Delight the experts,but never dissatisfy your customers! A multi-category study on the effects of online review source on intention to buy a new product

Online reviews are a pervasive form of electronic word-of-mouth (eWOM) that potentially accelerate—or slow down—the diffusion of recently launched services in the marketplace. While empirical research largely supports the effects of online reviews on attitudinal and behavioral outcomes, less is known about the impact the source of the review—i.e., if it comes from a peer consumer or an expert—has on the recipient. Two experiments that combine reviewer- (expert, consumer), service type- (mobile package, restaurant, car repair), consumer- (level of general innovativeness), and review-related (positive, negative) characteristics reveal a challenging interaction between the review’s source and its valence: while—compared to an established baseline—a positive expert review seems more effective in increasing the recipient's intention to purchase than a review by a peer consumer, a negative consumer review lowers the recipient's intentions to a larger extent than a negative expert review. We further find effects of the consumer's innovativeness and the service category across the experiments. Our research contributes to the topical and increasing body of empirical research on the effects of involved characteristics within online reviews across several product types.     

How do electronic word of mouth practices contribute to mobile banking adoption?

Mobile banking (m-banking) is the fastest growing and most cost-effective channel for delivering banking services. Electronic word of mouth (eWOM) plays a crucial role in the success of e-commerce. Therefore, the main purpose of this study is to investigate a comprehensive moderated mediated mechanism for enhancing m-banking adoption behavior through positive eWOM triggers using the elaboration likelihood model (ELM). Argument Quality, valence, consistency and volume were considered eWOM triggers, and the conceptual model also included initial trust in m-banking as a mediator and consumer involvement in m-banking as a moderator. A total of 1153 useable surveys completed by the Indian users of social networking websites were used for analysis. The findings showed that of the triggers, argument quality, valence, and consistency enhance intention to adopt m-banking. These effects were mediated by initial trust in m-banking. The mediation effects of initial trust between valence – Intention varied between high and low consumer involvement in m-banking. These findings make several contributions to the literature on marketing communication, particularly to eWOM research and ELM theory. Practically, this study provides several recommendations to banks about how to use positive eWOM for motivating consumers to adopt m-banking.     

When does electronic word-of-mouth matter? A study of consumer product reviews

Online consumer product reviews, a form of electronic word-of-mouth (eWOM), have attracted increased attention from researchers. This paper examines the persuasiveness of eWOM. Drawing on regulatory focus theory, the authors propose that the consumption goals that consumers associate with the reviewed product moderate the effect of review valence on persuasiveness. Data from lab experiments and actual online retailers suggest that consumers who evaluate products associated with promotion consumption goals perceive positive reviews to be more persuasive than negative ones (i.e., a positivity bias). Conversely, consumers who evaluate products associated with prevention consumption goals perceive negative reviews to be more persuasive than positive ones (i.e., a negativity bias).     

Seeing the wood for the trees: How machine learning can help firms in identifying relevant electronic word-of-mouth in social media

The increasing volume of firm-related conversations on social media has made it considerably more difficult for marketers to track and analyse electronic word-of-mouth (eWOM) about brands, products or services. Firms often use sentiment analysis to identify relevant eWOM that requires a response to consequently engage in webcare. In this paper, we show that sentiment analysis of any kind might not be ideal for this purpose, because it relies on the questionable assumption that only negative eWOM is response-worthy and it is not able to infer meaning from text. We propose and test an approach based on supervised machine learning that first decides whether eWOM is relevant for the brand to respond, and then—based on a categorization of seven different types of eWOM (e.g., question, complaint)—classifies three customer satisfaction dimensions. Using a dataset of approximately 60,000 Facebook comments and 11,000 tweets about 16 different brands in eight different industries, we test and compare the efficacy of various sentiment analysis, dictionary-based and machine learning techniques to detect relevant eWOM. In doing so, this study identifies response-worthy eWOM based on the content instead of its expressed sentiment. The results indicate that these machine learning techniques achieve considerably higher accuracy in detecting relevant eWOM on social media compared to any kind of sentiment analysis. Moreover, it is shown that industry-specific classifiers can further improve this process and that algorithms are applicable across different social networks.     

