Small But Mighty
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It’s well known that consumers value online reviews: As many as 98% report that they rely on reviews to inform purchase decisions, with some consumers listing it as the number-one factor they consider when contemplating a purchase — even above a product’s description.
Consumers weigh not only review characteristics (like an item’s numerical rating, the number of reviews it has, the identity of the reviewer, etc.) but also the content of the review itself, including whether reviewers recommend a product or say they’d buy it again — positive content that we call “loyalty expressions.”
Unsurprisingly, companies have attempted to harness the persuasive power of these expressions to boost sales. Many offer incentives to customers who review products, with some explicitly encouraging customers to specifically say that they recommend that product in their reviews. Companies such as BestBuy, Target, Macy’s, and Costco make reviews that contain recommendations more visible to customers — for example, by placing them on the first page of reviews.
Given the importance of online reviews to customers, and therefore to retailers, we wondered: What makes some reviews more persuasive than others? Is it more powerful when customers say “I recommend this product,” or is it more powerful when they say that they’d buy that product again (we call that their “repurchasing intention”)? Does the type of product being reviewed make a difference?
To answer these questions, we conducted a study, published in the Journal of Retailing. We analyzed 111,728 online purchase reviews and conducted seven experiments involving more than 2,000 individuals who were asked to consider purchasing a wide range of goods and services, including hotel rooms, bottles of wine, meals at restaurants, and dental services. We found that the persuasiveness of each loyalty expression depends on how frequently the item in question is likely to be purchased.
Frequently vs. Infrequently Purchased Items
In the first of our studies, we examined 111,728 online reviews on Yelp. Yelp allows users to mark when a review is “useful,” and users are able to sort reviews so that those with the most “useful” votes appear at the top. Confirming our hypothesis, we found that reviews were considered more useful when people noted they would recommend a service or use a service again compared to reviews without these loyalty expressions. Reviews stating repurchase intentions were the most likely to be considered useful by users.
Analyzing our data, we suspected that the majority of the reviews in our sample were for products or services that people frequently buy, like wine or dinner. But we wondered: Is repurchasing intention still the most persuasive expression for items one might buy infrequently, like a car?
To test this, as well as the part that perceived credibility plays in review persuasiveness, we conducted seven follow-up experiments in which we asked over 2,000 online participants to imagine they were making various purchases, from a bottle of wine to having a crown placed at a dental office.
Indeed, we found that which loyalty expression was the most persuasive was dictated by how frequently that item was likely to be purchased. In experiments where participants were asked to imagine they were buying items they might regularly pay for, like wine or a dental cleaning, reviews with repurchase intentions were the most persuasive. When participants were asked to evaluate reviews pertaining to infrequently purchased goods or services, like having a dental crown placed, they found reviews recommending the service to be the most persuasive.
This is because our participants found these expressions to be the most credible, given the circumstances. When an item is purchased frequently, saying you’ll repurchase it is likely to perceived as more appropriate, and therefore a more credible endorsement than simply making a recommendation. Conversely, when you’re likely to only buy something infrequently, a reviewer saying they would buy it again seems less credible, so a recommendation would likely be more persuasive. Our research suggests that credibility and persuasiveness are linked: The more credible a review seems, the more likely its content will sway a purchasing decision.
Our findings provide a useful new lens through which retailers can examine their review solicitation and highlighting processes. When determining what products to highlight or feature, companies should consider how frequently that item may be purchased and consequently select those reviews that are likely to be perceived as more credible to consumers.
Some Limitations
While our findings persisted across a range of goods and services, there are additional nuances retailers and researchers should consider. Our work focused on two distinct dimensions of loyalty — recommendations and repurchase intention — but future research might examine the relative persuasiveness of other loyalty expressions such as “I like it,” “It’s improved my life,” and so on.
Additionally, we only explored the relationship between positive sentiments and persuasiveness. We did not study the impact of negative expressions (like “I would not buy this again”) on how persuasive a review was perceived to be. It’s possible that these might prove even more persuasive, which would require retailers to act to mitigate their negative effects (for example, by replying to the review and offering assistance).
Further, additional work might be done to clarify and expand on the connection between credibility and persuasiveness. While we found them to be correlated, there may be some circumstances in which this is not the case, but more research is needed.
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As e-commerce continues to grow, it’s critical for retailers and service providers to understand the power of reviews and their importance to business revenues. Our findings show useful ways that retailers can improve and harness the kinds of reviews that are most meaningful to their customers.