Electronic Word of Mouth Bangladesh - Rev - 28.3.2020 - 2
Electronic Word of Mouth Bangladesh - Rev - 28.3.2020 - 2
Electronic Word of Mouth Bangladesh - Rev - 28.3.2020 - 2
ABSTRACT
The ascent and spread of the Internet have prompted the rise of another type of word of mouth
(WOM) namely the electronic word of mouth (e-WOM) which is considered one of the most
persuasive casual media among purchasers, business organizations, and the people at large. The
purpose of this paper is to measure the impact of electronic word of mouth (e-WOM) on brand
image and online purchase intention of shopping products among Bangladeshi consumers.
Recently, Bangladesh is experiencing rapid growth in terms of e-business and e-commerce.
However, investigation regarding the impact of e-WOM and brand image on online purchase
intention has remained mostly unexplored. This study follows a quantitative research
methodology and collects data of the consumers by using a non-probability convenience sampling
technique. This study reveals that e-WOM affects both brand image and purchase intention
positively.
Keywords: E-commerce, e-WOM, Online Purchase, Consumer Behavior, Brand Image.
1. Introduction
The emergence and expansion of Web 2.0 pave way several online platforms which have become
a natural source of dissemination of consumer opinions and experiences. The electronic word of
mouth (e-WOM) is one of the online platforms. Now the online platforms including different
social media sites, blogs, product review websites, shopping websites, discussion forums,
consumer reviews are considered as a form of e-WOM (Cheung & Thadani, 2012; Jiménez &
Mendoza, 2013; Yeap, Ignatius & Ramayah, 2014). Nowadays, e-WOM communication is well-
thought-out as the trust worthiness form of advertisement (Nielsen, 2015).
Thus it has become a critical loop which has a significant impact on different marketing outcomes,
purchase intention, value co-creation, brand equity dimensions, consumer decision making
process, and online purchase intention (Chevalier & Mayzlin, 2006; Hu, Liu, & Zhang, 2008; Park,
Lee, & Han, 2007; See-To & Ho, 2014; Chakraborty & Bhat, 2017; Lin, Lee, & Horng, 2011; Erkan &
Evans, 2016; Shan, 2016). Moreover, e-WOM can also help a firm or its products or services to
gain complimentary brand image (Jansen, Zhang, Sobel, & Chowdury, 2009). Thus, it helps the
brands to reduce the perceived risk and increase the perceived value of the customers (Wang &
Tsai, 2014). Furthermore, the brand image, as a result, helps to take marketing strategy of the
firms and it has a significant impact on brand equity, and it affects the purchase behaviour of the
consumer (Faircloth, Capella, & Alford, 2001; Wang & Tsai, 2014; Liu, Zhang, & Qin, 2016).
In connection with the global trends, for the past few years, Bangladesh has been experiencing
rapid growth of e-business and e-commerce (Rahman, 2015a). Each year the number of an
internet user is increasing at a significant ratio. Millions of people come under internet facilities
over the years (Husain, 2016). The Government of Bangladesh has set a vision of making “Digital
Bangladesh” by 2021 and in line with this goal, the government is continuously working to
develop the information technology infrastructure throughout the country (Rahman,
2015b).Currently the e-commerce market in Bangladesh stands at $1.6 billion and is expecting to
be doubled to $3 billion by the year 2023 (The Daily Star, 2019).
Online market is based on selling physical goods through a digital platform to the end-users or
consumers. Day by day, the trend of online shopping is gaining popularity (Uddin & Sultana,
2015). And in Bangladesh the practice of online shopping has increased a lot than before.
Moreover, according to Statista report earnings from selling consumer goods via online is
expecting to reach $1.24 billion by the year 2023 (The Daily Star, 2019).
Within the last few years, internet connections in Bangladesh have improved than before and as a
result access to the internet has also increased. This particular characteristic of the digital market
thus has made the e-commerce business flourished in Bangladesh. As a result, in Bangladesh,
currently there are approximately 2000 e-commerce sites and 50000 Facebook-based online
markets delivering approximately 30000 products each day. Moreover, majority (80%) of the sales
through online based platforms are taking place in cities like Dhaka, Chittagong and Gazipur (The
Financial Express, 2020). Although there is enormous growth of e-commerce in Bangladesh,
research on the impact of e-WOM on brand image and online purchase intention has remained
mostly unexplored and study on this field received minimum attention from the researchers. This
study, in this backdrop, aims to explore the impact of e-WOM on brand image and online
purchase intention and at the same time to examine the impact of brand image on online
purchase intention as a whole.