How Dispersive Opinions Affect Consumer Decisions: Endowment Effect Guides Attributional Inferences

Electronic word-of-mouth (eWOM) dispersion, reflecting the extent of reviewers’ opinion divergence regarding a product, determines consumer decisions. Drawing upon the endowment effect and attribution literature, this research proposes that the endowment effect mediates the influence of eWOM dispersion on attributional inferences, and the display formats of eWOM dispersion (“horizontal bar chart” vs. “eWOM content”) moderate the mediating influence of endowment effect on attributional inferences of eWOM dispersion. Three complementary studies reveal three key insights in this setting. First, when consumers already having an emotional attachment to a product and subsequently encountering dispersive eWOM, the higher the level of eWOM dispersion, the stronger the endowment effect. Secondly, In such circumstance, the stronger endowment effect promotes more reviewer-related attribution inference of high-dispersion eWOM, and the weaker endowment effect promotes more product-related attribution inference of low-dispersion eWOM. Third, the positive influence of eWOM dispersion on endowment effect is stronger for eWOM dispersion in the complexity or disfluency display format (i.e. “reviewers’ impression of product”) than for eWOM dispersion in the simply of fluency display format (i.e. “horizontal bar chart”), more importantly, the mediating influence of endowment effect on attributional inferences is moderated by the display formats of eWOM dispersion, and this findings persists even when product category (hedonic vs. utilitarian) is taken into consideration. The theoretical implications for the eWOM dispersion and attribution literature and practical implications for online retailers are discussed.     

Modeling the brand extensions' influence on brand image

Brand-extension strategies enhance success chances of new products, even though they expose brand image to dilution risks. The present work analyzes how brand-extension evaluation can affect the current brand image and proposes a theoretical model formed by five main factors related to brand associations, extension congruency and extension attitude. The model estimation includes structural equation analysis using data from 699 surveys developed under market conditions. The results verify that extension attitude influences brand image, whereas initial brand associations and perceived fit between the new product and either the remaining products (category fit) or the brand image (image fit) are able to strengthen consumer attitude. The study also explains the role of consumer innovativeness as a moderating factor, suggesting that the characteristics of consumer personality could be more important than expected.     

Acceptance of New Food Products: Reference Prices and Psychological Moderators of Heterogeneous Price Effects

This paper emphasizes a consumer-centered perspective to understand new food product success. It pursues two central objectives by showing that consumers are more likely to interpret new product prices as offering gains or losses depending on their individual purchase histories, and consumer psychographics are demonstrated to affect new product adoption directly, and/or moderate effects of prices and promotions as well as quality signalling product attributes. Several hypotheses are generated based on explanations of underlying psychological mechanisms. For data analysis a cross-classified random effects model is applied to household panel data on yoghurt and sausages that includes four crossed random factors. The findings confirm that inclusion of consumer-specific price information is beneficial for understanding new food products’ adoption behavior. Monetary losses as well as gains negatively affect adoption. Purchase habits also hinder adoption while consumer innovativeness is an important driver. Price consciousness and purchase habits moderate price and promotion effects. While price consciousness reinforces negative effects of prices and positive effects of promotions, habits hinder positive effects of promotions. This implies that introductory promotions are an inappropriate strategy for attracting habitual consumers, and managers should identify appropriate target groups in order to improve the efficiency of introductory promotions.     

Consumer perceptions of monetary and non-monetary introductory promotions for new products

Abstract

Little research has examined how consumers respond to sales promotions in new product categories. This article fills this gap by integrating research on reference prices with literature on sales promotions for new product categories. Existing research suggests that consumers respond more favourably to non-monetary promotions (e.g. extra free promotions) than monetary promotions (e.g. price discounts) because non-monetary promotions are framed as segregated gains rather than reduced losses. However, both kinds of promotions are widely used in practice, suggesting the importance of other contributory factors. With a consumer experiment on a national panel of consumers, this research demonstrates that extra free product promotions are most preferred for existing products, and introductory low-price promotions are preferred for innovative products. The moderating effect of a product's innovativeness is explained via a new relationship in the marketing literature, whereby perceived risk mediates the relationship between perceived innovativeness and a consumer's tendency to stockpile.     

Trust in online recommendations: an evolutionary psychology perspective

Electronic word-of-mouth (eWOM) is playing an increasingly important role in influencing consumer behavior, and it represents another opportunity for marketers to build support for their brands. This study explores how the gender of the reader influences how eWOM is perceived. An experiment grounded in evolutionary psychology examines how males and females differ in their perceived trust of eWOM of positive, negative, or mixed valence. The results indicate that females place greater trust than males in eWOM messages. But both genders find eWOM of mixed valence more trustworthy than entirely positive or negative eWOM. A follow-up phenomenological study of male and female consumers who had experienced eWOM shed more light on the experimental findings and offers additional support for their evolutionary basis. Theoretical and practical implications are discussed as well as recommendations for further research.     

