Every day, we are exposed to advertising material for every product and service imaginable. Whether on social media, tv, radio, print and more, billions of dollars are spent on advertising each year, all to influence whether or not we make a purchase.

Also impacting our decision-making process are recommendations, or alternatively criticisms, of these same products and services from family and friends.

But how much of an influence can these word of mouth interactions have, and ultimately, how does it impact advertising dollars?

Joining me to discuss this topic is Yogesh Joshi, a professor at the University of Maryland, whose study, “When Consumers Learn, Money Burns: Signaling Quality Via Advertising with Observational Learning and Word of Mouth,” has been recently published in the INFORMS journal Marketing Science.