Swayed by the Numbers: The Consequences of Displaying Product Review Attributes

Watson, Jared; Ghosh, Anastasiya Pocheptsova; Trusov, Michael

doi:10.1177/0022242918805468

Cited by 51 publications

(28 citation statements)

References 97 publications

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“…The effect of online product reviews on merchants' profits is significant. Studies have confirmed that online product reviews directly affect consumers' purchase decisions (Heydari et al 2015;Kostyra et al 2016;Choi et al 2017;Watson et al 2018) and product reputations (Filieri et al 2015;Petrescu et al 2018), and affects the sales volumes and profits of merchants (Chevalier et al 2006;Dellarocas 2006;Cai et al 2009). For instance, some studies found that a 1% increase in hotel review ratings may increase sales per room by approximately 2.6% in Paris and London (Öğüt et al 2012;Gössling et al 2018).…”

Section: Analyses and Propositionsmentioning

confidence: 96%

Fake online reviews: Literature review, synthesis, and directions for future research

Ngai

et al. 2020

Decision Support Systems

252

130

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Section: Analyses and Propositionsmentioning

confidence: 96%

Fake online reviews: Literature review, synthesis, and directions for future research

Ngai

et al. 2020

Decision Support Systems

252

130

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“…According to Watson et al. (2018) and Rozenkrants et al. (2017), some products and services (such as artwork and music) are evaluated more strongly on the basis of personal taste and self‐expression.…”

Section: Discussionmentioning

confidence: 99%

The weight of the crowd, social information credibility, and firm strategy

Ghosh

Galbreth

2023

Production and Operations Management

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When considering a purchase, consumers often augment their private information about a product with anonymous online social information (reviews, etc.). We examine the impact on firm strategy of how consumers weight these two information sourcesprivate and social-in their purchase decisions. An increase in weight on private information always results in higher prices at the interior equilibrium. However, the effects on profits, consumer, and total surplus are nonmonotonic: all increasing with the weight on private information when weight is high but decreasing when weight is low. Profit and surplus decrease with weight when weight is low because a marginal increase in a low weighting leads to a contraction of demand. The dynamic reverses when weight is high. Besides weighting of information sources, our model incorporates the questionable credibility of social information. A firm's optimal investment to improve social information credibility depends on whether consumers process information in a Bayesian or non-Bayesian manner. We show that, compared to Bayesian consumers, non-Bayesian consumers endogenously trust (distrust) social information from firms with high(low)-positivity ratings. This distinction in information processing results in a stark contrast in how firms manage social information credibility: when facing Bayesian consumers, with an increase in the positivity of its social information, a firm with high(low) positivity spends less (more) to improve credibility. On the contrary, when facing non-Bayesian consumers, a firm with high(low) positivity spends more (less) to improve credibility. Product quality also affects optimal credibility investment, following an inverted U-shape.

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“…Research shows that online reviews could help consumers to alleviate the risk concerns they may have while making an online purchase (Bond et al, 2019). Also, previous research shows that online reviews positively impact firms' sales (Watson et al, 2018).…”

Section: Online Shoppingmentioning

confidence: 98%

Price sensitivity and online shopping behavior during the COVID-19 pandemic

Rahmani

Kordrostami

2023

JCM

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Purpose The COVID-19 pandemic has disrupted numerous businesses and upended the lives and shopping habits of most consumers. This study aims to examine the price sensitivity and the efficacy of online reviews during a pandemic crisis. Design/methodology/approach This study borrowed from the regulatory focus theory and heuristic-systematic model and used a unique longitudinal sample of 320,000 product/day observations from the jeans category, collected before and during the pandemic, to investigate how consumers’ online shopping behavior changed during the pandemic. Findings The results of several hierarchical linear modeling analyses revealed that during the pandemic consumers were less price-sensitive and more willing to pay price premiums for jeans. Furthermore, consumers were more (less) likely to be influenced by online review volume than valence. Finally, the results of a post-hoc study highlighted the potential role of regulatory focus as the underlying psychological mechanism explaining the effect of the pandemic. Originality/value This research contributes to the digital marketing and regulatory-focus literatures by showing that the COVID-19 pandemic may have triggered a prevention-focus state of mind and prompted consumers to place a greater value on online review volume than valence when shopping online (for jeans). Furthermore, this paper contributes to the pricing literature by offering further evidence that the pandemic may have inclined consumers to be less price-sensitive.

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Swayed by the Numbers: The Consequences of Displaying Product Review Attributes

Cited by 51 publications

References 97 publications

Fake online reviews: Literature review, synthesis, and directions for future research

Fake online reviews: Literature review, synthesis, and directions for future research

The weight of the crowd, social information credibility, and firm strategy

Price sensitivity and online shopping behavior during the COVID-19 pandemic

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