Problem Statement

Word-of-mouth (WOM) is oral communication a concept used for persuading consumers as it creates link between communicator and receiver regarding service or product and brand. The words are spoken for sharing brand or product information in spontaneous manner as individuals rely on WOM for reviews and recommendation for generating referrals (Sernovitz, Kawaski and Godin, 2006). The disadvantage is slow spread of communication as limited number of audience is attracted in specific time period. The WOM is a perception of human mind that includes sharing of experiences, believes and ideas as they are truthful. The introduction of Web 2.0 is initiated from social media a means to advertise product in business platform. In 21^st century social media has changed the way business is performed in past years as it has created its own world.

The creation of online environment has changed the way marketers and consumers communicate (Healey, 2011). The connection between consumers and brands for offering them personal channel is making use of social interaction and networking by implementing user centred technique. Every workplace is hiring its own social media analyst for establishing departments separate from advertising and traditional marketing. One such social network is Facebook established in the year 2004 present in more than 70 countries and having 600m users and more (Carlton, 2011). Facebook offers its customer to create profiles and explore them by having an idea about interests and lifestyle. When a product is created it needs to be marketed in the audience so Facebook helps in understanding the consumer needs.

The communities prevalent in Facebook where the members act as users are an important source for the marketers. This community helps in indentifying consumer likes and taste by segmenting, targeting and positioning strategies. The facebook groups and profile state the mission and vision clearly for attracting consumers for product marketing. The posts coming in Fan page contains information on upcoming events, videos, games, blogs and links. The events are shared for marketing the product as the messages sent to users can be tailored in aspects.   

WOM is not considered as shill marketing where people are hired for conducting conservations with consumers without any information. It is viewed as part of social communication as it impacts groups. This interpersonal process is traditional in nature not relevant in today’s competitive world. It works on 2 concept- diversity and conformity by passing the limited information. The social media marketing is influencing consumer by acquiring the right product information virtually.

In the era of technological changes it is important to use applications build on Web 2.0 for generating and exchanging the content. The consumers are making connections and promoting the brand in Facebook by passing on the ads to friends. The business scenario provides insight on persuasive power of consumers which is more for Facebook rather than traditional WOM. The groups in Facebook deals with channels for attracting consumers by adhering to self-status in form of product category as the content set becomes viral establishing social contacts.       

Research Objective and Question

The aim of the research is to analyse consumer power of Facebook in comparison to traditional WOM with regards to service or product marketing. The research questions are as follows:

• RQ1: What are the three factors affecting persuasion power in product marketing?
• RQ2: What is the persuasive power of Facebook?
• RQ3: How to compare the persuasive power of Facebook and WOM and their effect on company performance?

The question set helps in answering the project aim by providing schemes or options than implementing Facebook for surviving economic downturns. 

The actions undertaken on Facebook are for each individual by making it appear on news-feed status as notifications are sent directly to e-mails. The research proposal would make use of feedback and literature review for the consumer’s via questionnaires and surveys.  The benefits that would be addressed for conducting the proposal under the circumstances are:

• It would help the consumers to understand how traditional WOM and Facebook peruse consumers regarding the product
• The proposal would be providing a broad scope for understanding what factors peruse consumers in traditional and Facebook marketing of products
• The results generated from research proposal will help the workplace and researchers to gain an understanding in it

The outcomes of the study would focus on power of consumer persuasion with the help of traditional WOM and Facebook in relation to product marketing. The power helps in developing and analysing strategies for persuading the consumers to understand difference between traditional WOM and Facebook. The power of persuasion is residing with the consumers as they would have to make choice for understanding the element perusing the most. The research outcome is based on research questions or objectives stated in proposal as it would be used for answering data collections, analysis and findings in same manner.

According to Miles, (2013) persuasion marketing understands human psychology for developing techniques to market services or products. It is related with promotion aspect of marketing mix based on customer impulsive behaviour. In terms of internet commerce the marketing persuasion is inclusive of web page starting right from human psychology to designing of web as a part of the decision making process. As per Griskevicius et al., (2009) the various elements abiding by the persuasion marketing ate tailoring the right message for promoting the product by encouraging the visitors to follow the website by taking specific actions. The customer sensitivity factor needs to be considered by undertaking persuasive arguments depend on various factors like emotional state.

