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The impact of digital word-of-mouth on tourism

The impact of digital word-of-mouth on tourism
Author: Joonas Riihijarvi
2 Commentries
The impact of digital word-of-mouth on tourism


Keywords: digital word-of-mouth, online reviews.

Tourism has always been an unorthodox business as it is an industry where products and services are sold to consumers who cannot 'test' the product before the actual purchase. Experience goods have always been dependent on word-of-mouth as people have been making their travel decisions, at least partly, on the basis of what they have heard of the destination, hotel, airline etc. from their friends and family. Word-of-mouth has played an important role on travel behaviour because of the unpredictable nature that tourism has. Tourism is a high risk product/service because most of the time the consumer is unaware of the quality of the purchase as well as the dimensions of possible dangers when on holiday. Because of this consumers try to find out as much information as possible when making the final decision on where to go and where to stay etc. As Papathanassis and Knolle (2011) note, that consumers take advantage of all the information available to them when booking a holiday. In the 21st century this is mostly done on the Internet because of the easy accessibility to information and because the traditional way of booking holidays in an office at a travel agency is being replaced by online bookings.

In experience goods user reviews are very influential however it demands the consumer to rely on unknown people whose expertise of the matter is also unclear (Ye et al. 2011). Another aspect that also makes decisions harder is the fact that nowadays there is an information overload which forces the consumers to be selective of what information they can trust and choose to process (Papathanassis and Knolle 2011). These issues force the consumer to analyze the actual reviews. Papathanassis and Knolle (2011) found out in their study that overly positive reviews make the consumer think that the review lacks criticism as negative ones seem many times more genuine as well as a kind of warning from a fellow consumer. It must be remembered that the actual reviews are only opinions and not facts as the level of enjoyment one receives from a holiday is many times dependent on the consumer's characteristics and on what they look for and not necessarily on the level of quality the product/service has. Therefore the most reliable reviews can perhaps be the ones that have somewhat of a balance between positive and negative reviews with the reviews having some similarities with each other. Interestingly enough Ye et al. (2011) found out in their study that other consumers opinions are perceived as being more up-to-date, enjoyable and reliable than ones made by professional critics. Perhaps this can be contributed to consumers thinking that other consumers look for the same kinds of characteristics from their holidays as critics can be seen as focusing on minor things.

When these issues are looked at from the point of view of actual tourism organizations things look a bit different. For example for hotels, online reviews impact greatly. For lesser known hotels online reviews can be seen as a positive (regardless of the nature of the reviews) as the actual exposure of an online review can elicit purchases however as for brand hotels their familiarity to the consumer can make them 'immune' to reviews as the consumer already has a certain image of the hotel (Vermeulen and Seegers 2009). Ye et al. (2011) found out that online word-of-mouth has significant impact on online room sales while positive reviews can bring in more line sales. According to Vermeulen and Seegers (2009) hundreds of millions of potential hotel visitors consult tourism review sites with 84 % of them being affected by what they read. These numbers clearly show the enormous impact that digital word-of-mouth has on tourism. It should be noted that these numbers were also just about hotels, there is still a lack of study regarding the influence of digital word-of-mouth and its impacts (and the actual numbers) on consumers purchases on airlines, destinations etc.

This study concludes that the impact of digital word-of-mouth is significant on the tourism industry as the influence of the Internet on everyday life and on consumer behaviour is expanding. This study suggests that the dimensions of online services can be expanded as well as further studies in to these issues examined in this paper can be increased. As this conference proves the tourism industry is reaching out more and more in to the Internet.



Reference list

Papathanassis, A. and Knolle, F. (2011) Exploring the adoption and processing of online holiday reviews: A grounded theory approach, Tourism Management, Vol. 32, pp. 215-224.

Vermeulen, I. E. and Seegers, D. (2009) Tried and tested: The impact of online hotel reviews on consumer consideration, Tourism Management, Vol. 30, pp. 123-127.

Ye, Q., Law, R., Gu, B. and Chen, W. (2011) The influence of user-generated content on traveller behaviour: An empirical investigation on the effects of e-word-of-mouth to hotel online bookings, Computers in Human Behavior, Vol. 27, pp. 634-639.


