Author : PRADEEP RACHERLA
Release : 2008
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Kind : eBook
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Book Synopsis FACTORS INFLUENCING CONSUMERS' TRUST PERCEPTIONS OF ONLINE PRODUCT REVIEWS by : PRADEEP RACHERLA

Download or read book FACTORS INFLUENCING CONSUMERS' TRUST PERCEPTIONS OF ONLINE PRODUCT REVIEWS written by PRADEEP RACHERLA. This book was released on 2008. Available in PDF, EPUB and Kindle. Book excerpt: Online word-of-mouth (WOM) platforms have been referred to by various terms such as online communities, feedback systems, peer reputation systems, or consumer generated media. Such systems provide a global platform for customers to share their experiences, and also rate service providers. WOM systems are burgeoning on the Internet for products such as music and books (Amazon.com), news (Slashdot.org), consumer electronics (shopping.com), tourism and travel (Tripadvisor.com; Hotels.com), and many other products and services. As with the traditional WOM, numerous studies have shown that these systems have a significant impact on customer decision making process, their satisfaction with goods and services, and the overall value of online economic transactions. In this study, the primary focus were the product review systems (PRS). These review systems are less personal but more ubiquitous platforms for online WOM wherein consumers post reviews about the products/services they have consumed. These reviews are widely accessible to other consumers but are disseminated only when other consumer consult these reviews during the purchasing process. However, there are still numerous problems associated with these systems. Recent studies have shown that there are numerous instances of deceptive information provided by service providers themselves or customers who have been paid by commercial parties. Added to this is the problem of anonymity in a computer mediated environment that adds to the already existing uncertainty for the consumer. Further, each review system consists of hundreds of consumer reviews associated with any given product or service. Given that consumers face these numerous problems, research is yet to examine the factors that drive the consumers develop trust in these reviews, and base their purchasing decisions on the information gleaned from the review systems. The main objective of this study was to explore this interesting phenomenon. To this end, this study applied uncertainty reduction theory and Social identity theory to delineate certain aspects of the online reviews that might have an impact on the consumer's assessment of online product reviews. Based on these theories, it was hypothesized that the informational content of the review and social component of the review (individuals' identity information disclosure and the consumers' perceived similarity with this information) have a significant effect on the consumers' trust in a review and subsequently the purchase intention. Further, based on the elaboration likelihood model, it was also posited that consumers' use of these heuristics is more salient while evaluating high involvement products than low involvement products. To test the hypotheses, the study adopted a quasi-experimental design with 2x2 (2 levels each for information content and social component within-subjects) x 2 (2 involvement modes between-subjects) full factorial design. Based on two levels for each of these factors, four reviews similar to those found in sites such as tripadvisor.com were created. A total of 283 students (153 in high involvement mode and 130 in low involvement mode) evaluated these reviews and assigned trust scores as well purchase intention scores to each review. The data was analyzed using linear mixed models and structural equation modeling. The results showed that both the main effects, information content of the review, and the consumers' perceived social identity with the reviewer contribute to an increased trust in the reviews. The study data did not support the hypothesis that involvement of the activity moderates the above mentioned relationships. Within this, information content was found to be playing an important role in both the involvement modes whereas the social component explained more variance in the trust in the high involvement mode than low involvement mode. Some of the results concur with previous research in both traditional and online WOM. The significance of these results in the extant literature as well their implications for both product review system providers as well tourism and hospitality service providers are discussed in detail.