2. Literature Review
2.1 Electronic Word of Mouth (e-WOM)
The Electronic word of mouth (e-WOM) is the statements (either positive or negative) about a
product or a company, which is on the internet (Hennig-Thurau, Gwinner, Walsh, & Gremler,
2004; Xue and Zhou, 2010). It is a phenomenon that takes opinion place over the Internet and the
majority of the associated people who opined there remain anonymous (Cheung & Thadani, 2012;
Shan, 2016). With the comprehensive use of the electronic word of mouth (e-WOM), present-day
consumers can evaluate other people's opinions about products and services regardless of their
geographical limits (Makrides et. al., 2020). Studies conducted on e-WOM have established the
fact that e-WOM is a critical concept for both consumers and marketers. Cheung & Thadani
(2012) divided e-WOM into two broad segments, which are: market-level analysis and individual-
level analysis. The market-level analysis deals with the organizational outcome such as product
sales, as a consequence of e-WOM and individual level analysis deals with the effect of e-WOM on
different aspects of consumer behaviour such as purchase intention. In recent times, e-WOM has
established a commitment to the issue of strategic importance in both research and practice
(Wilson et. al., 2017).
A lot of differences in many aspects can be found between the principal concept of e-WOM and
traditional word of mouth (WOM). One of the critical differences in the range and speed of e
-WOM in terms of coverage (King, Racherla, & Bush, 2014; Cheung & Thadani, 2012). As the e-
WOM is readily available on the internet, it spreads rapidly reach millions within a brief period.
However, during the early phases, the format of e-WOM was mainly text-based, but with the
phases of time various formats of e-WOM started to emerge, and now the people could share
picture-based and video-based reviews (Lin, Lu, & Wu, 2012). Thus, shortly we can conclude that
numerous studies have been undertaken using the concept of e-WOM. However, the majority of
these studies focused on e-WOM adoption, attitude, purchase intention and purchase as the
outcome of e-WOM effect. Very few studies focused on the relation between e-WOM and online
purchase intention. More specifically, the study of the impact of e-WOM on online purchase
intention and brand image in Bangladesh is absence.
2.2 Online Purchase Intention
Online purchase intention is an individual’s desire of making any purchase that gets reflected
through different websites associated with each other (Chen, Hsu, & Lin, 2010). Online purchase
intention as described under the principle of the theory of reasoned action (TRA), can also play as
an indicator of consumer online shopping behaviour since the intention is considered as a
predictor of behavior (Ajzen and Fishbein 1980). Understanding the determinants of purchase
intention can help marketers in understanding consumer shopping behaviour. Other factors that
are responsible for shaping the purchase intention also became important area to study for
researchers for many years. It is valid for online purchase intention, as well. Because online
purchase intention involves the higher degree of risk and uncertainty compared to purchase from
traditional brick and mortar setting, trust plays a significant role in affecting online purchase
intention (Pavlou, 2003). This was further confirmed by Ling et al. (2011) who conducted a study
on young Malaysian consumers, and one of the findings of the study showed that online trust is
positively related with online purchase intention. The technology perspective is another widely
cited component of online purchase intention. Another study by Van der Heijden, Verhagen, &
Creemers (2003) confirmed that both technology and trust perspectives have a significant
influence on online purchase intention.
3.
Methodology
Data was collected by administrating a closed-ended questionnaire by distributing to the people who had
previously completed a transaction on an online group buying site. The questionnaires were distributed
online by disseminating links through social networking sites such as Facebook and Twitter, WhatsApp. They
were also distributed via mailing lists and chat messenger. The link directly connected the respondents on a
Google Docs form that contained several questions. The answers given by the respondents were
automatically saved on the drivers provided by Google Docs. However, redundant data might be obtained
when collecting data through Google Docs. Therefore, the researchers carefully reviewed the collected data
throughout the process. The questionnaires were distributed in less than two months (January to February
2019), A total of 278 responses were obtained from the respondents of the study. However, 233 responses
were retained for final analysis because the other 32 responses did not meet the screening criteria of the
respondents (i.e. they answered that they are not familiar with online reviews). This target was set
according to the rules of structural equation modeling (SEM) as between 100 and 150 samples. Additionally,
Wijanto (2008) states that the ideal sample size is five times higher than the number of indicators. The
number of indicators in the study questionnaire was 17, so the ideal sample size was 105 or more. Hence, a
sample size of 233 respondents was sufficient to continue on to the data processing stage.
