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Report: Word-of-Mouth Recommendations Inspire Brand Awareness, Trust

With ever-multiplying e-commerce platforms and social media features geared toward brand discovery, it might come as a surprise that the most compelling generator of brand awareness is still word-of-mouth.

According to new research released in Yes Marketing’s Customer Lifecycle Report last week, 45 percent of survey respondents said their most recent purchase from a new retailer was inspired by a recommendation from a friend or family member.

When positioned against Google search results, which generate 16 percent of new business purchases, product review sites (8 percent), influencer posts (4 percent) and news sites like Business Insider and Buzzfeed (2 percent), the importance of real life recommendations comes into sharper focus.

And on the flip side, the impact of negative grumblings can be incredibly costly. The vast majority (69 percent) of survey respondents said they’ve chosen not to buy from a retailer based on unfavorable feedback from those they know personally.

For new brands and startups in a crowded marketplace, reaching new consumers and building trust quickly is imperative to success.

Thirty-six percent of survey respondents ranked providing comprehensive product information as the most important action brands can take to inspire confidence.

Still, unsurprisingly, the most influential factor for shoppers considering purchasing from a new retailer is price.

When asked about product-related features that might sway them in favor of a purchase from a new and untested retailer, 47 percent cited the cost of goods as the biggest driver, followed closely by quality at 36 percent.

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Convenience is also a deeply important consideration for consumers thinking of trying out a new brand, with 40 percent ranking free or expedited shipping as the most important non-product-related factor that figures into a purchasing decision.

“Free shipping is non-negotiable for consumers who have been conditioned by major players like Amazon and Walmart to treat it as a given,” Yes Marketing analysts explained in the report.

Convenience doesn’t just mean the ability to shop online, however.

Nearly a quarter (24 percent) of respondents said that proximity to a store was the top convenience-related factor that would inspire them to purchase from a new retailer for the first time. The ability to view products and try them on in person is still important to many consumers—especially when they haven’t bought from a brand or retailer in the past.

No matter how they come to know and trust a brand, though, consumer loyalty is worth the cost. Fifty-three percent of respondents said they would be willing to pay more to purchase from a retailer to who they believe to be loyal, rather than price shop for the best deal on an identical product.