The Influence of Electronic Word-of-Mouth on Video Game Sales

This report investigates the significant impact of electronic word-of-mouth (eWOM) on the video game industry, focusing on its influence on consumer purchasing decisions. The research begins by defining eWOM and its evolution in the digital age, highlighting its role as a viral marketing technique. It explores the sources of information provided by eWOM, the buying intentions of customers, and the concept of perceived risk associated with online purchases. The report then delves into the research methodology employed, followed by a detailed analysis of the data and results. The findings underscore the importance of eWOM in shaping consumer behavior, particularly in the context of video games, where online reviews, social media comments, and personal interactions heavily influence purchasing choices. The study emphasizes the effectiveness of eWOM compared to traditional marketing methods and its role in providing consumers with valuable information, ultimately affecting the sales and performance of video games. The report concludes by summarizing the key insights and implications of eWOM in the modern video game market.

Impact of eWOM on the video game:
Effect on consumer purchasing
decision

Table of Contents
CHAPTER- 1: INTRODUCTION...................................................................................................1
1.1 Background.......................................................................................................................1
1.2 Aims and Research questions...........................................................................................2
1.3 Research rationale............................................................................................................2
CHAPTER 2: LITERATURE REVIEW.........................................................................................4
2.1 Definition of eWOM........................................................................................................4
2.2 the effect of eWOM on video games purchasing intentions............................................5
2.3 Source of information supplied by eWOM .....................................................................5
2.4 Buying intention of customer ..........................................................................................6
2.5 Perceived Risk..................................................................................................................7
CHAPTER-3: RESEARCH METHODOLOGY...........................................................................10
CHAPTER-4: DATA ANALYSIS AND RESULT......................................................................17
CHAPTER-5 CONCLUSION.......................................................................................................33
REFERENCES..............................................................................................................................34

CHAPTER- 1: INTRODUCTION
1.1 Background
This research seeks to access the impact of eWOM on the sales and performance of the
goods in which eWOM is referred as Electronic Word of Mouth. It can be considered as a viral
marketing technique that mainly focuses on maximising the word of mouth potential of a
particular campaign, product or a game (Breazeale, 2009). EWOM can be traditionally derived
from word of Mouth is a mode of communication which can be described as a means of sharing
opinions and comments regarding the services and products that people are trasacting. However,
it has evolved in a completely new form of communication which exploits the modern
technology. The advent and growth of digital age that is built on the foundation of computing
and internet can be seen as the development and adoption of new ways which asses the trend of
consumers. So the technological development is continuously embraced by the consumer which
allows them to use web tools to interact with each other. This marketing strategy is used to
capture the attention of large number of people in surrounding.
It is very efficient and a better way of exploring the use of the new product in the market
via internet. In eWOM, a business lay emphasizes on the person to person contact through
internet. So people can easily share their experiences about the use of product or application.
However, video games are one of the very fast influential applications that may influence the
desire to perform all such activities about which people are buzz marketing. Also, eWOM can be
commonly called as the marketing of the product in the form of digital as well as physical
channel. These social media technology is allowing the people to post the comments, reviews
and critiques on digital platform. This digital platform is a consists of weblogs, newsgroups,
discussion, forums, social networking websites and online newspaper. So, eWOM is a kind of
online consumer reviews which consists of the commentaries and various people suggestions in
using the web applications or products (Cheung and Thadani, 2017). So people who are the end
user of the product who have spent their money on applications and web services so they share
their last experience with the new users.
Electronic Word of mouth is one of the major factor in video games which highly effects
the purchasing decision of consumers. In order to obtain the relevant information and reliable
source of data about video games, more than 41% of the people nowadays relay on eWOM
which allows consumers to know about the effective and advanced features related to video
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games. So new video game users generally get to know about the functionalities through the
social media comments and reviews or the personal interaction with the friends and relatives
(Cui, Lui and Guo, 2012). This kind of eWOM is more effective in influencing the purchasing
decision of the consumers then any other social promotional campaigns such as magazines,
social networking sites, advertisements etc.
1.2 Aims and Research questions
To analyse the impact of eWOM on Video games that influence the buying decision of
consumers.
Objectives
 To understand the concept of eWOM
 To explore the concept of eWOM in video games
 To identify the influence of eWOM on buying decision of consumers
Research questions
1. What is the concept of eWOM?
2. What are different types of solutions that assist the people in exploring the impact of eWOM
on Video games?
