Electronic Word-of-Mouth and consumers’ intention to purchase : a study of the effects of valence and argument quality of online reviews

Abstract

As technology has developed and phenomenon such as the participative web has emerged, the opportunities of communication and sharing has expanded simultaneously. The participative web represents a revolution where users are empowered to develop, collaborate, distribute and customize Internet content and applications. Word-of-mouth (WOM) has been known for decades to be of profound influence in consumers purchasing behavior and as consumers share their experiences and opinions, the need for advertisements decreases. Electronic word-of-mouth (eWOM) has enabled users to share information and opinions with others within seconds giving them the power to influence other consumers’ behavior. Although previous research on eWOM has shown effects of valence and argument quality, no studies have explored these two concepts combined. For this reason, the purpose of this thesis is to examine the relationship between valence and argument quality of online consumer reviews on consumers’ purchase intention. By conducting an online experiment and thereafter analyzing the data from 155 respondents, we discovered two main results. Firstly, we found that valence had a direct effect on consumers’ purchase intention, where the effect of negative online consumer reviews exceeds the effect of positive reviews. Secondly, we found that argument quality did not moderate the effect of valence on consumers’ intention to purchase. Our findings suggest that consumers focus more on the valence of an online review rather than the relevance of the content. Furthermore, we discovered that the use of online reviews is widespread and a key factor in consumer decision-making. Due to this, we suggest that both researchers and companies implement a greater focus on eWOM in the future.