Understanding and Defining E-Word of Mouth Marketing

Understanding and Defining E-Word of Mouth
Marketing and Its Impact on Hotel Industry in Goa

Abstract
This research involves the study of E-word of mouth marketing and its impact on the hospitality
industry in Goa. E-word of mouth marketing has swiftly replaced the traditional forms of word-
of-mouth marketing as technologies advanced. Because of the presence of several platforms on
social media, customers are able to express their viewpoints efficiently. People are now able to
share their experiences regarding tourism and hospitality industries with little inconvenience to
potential customers worldwide. In this regard, there are a variety of reviews available online,
including several negative reviews and comments as well. This study focuses on how these
positive, as well as negative reviews, affect consumer behavior while booking a hotel. To narrow
down the study to a particular area, the hotels in Goa are studied. The research carries a
significant factor as the digitalizing world, reveals that the future is dependent on social media.
Marketing is one of the important aspects of business and E-word is expected to be one of the
prospering ways of marketing with effective and productive results. The research would provide
some efficient findings which would help the business industry to grow and prosper through
various aspects. Data is collected through questionnaires in which both guests and managers at a
hotel are questioned regarding the impact of social media and online reviews on decision-
making. The study has exemplified that the E-word of mouth has a significant impact on the
hospitality industry in Goa because customers now trust more on online reviews. Through the
questionnaire, facts and experienced data would be collected. Through the 10 questions of the
survey and its acknowledgment and analysis would help in reaching to some productive and
realistic information. On the other hand, hotel managers also consider these reviews as reliable
sources to understanding the satisfaction level of the customers along with the drawbacks of their
customer services. In this way, e-WOM is influencing the hotels imposing competition in the
sector.

Acknowledgements
I would like to thank my supervisor ____________________ and co-supervisor
___________________ for their time, guidance and support in this research.
I would also like to thank my family members and friends as without their love and support I
would not have been able to complete this study.
I also want to thank all of my classmates as they have been very supportive of all my endeavors
and have helped me throughout the journey.

Table of Contents
Introduction
Literature review
Aims and Objectives of the study
Research questions
The rationale of the study
Methodology
Research reliability
Ethical considerations of the Study
Findings and Discussions
Conclusion
Limitations of the study and recommendations for future research

Chapter 1: Introduction
Introduction
Consumers tend to imitate one another by following a social paradigm. Explained as e-word of
mouth is a process through which consumers can share their opinions and information on the
internet which directs the buyers towards products and services. Such form of referrals differs
from its counterpart in the sense that they are electronic by nature and there exists no face-to-face
communication, the referrals are usually unsolicited which means that they are sent to those
recipients who were not in search for the information and perhaps may not be willing to pay
attention towards them (Godes and Mayzlin, 2004).
It has also been demonstrated by researchers that personal conversation, as well as the informal
exchange of information amongst people, tend to influence not only the choice of consumers and
their buying decision but, it also has the ability to shape consumer expectations (Anderson and
Salisbury, 2003), attitude before using the service, along with perceptions related to post-usage
of the product or service. One unique factor which distinguishes word of mouth from traditional
marketing aspects is the positive feedback mechanism between word of mouth and product sales.
This means that word of mouth leads to increased sales of products or services which tend to
generate more word of mouth and eventually more sales of the product or service (Godes and
Mayzlin, 2004).
The principle governing word of mouth has rapidly spread in the field of internet marketing and
online user generated content has replaced professional reviewers. It has become a new source of
obtaining information and is rendered to be electronic or e-word-of-mouth (e-WOM). According
to Dobele, Toleman and Beverland, (2005), advancement within information technology has
bought about several changes in the way of communication and these changes have imposed a
huge impact on consumer behavior as well as on their purchasing decision dramatically. The
World Wide Web serves as an opportunity where people can buy products or look for
information online. Within the context of word of mouth, the internet has changed how people
communicate with each other. Electronic word of mouth is similar to face-to-face or traditional
word of mouth except that the communication takes place online (Huete-Alcocer, 2017; Barreto,
2014; Carr and Hayes, 2014; Daugherty and Hoffmann, 2014).