The marketers have to design the right kind of websites for attracting consumers in right manner for working on missed opportunities. As said by Thompson and Malaviya, (2013) the first aspects of persuasion marketing are neuromarketing that makes use of people psychology. It helps in making decisions by making a conscious reasoning. The second factor is copywriting by making use of the right phrases and words for making product description and texts too. As opined by Baker, (2014) it is a kind of making different copy by determining what is the most likely that needs to be produced for answering the question. The third factor is storytelling that evokes subconscious and emotional responses for dominating or joining in order to getting more analytical response. It makes use of words like empathy, resolution desire, familiarity and affection.

As discussed by Stiff and Mongeau, (2016) the last aspect is most important structured communication meaning a planned conservation that involves controlling dialogue or gathering information for presenting it to consumer. The goal is moving with the customer by encouraging the impulse for taking the right action and encouraging the use exploring website. As per Thorson and Moore, (2013) structured communication the messages can be explored further in the initial stages.

Project Justification

The study conducted by Hoven, (2010) Facebook user’s value is gaining knowledge that are brought from brands followed by fans. The benefit is realized by recommending brands to followers or fans and others people too. The reason people follow brands are for getting discounts meaning the customers are being supported for purchasing the things. As said by Telegraph, (2015) Facebook was set for text and images but, now even videos have become an important part of social network. The interactions taking place on video is now used with the help of Facebook too but, it’s overtaken by YouTube. The Facebook video is used as a measure of persuasion in the form of social network. The Facebook emergence is a marketing platform that takes into account directed and ushered in the personalised era.

The ads are targeted towards advertising inclusive of education, sex and so on by working in restrictions and on ad quality for generating viable traffic by advertising large and small business. As said by Greste, Cohen and Davies, (2017) it a platform that appeals to online advertisers and marketing specialist in online business. In previous times the customer were termed as audience for taking active part in information creation by gathering information and working in line to get insight on personal experiences. As discussed by Patel, (2015) on the flip side it can be stated that Facebook is spending $10,000 monthly by working as sales representative for helping in resolving marketing challenges. The social ads generated helps in improving marketing importance by discussing links used by Facebook users.

As per Ramsaran-Fowdar, (2013) Facebook is a marketing platform that gathers response by providing immediate feedback to marketing problems and questions in the given time period. Facebook helps in positioning the brand in right manner in consumers mind for developing the right marketing strategies. As opined by Trusov, Bucklin and Pauwels, (2009) traditional WOM is critical for companies to use as it does not last long in workplace and its effects could not be determined. The relationships generated works on the conversation that persuasive power of traditional WOM in less in front of Facebook as information spreads quickly. As discussed by Meuter, McCabe and Curran, (2013) the traditional WOM in marketing is involving brands and product by only attracting small consumer. A vast range of area helps in attracting customer by attracting only group of consumers as WOM is having less power.

The percussiveness regarding WOM helps in making the right decision by having a perception of being reliable, trustworthy and credible in nature. As said by Bughin, Doogan and Vetvik, (2010) the WOM makes use of face to face communication process in oral form by working in synchronous manner limited by diffusion. The reach is limited as it is both non-observable and anonymous in nature that is collected from relatives, peers, colleagues and friends. As per Ayofadipe, (2015) the consumer persuasion contents three elements- message, competition and audience for undertaking traditional WOM. The influence of consumers is generated through WOM communication with the advent and advancement of internet has increased. As said by Groeger and Buttle, (2013) the effect of online and offline WOM depends not only on consumer behaviour rather than attitude.      

Research Outcome

The comparison states that with the advent of online internet is having certain aspects in working in progressive manner. The interpersonal impact of positive customer satisfaction on customer loyalty and satisfaction is proving to be beneficial for consumers. As said by Kuei Huang, (2012) the information shared in traditional WOM is having limited access in comparison to social network site like Facebook where the access is wide. The central part of traditional WOM is involving consumers in the process by using the right effort and time allocated for gathering information.

