Вы находитесь на странице: 1из 20
The current issue and full text archive of this journal is available at www.emeraldinsight.com/1066-2243.htm

The current issue and full text archive of this journal is available at

www.emeraldinsight.com/1066-2243.htm

The different effects of online consumer reviews on consumers’ purchase intentions depending on trust in online shopping malls

An advertising perspective

Jumin Lee

Department of E-business, Kyung Hee Cyber University, Seoul, Republic of Korea

Do-Hyung Park

LG Electronics Inc., Seoul, Republic of Korea, and

Ingoo Han

KAIST Business School, Seoul, Republic of Korea

Abstract

Purpose – With the increasing influence of online consumer reviews (OCRs) on a consumer’s decision making, online sellers have begun to embed the OCRs in their advertisements (OEAs). This study has the following two research objectives: first, to investigate the effects of two types of (OCRs vs OEAs) on consumers’ purchase intention from an informational influence perspective; second, to investigate the effects of OCRs from a credibility perspective. Design/methodology/approach – The data for this study are obtained from a two-way factorial experimental research design. The factors included are the type of OCRs and the trust level of online shopping malls. In addition, PLS test is used to understand the underlying effects of trust in online shopping malls, credibility of OCRs/OEAs, and consumers’ purchase intentions. Findings – The results show that OCRs are more influenced by trust in online shopping malls than OEAs. The greater the perceived credibility of OCRs among potential consumers, the higher is the purchase intention. When the trust in online shopping malls is high, consumers’ purchase intentions influenced by OCRs are more favorable than those influenced by OEAs. Originality/value – This study is an initial consumer endorsement research that uses OCRs to extend the trust transfer theory and extends the interpersonal online trust perspective. For practitioners, this study is useful in determining which type of OCRs is useful for marketing, depending on the trust in online shopping malls. Moreover, the results of this study could aid in the development of an e-commerce strategy using OCRs.

Keywords Electronic commerce, Consumers, Perception, Trust, Internet

Paper type Research paper

1. Introduction With the exponential growth of e-commerce, consumers create a huge amount of information, which influences other consumers (Brown and Reingen, 1987; Chatterjee, 2001; Chen and Xie, 2008; Dellarocas, 2003; Godes and Mayzlin, 2004). Recent evidence suggests that consumer-created information has become a rather important influence for consumer behavior such as purchase decisions. Online consumer reviews (OCRs)

Effects of

customer

reviews

187

consumer reviews (OCRs) Effects of customer reviews 187 Internet Research Vol. 21 No. 2, 2011 pp.

Internet Research Vol. 21 No. 2, 2011 pp. 187-206 q Emerald Group Publishing Limited

1066-2243

DOI 10.1108/10662241111123766

INTR

21,2

188

Figure 1. An example of OCRs embedded in advertisement (copying OCRs into advertisement)

are part of consumer-created information by web site users who have already bought

the target product. OCRs contain information and recommendations of the products from the consumer’s perspective (Park et al. , 2007). Recent studies have investigated OCRs as electronic word-of-mouth (eWOM) that influences consumer behavior (Brown and Reingen, 1987; Chatterjee, 2001; Chen and Xie, 2008). For example, people make purchasing decisions based on consumer-created information over the Internet (Godes and Mayzlin, 2004) and rely on Internet postings to make decisions that range from which movie to watch to which stocks to invest in (Dellarocas, 2003). Online sellers have discovered the effect of OCRs and are trying to use these OCRs to advertise in online shopping malls as consumer endorsements that have been used in advertisements in other media, such as television and radio (Fireworker and Friedman, 1977; Friedman and Friedman, 1979; Frieden, 1984). Consumer endorsement is a useful advertising strategy in advertising. Typical consumer endorsements significantly improve the overall attitude toward the product, thereby increasing the expected price (Fireworker and Friedman, 1977). Thus, unlike traditional consumer endorsements, online sellers can use OCRs without incurring a cost. While traditional advertisers select people and interview them regarding their personal experiences, online advertisers merely quote the body or certain parts of OCRs that are already exposed in an online shopping mall. For example, Tom and Jane gave it a “Two

Thumbs Up!” or other members say, “It is awesome! Good choice because [

Figures 1 and 2 illustrate examples of consumer review usage in online advertisements.

]”

awesome! Good choice because [ Figures 1 and 2 illustrate examples of consumer review usage in
Sellers either quote the entire OCR in the advertisement (e.g., “many people who have bought

Sellers either quote the entire OCR in the advertisement (e.g., “many people who have bought off me from eBay have lost weight with this product. Take a look at the feedback comments taken directly from my feedback pages from people who have lost

weight [

used in online advertisements are defined as OCRs embedded in advertisement (OEAs). Several studies have considered OCRs from an information processing perspective (Park et al. , 2007; Lee et al., 2008). However, online sellers were unable to ascertain from these studies whether or not the new advertisements using OCRs are more attractive to customers. The key research questions of this study are stated below:

(Figure 1) or quote them partially (Figure 2). In this paper, OCRs that are

]”)

Do customers process OEAs differently from OCRs depending on the trustworthiness of online shopping malls?

Is it a good idea to use OCRs in online advertisements (OEAs)?

Which environments make the effect of the OEAs better than that of OCRs?

The above research questions will be comprehensively addressed throughout the paper. From an analysis of previous research, the predicted answers of the abovementioned questions will be hypothesized in the experiment. The remainder of this paper is organized in the following manner. The next section describes the literature reviews from informational influence perspectives and trust perspectives. Section 3 presents our proposed hypotheses. Sections 4 and 5 explain the experimental design and results of the experiment. The final section presents the research summary and discussion, as well as implications for future research.

.

.

.