3.3 Measurement
All the items were measured using the five-point Likert scale ranging from strongly disagrees with
agreeing strongly. All the items were adapted from previous studies. A total of fourteen items
were used to measure the three variables (e-WOM, brand image & online purchase intention). Six
items adapted from Bambauer-Sachse and Mangold (2011) were used to measure e-WOM. Four
items were adapted from Moon, Chadee, and Tikoo (2008), Coyle and Thorson (2001) to measure
online purchase intention. Finally, four items adapted from Davies, Golicic, & Marquardt (2009)
were used to measure brand image. Table-1 outlines all the items used in this study.
Variable Items
I often read other consumers’ online product reviews to know what
products/brands make good impressions on others
To make sure I buy the right product/ brand, I often read other
consumers’ online product reviews
I often consult other consumers’ online product reviews to help choose
e-WOM
the right product/ brand
(Bambauer-Sachse and
I frequently gather information from online consumers’ product reviews
Mangold, 2011)
before I buy a certain product/brand
If I don’t read consumers’ online product reviews when I buy a
product/brand, I worry about my decision
When I buy a product/brand, consumers’ online product reviews make
me confident in purchasing the product/brand
Online Purchase It is very likely that I will buy the product
Intention I will purchase the product next time I need a product
(Coyle & Thorson, 2001; I will definitely try the product.
Moon et al. 2008) I will recommend the product to my friends.
In comparison to other products/brand, the reviewed product/brand has
high quality
Brand Image The product/brand has a rich history
(Davies et al. 2009) I can reliably predict how this product/brand will perform
Compared to other products/brands, the reviewed product/brand is
highly respected by others
4. Results
4.1 Demographic Profile
Out of the 233 respondents, 66.5% of the respondents were male, and 33.5% were female. A
large portion of the respondent’s age was within the range of 19-28 (63.9%), which highlights
the fact that majority of the respondents were young Bangladeshi adults. In terms of monthly
income, the majority of the respondents (41.6%) were dependent.
Age
18 or Below 5 2.1
19-28 149 63.9
29-38 60 25.8
39-48 10 4.3
49-58 7 3.0
59 or Above 2 .9
Gender
Male 155 66.5
Female 78 33.5
Monthly Income
Dependent 97 41.6
Below BDT10,000 17 7.3
BDT10,000-BDT30,000 41 17.6
BDT30,001-BDT50,000 41 17.6
More than BDT50,000 37 15.9
4.2 Measurement Model
The proposed structural model was calculated by Structural Equation Modeling (SEM), which
included an overall model fit test and individual testing of the importance of the relationships
between variables. These tests demonstrated the relationship between e-WOM, the Brand Image
and the purchase Intention of customers. This research uses the parameter estimates and the
measurement model's overall fit index. The relationships are based upon the method of
maximum likelihood (ML).
This research uses Cronbach’s α to test the internal consistency and measure reliability of the
study. The internal consistency level was appropriate for each build, with the alpha ranging from
0.750 to 0.777, which surpassed the minimum hurdle of 0.60 (Hair et al., 1998). All measuring
objects had uniform load estimates of 0.5 or higher at the alpha stage of 0.05 (ranging from 0.532
to 0.805), suggesting the convergent validity of the measuring model. Construct reliability to
predict convergent validity was verified; each construct had acceptable construct reliability, with
estimates ranging from 0.801 to 0.836 (Hair et al., 1998).
