Friends and relatives are more likely to influence consumer choice than any other source of information. Personal influence is most powerful because consumers generally regard friends and relatives as more credible and trustworthy than commercial sources of information. Moreover, information from reference and family groups is a means of reducing risk in a purchase decision. A consumer considering the purchase of an expensive item such as clothing or furniture,is likely to obtain the opinion of "relevant others". Such opinions not only provide information to reduce financial and performance risk,but are also a means of group sanction to reduce social risk.
Studies carried out some researchers have confirmed that dominance of personal influence in choice decisions. For instance Arndt (1967) found that respondents who receive positive word of mouth communications about a new food product were three times as likely to purchase it than those who receive negative communication. Feldman and Spencer (1965) found that two third of new residents in a community relied on word of mouth communication to select a doctor, and that over 40 percent requested additional advice from the same individuals on the product and services.
Word of mouth communication will not be the dominant factor for every product category: It will be most important, however, when reference groups are more likely to be sources of information and influence. This will occur when:
1) The product is visible and thereby behaviour is apparent.
2) The product is distinctive and can more easily be identified with style,taste,and other personal norms.
3) The product has just been introduced.
4) The product is important to norms and belief system of the reference group.
5) The purchase of product is likely to be seen as risky,encouraging a search for additional information.
6) The consumer is involved in the purchase of decision (Assael 1984).
