Research finds big value in sharing, 'liking' Web posts
By Rob Lever, AFP
May 1, 2014, 12:03 am TWN
WASHINGTON -- In the online world of sharing and "likes," the recommendations of friends, family and even strangers turn out to have real, measurable value.
Positive online recommendations can boost the price consumers are willing to pay by an average 9.5 percent, found a study released Tuesday claiming to be the first of its kind.
Negative recommendations meanwhile can reduce the likelihood of purchasing a product or service by up to 11 percent, said the study commissioned by the social data company ShareThis and The Paley Center for Media.
The study highlights the theoretical value of sharing on social media instead of the actual impact on prices.
Kurt Abrahamson, chief executive of ShareThis, said the findings are nonetheless significant in measuring the value of online sharing — such as clicking the "like" button on Facebook, sharing a link to a product or posting a review on rating websites.
"This is the first time someone has tried to quantify the value of recommendations and sharing," Abrahamson told AFP.
"If you are able to generate positive buzz, it does have a significant value."
The study, to be released at a conference in New York on Wednesday, indicates that online recommendations influence consumer purchases more than price and brand, and carry nearly as much weight as face-to-face recommendations.
"There's no question consumers are actively looking online for recommendations and content to help them decide what to buy," said Abrahamson.
"We've all known that social sharing is important, but it's been difficult to measure its impact on consumer spending — until now."
A key finding is that positive online recommendations enable manufacturers and retailers to charge more.
The impact can range from less than a dollar for grocery items to around US$30 for technology produces and upwards of US$9,000 for an automobile.