Online reviews as a driver of new product sales
Proceedings : 2010 International Conference on Management of e-Commerce and e-Government : ICMeCG 2010, 23-24 October 2010, Chengu, Sichuan, China
IEEE Computer Society
Word-of-mouth, Online product reviews, New product sales, Search vs. experience products, Panel data analyses
This study reports several surprising findings and new insights about the effect of online product reviews on the sales of new products. Analyses of panel data of 332 new products from Amazon.com indicate that negative reviews affect new product sales more than positive reviews, but also in a positive way. Different from the proposition of the diffusion model, e-WOM has a strong effect on new product sales early on and such effect decreases over time. Moreover, the volume of page views by followers is far more influential than that of reviews by opinion leaders, especially in the early period of product lifecycle, suggesting a significant cascade effect. The effects of page views and valence of online reviews are stronger than that of volume, more so for search products than for experience products. Thus, marketers need to consider the distinctive influences of various aspects of online reviews when launching new products and devising e-marketing strategies.
Copyright © 2010 by The Institute of Electrical and Electronics Engineers, Inc.
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ISBN of the source publication: 9781424485079
Cui, G., Lui, H.-k., & Guo, X. (2010). Online reviews as a driver of new product sales. In Q. Li, C. Wan, & B. Xu (Eds.), Proceedings: 2010 International Conference on Management of e-Commerce and e-Government: ICMeCG 2010, 23-24 October 2010, Chengu, Sichuan, China (pp. 20-25). Los Alamitos, California: IEEE Computer Society. doi: 10.1109/ICMeCG.2010.13