There are many recent studies that quantify the influence of e-WOM has in the hospitality
industry concerning hotel operations and hotel managers (Anderson, 2012). The report intends to
determine the association between e-WOM and the operations of hotels in Goa.
Marketing provides the organization with the capability of being acknowledged by the people.
For the business industry, marketing is the tool to reach the people at large and gain in sales. The
traditional way of marketing has been providing the industry with productive results and it has
been enhancing the business sector too (Hughes and Sharrock , 2016). The business sector and
the marketing sector both develop simultaneously as both the industries act as a supportive
system for each other. Along with the technological development, the marketing industry has
grown and developed in a way which has provided with productive and enhancing results for the
business sector (Kim et al. 2015). The technological innovations have helped in enhancing the
marketing industry and the new digitalized inventions have provided a new approach towards
marketing. The E-word marketing is one of the most convenient and productive ways of
reaching to the people at large. Though the risk is quite high in this marketing tool, the
enhancing capacity and the acceleration in business are double the risk, it carries. The study
investigates the impact of e-word marketing tool in the hospitality industry of Goa as the
hospitality industry is the one which attracts the people to explore the online feedbacks for
making decisions (Ögüt and Onur, 2012). The consumer’s choices are dependent on multiple
factors and the exploration of consumer’s behavior and psychology is to be made through the
research.
The hotel industry has now become one of the most mature industries which have been hugely
impacted by the advent of information technology and the internet. During a trip plan, the hotel
stay is rendered to be an essential component (Ye et al. 2014). Studies conducted previously
identified four varying factors that impact the decision-making process of consumers for
different products and services. Concerning the hotel industry, these variables include price, the
service quality, features as well as the facilities provided (Liu, 2006).to assess the various
alternatives available, travelers tend to seek information from different sources on the web. As e-
WOM tends to spread wider and faster, it imposes a more powerful impact on the decision-
making process of the customers (Litwin et al., 2008). Travelers find for recommendations or
reviews made by other travelers through different online sources such as review websites,

forums, and blogs. According to Cantallops and Salvi, (2014), suggests that the hotel industry is
one of the most affected sectors by e-WOM in the tourism and hospitality industry. In addition to
this, Cheng and Zhou (2010), e-WOM imposes a very significant impact on travelers' selection
of accommodation at the time of planning a trip. With this increasing importance of e-WOM, it
is very important for hotel managers to understand the specifics of e-WOM. Research was
undertaken by Jeong and Jang (2011) there are very few researches related to customer
motivation about e-WOM. Gaining a clear understanding of e-WOM allows managers to how to
foster or encourage this aspect of effective marketing. This report will also include those factors
that motivate customers towards e-WOM (Cantallops and Salvi, 2014).
There are many industries that are well aware of the importance of consumer experience
(Nasution et al., 2014). Research suggests that the consumption experience of consumers is a
very important source of human motivations. The same research presents the fact that there
exists a positive relationship between consumption experiences and human motivation for the
publishing of e-WOM (Tian (2013). In the hotel industry, there are many successful hotel brands
which offer a multidimensional and unique experience to their visitors which affects their
behavioral intentions (Xu and Chan, 2010).
The rationale of the Study
A study done by Anderson (1998, p.15) reveals that only those consumers initiate WOM
communications who belong to the extreme ends of the spectrum, i.e. who are either extremely
satisfied or extremely dissatisfied. Moreover, bias has been seen in customer reviews in the
product-introduction stages (Li and Hitt, 2008). However, as seen by recent studies, prior
positive ratings can bias future ratings because of their social influence (Aral and Walker, 2012,
p. 337). However, Bright Local (2014) suggests that the reliance on online reviews and ratings
by other customers has been increasing year by year and influencing consumer buying behavior.
Online ratings constitute a kind of social influence that includes accepting the information given
by unknown people. Online ratings have become increasingly popular among consumers in the
context of making purchasing decisions, as it describes the services and quality of various
businesses including hotels or restaurants. As a matter of fact, the main difference between a
brochure of a hotel and its website is that the hotel website offers customer reviews and ratings
of their services (Xu and Chan, 2010). The study investigates the hospitality industry for