Effects of

customer

reviews

189

Figure 2. An example of OCRs embedded in advertisement (quoting OCRs into advertisement)

INTR

21,2

190

2. Literature reviews Deutsch and Gerard (1955) introduced two types of social influence – normative and informational influences. While a normative influence occurs when people conform to the expectations of others, an informational influence is the tendency to accept information from others as an indicator of reality. Individuals may either seek information from knowledgeable others, for example, through OCRs, or make references based on an observation of the behavior of other people or groups (Park and Lessig, 1977). In the Internet environment, consumers do not need to conform to the expectations of others when making a purchase, and they all have informational influence that enables them to make good decisions (Dholakia et al. , 2002). Therefore, an informational rather than a normative influence is expected to play a central role in influencing the purchasing decision of individuals (Huang and Chen, 2006). This study focuses on informational influences.

2.1 Order of information presentation and the primacy effect

Online shopping malls have a general rule of information arrangement. The product picture is located at the top and the advertisement including product details and OCRs follows sequentially. The order in which a consumer receives and processes information may affect the impact of the message because information is processed sequentially over time (Crowley and Hoyer, 1994). The primacy effect reveals that information that is presented earlier is more persuasive (Asch, 1952). Moreover, primacy effects have been observed not only in the position of information but also in the content of advertisements (Petty and Wegener, 1998). According to the primacy effect, placing online consumer reviews first on the web page may be wise because the recommendation may form a first impression and attract the users on the basis of what is presented first. Consistent with this view, the anchoring and adjustment hypothesis (Alba et al. , 1991) also suggests that an initial positive attribute establishes an “anchor” for subsequent evaluation. In online shopping malls, a product’s first impression is more positive when sellers use OCRs in their product advertisement (OEAs) rather than presenting it later, after product information (OCRs).

2.2 Credibility and challenges of online consumer reviews

Consumer endorsement in advertisements is of three types: celebrity, expert, and typical consumer endorsements (Fireworker and Friedman, 1977; Kelman, 1961; Friedman and Friedman, 1979). The endorsers are persuaded through the informal influence of the process of internalization (Fireworker and Friedman, 1977; Kelman, 1961; McGuire, 1969). Internalization occurs when the receiver adopts an attitude because it is useful for the solution of a problem or is demanded by his or her value system. Further, internalization occurs if reference groups are considered credible (McGuire, 1969). Consistent with this view, information from high-credibility sources is likely to be more easily accepted (Bearden and Etzel, 1982). Credibility includes expertise and trustworthiness (Hovland et al. , 1953). Expertise is defined as the perceived ability of the source to make valid assertions, and trustworthiness is defined as the perceived willingness of the source to make valid assertions (Hovland and Weiss, 1951-1952). The model indicates that sources exhibiting expertise and trustworthiness are credible and persuasive (Atkin and Block, 1983; Kamen et al. , 1975; Klebba and Unger, 1983). Further, trustworthiness positively influences consumer

attitudes toward a brand, consumer intentions, and their purchase behaviors (Lascu et al. , 1995; Petty and Wegener, 1998). Prior research has suggested that OCRs are likely to be more credible than seller-created information (Dellarocas, 2003; Wilson and Sherrell, 1993). On the other hand, several researchers suggest that there exist some challenges related to customer-created information (Dellarocas, 2003). These challenges are related to online identity and feedback operating perspectives. In the online identity perspective, online identity can be changed easily in an online environment. This leads to various forms of strategic manipulation. Dellarocas (2003) provided some examples in this regard:

community members can build good reputations, take advantage of this by cheating other members, and then disappear and reappear under new online identities and clean records (Friedman and Resnick, 2001). Moreover, they can use fake online identities to post dishonest feedback; thus, attempting to improve their reputation or tarnish that of their competitors (Dellarocas, 2000). In the feedback operating perspective, the questions are related to the trustworthiness of operators. Web sites may delete some reviews from their web site or repeat reviews depending on their purposes. Therefore, the influence of OCRs may be dependent on the credibility enjoyed by the web site. The web site where OCRs are located forms the context; the effect of this is considered in the trust transfer theory.

Effects of

customer

reviews

191

2.3 Trust in online shopping malls and trust transfer A number of researchers suggest that the construct of trust is an important element in a business environment (Anderson and Narus, 1990; Dwyer et al. , 1987). Moreover, trust is critical in facilitating e-commerce because the seller’s physical absence makes online transactions more vulnerable (Lowry et al. , 2008; McKnight and Chervany, 2001-2002). Internet users perceive significant risks and uncertainties in transacting with an unknown seller on a web site (e.g., Hoffman et al. , 1999). Recent studies indicate that trust is essential for the success of e-commerce activities (Crowell, 2001; Hoffman et al. , 1999), and trust in online shopping malls is central to e-commerce (Gefen, 2000; Reichheld and Schefter, 2000). Moreover, trust could moderate risk in the buying process. The moderating role of trust has been focused on in studies of interpersonal behavior in organizations and marketing settings (e.g., Rousseau et al. , 1998; Andaleeb, 1995). According to trust transfer research, trust in online shopping malls could influence OCRs as the context from which trust is transferred to individuals (Henslin, 1968; Milliman and Fugate, 1988; Stewart, 2003). Stewart (2003) indicates trust transference in the context of the world wide web. According to her, trust is transferred from a trusted entity to an unknown target if the unknown target is perceived to be related to trusted sources. Numerous other studies have also demonstrated that different types of contextual factors such as society, organization (Milliman and Fugate, 1988), and location (Henslin, 1968) may influence trust. For example, the cab drivers’ trust in passengers is influenced by the location that is involved in an encounter. Further, a salesperson could transfer the burden of establishing trust from him/herself to a “proof source” by co-opting a prospect’s trust in an industry association (Milliman and Fugate, 1988). The proof source offers verifiable evidence of the salesperson’s claims, thereby influencing the client’s intention to purchase. General measures of establishing trust have been investigated on the basis of the communications infrastructure of society (Fisman and Khanna, 1999).