3. How can we identify the influence of eWOM on buying decisions?
1.3 Research rationale
The main purpose of the research is to understand the significance Electric Word Of
Mouth on video games and also understanding the influence of eWOM on the buying decision of
the people. Significant improvement in the technology has leads towards the development of the
Word of Mouth towards the Electric Word of Mouth (Davis and Khazancht , 2008). This have
improved the communication of the people and also large number of people are attracted towards
the use of services online. Online interaction between the users in the form of reviews and
feedback allow new people to understand the main concept of such games and their
functionalities. Internet have enhanced the way people used to interact with each other. It enables
people to share their experiences of used applications such as smart video games and different
paid web services. According to the reviews and comments of the users people generally chooses
their services. So eWOM can be identified as the one of the reliable and valuable sources. It
provides effective information about new web services and games and thus it helps the consumer
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in buying such products. This study is very essential to understand the role of technology in this
advanced world. It helps in developing the skills and data collection knowledge of the readers.
In addition to this, Research plays the important role in developing the skills of electric
Word of Mouth. It allows customers to interact together and also communicate their opinions to
and views regarding the use of the latest smart video games and different web services.
Although, electric word of mouth attracted more and more number of people. Today, almost
more than half of the population seeks interest in consuming online web services. So commonly
they keenly participate in various web services and products and hence it moderates the role of
product type in customer's word of mouth (Floyd, and et.al., 2014). So ultimately, electronic word
of mouth influences the buying decisions of customers. When people prefer to shop online then
they mostly refer to the reviews and opinions of the users regarding the particular web services
so eWOM plays a significant role in influencing the decisions of buyer.
Nowadays, people feel pleasure in playing online games and watching different web
series so eWOM promotes such services among large number of teenagers. Large number of
online services are promoted and many online games are been used by millions of people on
daily basis so their preferences and choices of optimizing such services highly depends upon the
reviews of the people. When qualifying value, guests tend to associate with the amount of money
paid on services then personalisation and flexibility of the specified service may be rated
differently according to their perceptions. However, it can be interpreted as a promise of the
quality which provides the comfort to the people. Also, Electronic Word Of Mouth and its
emergence in the world have influenced the search and consumption behavior of the customer.
This may largely effects the purchasing power of consumer. Also, the emergence of various
social media platforms such as Facebook, Instagram and various popular social networking sites
now allow the consumer to share their opinions, views and converse with other consumers
online. EWOM can also be considered as one of the best medium in terms of consumer
communication via user generated sites. Also, the establishment of meta-search and comparison
websites in many industries have spurred on the increase of online reviews which have attracted
gained the attention of the researcher towards the factors that derives and influences the decision
of consumers. At the same time most of the people are attracted towards the most popular video
games which rapidly gains huge publicity and large attention of the people.
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CHAPTER 2: LITERATURE REVIEW
Prior to the Internet Era, consumers generally share their product related experiences
through the traditional method that is Word of mouth. This chapter reviews literature related to
quotations and advice of expert and non expert on the topic of Electronic Word of Mouth. This
helps in determining the customer intention factors with respect to the perceived credibility and
perceived risk which changes the customer purchase intention according exchange of
information between one person to another. This part of the study will provide various aspects
of eWOM that impacts on the buying behavior of consumer. This will be helpful in identifying
the impact of eWOM on video games which will influence people in buying different products. It
will going to discuss about the impact of eWOM on Video games according to the perspective of
different authors. This helped the people in exchanging their thoughts, opinions and reviews
regarding any product or services. However, the Internet's global nature has created an efficient
and effective medium for the interaction of the people across the world (Clark, 2018). This can
be called as Electronic Word of Mouth. Even this allows the communication between those
consumers who never met with each other in their entire life they may be earlier strangers to
each and evolution of the internet has provided a big opportunity for those strangers to become
friends.
2.1 Definition of eWOM
Electronic Word of Mouth has been recognized as one of the most influential resource of
information transmission since the evolution of the internet in the society. This phenomenon has
been the changing the behavior of the people because of the growth of the internet usage. People
even make the offline decisions on the basis of online information. Moreover, they tend to relay
on the opinions of other consumers specially at the ti me of watching movies and playing video
games. The eWOM enables the customers to write recommendations that influences the potential
consumers and rapidly changes their perception. This can be typically known as Online
Consumer Reviews (OCR) which is a kind of eWOM that enables various recommendations and
suggestions according to the different perspectives of the customers (O’Reilly and et.al., 2016).
This has been increasingly changing the world as the people generally continue to purchase
various online services such as video games and different entertaining applications. When a
person has to pay for the online services and consumer cannot judge between the variety of same
type of products then they often relay on eWOM. This transfers mitigate risk regarding the
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truthfulness and quality of the product. So this ultimately effects the buying decision of the
consumers, so online Consumer Reviews play the major role in influencing the decisions of the
people to purchase the online services.
