The answer is positive. In order to prove how this is possible, I will recall a past event:
On 25thof July 2017 the famous cosmetics brand Anastasia Beverly Hills launched its eyeshadow palette “Subculture”. At first, many people were excited about the launch.
BUT then people started to complain on Instagram, Twitter, Youtube about the bad quality of the product! All the terrible reviews became viral on social media.
Obviously, the brand was really affected by that. Even if they fixed the problem by improving the formula, guess what: once you fail with a product, people will loose their trust in your brand. They were still skeptical about purchasing the product.
Later, Anastasia and its retailers put the palette on sale for half of the price. Only then the customers including myself started to buy it. This confirms the theory of Wang et al. (2019): customers’ reviews on quality influence the pricing of goods. In this case, the bad reviews of the product required a lower price in order to be sold. However, from my experience, the improved version was worth the full price.
But how did this happen?
Social media. It gives voice to customers, a voice that is easily to be heard considering how many users can see and share a post. Lately, I have noticed that customers became even more powerful as they can either improve or ruin the reputation of a product or a brand. This is because, according to Kincl, Novák and Pribil (2013) more than 75 % of people are significantly influenced by the customer’s reviews on social media when purchasing a product.
The lesson?
I think that brands should become aware of the power of customers on social media and pay attention to what they offer, as mistakes can have terrible consequences on their sales and reputation.
The Investigator 