Cutting Through the Online Review Jungle — Investigating Selective eWOM Processing

Consumers frequently rely on online reviews, a prominent form of electronic word-of-mouth (eWOM), before making a purchase decision. However, consumers are usually confronted with hundreds of reviews for a single product or service, as well as rich information cues on online review websites (review texts, helpfulness ratings, author information, etc.). In turn, consumers face more information cues on online review websites than they can or want to process, and are likely to proceed selectively. This paper investigates selective processing of such eWOM information cues. Results of Study 1, an exploratory study using verbal protocols, confirm that consumers display selective eWOM processing patterns and are able to articulate them. Study 2 develops and applies a measurement instrument to capture these patterns. A subsequent cluster analysis on members of a large-scale online panel (N = 2,295) indicates five prominent eWOM processing types, termed “The Efficients”, “The Meticulous”, “The Quality-Evaluators”, “The Cautious Critics”, and “The Swift Pessimists”. Insights of this research can help firms to better understand consumers' eWOM processing and improve the user-friendliness of online review websites.     

Explaining the joint effect of source credibility and negativity of information in two‐sided messages

By referring to different stages of an attribution process, this study examines how source credibility effects and opposing effects of negative information in two‐sided messages can be disentangled. The findings show that disclosure uniqueness (i.e., whether disclosures in a two‐sided message are given voluntarily or not) leads to both inferences on source credibility and inferences on product uniqueness. The inference on product uniqueness requires more cognitive effort on the part of the consumer than the inference on source credibility. Therefore, the effects of disclosures in two‐sided messages on brand attitudes depend on the cognitive load of consumers. Consumers make either an inference on the source or on both the source and the product. The results add to previous attribution research and the two‐sided message literature, showing that consumers under cognitive load can fail to make inferences on negative brand attributes in two‐sided messages. © 2010 Wiley Periodicals, Inc.     

Making new products go viral and succeed

Why are some new product introductions more viral and successful than others? This research integrates theories of interpersonal communication and consumer learning to explore this question. Analyzing a unique data set of millions of consumer word-of-mouth transmissions (eWOM) on social media regarding 345 new automobile products introduced during 2008–2015, we find that more innovative products generate more eWOM volume but surprisingly less positive sentiment. These effects vary in magnitude across eWOM channels. However, the use of rich-content communication, pre-announcement, and cobranding strengthens (weakens) the positive (negative) effect of product innovativeness on eWOM volume (sentiment). The results further indicate that eWOM sentiment is a stronger predictor of new product success than eWOM volume. Experimental results reveal more insights into how product innovativeness influences eWOM metrics in several product categories and shed light on the role of excitement and perceived risk as mechanisms underlying these effects. The research offers useful implications for firms to design effective viral marketing campaigns to enhance new product success.     

Payment formats and hedonic consumption

Payment formats have many important influences on consumer behavior. However, few studies have examined how the payment format affects hedonic consumption. This study explores how the transparency of the payment format (e.g., bonus points vs. cash) influences consumers’ willingness to pay, budget assignments, and consumption choices through differences in their perceived pain of purchasing (exchanging) hedonic and utilitarian options. Specifically, consumers who pay with highly transparent payment formats (e.g., cash), compared with consumers who pay with less transparent payment formats (e.g., store points, bonus points, and gift certificates), are willing to pay less, assign a lower budget, and are less likely to choose hedonic products. The perceived pain of purchasing (exchanging) a hedonic product plays an important mediating role on the influence of the payment format on hedonic consumption. However, the perceived pain of purchasing (exchanging) a utilitarian option plays a parallel mediating role only when people have paid for the less transparent payment format (e.g., buying store points) rather than when they accumulate the points through previous consumption events. The research findings provide insights that can benefit both theory and practice.     

Store format choice and relationship quality in apparel retail: A study of young and early-middle aged shoppers in New Delhi region

Shopping format choice has been an interesting and important area of research in the academic literature from long time. However, research in this area is presently at a nascent stage in India. There are a very few studies which focus on store format choice in India which includes the works of Anand and Sinha (2009), Prasad and Aryasri (2008), Sinha and Banerjee (2004) and Tripathi and Sinha (2008). The present study compares three different retail formats (Discount stores, Exclusive stores and Multi-brand outlets) based on the shopper's perception of relationship quality (RQ) of these stores using multivariate techniques. For addressing, the objective of this study a sample of 313 shoppers is used. Results suggest that “conflict due to store” and “combined overall RQ due to the store and its employees” influence the store format choice. The RQ levels among the apparel store format are highly competitive.     

I'll Have Fries with That: Increasing Choice Complexity Promotes Indulgent Food Choices

Three studies showed that the way that options are presented in a choice set—as combinations of intersecting attributes or in a more sequential “a la carte” choice format—affects the degree to which consumers adhere to their goals in the consumption setting. Specifically, using the context of food consumption and healthy eating, results showed that consumers were more likely to make double indulgent choices, the choice of both an indulgent entrée and an indulgent side item, when choosing from a menu consisting of predetermined “combination meals” than when selecting among the same entrée and side options in an a la carte fashion. Studies 2 and 3 implicated a goal distraction mechanism in driving the effect; the combination format, with its cross‐cutting of product choices into various combinations, reduces the salience of goal‐related constructs on implicit measures. In showing that different product presentation formats can affect the degree to which consumers make goal‐consistent choices, the current work adds to work on the effects of environmental influences on goal progress and goal achievement. Implications for encouraging goal‐consistent behavior in the context of healthy eating as well as other important consumer goal contexts are discussed.     

