Research Hypotheses

Online reviews and ratings

 

The impact on individual decision-making and product demand

  

Given the research concerning eWOM, online reviews and ratings and disagreement on their impact to decision-making and product demand, this study aims to investigate phenomenon in further detail. The main hypothesis is that this type of eWOM affects buyers decision-making, reviews heuristics (average rating and product popularity) act as effective cues helping to make a decision and different kind of reviews have different effects on product sales. Hypotheses are therefore organised as follows. H1, H2 and H3 concentrate on individual decision-making. H4 and H5 focus on online reviews impact on sales.

 

H1: Consumers perceive online recommendations as important product attributes before making purchase decisions

 

This hypothesis claims consumers give high importance to online reviews and ratings when evaluating future purchases. Regardless of the product category, product life cycle or personality traits, this type of eWOM affects decision making rather than being a mere indication of product popularity.

 

H2: Consumers are affected by online reviews heuristics, specifically product popularity and average rating, that leads them to make quicker purchase decisions

 

This hypothesis investigates if product popularity and average ratings are satisfactory forms of heuristics to act as mental shortcuts. If that is true, consumers should spend less time on the product pages that have peer recommendation in comparison to pages that do not involve any type of eWOM.

 

H3: Consumers are affected by online reviews heuristics, specifically product popularity and average rating, that leads them to fewer product selections before deciding on the purchase

 

This hypothesis also investigates if product popularity and average ratings are satisfactory forms of heuristics, however looks at the number of product selections. If this is true, consumers should make fewer product selections when they are exposed to this type of eWOM in comparison with no eWOM.

 

H4: Buyers are more willing to buy from a seller with positive reviews than from a seller without any peer recommendation

 

This looks into the impact of online reviews to product sales. If the hypothesis is true, buyers will purchase more items from a seller that has positive reviews (high average star rating and high number of product reviews) in comparison to no peer recommendation.

 

H5: Buyers are not willing to buy from a seller with negative reviews compared to a seller without any peer recommendation

 

This also looks into the impact of online reviews to product sales. If the hypothesis is true, buyers will purchase fewer items from a seller that has negative reviews (low star rating and low number of product reviews) in comparison to no peer recommendation.

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