Table 3: Psychometric Properties of Measures
t-
Standardized Cronbach’s
Construct Item statisti Mean St. dev
loading α
c
eWOM1 .548 - 3.926 .890
eWOM2 .647 7.233 3.955 0.948
eWOM
eWOM3 .600 6.905 3.758 1.028
.777
eWOM4 .692 7.518 3.902 0.981
CR= .841; AVE= .592
eWOM5 .546 6.479 3.615 1.006
eWOM6 .623 7.067 3.963 0.876
BI1 .787 10.181 3.652 0.959
Brand Image (BI)
BI2 .545 7.485 3.623 0.878
.765
BI3 .658 8.837 3.725 0.792
CR= .841; AVE= .571
BI4 .679 - 3.799 0.849
PI1 .805 - 3.762 0.847
Purchase Intention (PI)
PI2 .596 9.108 3.889 0.743
.750
PI3 .677 10.494 3.664 0.939
CR= .889; AVE= .567
PI4 .532 8.043 3.820 0.786
Notes: CR= Construct Reliability, AVE= Average Variance Extracted; e-WOM = Electronic word of
mouth; BI= Brand Image; PI= Purchase Intention
Additionally, because the average variance extracted (AVE) from all three constructs surpassed
the minimum requirement of 0.5 (ranging from 0.567 to 0.592), convergent validity was
guaranteed (Hair et al., 1998). The researchers estimated discriminating validity among constructs
using correlation estimation. If they were significantly different from 1; the intervals of confidence
of the correlations, calculated as correlations± 1,96 ± standard estimate error, did not contain 1,
so these results indicated the discriminating validity of the measuring model. The correlations for
the constructs are shown in the following table. Overall, these measurement results are
satisfactory. These also suggest that it is appropriate to proceed with the evaluation of the
structural model.
Table 4: Correlation Matrix
eWO eWO eWO eWO eWOM eWOM
PI4 PI3 PI2 PI1 BI1 BI2 BI3 BI4
M6 M5 M4 M3 2 1
PI4 1.000
PI3 .408 1.000
PI2 .354 .401 1.000
PI1 .393 .567 .449 1.000
BI1 .370 .436 .466 .567 1.000
BI2 .187 .230 .270 .410 .459 1.000
eWO eWO eWO eWO eWOM eWOM
PI4 PI3 PI2 PI1 BI1 BI2 BI3 BI4
M6 M5 M4 M3 2 1
BI3 .303 .351 .319 .436 .513 .442 1.000
BI4 .340 .488 .356 .489 .505 .329 .450 1.000
eWOM6 .319 .300 .341 .432 .347 .244 .317 .366 1.000
eWOM5 .313 .346 .290 .380 .394 .296 .269 .304 .348 1.000
eWOM4 .297 .335 .341 .453 .423 .172 .320 .406 .441 .345 1.000
eWOM3 .241 .303 .326 .383 .357 .245 .287 .265 .369 .296 .474 1.000
eWOM2 .254 .334 .297 .433 .354 .187 .323 .357 .379 .327 .464 .407 1.000
eWOM1 .179 .307 .246 .409 .361 .152 .329 .315 .336 .300 .342 .283 .411 1.000
Note: All of the correlations are significant at the 0.01 level; EWOM-Electronic word of mouth; BI-Brand Image; PI-Purchase
The Table-5 presents the results of the individual tests on the relationship's significance among
variables. e-WOM had a substantially positive effect on the brand image, with β= 0.890, t = 6.558
and p = 0.000 suggesting that the e-WOM contact of consumers was an effective track record of
the brand image. e-WOM also had a clear positive impact on intention to purchases (β=0.506,
t=3.136, p=0.002). Such findings show that e-WOM plays a major role as a substantial antecedent
of the behavioral expectations of consumers relative to other advertising outlets. Finally, brand
image affected purchases intention, with β= 0.708, t = 4.975, and p = 0.000 suggesting that brand
image was a precedent of purchase intention.
In Bangladesh while consumers purchase any product through online platforms, they look at the
content and design of the platform as well. As a result, customers will be inclined to log in or
purchase where they found online companies providing more lucrative designs or offerings. So,
there are scopes of research to find out how these online companies can make their platforms
more attractive to lure more consumers.
In addition, as there are lot of online shops available now a days and consumers have less time to
visit shops physically, this study will help the future researchers to think about ways to structure
brand images and make the brand available as per the consumer want to develop an effective and
constructive purchase intention.
Reference