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.     

Attributional influences on consumers' desires to communicate about products

Three studies examined attributional antecedents of selected consumer communications about products. Study One used the critical incident technique to examine the types of attributions consumers make about product performance when they want to complain to or compliment a firm. Studies Two and Three systematically manipulated causal inferences to determine their effects on consumer desire to complain to a firm, compliment a firm, warn against, or recommend a product to other consumers. Results indicate that attributional locus (buyer-related versus seller-related), controllability (under volitional control versus uncontrolled), and stability (fluctuating versus stable) influence consumers' desires to communicate about products.     

The effect of negative online customer reviews on brand equity and purchase intention of consumer electronics in South Africa

This study investigated the effect that negative online customer reviews have on brand equity and purchase intention. This research examined the influence of negative electronic word of mouth (eWOM) on brand equity, as influenced by customer review quality, product involvement and source credibility. A 3 (high quality review versus low quality review versus no review) × 2 (high product involvement versus low product involvement) factorial experiment with 236 respondents was conducted. The results revealed that the presence of negative eWOM has a significant detrimental effect on brand equity and purchase intention. Furthermore, the effect of negative online customer reviews is more detrimental to the brand equity of a high involvement product than a low involvement product. The results also revealed that high quality reviews are more influential than low quality reviews with respect to brand equity, and the difference between the levels of eWOM source credibility has no significant effect on brand equity.     

The characteristics and business impact of children’s electronic word of mouth in marketing communications

Abstract

Leading digital technology companies have shown a strong interest in enabling children to send electronic word of mouth (eWOM). Recasting children from passive to active participants in marketing communications, this shift expands children’s marketing practices from how companies influence children via traditional marketing communications, to how children influence companies’ marketing practices through eWOM. We apply the value-capacity-vulnerability framework for children’s expressive rights to the context of children’s eWOM. Using a dataset of Amazon customer reviews written by children under the age of 13, we examine the characteristics and business impact of children’s eWOM. We find that the volume and variance of children’s eWOM are smaller than that of adults’. Children’s eWOM increase the overall diversity of opinions. Although receivers perceive children’s eWOM as less helpful, children’s eWOM valence (i.e. average rating) correlates with that of adults’. Children’s eWOM volume has a product-category-dependent association with product sales: positively in children’s product categories, while negatively in general categories. Children’s eWOM valence and variance are positively associated with product sales in both product categories. Receivers are less likely to criticize children’s eWOM compared to that of adults’, suggesting an underlying protective behaviour towards children among eWOM receivers. These results show that children have the capacity to engage in eWOM of social and business value, with receivers typically mindful of children’s vulnerability in social interactions.     

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.     

Advertising in English in Nonnative English-Speaking Markets: The Effect of Language and Self-Referencing in Advertising in Romania on Ad Attitudes

As a potent symbol of globalization, English has become one of the most popular foreign languages used in advertising in many nonnative English-speaking markets. This study aims to explore the effect of language used in advertising (English versus local) and self-referencing on consumers' ad attitudes in Romania, a country where the population is not necessarily speaking English fluently. The results indicate that multinational brands benefit from using English in advertising, whether a high or a low level of self-referencing is used. For local brands, different language formats do not vary in their advertising effectiveness. However, if English is to be used to advertise a local brand to give a “modern” flavor to the product, a high self-referencing format should be used.     

Attribution Effects of Time Pressure in Retail Supply Chain Relationships: Moving From “What” to “Why”

Retail supply chains must be responsive to consumer demand and flexible in adapting to changing consumer preferences. As a result, suppliers are often expected to deal with time pressure demands from retailers. While previous research demonstrates that time pressure can have longer term relational costs that reduce collaborative behaviors and overall relationship quality, this mixed‐methods study goes further by accounting for attribution effects to explain why the time pressure occurs. Specifically, supplier perceptions for the reason of time pressure being within or beyond a retailer's control, rather than time pressure itself, appear to have a stronger effect on relational outcomes. By investigating time pressure through the lens of attribution theory, this research opens a new inquiry of research that moves away from examination of outcomes themselves (the “what”), to examining “why” the outcome occurred.     

Feature-based attributes and the roles of consumers' perception bias and inference in choice

This paper considers decision contexts wherein consumers make choices among alternatives that contain a manifest feature-based attribute: i.e., a discrete, salient and important attribute that describes a dichotomous quality, such as “genetically modified”, “organic”, or “locally grown”. We propose a choice model that can explicitly account for a) perception bias with respect to such an attribute when its information is present, and b) inference formation if this attribute information is missing for some alternatives. The impact of different information presentation formats on consumers' perception bias and inference formation is then examined by applying theories from social psychology. Our model outperforms standard Random Utility models that omit explicit representation of these phenomena. Consistent with theories considered, we find significant evidence of perception bias and inference in the choice data. Our results also provide insights on how consumers may infer the quality of a missing attribute in different competitive framing contexts. Finally, our welfare estimates show that consumers may benefit simply from the information improvement regarding government labeling policies.     