Electronic word-of-mouth (eWOM) on WeChat: examining the influence of sense of belonging,need for self-enhancement,and consumer engagement on Chinese travellers’ eWOM

‘Friends’ circles’ on WeChat have helped make eWOM more easily accessible and influential than ever. Drawing from the social identity theory, literature on consumer engagement and eWOM, this study presents the first research that examines the influence of two personality traits, sense of belonging and need for self-enhancement, on consumer engagement and in turn leads to eWOM intention. The results suggest that the need for self-enhancement positively influences Chinese travellers’ engagement with WeChat. In addition, a partial positive relationship between consumer engagement and eWOM intention was identified: only dedication towards WeChat is directly related to travellers’ intention to engage in eWOM on WeChat. Dedication was found to mediate the influence of need for self-enhancement on eWOM intentions. Sense of belonging, however, does not have a significant impact on consumer engagement. These mixed results demonstrate changing cultural values of contemporary Chinese society. Theoretical and practical implications are discussed.     

Organizational memory influences new product success

Prior research on the impact of organizational memory on new product success has divergent perspectives. Such inconsistency has accrued mainly from not considering memory's multifaceted aspects, which interact with specific project characteristics. This paper tries to sort out this paradox by proposing that project innovativeness moderates the relationship among variables of organizational memory and new product success. An empirical study of 169 NPD projects of Korean manufacturing firms finds that memory sharing and the use of external information and formal procedures enhance new product success, whereas organizational memory has no effect. Project innovativeness is found to moderate memory's effect, despite some tradeoffs. As innovativeness increases, the effect of organizational memory and use of external information become stronger whereas the effect of memory sharing and use of formal procedures weaken. This suggests that firms must activate organizational memory more carefully according to project characteristics and the memory level to maximize its positive effects.     

Consumer Innovativeness and Loyalty to Non-GMO Foods: The Role of Cognitive and Affective Beliefs

Public concern over genetically modified (GMO) foods has led marketers to promote non-GMO branded foods to consumers. However, factors affecting consumers’ loyalty to non-GMO branded foods are still largely unknown. Building on the product diffusion model, the present research predicts and finds that consumer innovativeness has a positive effect on consumer loyalty to non-GMO foods. In addition, the present research draws from previous research on attitude formation and tests whether cognitive and/or affective beliefs may mediate the relationship between consumer innovativeness and loyalty to non-GMO foods. The results of a parallel multiple mediation model suggest that cognitive, but not affective, beliefs fully mediate the effect of consumer innovativeness on loyalty to non-GMO foods. These results have direct implications for marketers of non-GMO foods and, in general, increase our understanding of the process by which consumer innovativeness may affect consumer loyalty.     

Interpersonal influence and consumer innovativeness

Innovators represent a small and somewhat elusive group of consumers who are often the earliest adopters of new products. As such, marketing researchers and practitioners alike are interested in determining the personality characteristics that influence innovators to purchase a new product early in the product life cycle. This correlational study examined the relationships of three of these characteristics (susceptibility to interpersonal influence, attention to social comparison information, and role‐relaxed consumption) to individual innate innovativeness. Data were collected using self‐report surveys administered to 326 students at a large public university in the south‐east United States. The results supported hypothesized negative relationships between consumer innovativeness and both susceptibility to interpersonal influence and attention to social comparison information, as well as a positive relationship between consumer innovativeness and role‐relaxed consumption.     

How differences in eWOM platforms impact consumers’ perceptions and decision-making

ABSTRACT

This article aims to examine the effects of different features of various eWOM (electronic word-of-mouth) platforms on consumers’ perceived credibility of eWOM regarding the product-related risks. Based on the stimuli–organism–response (S–O–R) theory, this study establishes a model to explore the relationships among eWOM platforms, tie strength, social cues, and perceived eWOM credibility. A mixed design of 2 (eWOM platforms) × 2 (product-related risks) conditions experiment and a survey method is applied to verify the model. The results show that tie strength between eWOM publishers and recipients positively influences the perceived eWOM credibility. The volume of social cues in eWOM platforms positively influences the perceived credibility of a female, while the opposite is true for a male. Both tie strength and volume of social cues in social media are greater than those in e-commerce websites. For products with low risks, eWOM in e-commerce websites is perceived to be more credible. Findings implicate that interactive functions should be added to the product comment area to enhance communications between the reviewers and potential consumers. Findings also encourage the cooperation between e-commerce websites and social media and suggest that managers should develop proper strategies in different situations.     

Health‐care product advertising: The influences of message framing and perceived product characteristics

Message framing readily lends itself to marketing communication and advertising persuasion strategies. However, past research yields contradictory and inconsistent predictions as to whether positive or negative frames are more persuasive. This study examines the most appropriate message framing to present to consumers in print advertisements for health care products. Two experimental studies are conducted to investigate the moderating effects of product functions: perceived innovativeness and perceived risk on the processing of framed advertising messages. Findings of Study 1 indicate that messages for familiar products should be framed differently depending on perceived product functions (prevention vs. detection), but gain‐framed messages are more persuasive for both new prevention and detection products. Results of Study 2 suggest that a mixed‐framed message (combining gain and loss) could enhance message effectiveness only when subjects have prior experience. Similar to the role of product function, product perceived risk is found to moderate the framing effects on message effectiveness. © 2007 Wiley Periodicals, Inc.     

