Indian shoppers look to online word of mouth

08 July 2010

NEW DELHI: Online word of mouth is playing an increasingly central role in shaping the views of consumers in India.

American Express polled 1,000 people in the country to gain an insight into their attitudes on customer service.

Some 89% of participants agreed this issue was “important”, and 82% thought it had become a greater priority during the downturn.

The average respondent was also willing to pay a premium of 11% to do business with an organisation that boasted impressive credentials in this field.

A further 77% would end their relationship with a company that fell short of their expectations, although 65% believed Indian corporations were attempting to better meet the needs of their clients.

Just 9% of the panel felt taken for granted, compared with 52% who suggested most firms put in a reasonable effort to retain their affiliation.

Over 90% of individuals exhibited stronger loyalty to products that have fulfilled their requirements, with 85% displaying a tendency to switch wherever this was not the case.

Elsewhere, 95% of the sample shared favourable feedback about a brand with their friends, falling to 77% when it came to negative opinions.

Personal experience was the factor with the most substantial influence on the decision-making process, on a score of 96%.

The reputation of a corporation or brand registered a total of 95%, although less consumers saw it as "very important", with recommendations from friends and family on 86%.

However, 80% of Indians now regularly access the internet to consult user-generated reviews, blogs and other such content applicable to this area.

A third of shoppers asserted that critical posts could have a sizeable impact on their purchase intentions, but only 25% gave complimentary word of mouth a similar status.

"The internet has made customer service quality more transparent than ever before," said Pradeep Kapur, vice present and general manager of American Express in India.

"In the online space, positive recommendations are important, but people often surf for the negative."

Nearly 40% of those interviewed allowed a company to deliver two instances of poor service before transferring their allegiance to one of its rivals.

Moreover, 86% of consumers would give a brand a second chance if it had previously met their expectations in the long term.

When resolving complaints, 63% of the cohort argued they should be compensated by a firm which had let them down.

A 55% majority could be convinced to forgive such a slip with a free product, with 51% saying the same for a discount or money-off voucher.

"Customers want and expect high-quality service, especially as they focus on getting good value for their money in a difficult economic environment," said Kapur.

Data sourced from Indiainfoline; additional content by Warc staff