INTR

21,2

192

3. Research model and hypotheses The strength of trust transfer is related to the correlation between the trusted entity and another unknown target (Zaheer et al. , 1998). Although OCRs are presented independently of advertisements, online reviewers are members of online shopping malls and have a history of making online transactions. Further, online shopping malls provide space for additional information such as consumer reviews. Since trust is transferred through contextual factors such as location (Henslin, 1968), trust in online shopping malls may transfer to OCRs because OCRs are presented on the web site. Moreover, trust in online shopping malls directly influences OCRs because online shopping malls manage all aspects of their web sites, as mentioned above. If an online shop is trustworthy, potential consumers may trust the online web site operation and may feel that the information presented on the site is trustworthy (Park and Lee, 2009). On the contrary, if a web site is not trustworthy, consumers are not likely to trust information presented on the web site such as OCRs:

H1 . Trust in online shopping malls positively influences the credibility of OCRs.

Sellers who use OCRs to advertise have a relationship with online shopping malls because they make sales transactions at the malls and conduct business with these malls. In such a situation, online shopping malls may be a “proof source,” and trust in the malls is transferred to the sellers who advertise through OCRs (Milliman and Fugate, 1988). At the same time, the trust in online shopping malls may sequentially transfer to OEAs because of the expected relationship between the sellers and OEAs. Customers perceive that the reviewers in an advertisement have a relationship with advertisers for two reasons. First, advertisers could directly compensate reviewers through traditional consumer endorsement on television or radio. Second, sellers manipulate OCRs in terms of aspects such as the storyline and formats. In brief, the trust in online shopping malls has an indirect, albeit weak, influence on OEAs through the mediating trust in the seller; on the other hand, this trust may influence the credibility of OCRs directly and indirectly. Therefore, the effect of trust in online shopping malls is lesser on OEAs than on OCRs.

H2 . The effect of trust in online shopping malls on OCRs is greater than on OEAs.

As mentioned earlier, OEAs could provide customers with advantages due to the primacy effect, while OCRs could provide customers with advantages or disadvantages due to the trust in online shopping malls. When the trust in online shopping malls is low, the level of credibility of OCRs may rapidly decrease due to trust transfer from the online shopping mall. In such a case, the fact that strangers write OCRs could have a negative impact on consumers. Although the trust in online shopping malls influences OEAs, the effect is mild because of the indirect relationship between online shopping malls and reviewers, as mentioned earlier. Moreover, OEAs have the primacy effect; therefore, when the trust in online shopping malls is low, OEAs influence consumers’ purchase intentions more than OCRs:

When the trust in online shopping malls is low, OEAs affect consumers’ purchase intentions more than OCRs.

However, as the trust in online shopping malls increases, OCRs are more credible as compared with OEAs due to the direct effect of trust transfer from online shopping

H3 .

malls. Moreover, another positive aspect that adds to the credibility of OCRs is the independence from sellers. On the other hand, consumers believe that the effect of trust transfer from online shopping malls is lower in OEAs and there is an expectation of dependence on the sellers. Although OEAs have a primacy effect in a high-trust environment, the lower trust transfer from online shopping malls and dependency on sellers causes the effect of OEAs on consumers’ purchase intentions to be lesser than that of OCRs:

H4 . With the moderation of trust in online shopping malls, the effect of OCRs on consumers’ purchase intentions is not different from that of OCRs under a condition where the trust in online shopping malls is high.

Effects of

customer

reviews

193

4. Research methodology

4.1 Experimental product and stimuli

The experimental product used in this study is a digital camera. This product has been selected because most college students are familiar with a camera and can understand its basic functions and characteristics. Moreover, a digital camera is similar to a film camera; however, a digital camera is frequently upgraded with advances in technology. Thus, consumers’ product reviews are useful to other consumers. A focus group interview was conducted to decide the review quantity. The members in the focus group interview did not participate in the main experiment. When questioned “How many reviews are a moderate number?” the focus group answered that when surfing online shopping malls, they generally read six to eight reviews of three to four lines each. Thus, we selected the number six as a moderate number of reviews. The length of each review was set at three lines. Each review included a title, the reviewer’s name, and contents.

4.2 Design and subjects

This experiment had a 2 £ 2 (trust in online shopping malls: low and high; type of consumer reviews: OCRs and OEAs) full factorial design. There were 135 subjects, and they were randomly assigned to each group. Approximately 70 percent of the subjects purchase products over four times in a year through online shopping malls. The two types of consumer reviews (OCRs and OEAs) in this experiment contain the same information but are presented in different locations. One location is outside and under the product advertisement (OCRs); the other location is within the advertisement (OEAs) (Figures 3 and 4). The better the perceived reputation of a company, the greater the trust customers place in the online shopping mall (e.g., Jarvenpaa et al. , 2000). A favorable reputation is easily transferable and enhances the credibility of the vendor (Ganesan, 1994). Moreover, a firm’s reputation is important in influencing a consumer’s trust toward the firm (Chen and Dhillon, 2003). Trust in online shopping malls is manipulated through reputation. A company’s reputation is ascertained through popularity and award-records of the online vendor (e.g., “Most online users have purchased on this site. Two awards: no. 1 online shop in Consumer Satisfaction Survey, Security Mark”).

4.3 Procedures and measures

The procedure used in the experiment is divided into three parts. First, the subjects are

given an explanation regarding the experiment and the online shop. In addition, they

INTR

21,2

194

Figure 3. OCRs embedded in advertisement (OEAs)

21,2 194 Figure 3. OCRs embedded in advertisement (OEAs) are told to continue the experiment at

are told to continue the experiment at their own pace and raise their hands if they have any questions. Second, each subject is asked to navigate to the online shop. The online shop contains the target product advertisement, including a product picture and either an OCR or and OCE. After viewing the online shop, participants are asked manipulation check questions. The manipulation check of the trust in an online shopping mall includes questions based on previous research (McKnight and Chervany, 2001-2002; Pavlou and Gefen, 2004). These questions represent single reliable factors for trust in online shopping malls (Cronbach’s alpha ¼ 0:900). After the manipulation check questions, participants are asked to evaluate two dependent variables: credibility on three seven-point bipolar items (Sternthal et al., 1978) and their purchase intentions (Lang, 2000; Ekinci and Riley, 2003). These variables represent single reliable factors for credibility of OCRs/OEAs ( a ¼ 0:958) and purchase intentions ( a ¼ 0:859). Here, it is necessary to control possible confounding variables for the improvement of the internal validity of this study. The subjects in all groups should think that the content and amount of both OCRs and OEAs are not different. In order to control the variables, the perceived quantity of reviews is measured. Other variables that change the effects of consumer reviewsare thesite name, product brand, prior product knowledge, andgeneral

Effects of customer reviews 195 Figure 4. OCRs attitude of consumer reviews (Hong et al.