The mpact of digital word-of-mouth on tourism
Author: Bintou Jallow
This is an interesting discussion paper that reaches very well into the impacts of digital word-of-mouth on tourism from different perspectives.

Because of the nature of the tourism industry i.e. the product or service offered cannot be "tested" before they are paid for, this open the gate for consumers to seek out information that from those who have some knowledge or have experienced what they are looking for.

As the author noted, the industry has always been heavily been reliant on word of mouth. Information about experiences is widely shared amongst people close to us and over the years, this ritual has even managed to go viral with a wider audience being reached through internet sites. There are even websites such as "www.tripadvisor.co.uk", who dub themselves "the world's largest travel review site", which are dedicated specifically to consumer coming together and sharing our travel experiences with the rest of the world.

The levels to which our opinions are shared, depends of course on the quality of our experiences. (George 2001) suggests that if the service the organisation is providing is just "satisfactory", people won't talk about it adding that it has to be unusually poor or unusually good for it to be "worth talking about".

That author also made an interesting point from the other side of the argument which is that because of the nature of the internet, consumers are forced to rely on information from people who are "unknown" to them.
There is also the fact that the online community is huge and still growing beyond belief which means that there is information overload not to mention the information available on the internet if most of the time a matter of opinion and not facts.
However, there is also an interesting point mentioned that consumers' in search of information mostly trust ones that are presented by the other consumers rather than professional critics therefore, for all stakeholders to benefit, there has to be balance.

This author shows that despite criticism, the effects that digital word of mouth is still very much significant to the tourism industry especially because the rise of the internet doesn't seem to be showing any signs of slowing down, anytime soon.
There is a chance for business within the industry to (instead of criticising) find a balance that will be to their advantage.
The Impact of Digital Word-of-mouth on Tourism
Author: Mikko Kuusela
This is an interesting paper discussing the word-of-mouth aspect of reviewing the holiday, a topic of which I have not researched or read about before. I really enjoyed reading it as it was bringing a lot of new information I had no previous knowledge about and this paper was even breaking much of the expectations I had on online reviewing of holiday experiences.

The discussion paper was stating that the tourist cannot 'test' his or her product before the actual purchase, which of course differs from other services that you buy. If it is restaurants, hair dressers or the local doctor there definitely is growing amount of not only contacts to ask from, but also tools to review and research your future holiday. The Internet is providing us with forums that discuss almost any destination in the world they provide us with tools to study the destination through pictures, review systems, maps even the view on almost every street in that particular city. So the customer can really explore every component of the holiday through trip advisor, google earth, different travel blogs or travel agencies' and destinations websites etc. The amount of information and the options are infinite. The whole process is reviewed from the booking, the flight to the experience itself and also the negative incidents everything is reported and one can find it in the internet.
It was really interesting to see that good user reviews are having a great impact on the travel decisions though consumer needing to rely on unknown people. It is of course clear that friends and relatives are the most influential contacts when choosing your holiday. The study of (Papathanassis and Knolle 2011) was exciting to see that the overly positive reviews really have an negative than stimulating impact on the consumer. Maybe the more alert reviews give a better understanding of the destination and reflect on the modern day tourists urge of finding a genuinely authentic experience. The research that the consumer often is more educated and up-to-date on a destination than the critic or the tourism professional is thought-provoking. It supports my idea of the current situation where the critic or the professional is always struggling to bring the tourist the latest, relevant and interesting information on the destination where the consumer has the passion and all the tools and the information available to make the travel agency or the guide and their knowledge almost obsolete.

The number, as big as 84%, reading the reviews in the internet is large and I can really see them having a great impact on the hotels where the relationship with the customer is the most crucial. After finding a certain hotels quality good he or she will probably come back. I can imagine that this knowledge is shared vastly and it is good in quality so the numbers do not come as a surprise. Applying the study of (Vermeulen & Seegers 2009) to destinations should not be intended as everyone experiences the culture and holiday activities totally different way.

It will only be leaving us questioning what will be the effect of the ever growing internet and which role will the travel industry take. Is it trying to provide information, authentic experience or easy solutions to get close to the sun or the culture for the consumer to discover the things by himself?