Flow of Communication Theory
  • Example - Automobiles Opinion Leader CONSUMER Car Magazines Websites Auto Shows
  • Case 1 - Movies
    • Minimum publicity
    • More “Word of Mouth” buzz
    • Worked more on recommendations and reviews
    • Influenced by friends, family and peer circles
  • Adoption Diffusion Model First Day First Show 2 nd & 3 rd Day – Sat & Sun First Week Later Weeks CD, DVD, TV Premiers
  • Case 2 – MouthShut.com
    • A platform for Opinion Leaders
    • Platform for writing reviews and rating products from any category
    • Platform to interact with people of the same interest groups and create communities
    • Get ratings and opinions on different aspects of products
    • Add members to your trusted circle based on the reviews they write
    • View overall ratings for movies, products, services etc.
    • Members can also in turn rate reviews to avoid biasness and invalid reviews
    • You can also rate products based on your experiences
    Case 2 – MouthShut.com
  • Case 3 – Tata Magic and Winger To change the way people in urban and rural India travel Tata Magic offers urban and rural areas a comfortable, safe, four-wheeler public transportation mode Tata Winger offers a perfect blend of the comfort of a car with the spaciousness of a bus for intra-city and long-distancetransportation needs - Combine Tata Motors’ traditional engineering excellence with strong customer orientation Influencing – Private transport operators , Vegetable vendors etc
  • The free browser, called "Chrome," is being promoted as a sleeker, faster and more secure alternative to Microsoft's Internet Explorer, which has been the leading vehicle for surfing the Web for the past decade Case 4 – Chrome, Google
    • Usage of cartoon characters as a strategy to create a loyal user base
    • THANK YOU!!!