Fig: 1 Conceptual Framework

The above image helps in understanding traditional WOM and social media tool Facebook for persuading the consumers by adopting strategic approach. A firm needs to adopt the right practices for taking right decision by managing the benefits gathered in comparison to traditional WOM. The problem was based on the research objectives and problem statement by undertaking research hypothesis in the following study:

• Null Hypothesis: Consumer persuasion power is not having any impact on Facebook but, on traditional WOM
• Alternative Hypothesis: Consumer persuasion power is impacted by Facebook rather than traditional WOM

The methodologies that would be used in this research proposal are:

• Literature Review- The study and analysis for the relevant literature would be based on the information generated from various sources. It includes journals, Google scholar, Science Direct written from several authors. A thematic analysis is undertaken for examining the content of consumer persuasive power for traditional WOM and Facebook product marketing.
• Data Surveys and Series (Data Collection Method)

The data is collected from surveys and series of data for generating information and scrutinizing the idea on comparing traditional WOM with Facebook for product marketing by persuading the consumers. The questionnaires would be prepared and handed to online consumers for gathering their feedback and reactions. The Likert scale would be used with five points (5 will be least effective and 1 will be strongly effective) and it is linked to WOM traditional and social media Facebook.     

• Key Indicators of Traditional WOM and Facebook: The critical information gathered works on collecting data from National Bureau of Economic Research by focusing on technology rather than traditional WOM.
• Data Analysis:

The data analysis used for the research is making use of qualitative and quantitative techniques where, qualitative data is collected from surveys, websites and online forums and quantitative analysis from pie charts, statistical modelling and scholarly articles. The technique used for qualitative data is descriptive in nature and making use of hypothesis testing and regression analysis would also be considered. The qualitative data gathered from literature review would be helping in establishing relationship by examining the surveys and online forums. The research that would be collected from online survey helps in working on modelling, figures and pie charts forms. This will be compared to persuasive power of traditional WOM with Facebook.

The research implied would make use of mix methods for working on the methodologies by arriving at the solution for working on identification of problem statement. The literature review would be providing an in-depth solution by gathering the response through questionnaires and surveys. It would help the researcher in working on relevant findings by arranging the data in first group together and working on categories and factors. The results presented and analysed with the help of sample charactertics, profile data and adopting strategies by using elements for comparing traditional WOV with Facebook. The data collected will be analysed in appropriate manner by considering both the methods for obtaining answers in form of traditional WOM and Facebook for persuading the power relying with consumers.                   

The organization study consists of the following:

• Chapter 1 it will be based on Research Proposal as it acts as an outline guiding the assignment
• Chapter 2 it is following the case study of persuading power of customers in Facebook and traditional word-of-mouth marketing for product marketing
• Chapter 3 it is working on details of methodology- data series, literature review, data collection methods (survey), key indicators of traditional WOM and Facebook along with data analysis methods
• Chapter 4 the report would be presented on analysis and findings for the proposed research
• Chapter 5 it contains summarized information on the discussion and findings generated on the implication for Facebook and traditional WOM for persuading customers.

Activities	Start Day	End Day	Time Period
Project Proposal	1/04/17	15/04/17	14 days
Literature Review	16/04/17	5/05/17	50 days
Data (Primary and Secondary) Collection Plan	6/05/17	7/7/17	60 days
Data Analysis	8/7/17	9/8/17	30days
Submission of Final Report	10/8/17	12/9/17	31 days

The budget proposed for the research is around $5000 for completing the project within the stipulated time period 12^th September, 2017as per the given Gantt chart. The budget would be having the following reasons:

• The Literature Review undertaken would make use of journal articles, online resources and textbooks and the cost would be around $1000
• The data collection would be collected through questionnaire and surveys including mailing, travelling and printing costs. The cost would be around $3000
• At last the government figures or tables or charts for accessing the data analysis as the budget proposed would be around $1000

Purpose	Amount Spent
Literature Review	$1000
Data Collection	$3000
Data Analysis	$1000
Total Budget	$5000

References

Ayofadipe, V. (2015). Traditional Marketing is Alive. International Journal of Online Marketing Research, 1(1), p.31.

