User reviews and social media reshape corporate communication in the web 2.0 sphere

New media and web 2.0 have dramatically changed the traditional paradigm of brand communication. Shifting the power over content from companies to consumers, this new digital environment challenges all conventional beliefs and traditional best practices. Users are empowered to communicate with one another, to share experiences, and to leverage the power of Internet to obtain the best deals and to solicit better service from companies. Brand managers are left with little control over what is said, and over where it is heard. Word of mouth rules over coordinated and controlled messages and traditional communication channels tend to fade in a background of indistinguishable noise. This interactive nature and transparency of web 2.0 communication impacts general brand metrics in a way that is yet to be fully understood.
Consumers are the rising stars in this evolving communicational landscape, renouncing their passive attitude and taking an active approach in multi-leveled and ubiquitous dialogues. Web 2.0 transformed users into content creators, into journalists who have the opportunity to attract and address their own audience. User reviews and recommendations have gained increasing influence in shaping purchase decisions.
Interactions between companies and consumers in this fragmented media environment are constant, fast-paced and continually evolving. Through various channels such as blogs, social media, video/image-sharing platforms, brands connect with fans and engage in dialogues with them. Keeping communication relevant is one of the biggest challenges in this context of multiple media, channels and communication avenues. Web 2.0 enables three major types of interactions as far as brand building is concerned; it allows companies to communicate with consumers, it provides a transparent space in which consumers can consult and communicate among each other, and it brings high interactivity by enabling consumers to communicate with companies.
This transparent and interactive nature of the digital sphere propels word-of-mouth to the forefront of influential communication tools. The magnitude of consumer-generated content and its influence in this space is dazzling, making companies wonder whether one bad review can indeed (as the saying goes) cancel all the good word of mouth. Contrary to conventional marketing wisdom which preached the relatively limited impact of this phenomenon, in a communicational landscape of balanced power over content ongoing conversations are many times dictated by users, and companies are simple participants in these forums.
Brands are no longer built by corporate architects after a long process of research and planning. They become more flexible, fluid, evolving organically from a constant flow of information. Users become equally important to companies in shaping brands. The evolution of brand metrics is thus contingent on a process of continual communication on multiple avenues.
Two broad types of brand metrics should be considered in this discussion – performance metrics and perception metrics. Whereas performance metrics measure the tangible impact of brand building activities on the bottom line and on overall performance, perception metrics are concerned with evaluating intangible aspects of the brand-consumer relationship, including awareness, recall, relevance, loyalty etc. Both categories impact, either directly or indirectly, the business performance in terms of revenue.
The emergence of new media and of a new communicational landscape in which users claim power over content, perception brand metrics are the ones to be most likely affected. User reviews and social media reshape corporate communication and push companies toward adopting new tools and strategies to effectively engage with consumers. In an environment of grassroot journalism the dialogue surrounding brands is more volatile and transparent than ever before. The awareness, recall and relevance of a brand depend increasingly on user-generated content rather than on planned communication initiatives. Brand preference and loyalty are shaped by continual flows of information among consumers, in which companies play a decreasing role. User reviews and word-of-mouth are central in this process.
At the same time, performance metrics are also likely to be influenced by web 2.0 technologies. Consumers can compare prices and competing products directly in-store, having access to continually updated information on special offers and user reviews. Companies have little or no influence over these conversations between customers; the only way to participate in the communicational process is to actively engage in discussions consistently and coherently. The offline influence of dialogues originating from the web is increasing.
Social media is a corporate communication playground governed by new rules. The tools and strategies developed for traditional media are ineffective due to the transparent, fragmented and interactive nature of web 2.0. The planning and implementation of brand-building initiatives in this arena requires an organic approach. Flexibility and responsiveness are critical. There is also a large untapped potential in this sphere. Users can become effective brand ambassadors, positively impacting all brand metrics. Web 2.0 and social media thus have strategic importance for brand building by facilitating the strengthening of consumer relationships and loyalty. By providing a more direct and relevant channel of communication, social media is an essential element in the communicational mix between companies and consumers.
The relationship between grassroot journalism (user reviews, blogs, comments, articles) and brand metrics is continually evolving. In the web 2.0 sphere corporate communications have been restructured and refocused on consumer needs and interests, and planned (one-way) messages have been replaced by open dialogues. Engaging with users consistently and coherently across channels is an imperative, and both positive and negative reviews have to be considered as part of an ongoing, evolving conversation.

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