The electronic word-of-mouth effects of review valence, review volume, and product type on consumer purchase behaviour.

Abstract

This thesis aims to examine the mediating role of product type (i.e., product-luxury perceptions) on consumer response to online reviews and the subsequent effect on purchase behaviour. Specifically, this thesis explicates the influence of review valence and review volume in shaping the consumers’ product evaluation, which in turn affects their purchase intentions for the focal product. An experimental design is adopted for this research. To examine the possible effects of product type and online reviews on consumer response, an online experiment based on a review website platform is conducted, using a 2×2×3 between-subjects factorial design. In the experiment, participants were exposed to one of twelve conditions involving the manipulation of the three independent variables (review valence, review volume and product type). A total of 432 participants were included in the final analyses, which were recruited via online convenience sampling on Amazon’s Mechanical Turk. Factorial ANCOVA analysis was conducted to test the hypothesised relationships. The results indicated three interaction effects between review valence, review volume and product type on consumer decision-making. A two-way interaction effect of review valence and product type, confirmed that product type mediates the influence of review valence on product attitude, product evaluation and purchase intent. Results also indicated that luxury products are less susceptible to the influence of review valence, which equates to lower purchase intentions than the non-luxury counterpart when exposed to positive reviews. A recurrent main effect of review valence was present, with results indicating a negativity bias on the perceived informative value and persuasiveness of online reviews, which was also salient in information adoption. Review volume had one main effect and tended to emerge as significant through mediating variables. Moreover, product type elicited a main effect for six dependent measures. Product involvement, susceptibility to interpersonal influence (i.e., social learning and social belonging) and materialism were found to have exogenous effects (covariates). The managerial and theoretical implications are discussed for this research, along with suggested directions for future research.