Effects of

customer

reviews

195

Figure 4.

OCRs

attitude of consumer reviews (Hong et al. , 2004). In order to control the effects, the subjects werenotgivenanyinformation regarding thesiteandbrand. Further,themeasurementof prior product knowledge is also considered as an item.

5. Results The followings are the manipulation checks. Subjects perceived the differences between low and high trust in online shopping malls (F (1, 133Þ ¼ 31:743, p , 0.01,

M hightrustinonlineshopping mall ¼ 4:228, M lowtrustinonlineshopping mall ¼ 3:272). Further,

subjects who read both types of OCRs perceive that the reviews provide a moderate

amount of information ( M quantity ¼ 3:51, t ¼ 21:110, p . 0:1). Subjects who are exposed to OCRs perceive that the reviews are independently located as compared with consumers who are exposed to OEAs ( F (1, 133Þ ¼ 6:087, p , 0:01, M OCRs ¼ 4:02,

M OEAs ¼

3:23).

A 2 £ 2 ANCOVA is run with prior product knowledge in order to test the credibility of OCRs/OEAs (Table I). Further, it is found that the covariate variable is not significant – prior product knowledge ( F (1, 130Þ ¼ 0:054, p ¼ 0:817).

INTR

21,2

196

The main effect of trust in online shopping malls is found to be significant ( F (1, 130Þ ¼ 22:590, p , 0:001), and the interaction between the trust in online shopping

malls and consumer review type is significant ( F (1, 130Þ ¼ 18:804, p , 0:001). However, the main effect of the review type is not significant ( F (1, 130Þ ¼ 0:159, p ¼ 0:691). Table II presents the means and standard deviations of the credibility of OCRs/OEAs. Trust in online shopping malls significantly influences the credibility of OCRs ( t ¼ 25:720, p , 0:001), while it does not influence that of OEAs ( t ¼ 20:361, p ¼ 0:719). Thus, H1 is accepted. Further, the interaction of the type of consumer reviews and trust in online shopping malls ( F (1, 130Þ ¼ 18:804, p , 0:001) revealed that trust in online shopping malls has a stronger impact on the credibility of OCRs than on that of OEAs. Thus, H2 is accepted.

A 2 £ 2 ANCOVA was run to test purchase intentions ( H3 and H4 ) (Table III), prior

product knowledge ( F (1, 130Þ ¼ 0:795 p ¼ 0:374). The main effect of trust in online shopping malls is found to be significant ( F (1, 130Þ ¼ 25:414, p , 0:001), and interaction between trust in online shopping malls and consumer review type is also significant ( F (1, 130Þ ¼ 4:774, p , 0:05). With an increase in trust in online shopping malls, the effect of OCRs on purchase intentions is much greater than OEAs (Figure 5). Further, the main effect of the review type is not significant ( F (1, 130Þ ¼ 0:871, p ¼ 0:352). Table II presents the means and standard deviations of purchase intentions. Consumers’ purchase intentions are more influenced by OCRs when the trust in online shopping malls is high as compared with when the trust in online shopping malls is low ( t ¼ 24:841, p , 0:001). The results are the same in the case of OEAs ( t ¼ 22:227, p , 0:05). When the trust in online shopping malls is low, the difference in purchase intentions influenced by OCRs and OEAs is insignificant ( t ¼ 21:085, p ¼ 0:282). Thus, H3 is rejected. When the trust in online shopping malls is high, purchase intentions influenced by OCRs are more favorable than purchase intentions influenced by OEAs ( t ¼ 2:074, p , 0:05) ( H4 rejected). This result indicates that the primacy effect of OEAs is weaker than the trustworthiness of information sources. Furthermore, partial least squares modeling (PLS) was employed in order to ascertain the underlying mechanism of the influence of trust in online shopping malls and credibility on consumers’ purchase intentions and to explore the mediating effect of the source credibility of consumer reviews. The software program used to conduct the PLS was PLS-Graph. PLS is a structural equation modeling technique. As suggested by Chin (1998), although LISREL is more suitable for confirmatory research, PLS is more suitable for exploratory research and requires fewer data sets.

In this study, the individual item reliabilities for all construct measures were found

to be higher than an acceptable level of average variance extracted – 0.50 (Hair et al.,

Credibility of OCRs/OEAs

 

F

p

Table I.

Prior product knowledge Type of consumer reviews Trust in online shopping malls Trust in online shopping malls £ type of consumer reviews

0.054

0.817

ANCOVA results

0.159

0.691

(credibility of

22.590

0.000

OCRs/OEAs)

18.804

0.000

26

31

n

deviation

Standard

0.492

0.832

High

Mean

4.366

3.925

OEAs

31

31

n

deviation

Standard

1.050

0.639

Low

Mean

3.946

3.849

35

35

n

deviation

Standard

1.307

0.981

High

4.8286

Mean

4.848

OCRs

38

38

n

deviation

Standard

1. 347

0.958

Low

Mean

3.728

3.070

Trust in online shopping malls

Purchase intention

Credibility

Effects of

customer

reviews

197

Table II. Means and standard deviations for each experimental cell

INTR

21,2

198

1998). Ideally, correlations between two constructs must be smaller than the average variance extracted of their respective constructs (Fornell and Larcker, 1981). These results indicate that the constructs had acceptable levels of reliability. The results in Table IV indicate that the correlations between any two constructs are less than the square root of the average variance extracted by the measures of that construct (the diagonal entries in Table IV). This result reveals successful discriminant validity. It is evident that trust in online shopping malls has a positive relationship with purchase intentions, which is supported by numerous previous studies (see Figure 6). Further, while trust in online shopping malls has a significant positive relationship with the credibility of OCRs, it does not have a significant positive relationship with the credibility of OEAs. These results indicate that trust is not transferred from the web site to consumers’ information in advertisements. The reasons for this could be that consumers perceive that the relationship between the web site and OEA sources is a weak and indirect one (Stewart, 2003). While the source credibility of OCRs positively influences purchase intention, the source credibility of OEAs does not influence purchase intention.