Moderating effect of customer's retail format perception on customer satisfaction formation: An empirical study of mini-supermarkets in an urban retail market setting

Customer perceptions of retail formats have become ambiguous with new value-added features of traditional retail formats. Hence, this paper proposes a framework for explaining retail patronage formation under the condition that customers perceive the ambiguity of retail format boundaries. The moderating effect of customers' retail format perceptions on customer satisfaction is examined using data from Japanese mini-supermarket customers. Results indicate that customers' perceptions of retail formats partially influence customer satisfaction. Theoretically, this implies that considering retail format as a concept that customers construct a posteriori may be necessary and practically indicates that retail practitioners should manage customers’ retail format perception.     

The Effect of Low‐ versus High‐Variance in Product Reviews on Product Evaluation

This research investigates whether the effect of low‐ versus high‐variance product reviews on the evaluation of a product about which consumers have favorable or unfavorable prior expectation can vary depending on product type, the argument quality of product reviews, and the number of reviewers. The data across three laboratory experiments demonstrate that high‐variance product reviews are more likely than low‐variance product reviews to undermine product evaluation when consumers have unfavorable prior expectation about a product. When consumers have favorable prior expectation, however, high‐variance product reviews can enhance or undermine product evaluation depending on product category, the argument quality of reviews, and the number of reviewers. The findings are explained by the type of causal attribution consumers make, such that high‐variance product reviews can allow consumers to make biased product evaluation consistent with their prior expectation when the causes of variance in the product reviews are attributed to the reviewers rather than to the product. However, when the causes of variance are attributed to the product rather than the reviewers, high‐variance product reviews can undermine product evaluation regardless of the favorability of prior expectation.     

Extending Our Understanding of eWOM Impact: The Role of Source Credibility and Message Relevance

Using qualitative data from consumers who have previously purchased online and who read online product reviews, this work expands current thinking on determinants of the impact of electronic word-of-mouth (eWOM) communications on consumer decision making. Specifically, beyond source credibility, findings suggest that consumers also assess how similar the source of eWOM is to them in terms of personality and product usage. In addition to source credibility, the notion of message relevance is introduced as the second first-order factor of eWOM impact. In turn, the underlying dimensions of source credibility (expertise and trustworthiness) and message relevance (persona similarity and usage similarity) constitute four second-order determinants of eWOM impact; providing a comprehensive view of the determinants of eWOM impact. Additionally, a conceptual framework depicting the sequential and cumulative effect of the four assessment dimensions along with possible gender differences in the processes used to assess eWOM credibility and message relevance are discussed.     

Electronic word-of-mouth (eWOM) generation in new media platforms: The role of regulatory focus and collective dissonance

In this research, we examine the role of two motivational forces associated with creation of electronic word-of-mouth (eWOM): regulatory focus and collective dissonance. Our studies show that generation of eWOM is enhanced by regulatory fit, while traditional WOM is dominated by the negativity effect. In study 1A, we show that prevention-focused consumers produce stronger intentions to post eWOM when they undergo a negative compared to a positive service experience. In study 1B, we find that promotion-focused consumers are more likely to post eWOM in reaction to a positive service experience when one's self-construal is independent. The final study shows that due to collective dissonance, consumers have greater intentions to create eWOM when their experiences are inconsistent with others' postings. We discuss the implications of these results for the development and management of eWOM communication in virtual communities.     

The impact of inference generation on belief formation

This study investigates the effects of generating inferences (or failure thereof) with incomplete advertising messages on consumer's belief formation. A factorial design is used to systematically investigate the roles of product knowledge, message structure, and inference prompting in this process. The results show that inference generation or failure affects not only the belief per se, but also the confidence in the belief and that strength of learned beliefs about the product tends to be congruent. Specifically, high knowledge consumers' inferred beliefs are stronger, held with higher confidence, and more congruent with their existing beliefs than those of low knowledge consumers. Interaction effects are also observed between product knowledge and message structure for low knowledge consumers. High knowledge consumers are not affected by message structure or inference prompting condition. Implications of these findings for inference-persuasion research, advertising effectiveness, and future research are discussed.     

Effects of recommendation systems on consumer inferences of website motives and attitudes towards a website

Drawing on the theoretical framework of consumer inferences of marketer motives, we explore consumer responses to different types of product recommendation provided by an e-commerce website (i.e. recommendation systems, RS). The findings demonstrate that RS for alternative brands only are most likely to lead to the consumer inference of a consumer-serving motive, followed by RS for both alternative brands and additional products, and RS for additional products only. In turn, the consumer inference of a consumer-serving motive has a positive influence on attitude towards the website. However, the consumer inference of a firm-serving motive does not mediate the effect of RS type on attitude towards the website. Further, the effect of RS type on attitude towards the website occurs only for consumers low in interpersonal trust. Theoretical and managerial implications are also discussed.