2.2 the effect of eWOM on video games purchasing intentions
According to the latest opinions from the research corporations, nearly 2/3rd of the people
prefer online reviews in order to identify the quality and last experiences of the users. In addition
to this, a report made by National Research company which can be considered as one of the most
effective and trusted advertising method is considered as consumers opinions posted on the
network. Moreover, as per the Nielson Global Online consumer survey, 70% of the people
mainly trust on the online opinions posted by various product as well as internet users. This can
be now called as one of the effective method to differentiate between the quality of different
online services. So in response to this eWOM plays the important role as it often includes the
suggestions, comments, reviews and different types of queries coming from consumers (Flick,
2018). Throughout the eWOM activity consumer can obtain high level of information in terms of
market transparency which may provide the comparison between different industries in terms of
prices, quality and effectiveness of the products and services.
According to Hennig-Thurau et al., 2016 Video games are one of the most effective
entertainment source for most of the people. With the evaluation of the internet, software
developers are often trying to introduce new features. As people influence rapidly by such online
services so they even quickly bored with the same video games so they want more effective
sources. So software developers are introducing very advanced feature to attract large number of
users towards buying such services.
2.3 Source of information supplied by eWOM
According to the information and data published regarding the use of Electronic word of
mouth, this research identify the main concept of eWOM in this technological world. EWOM
can be refers as any attempt by a former, potential or actual customer in order to highlight the
negative and positive attributes of the products and services which are available on the online
platforms. The Latest goods related to online video games and adventure games gives pleasure to
the minds of people. Generally people are more conscious towards new kind of online games
which brings energy and more enthusiasm in the minds of customer (HUANG , HSIAO and
CHEN, 2017). Technology has not only enhanced the entertainment of the people but also it has
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also reached towards the large number of people worldwide (Jaenisch and et.al., 2018). These
online web services and games not only provides pleasure to customers but also people take it as
a source of generating money so customers are looking forward to participating in this profit
generating entertainment industry. So electronic word of mouth has created a long lasting
impact on perceptions of the people in choosing the best web services in the form of social media
reviews and comments of people.
Unlike the role of offline eWOM customers often relay on experts advice for the source
of information where it may be unclear in some contexts due to the limitations to access the
identity of the online user. Not it has been identified that non expert eWOM usually creates
greater influence on customer's perceived credibility because the customers generally tend to
relay on the opinions of other consumers regarding buying the online products and services such
as video games.
According to Cheng & Thadani (2017) eWOM is one of the most effective communicator
and conceptual receiver that investigates the factors related to products services. According to
the views and opinions of many researchers, it is found that Electronic Word of Mouth is the
most powerful communicator between receivers who perceived different online web services.
EWOM leads to the great effects on the games as online services are very popular among most
of the people across the country which encourages the customers in playing trendy games with
other peoples who are sitting online to compete with them.
According to the different functions and communication forums, eWOM can be
categorised into four sub divisions. The first one is referred as a specialised eWOM that enables
the users to leave their reviews and comments about the features and use of web services. So
online video games have gained more popularity in this technological world. So the impact of
video games held on society is incredible (Kumar, 2019). Improvements can come in a variety of
ways because of technological growth among the people. Video games are an important piece of
many economies as it leads to the technological growth and betterment of the society as a whole.
2.4 Buying intention of customer
Although, social media eWOM is not well developed as other social networking sites
such as Facebook, Instagram, etc. instead, the effect of viral marketing on social media cannot be
underestimated (Kudeshia and Kumar, 2017). Widely popular online video games have also
reached the popularity among large number of player that often downloads the various online
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web services. Before people pay money for the online services, generally they investigate the
functionalities and popularity of such services. Features and popularity of such online video
games can be determined by the views and perceptions of the people. So eWOM plays the
important part in determining the uses and features of those online web services. This result in
significance impact eWOM on potential customer and it also influences the buying decision of
customer.
2.5 Perceived Risk
According to Wynn and et.al., 2018 the concept of risk is defined in terms of uncertainty
and consequences that are associated with unexpected customer intentions. Perceived risk can be
considered as uncertain situation in which consumer cannot predict the consequences of the
buying intentions. This level of disruption at the time of purchasing the products so this may lead
to the negative impact of the product on the first random users. Although, regarding the previous
research about purchase intentions, perceived risk usually appears when customers are lacking in
information about the use of product or any reviews from the side of other people. So higher risk
may leads to the lower purchasing intention. The previous researches have mentioned that
eWOM is one of the most influential element that helps in decreasing the customer's perceived
risk by providing various suggestions about the use of online products or services. Also, eWOM
can effectively increase the brand awareness and increases the possibility of influential decision
of the people in purchasing a popular product and it can be completely identified through
reviews and previous experiences of the people.