Purchase intention

 

F

p

 

Prior product knowledge Type of consumer reviews Trust in online shopping malls Trust in online shopping malls £ type of consumer reviews

0.795

0.374

0.871

0.352

Table III. Results of ANCOVA (purchase intention)

25.414

0.000

4.774

0.031

Figure 5. The interaction effect of review type and trust in online shopping malls

25.414 0.000 4.774 0.031 Figure 5. The interaction effect of review type and trust in online

Constructs

Trust in online shopping

Source

Purchase

malls

credibility

intentions

OCRs Trust in online shopping malls

0.847

Credibility

0.542

0.894

Purchase intentions

0.635

0.532

0.948

OEAs Trust in online shopping malls

0.822

Credibility

0.322

0.754

Purchase intentions

0.209

0.184

0.809

Note: Diagonal elements are square roots of the average variance extracted

Effects of

customer

reviews

199

Table IV. Correlation and square root of average variance extracted of constructs

and square root of average variance extracted of constructs Figure 6. Additional analysis – path analysis

Figure 6. Additional analysis – path analysis

6. Discussion and conclusion The objective of this research was to investigate how consumers process OEAs differently from generally located OCRs, and to determine whether using OEAs is a good idea or not. We consider trust in online shopping malls because credibility of information depends on the context, such as online shopping malls, in the process of internalization of informational influence. Moreover, the context effect is supported by the trust transfer theory. Trust is the most important factor in online business transactions such as online shopping malls. It is evident from this study that when the trust in online shopping malls is low, there is no significant difference in consumers’ purchase intentions irrespective of whether the information is located within the advertisement. On the contrary, when the trust level is high, information provided on the web site is meaningful and influences consumers’ decision making and purchase intention. These results support previous studies that investigated that trust in online web sites is essential for the success of e-commerce activities (Crowell, 2001; Gefen, 2000; Hoffman et al. , 1999; Reichheld and Schefter, 2000) from an informal influence perspective. Further, in this study, we tested the transfer of trust from shopping malls to consumer reviews. It was found that trust is transferred from online shopping malls to the credibility of OCRs more than OEAs. In other words, trust in online shopping malls influences the credibility of OCRs; however, the credibility of OEAs is not influenced by this factor. This could imply that potential consumers perceive the link between an

INTR

21,2

200

online shopping mall and OEAs as being rather weak. Other consumers believe that an advertisement presents unrelated information in an online shop. The reason for this may be that consumers perceive the advertisement as being a mass marketing tool not only for the online shopping mall, but also other web sites. This research makes various academic contributions. First, this study is an initial consumer endorsement research that uses the concept of OCRs (OEAs). Current studies on OCRs have mainly investigated the effect of OCRs as word of mouth or a part of the marketing communication mix (Lee et al. , 2008; Chen and Xie, 2008), although marketers are interested in the usage of OCRs and have begun using them in their advertisements (OEAs). Thus, this study could initiate the usage of OCRs as a sales tool for marketers. Second, this study extends the trust-transfer concept to the online context by applying it to OCRs. Trust in online stores has been investigated from the viewpoint of institution-based trust (Pavlou and Gefen, 2004) among sellers. In sociology, institution-based trust indicates that behaviors are situationally constructed (McKnight and Chervany, 2001-2002). Such trust stems from the belief that impersonal structures exist to facilitate and encourage trustworthy behavior in a given situation (Zucker, 1986). Thus, situational trust is an important influence for interpersonal trust (Stewart, 2003). This study indicates that situational trust occurs in the context of OCRs, and that trust transfer occurs not only in the seller community (Pavlou and Gefen, 2004), but also in customer community such as OCRs. Third, this study contributes by introducing another perspective to provide an answer to how trust can be built in a person-to-person context in a web environment. As individuals are exposed to a huge amount of information and the expansion of their participation is changing other people’s behavior, more research efforts are now being spent in exploring the effect of trust in a person-to-person context in a web environment (e.g., Xiong and Liu, 2004; Jøsang et al. , 2007). Although a huge amount of research has focused on building trust for electronic markets through trusted third parties or intermediaries (e.g., Atif, 2002; Ketchpel and Garcia-Molina, 1996), it is not applicable from a consumer-to-consumer perspective (Xiong and Liu, 2004). This study has suggested another method of building trust among consumers in the context of online shopping malls. Moreover, previous studies suggested the building of trust in the person-to-person and person-to-medium contexts in a web environment, such as reputation systems, through social control by utilizing community-based feedback regarding past experiences of consumers to make product recommendations (Resnick et al. , 2000); moreover, these studies also suggested the establishment of a trust supporting framework to overcome the challenge of creating such a reputation-based trust mechanism (Xiong and Liu, 2004). However, according to our study, these trust-supporting mechanisms have different effects depending on the web environment. Therefore, the context effect in web interaction can serve as an extension-point for researchers of online reputation systems. For example, current research indicates that trust and reputation systems among consumers used in commercial and online applications have serious vulnerabilities, and it is obvious that the reliability of these systems is occasionally questionable (Jøsang et al. , 2007). In such cases, devising various methods for increasing the trustworthiness of web sites could enable the reputation system itself to become more trustworthy in terms of not only

