Self-Selection and Information Role of Online Product Reviews

Introduction Word of mouth has long been recognized as a major driver of product sales. It can raise consumer awareness, and may be one of the few reliable sources of information about the quality of experience goods. With the development of the Internet, word of mouth has moved beyond small groups and communities, to being freely available through largescale consumer ne tworks (Avery, Resnick and Zeckhauser 1999). These networks have reinforced the impact of word of mouth to an unprecedented scale, and correspondingly dramatically changed the way consumers shop, enhancing or even supplanting traditional sources of consumer information such as advertising. In a survey of 5,500 web consumers conducted by BizRate, 44% of respondents said they have consulted opinion sites before making a purchase and 59% considered consumer-generated reviews more valuable than expert reviews (Piller 1999). A recent survey of DoubleClick also found that word of mouth plays a very important role in consumer’s purchasing process for many types of products and for some goods, such as electronics and home products, product review websites outrank all other media in influencing customer decisions (DoubleClick 2004).