Explain the Importance of Word of Mouth Marketing

question 137

Essay

Explain the importance of word of mouth marketing. Briefly describe some of the channels that customers use to spread word of mouth.

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Definitions:

Maximum

The highest point on a nonlinear curve, where the slope changes from positive to negative.

Diminishing Marginal Utility

A principle stating that as a person consumes more of a good, the additional satisfaction or utility from consuming an additional unit decreases.

Total Utility

The total satisfaction received from consuming a particular quantity of goods or services.

Marginal Utility

The added satisfaction a consumer gets from having one more unit of a good or service.