improving the web site’s reputation but also highlighting the web site’s efforts such as providing additional information (e.g., various reputation results using new techniques or mechanisms). Moreover, the visual aspects of a web site’s efforts to build trust could be a new approach to influencing the establishment of person-to-person trust. Our findings have important business implications to online marketers who follow the strategy of Amazon.com in terms of collective intelligence. Web sites may believe that individuals undoubtedly trust OCRs more than seller-created information, and the OCRs are effective in influencing consumers’ purchase intention. However, this study reveals that OCRs do not have the same effect on consumers’ purchase intentions. On the contrary, only trustful web sites actually benefit from customer-created information such as OCRs. Therefore, these findings could encourage the development of an e-commerce strategy using OCRs. In the initial stage of e-commerce, online shopping malls are not popular and have few or no OCRs because of a lack of customers. In this stage, a steady increase in the number of positive OCRs could be a good sign of trust. However, it is difficult to increase the number of reviews quickly in the initial stages of a business. Moreover, as indicated by as Dellarocas (2003), before the web site actually enjoys some degree of trustworthiness, it is possible that people consider the positive reviews to be fake ones. The results of this study indicate that in such a situation, OEAs are a wise decision because they are barely influenced by trust in online shopping and influence a consumer’s purchase intention in a manner similar to OCRs. Further, advertisements use official space that is promoted freely by sellers. Thus, sellers can use OCRs that are available in other web sites. It is easier to quote OEAs than collecting OCRs in its own web site, and this will provide an instant trustworthiness to the web site in the initial stages of its business. With this strategy, the managers of online shops can continuously improve the trustworthiness of online shopping malls. Moreover, online shops must ensure that consumers trust the site by emphasizing their stable transactions using escrow service and recommendations from third parties. As the web site gathers credibility and accumulates a larger number of OCRs, using OCRs in advertisements becomes unnecessary. The greater the trustworthiness of online shopping malls, the greater is the persuasion power of OCRs. Thus, the positive impact of OCRs on consumers’ purchase intentions could provide online shopping malls with a good opportunity for increasing sales. Our study has certain limitations. Our sample comprised students, thus the findings and contributions of this study are exploratory in nature. Future research must be conducted by using samples of actual online shopping mall users. Further, this study merely focuses on trust in online shopping malls as an antecedent of the credibility of OCRs, while other factors such as the contents of OCRs could influence consumer attitude and credibility. Research on other factors that increase credibility of OCRs would be interesting. In addition, celebrity and third-party endorsements are important in advertising (Dean and Biswas, 2001; McCracken, 1989; Tripp et al. , 1994). It could be interesting to study the effects of different endorsement types along with OCRs in the OCR research area. The results in the additional test using PLS suggest an interesting aspect in the relationship between source credibility and purchase intention. Previous consumer endorsement research in traditional advertisements suggested that source credibility influences consumer behavior (e.g., McGuire, 1969). However, our results using PLS

Effects of

customer

reviews

201

INTR

21,2

202

indicate that the source credibility of OCRs influences consumers’ purchase intentions, while the source credibility of OEAs does not influence consumers’ purchase intentions. This implies that the traditional effect of consumer endorsement from the source credibility perspective occurs in the original type of OCRs; however, this effect does not occur in OEAs. Although this study did not analyze the reasons and underlying mechanism for this, it could be an interesting aspect for future research.

References Alba, J.W., Hutchinson, J.W. and Lynch, J.G. (1991), “Memory and decision making”, in Robertson, T.S. and Kassarjian, H.H. (Eds), Handbook of Consumer Behavior , Prentice Hall, Englewood Cliffs, NJ, pp. 1-49.

Andaleeb, S.S. (1995), “Dependence relations and the moderating role of trust: implications for behavior intentions in marketing channels”, International Journal of Research in Marketing , Vol. 12 No. 2, pp. 157-72.

Anderson, J.C. and Narus, J.A. (1990), “A model of distributor firm and manufacturer firm working partnerships”, The Journal of Marketing , Vol. 54 No. 1, pp. 42-58.

Asch, S.E. (1952), Social Psychology , Prentice-Hall, Englewood Cliffs, NJ.

Atif, Y. (2002), “Building trust in e-commerce”, IEEE Internet Computing , Vol. 6 No. 1, pp. 18-24.

Atkin, C. and Block, M. (1983), “Effectiveness of celebrity endorsers”, Journal of Advertising Research , Vol. 23 No. 1, pp. 57-61.

Bearden, W.O. and Etzel, M.J. (1982), “Reference group influence on product and brand purchase decisions”, Journal of Consumer Research , Vol. 9 No. 2, pp. 183-94.

Brown, J.J. and Reingen, P.H. (1987), “Social ties and word-of-mouth referral behavior”, Journal of Consumer Research , Vol. 14, December, pp. 350-62.

Chatterjee, P. (2001), “Online reviews: do consumers use them”, in Gilly, M.C. and Meyers-Levy, J. (Eds), Advances in Consumer Research , Vol. 28, Association for Consumer Research, Valdosta, GA, pp. 129-33.

Chen, S.C. and Dhillon, G.S. (2003), “Interpreting dimensions of consumer trust in e-commerce”, Information Technology and Management , Vol. 4 Nos 2-3, pp. 303-18.

Chen, Y. and Xie, J. (2008), “Online consumer review: word-of-mouth as a new element of marketing communication mix”, Management Science , Vol. 54 No. 3, pp. 477-91.

Chin, W.W. (1998), “The partial least squares approach to structural equation modelling”, in Marcoulides, G.A. (Ed.), Modern Methods for Business Research, Lawrence Erlbaum Associates, Mahwah, NJ.

Crowell, W. (2001), “Trust, the e-commerce difference”, Credit Card Management , Vol. 14 No. 5, p. 80.

Crowley, A.E. and Hoyer, W.D. (1994), “An integrative framework for understanding two-sided persuasion”, Journal of Consumer Research , Vol. 20 No. 4, pp. 561-74.

Dean, D.H. and Biswas, A. (2001), “Third-party organization endorsement of products:

an advertising cue affecting consumer prepurchase evaluation of goods and services”, Journal of Advertising, Vol. 30 No. 4, pp. 41-57.

Dellarocas, C. (2000), “Immunizing online reputation reporting systems against unfair ratings and discriminatory behaviour”, Proceedings of the 2nd ACM Conference on Electronic Commerce , Association for Computing Machinery, Minneapolis, MN, pp. 150-6.