Baker, M.J., (2014). Marketing strategy and management. Palgrave Macmillan.

Bughin, J., Doogan, J. and Vetvik, O.J., (2010). A new way to measure word-of-mouth marketing. McKinsey Quarterly, 2, pp.113-116.

Carlton, N. (2011). Facebook has 600 million users Facebook announced in July that it had crossed the 500 million mark. NBC News. [online] Available at: https://www.nbcnews.com/id/40929239/ns/technology_and_science-tech_and_ [Accessed 20 May 2017].

Greste, P., Cohen, J. and Davies, A. (2017). CRACKING THE CODE. Four Corners. [online] Available at: https://www.abc.net.au/4corners/stories/2017/04/06/4649443.htm [Accessed 20 May 2017].

Griskevicius, V., Goldstein, N.J., Mortensen, C.R., Sundie, J.M., Cialdini, R.B. and Kenrick, D.T., (2009). Fear and loving in Las Vegas: Evolution, emotion, and persuasion. Journal of Marketing Research, 46(3), pp.384-395.

Groeger, L. and Buttle, F. (2013). Word-of-mouth marketing influence on offline and online communications: Evidence from case study research. Journal of Marketing Communications, 20(1-2), pp.21-41.

Healey, J. (2011). Social impacts of digital media. 1st ed. Thirroul, N.S.W.: Spinney Press.

Hoven, M. (2010). he Persuasive Power of Studies About the Persuasive Power of Twitter and Facebook. AgencySpy. [online] Available at: https://www.adweek.com/agencyspy/the-persuasive-power-of-studies-about-the-persuasive-power-of-twitter-and-facebook/6965 [Accessed 20 May 2017].

Kuei Huang, Y. (2012). Marketing budget allocation and marketing benefits of traditional media, online advertising, and electronic word-of-mouth. AFRICAN JOURNAL OF BUSINESS MANAGEMENT, 6(33).

Meuter, M., McCabe, D. and Curran, J. (2013). Electronic Word-of-Mouth Versus Interpersonal Word-of-Mouth: Are All Forms of Word-of-Mouth Equally Influential?. Services Marketing Quarterly, 34(3), pp.240-256.

Miles, C., (2013). Persuasion, marketing communication, and the metaphor of magic. European Journal of Marketing, 47(11/12), pp.2002-2019.

Patel, N. (2015). Facebook is the new AOL. The Verge. [online] Available at: https://www.theverge.com/2015/1/4/7488495/facebook-is-the-new-aol [Accessed 20 May 2017].

Ramsaran-Fowdar, R. (2013). The Implications of Facebook Marketing for Organizations. Contemporary Management Research, 9(1), pp.73-84.

Sernovitz, A., Kawaski, G. and Godin, S. (2006). Word of Mouth Marketing. 1st ed. Chicago, USA: Dearborn Trade, A Kaplan Professional Company.

Stiff, J.B. and Mongeau, P.A., (2016). Persuasive communication. Guilford Publications.

Telegraph. (2015). Seeing is believing: the persuasive power of video. [online] Available at: https://www.telegraph.co.uk/sponsored/business/business-reporter/11558685/Persuasive-power-of-video.html [Accessed 20 May 2017].

Thompson, D.V. and Malaviya, P., (2013). Consumer-generated ads: does awareness of advertising co-creation help or hurt persuasion?. Journal of Marketing, 77(3), pp.33-47.

Thorson, E. and Moore, J., (2013). Integrated communication: Synergy of persuasive voices. Psychology Press.

Trusov, M., Bucklin, R. and Pauwels, K. (2009). Effects of Word-of-Mouth Versus Traditional Marketing: Findings from an Internet Social Networking Site. Journal of Marketing, 73(5), pp.90-102