Value of consumer conversations—the true impact of word of mouth on sales

Agility PR

by Bulldog Reporter | Jan 28, 2019

Word of mouth has been among the best forms of spreading brand awareness and product recommendations since… well, since any other strategies even existed—and it remains one of the most reliable, according to new research from social data and analytics firm Engagement Labs.


The firm’s new report, published in MIT Sloan Management Review, reveals that 19 percent of U.S. consumer purchases are traced to consumers talking about brands online and offline. And while there may be little correlation between what consumers say online and offline about brands, both streams of conversation can have big effects on a company’s sales.


The article, “Deriving Value from Conversations about Your Brand,” is based on analytics conducted and authored by three executives of Engagement Labs in conjunction with Koen Pauwels, professor of marketing at Northeastern University. The analytics determined correlations between consumer conversations and purchases for 175 brands across multiple sectors such as beauty, personal care, retail, technology and food, as well as more detailed analytics of 21 brands, including Apple, Intel, A&W, Campbell’s, Lay’s, Red Bull, and Revlon.

How customer conversations affect sales

The analytics found that offline and online conversations had similarly large impacts on sales. For the 21 brands most closely studied, 9 percent of purchase decisions could be traced back to online conversations and engagement that occurred on social media (including Facebook, Twitter, Instagram, YouTube, blogs, and customer forums). A slightly larger share—10 percent of sales—was related to offline conversations as measured through continuous surveys.


Read the full Agility PR article, here.

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