An examination of the role of review valence and review source in varying consumption contexts on purchase decision

https://doi.org/10.1016/j.jretconser.2019.01.003Get rights and content

Abstract

This study examines the influence of Valence and Source of Online Reviews on a customer's attitude and purchase decision in the context of public and private consumption using social influence theory and the concept of negativity bias. The study was conducted using a 2 × 3 × 3 online experiment to examine the influence of review valence (positive vs mixed vs negative), two sources (retailer vs third-party site) in two different consumption contexts (public vs private). The results highlight the role of review valence as well as consumption context on a shopper's decision.

Introduction

Online reviews have become a source of useful pre-purchase information for buyers. According to PwC (2016), nearly fifty-percent of the surveyed shoppers reported reading reviews, comments and feedback before making purchase decision (Jiménez and Mendoza, 2013). Such reviews are prominently available on the retailer's website (such as amazon.com) as well as the third party sites (such as gsmarena.com). While retailer's website allows actual buyers to post reviews, third party sites allow experts to post their evaluation as well as allow comparison of various similar products. Blogs are written by neutral people who wish to gain traction to their site or simply share/disseminate knowledge.

Research on online reviews have mostly examined the influence of reviews on sales (e.g. Cui et al., 2012; Xie et al., 2016; Zhang et al., 2014). However, previous studies have not examined the role of source of reviews and review type on one's purchase decision. It is important to understand that reviewers provide reviews based on their previous experience. Bickart and Schindler (2001) argue that shoppers trust online reviews on a retailer's site as they consider them as unbiased and not influenced by marketers. Previous studies (e.g. Reichelt et al., 2014) have also made a call for examining the role of the source of the review in consumers’ evaluation. Apart from the source of review, the review mix is expected to influence one's purchase decision. The reviews provided on a retailer's site can be sorted by number of stars, most recent, most helpful, most positive and most negative, or viewed by specific features of the phone. Sorting the reviews by any option except most recent create a biased mix of reviews (most positive or most negative). Thus, in general, a customer is left with either all positive, all negative or a mix of positive and negative reviews. Therefore, it is important to examine the influence of review valence on a shopper's purchase decision taking forth the call by Wang et al. (2015) who similarly examined the role of review valence along with the type of reviews (benefit vs attribute) on a shoppers’ attitude and purchase intention.

In pursuance of this objective, this study seeks to answer the following research questions: What is the influence of the source of review (Retailer/Third Party) on consumer's purchase decision? What is the relative influence of review valence (Positive/Negative/Mixed) on one's purchase decision? Since, the products are purchased either for self (private consumption) or for others (public consumption), the context of consumption may also influence the relationship between review source and type on purchase decision. There is very little empirical evidence on how consumers deal with online reviews under different consumption contexts (Mudambi and Schuff, 2010). Thus, this study also examines: how does the consumption (buying) context moderates a customer's response to online reviews? We examine these from the perspective of negativity bias and social influence theory.

Section snippets

Research on online consumer reviews

Online consumer reviews have gained significant attention from both academicians and practitioners. Researchers have examined online reviews from various perspectives including their role on review helpfulness (e.g. Yin et al., 2013), purchase intention (e.g., Lee et al., 2011), information adoption (e.g. Cheung et al., 2008; Tata et al., 2017), product choice (e.g. Senecal and Nantel, 2004), and sales (e.g., Cui et al., 2012; Wang et al., 2015; Xie et al., 2016; Zhang et al., 2014). Research

Reliability and validity

First, we tested for reliability and validity of attitude and purchase intention (Table 2). The Cronbach's α, average variance extracted (AVE) and Composite Reliability (CR) were all greater than their minimum threshold of 0.7, 0.5 and 0.7 respectively (Hair et al., 2010) thus exhibiting reliability and validity.

Manipulation checks

For examining the manipulation success of review types, the subjects were enquired “whether the online reviews given to them positively evaluated the smartphone” on a seven-point Likert

Discussion and implications

The influence of review valence on attitude and purchase intention was found to be significant and supporting the results of earlier studies (e.g. Floh et al., 2013; Doh and Hwang, 2009). With respect to the impact of reviews, our findings contradict earlier studies, which posit that negative reviews have greater influence than positive reviews (e.g. Sen and Lerman, 2007; Lee et al., 2008). Albeit marginal, this study reflects that positive reviews have greater influence on both attitude and

Conclusion, limitations and future scope of research

In this study, we examined the role of review source and review valence in varying consumption context on an online shopper's attitude and intention to purchase. We used the theory of social influence and negative bias for theorizing and examining our research model. The results reveal the importance of review valence as well as consumption context in influencing a shopper's attitude and purchase intention. The results also reveal that shoppers do not differentiate between the reviews present

Funding

This research did not receive any specific grant from funding agencies in the public, commercial, or not-for-profit sectors.

Dr. Sai Vijay Tata is presently working as assistant professor, at Indian Institute of Management Ranchi, in the department of Marketing. His research interest includes – online consumer behaviour, online consumer reviews, consumer buying behaviour for new and innovative products, customer relationship marketing and impulse buying behaviour. He has published research papers in various journals like Journal of Internet Commerce, Pacific Asia Journal of the Association for Information Systems,

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    Dr. Sai Vijay Tata is presently working as assistant professor, at Indian Institute of Management Ranchi, in the department of Marketing. His research interest includes – online consumer behaviour, online consumer reviews, consumer buying behaviour for new and innovative products, customer relationship marketing and impulse buying behaviour. He has published research papers in various journals like Journal of Internet Commerce, Pacific Asia Journal of the Association for Information Systems, International Journal of Strategic Decision Sciences, Asian Academy of Management Journal, Journal of International Consumer Marketing, etc. He has also published case studies in Ivey publishing and Case centre.

    Dr. Sanjeev Prashar is a Professor at Indian Institute of Management Raipur India in the area of Marketing Management. Prior to this, he worked with Institute of Management Technology (IMT), Ghaziabad, as Professor in the area of Marketing Management. His areas of interest are Impulse Buying, Online Buying, Mall Selection, Rural Marketing, International Marketing/Exports Management and Marketing of Services. He has published research papers/Case studies in various journals like – Richard Ivey School of Business, Emerald Group Publishing Limited, IGI Publishing Limited, Inderscience Publishers, Palgrave Macmillan and Journal of Retailing and Consumer.

    Dr. Sumeet Gupta is an Associate Professor at Indian Institute of Management Raipur India in the area of Information systems and Decision Science. He did his Ph.D. (Information Systems) from School of Computing, National University of Singapore, Singapore. His areas of interest are Technology Adoption, Mobile Commerce, Electronic Commerce, Virtual Communities, Business Analytics, Supply Chain Management. He has published research papers in various journals like – Information Development, Information Technology for Development, Journal of Global Information Management, International Journal of Mobile Communications, International Journal of Market Research, Behaviour and Information Technology, Internet Research, Electronic Commerce Research and Applications, etc.

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