Dellarocas, C. (2003), “The digitalization of word of mouth: promise and challenges of online feedback mechanisms”, Management Science , Vol. 49 No. 10, pp. 1407-24. Deutsch, M. and Gerard, H.B. (1955), “A study of normative and informational social influences upon individual judgment”, Journal of Abnormal and Social Psychology , Vol. 51 No. 3, pp. 629-36.

Dholakia, U.M., Basuroy, S. and Soltysinski, K. (2002), “Auction or agent (or both)? A study of moderators of the herding bias in digital auctions”, International Journal of Research in Marketing , Vol. 19 No. 2, pp. 115-30. Dwyer, F.R., Schurr, P.H. and Oh, S. (1987), “Developing buyer-seller relationships”, The Journal of Marketing, Vol. 51 No. 2, pp. 11-27. Ekinci, Y. and Riley, M. (2003), “An investigation of self-concept: actual and ideal self-congruence compared in the context of service evaluation”, Journal of Retailing and Consumer Services , Vol. 10 No. 4, pp. 201-14.

Fireworker,

evaluation”, Decision Science , Vol. 8, July, pp. 576-83. Fisman, R. and Khanna, T. (1999), “Is trust a historical residue? Information flows and trust levels”, Journal of Economic Behavior and Organization , Vol. 38 No. 1, pp. 79-92. Fornell, C. and Larcker, D.F. (1981), “Structural equation models with unobservable variables and measurement errors”, Journal of Marketing Research , Vol. 18 No. 2, pp. 39-50. Friedman, E. and Resnick, P. (2001), “The social cost of cheap pseudonyms”, Journal of Economics and Management Strategy, Vol. 10 No. 1, pp. 173-99. Friedman, H. and Friedman, L. (1979), “Endorser effectiveness by product type”, Journal of Advertising Research , Vol. 19 No. 5, pp. 63-71. Frieden, J.B. (1984), “Advertising spokesperson effects: an examination of endorser type and gender on two audiences”, Journal of Advertising Research , Vol. 24 No. 5, pp. 33-41. Ganesan, S. (1994), “Determinants of long-term orientation in buyer-seller relationships”, Journal of Marketing, Vol. 58 No. 2, pp. 1-19.

Gefen, D. (2000), “E-commerce: the role of familiarity and trust”, Omega, Vol. 28 No. 6, pp. 725-37.

Godes, D. and Mayzlin, D. (2004), “Using

communication”, Marketing Science , Vol. 23 No. 4, pp. 545-60. Hair, J.F., Anderson, R.E., Tatham, R.L. and Black, W.C. (1998), Multivariate Data Analysis , 5th ed., Prentice-Hall, Englewood Cliffs, NJ.

Henslin, J.M. (1968), “Trust and the cab driver”, in Truzzi, M. (Ed.), Sociology and Everyday Life , Prentice-Hall, Englewood Cliffs, NJ, pp. 138-58.

Hoffman,

M.

Communications of the ACM, Vol. 42 No. 4, pp. 80-5. Hong, W., Thong, J.Y.L. and Tam, K.Y. (2004), “The effects of information format and shopping task on consumers’ online shopping behavior: a cognitive fit perspective”, Journal of Management Information Systems , Vol. 21 No. 3, pp. 149-84. Hovland, C.I. and Weiss, W. (1951-1952), “The influence of source credibility on communication effectiveness”, Public Opinion Quarterly , Vol. 15 No. 4, pp. 635-50. Hovland, C.I., Janis, I.F. and Kelley, H.H. (1953), Communication and Persuasion , Yale University Press, New Haven, CT.

Huang, J.H. and Chen, Y.F. (2006), “Herding in online product choice”, Psychology and Marketing, Vol. 23 No. 5, pp. 413-28.

R.B.

and

Friedman,

H.H.

(1977),

“The

effects

of

endorsements

on

product

online conversations to study word-of-mouth

L.D.,

Novak,

T.P.

and

Peralta,

(1999),

“Building

consumer

trust

online”,

Effects of

customer

reviews

203

INTR

21,2

204

Jarvenpaa, S.L., Tractinsky, N. and Vitale, M. (2000), “Consumer trust in an Internet store”, Information Technology and Management , Vol. 1 Nos 1/2, pp. 45-71.

Jøsang, A., Ismail, R. and Boyd, C.A. (2007), “A survey of trust and reputation systems for online service provision”, Decision Support Systems , Vol. 43, pp. 618-44.

Kamen, J., Azhari, A. and Kragh, J. (1975), “What a spokesman does for a sponsor”, Journal of Advertising Research , Vol. 15 No. 2, pp. 17-24.

Kelman, H.C. (1961), “Processes of opinion change”, Public Opinion Quarterly , Vol. 25 No. 1, pp. 57-78.

Ketchpel, S. and Garcia-Molina, H. (1996), “Making trust explicit in distributed commerce transactions”, Proceedings of the 16th International Conference on Distributed Computing Systems .

Klebba, J.M. and Unger, L.S. (1983), “The impact of negative and positive information on source credibility in a field setting”, in Bogazzi, R. and Tybout, A. (Eds), Advances in Consumer Research , Vol. 10, Association for Consumer Research, Provo, UT, pp. 11-16.

Lang, T. (2000), “The effect of the Internet on travel consumer purchasing behavior and implications for travel agencies”, Journal of Vacation Marketing , Vol. 6 No. 4, pp. 368-85.

Lascu, D.-N., Bearden, W.O. and Rose, R.L. (1995), “Norm extremity and personal influences on consumer conformity”, Journal of Business Research , Vol. 32 No. 3, pp. 201-13.

Lee, J., Park, D.-H. and Han, I. (2008), “The effect of negative online consumer reviews: an information processing view”, Electronic Commerce Research and Applications , Vol. 7 No. 3, pp. 341-52.

Lowry, P.B., Vance, A., Moody, G., Beckman, B. and Read, A. (2008), “Explaining and predicting the impact of branding alliances and web site quality on initial consumer trust of e-commerce web sites”, Journal of Management Information Systems , Vol. 24 No. 4, pp. 199-224.