In addition to this, there is a little research that investigates the differences or the impact
of eWOM on video games on the perception of the customers regarding the source of
information on purchase intention in online video games. Hence, this study will expose the
relationship between perceived risk during the form of purchase intention which is based on
determinants.
This section has reflected on the literature reviews of previous and recent researches
which are mainly relates to eWOM. This has provided various source of information in eWOM
which influences the purchasing decision of the customer. There has been several concepts
which considers use of social media strategies to influence large number of people towards the
consumption of services. Also, the study has discovered that buying decision of the customer
may relay on the experiences of the previous users. These experiences are shared via customer
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feedbacks and reviews based on their perceptions which they had during the consumption of
product or services (Elwalda and Lu, 2016). According to persuasion research, there is a
presumed relationship between attitude and behaviour of customers. People's attitude can be
determined by several factors source factor, receiver factor, message factor and context factor
(Sunand Lipsitz, 2018). It implies that different sources in electronic word of mouth influence
people's attitude and behaviour to varying extent. So this study on eWOM would contribute
towards better understanding of the customer's behaviour. The Elaboration Likelihood model can
be used to explain the perceptions and decision making process of influenced behaviour. In this
model people generally refer to outside sources such as reviews and comments of people which
help the customers in decision-making. Thus, high involvement and ability of people to process
the information from the online sources influence the buying decisions of consumers. Moreover,
this part has provided the comprehensive view regarding the use of eWOM in influencing the
buying decision of the consumers with respect to the impact on online video games.
According to the recent survey there are various credible sources that determines the
interest of society among availability of online games on internet. So people are generally
engaged towards various entertained and adventurous games. So this kind of viral marketing
helps in promoting such web services towards the large number of people via internet. Reviews
and comments of the people in consuming such services determines the popularity of such online
games. Such posts and reviews help people in identifying the uses of web services thus it
influences the purchasing decisions of the customer (Lee and Shin, 2010). There are different
kinds of comments and posts are there which justifies the preferences and perceptions of the
people regarding different web services, applications and online video games. EWOM also
promotes the communication between different via internet messages and reviews. There are two
kinds of reviews available online such as negative and positive comments. Negative comments
derives negative influence of the customers while positive reviews changes the perception and
preferences of consuming such online web services. Importance of eWOM while searching for
the services and goods depends on the feedback and reviews of other people. This effects the
Electronic word of mouth on product judgement and choices as it describes the moderating role
of virtual community in the reality (Yayli and Bayram, 2010). When people generally wants to
buy a product then customers basically investigates about such choices of consuming web
services. Customers either acquires the information online or considers the opinions and advices
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coming from friends and family. So Electronic word of mouth plays the important role in
influencing the buying decisions of people.
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CHAPTER-3: RESEARCH METHODOLOGY
Research methodology is a process that can use to collect and gather the information for the
purpose of research project development. It helps for analyzing and evaluating the concept
regarding the development. It may includes survey, research technique, publication and could
include the both type of historical and present information. Research methodology is a basically
the philosophical framework withing the research that conduct the foundation. It may describe
the set of assumptions that can use in the case study. There are different ways to divide the
research methodology.
Research method-
Research method is a systematic and scientific procedures of collecting data, interpretation,
compilations and implications to the research project. Research method is mainly divided into
two ways such as qualitative method and quantitative method. These are the two different type of
research method that use on the nature of case study and other attributes.
Quantitative research method describe the different measurement level of case study on
the basis of calculation and numbers. This method is based on the mathematical concepts to find
the accurate result or outcome. This research method entailing the collection of numerical data
and existing view of relationship between the theory (Marchand, Hennig-Thurau,and Wiertz,
2017). This quantitative case study examine the relationship between the numerical data with
application of statical techniques.
Qualitative research methods are the exploratory in the nature of study which concerned
about to understand the reasons and motivations. This method mainly emerged to collect the data
through observations, interviews and other action etc.
Researcher will use the qualitative method to collect and gather the information and
data through questionnaires or interviews. Researcher will understand the relevant information
about the project and find the appropriator results.
Research design-
It is defined as a design and framework method or technique chosen by the researcher.
Researcher will combine the different components of relevant logical concept in effective
manner. In this way, researcher will handle the complex problem and issues during analysis. It
provides the insight about the case study in the particular methodology. Researcher design is
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