Born Unequal: A Study of the Helpfulness of User-Generated Product Reviews

Online user-generated product reviews have become an indispensible tool for consumers and thus for retailers who want to attract and retain consumers. Yet, relatively little is known about what causes consumers to find an online peer review helpful to their shopping tasks. Prior research examines mostly the effects of product reviews on consumer product attitude, product choice, and product sales. This paper, however, provides an analysis of the determinants of review helpfulness. In two studies, we examine the effects of review characteristics, product type, and reviewer characteristics on perceived review helpfulness. With data collected from a real online retailer, we provide empirical evidence to support our conceptual predictions. Specifically, both review valence and length have positive effects on review helpfulness, but the product type (i.e., experiential vs. utilitarian product) moderates these effects. Using content analysis of reviews, we develop a measure of expressed reviewer innovativeness (i.e., the predisposition toward new products as revealed in review content). A curvilinear relationship exists between expressed reviewer innovativeness and review helpfulness. These findings lead to pertinent managerial implications.     

Information direction, website reputation and eWOM effect: A moderating role of product type

This article examines how the electronic word of mouth (eWOM) information direction (positive vs. negative) and a website's reputation (established vs. unestablished) contribute to the eWOM effect. The article describes a study focusing on the moderating role of the product type (search vs. experience). The results of the experiment show that the eWOM effect is greater for negative eWOM than for positive eWOM, greater for established websites than for unestablished websites, and greater for experience goods than for search goods. The results support the moderating effects of product type on the eWOM information direction-website reputation-eWOM effect relationship. The impact of negative eWOM on the eWOM effect is greater for experience goods than for search goods. Similarly, the impact of website reputation on the eWOM effect is greater for experience goods than for search goods. The findings provide managerial implications for an Internet marketing strategy.     

Consumer acceptance of a revolutionary technology-driven product: The role of adoption in the industrial design development

Understanding how consumers adopt a state of the art product is important for the development and marketing of innovative products. The purpose of this study is to examine factors that affect consumer intentions to use a revolutionary technology-driven product (RTP). The research integrates two innovation adoption models, the Unified Technology Acceptance and Utilization Theory (UTAUT) and the Task-Technology Fit (TTF) model with two antecedents of consumer characteristics: consumer innovativeness and perceived value of a new product. The study examines consumer responses to an unfamiliar product, the TEASER which is a conceptual digital cookbook that offers taste sampling, thereby providing an online food-tasting experience. Consumers who are prone to innovativeness and who perceive value in a RTP’s aesthetics are able to discern the conditions that support their intent to use such a product. The resulting model expands the UTAUT and TTF theories by showing that UTAUT variables mediate between the variables of TTF and adoption intentions. These results support the need for nonlinear industrial development processes involving consumers.     

Accelerating Adoption of New Products of Thai Consumers: The Moderating Roles of Self-Brand Concept and Reference Group

The effect of consumer innovativeness on intention to purchase new products has been considerably investigated, but moderating effects to increase adoption rate of new products have thus far been overlooked. Drawing from the concept of consumer innovativeness, using survey research among Thai consumers, and analyzing data with hierarchical regression analysis, the author reveals that self-brand concept and reference groups can accelerate the adoption rate of new products. Successful firms can redefine marketing strategies to increase the adoption rate by developing new products and using brand strategy to fit with the individual or his/her group.     

Altruistic eWOM marketing: More than an alternative to monetary incentives

As a form of word of mouth, online reviews are used to reduce uncertainty about service quality and direct consumer attitudes and behavior. As a consequence of the high persuasiveness and the broad accessibility of electronic word of mouth (eWOM), companies are very interested to proactively managing this form of customer-to-customer communication. Compared with traditional advertising provides, eWOM marketing is a more credible and low-cost alternative. So far marketers have commonly used monetary incentives to influence customer-to-customer communication. However, this form also includes potential negative consequences such as credibility loss through consumer skepticism and crowding-out effects. This study analyzed two new incentive programs for increasing recommendation likelihood that considered the activation of an altruistic form of motivation to overcome these drawbacks. Therefore, an experiment was designed with three experimental groups (incentive programs) vs. a control group (no incentive). Finally, the results are discussed while taking into account the advantages and drawbacks of the particular incentive program to deduce practical implications.