McCracken, G. (1989), “Who is the celebrity endorser? Cultural foundations of the endorsement process”, Journal of Consumer Research , Vol. 16 No. 3, pp. 310-21.

McGuire, W.J. (1969), “The nature of attitudes and attitude change”, in Lindzey, G. and Aronson, E. (Eds), The Handbook of Social Psychology , Addison-Wesley, Reading, MA, pp. 137-314.

McKnight, D.H. and Chervany, N. (2001-2002), “What trust means in e-commerce customer relationships: an interdisciplinary conceptual typology”, International Journal of Electronic Commerce , Vol. 6 No. 2, pp. 35-59.

Milliman, R.E. and Fugate, D.L. (1988), “Using trust-transference as a persuasion technique:

an empirical field investigation”, Journal of Personal Selling and Sales Management, Vol. 8 No. 2, pp. 1-7.

Park, C.W. and Lessig, V.P. (1977), “Students and housewives: differences in susceptibility to reference group influence”, Journal of Consumer Research , Vol. 4 No. 2, pp. 102-10.

Park, C. and Lee, T.M. (2009), “Information direction, web site reputation and eWOM effect:

a moderating role of product type”, Journal of Business Research, Vol. 62 No. 1, pp. 61-7.

Park, D.-H., Lee, J. and Han, I. (2007), “The effect of on-line consumer reviews on consumer purchasing intention: the moderating role of involvement”, International Journal of Electronic Commerce , Vol. 11 No. 4, pp. 125-48.

Pavlou, P.A. and Gefen, D. (2004), “Building effective online marketplaces with institution-based trust”, Information Systems Research , Vol. 15 No. 1, pp. 37-59.

Petty, R.E. and Wegener, D.T. (1998), “Attitude change: multiple roles for persuasion variables”, in Gilbert, D., Fiske, S. and Lindzey, G. (Eds), Handbook of Social Psychology , 4th ed., McGraw-Hill, New York, NY. Reichheld, F.F. and Schefter, P. (2000), “E-loyalty: your secret weapon on the web”, Harvard Business Review , Vol. 78 No. 4, pp. 105-13. Resnick, P., Zeckhauser, R., Friedman, E. and Kuwabara, K. (2000), “Reputation systems”, Communications of the ACM, Vol. 43 No. 12, pp. 45-8. Rousseau, E., Sitkin, S., Burt, R. and Camerer, C. (1998), “Not so different after all:

a cross-discipline view of trust”, Academy Management Review , Vol. 23 No. 3, pp. 387-92.

Sternthal, B., Dholakia, R. and Leavitt, C. (1978), “The persuasive effect of source credibility: tests of cognitive response”, Journal of Consumer Research , Vol. 4 No. 4, pp. 252-60. Stewart, K.J. (2003), “Trust transfer on the world wide web”, Organization Science , Vol. 14 No. 1, pp. 5-17.

Tripp, C., Jensen, T. and Carlson, L. (1994), “The effects of multiple product endorsements by celebrities on consumers’ attitudes and intentions”, Journal of Consumer Research , Vol. 20 No. 4, pp. 535-47.

Wilson, E.J. and Sherrell, D.L. (1993), “Source effects in communication and persuasion research:

a meta-analysis of effect size”, Journal of the Academy of Marketing Science , Vol. 21 No. 2,

pp. 101-12. Xiong, L. and Liu, L. (2004), “PeerTrust: supporting reputation-based trust for peer-to-peer electronic communities”, IEEE Transactions on Knowledge and Data Engineering , Vol. 16 No. 7, pp. 843-57. Zaheer, A., McEvily, B. and Perrone, V. (1998), “Does trust matter? Exploring the effects of interorganizational and interpersonal trust on performance”, Organization Science , Vol. 9 No. 2, pp. 141-59. Zucker, L.G. (1986), “Production of trust: institutional sources of economic structure 1840-1920”, in Staw, B.M. and Cummings, L.L. (Eds), Research in Organizational Behavior , Vol. 8, JAI Press, Greenwich, CT, pp. 53-111.

Effects of

customer

reviews

205

Further reading Park, D.-H. and Lee, J. (2008), “eWOM overload and its effect on consumer behavioral intention depending on consumer involvement”, Electronic Commerce Research and Applications , Vol. 7 No. 4, pp. 386-98. Strub, P.J. and Priest, T.B. (1976), “Two patterns of establishing trust: the marijuana user”, Sociological Focus , Vol. 9 No. 4, pp. 399-411.

About the authors Jumin Lee received her PhD degree in Management Engineering from Korea Advanced Institute of Science and Technology (KAIST), Korea, in 2007. She worked at Deloitte Consulting in Seoul, Korea before entering the graduate school. She is currently an Assistant Professor in the E-business Department in Kyung Hee Cyber University in Seoul, Korea and a Director of Korea CRM Association. Her current research interests are online consumer behaviors including knowledge sharing, online trust, and e-WOM. Her papers have been published in the International Journal of Electronic Commerce , Electronic Commerce Research and Applications , Expert Systems with Applications , and others. Jumin Lee is the corresponding author and can be contacted at: juminlee@khcu.ac.kr

INTR

21,2

206

Do-Hyung Park received his PhD degree in Management Engineering from Korea Advanced Institute of Science and Technology (KAIST) in 2008. His research interests include electronic word-of-mouth, consumer behavior in electronic commerce, user behavior in social networks and digital marketing. Currently, he works as Senior Researcher for LSR laboratory at LG Electronics Inc. Ingoo Han is a Professor at the Graduate School of Management of KAIST. He received his PhD from University of Illinois at Urbana-Champaign. His papers have been published in Decision Support Systems , Information and Management , International Journal of Electronic Commerce , Expert Systems , Expert Systems with Applications , International Journal of Intelligent Systems in Accounting , Finance and Management , and other journals. His research interests include applications of AI for finance and marketing.

To purchase reprints of this article please e-mail: reprints@emeraldinsight.com Or visit our web site for further details: www.emeraldinsight.com/reprints