Study: Blogs Influence Purchases More Than Social Sites
Blogs can have a greater impact on purchase decisions than social networks, a new study from the Jupiter Research arm of Forrester finds. Blogs create a community, and become a trusted resource with the ability to influence purchase decisions.
Blog readership is on the rise. Jupiter Research noted a 300 percent growth in monthly readership in the past four years. Readers look to links and multiple blog sources to extend a conversation: 49 percent of blog readers, defined as someone who reads at least one blog a month, and 71 percent of frequent readers all read more than one blog per session. Multiple blog sources offer more opportunities for consumers to be exposed to advertising. A quarter of readers say they trust ads on a blog, compared to 19 percent who trust ads on social networking sites.
The survey also finds that consumers are influenced by blogs at the moment of purchase decision. Blogs play a greater role than social networks, likely because bloggers establish themselves as an authority on a topic, particularly in niche areas, and create a relationship with the consumer.
As we embark into the public blogosphere, we need to recognize the power that this medium brings.
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December 24th, 2008 at 5:12 pm
I haven’t seen the report but am confused by the findings described in the posting. I completely understand why a blogger can be seen as an authoritative source in a niche area and therefore trustworthy but don’t see the connection with why ads on a blog would be more trustworthy than ones anywhere else on the web since they are likely served up by the same souce. The exception, of course, is if it’s not an ad but an unpaid recommendation in the content of the blog.
I think the issue of trust in a blogger vs. a social network depends on what it is for and how you use the social network for research. If you are asking “friends”, i.e. people you know and trust who are part of your social network then I think it likely would be at least as good as a blogger you don’t know. This would be particularly true if it’s a referral for something personal like a financial advisor (to bring it back to banking) or a movie recommendation as opposed to something where domain expertise is important like a car purchase or how to get a mortgage.
December 30th, 2008 at 5:06 pm
I think we should consider a value of blogs in the context of what we are trying to accomplish.
If we want to influence consumers via blogs at the moment of purchase decision, then “yes” this is great way.
If we want to teach consumer to spend responsibiliy with consideration of their ability to pay, then probably blog is not a good way to do that.
The blogs became a handicap substitute for basic financial management and social skills.
If you know how much money you have in your pocket and what you really want/need to buy, why would you want to outsource your purchase decisions to total strangers?!
Compulsive and uncontrollable spending is a big problem and I don’t see how blogs could help to cure that.
Question to everyone: Do we really need to induce consumer spending and thus debt through blogs or we need to figure out first what kind of consumer behavior we should encourage?
January 2nd, 2009 at 8:40 pm
Hi Ken -
Interesting topic. What I’m wondering is how many of the people in the study realized they were reading a “blog” while making their decision. The concept of getting “advice from a total stranger” makes sense if you know you’re reading a blog, but I see plenty of blogs out there that look like a “bona fide” product review site. In addition, the vast majority of Internet users probably don’t even know the difference between a blog and a real media site.
If that’s the case, you have to wonder what it is about a blog that makes it more credible than a social networking site. Possibly it is because of you can get a lot more information into a blog to describe why you are promoting the product versus a social network that allows you to be a “fan” and not much else.
As for banking, the concept of blogging about your bank choice is plausible but seems less likely than an electronic product endorsement. Does anyone have examples of “bank blogs”?
January 4th, 2009 at 4:15 pm
Two thoughts. First, the rampant consumer spending model has come to a rapid slow-down. We can see this in the post holiday retail sales results. Now whether it is due to the daily news around the economy or the information a consumer sees on a blog is up for debate, but the net result is that a slow-down in spending indicates that the consumers are beginning to take responsibility for spending into their own hands. One could hope that the focus on self education is beginning to take hold.
Second thought as to examples of bank blogs, I believe that this blog is actually the first such open banking forum.
January 5th, 2009 at 8:28 pm
I think the power of blogs in this context is in influencing behavior without being a blatent advertisement or buy recommendation. I fit the survey results in that I follow a select group of blogs that I have decided are credible and I often do further research on topics or products mentioned in them. As an example, I just read Kathryn Fialkowski’s post on this blog, followed the link to learn more about the book she mentions (Honest Signals) and decided to purchase it because I thought it sounded interesting.
On the flip side of this argument, I think ad serving on blogs needs to get more intelligent to have the impact suggested by the survey. I was on a blog site last night searching for a solution to a *@#* driver issue on my home computer. The blog was blasting Gateway computers for locking down the capabilities in the bios and there right in the middle of the blog was an ad for Gateway! I doubt that is ad money well spent.
January 7th, 2009 at 5:10 pm
I am curious what demographic was most represented within this study. I can see Blog readership rising for boomers - who are traditionally Spectators or Inactives within the Social Computing Participation ladder. However, when referring to the upcoming generation of banking & wealth clients - Gen X & Y who are avid Joiners of social networks - I tend to believe the future ‘power to influence’ will reside within the social networks.
January 7th, 2009 at 7:51 pm
I’m not surprised by the controversy. How many bloggers are actually getting paid as an affiliate for referring business - but pose as impartial opinion providers? It’s one of those nasty truths that I don’t believe the mainstream has quite caught on to yet.
As with any information, it is up to the buyer to be wary of the source and the intentions behind the opinion. Think of the conflicts of the “trusted” stock broker, the “impartial” insurance agent, the car sales guy, the real estate agent, the clerk at the local department store - It’s the age old issue of conflict of interest… just a different medium.
As consumers continue to become more savvy, and social media becomes easier to use and more task oriented, I think more people will realize the wisdom of the crowd.
January 7th, 2009 at 9:05 pm
Our experience show that consumers reading blogs do business 4 time more with banks with blogs than without.
There’s a very specific type of blogs that attract and build trust with consumers. not executive blogs, but topics that directly help and touch consumers. Blog about tips about tips to save money, how to make the best use of banks’ services, anything that help them improve their (financial) life and how they interact with their bank.
There’s no ideal way to build trust with consumers but being honest (about the good and the bad) always help building trust and lasting relationship.
February 18th, 2009 at 8:57 am
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Sarah
http://www.craigslistdecoded.info