Information Adoption

E. Ismagilova et al., Electronic Word of Mouth (eWOM) in the Marketing Context, SpringerBriefs in Business, DOI 10.1007/978-3-319-52459-7_6

Impact of eWOM

Studies on the impact of eWOM can be classified into two categories (Pan 2014).

First, market-level analysis, where researchers focus on market-level parameters, such as product sales. These studies use panel data from a website in order to inves- tigate the impact of eWOM communications on product sales (Amblee and Bui 2007a; Baek et al. 2014). Second, individual-level analysis, where researchers con- sider eWOM as a process of personal influence, meaning communications between a sender and a receiver of eWOM can change the receiver’s attitude and purchase decision (Baber et al. 2016; Lis 2013). Attitude, purchase intention, sales, informa- tion adoption, and information overload are the most investigated consequences of eWOM communications. Hence, exploring the impact of eWOM will advance understanding of consumer behaviour. Thus, the objective of this chapter is to pro- vide a review of existing studies on impact of eWOM communications from both consumer and company perspectives.

This chapter starts with a discussion of the impact of eWOM on information

adoption. After this, information overload as a consequence of eWOM is consid-

ered. The chapter then moves forward to explore changes in attitude and purchase

intention as consequences of eWOM communications. Next, we provide a brief

discussion on how eWOM communications can influence sales of products and

services. Finally, the chapter is concluded with a discussion of the impact of eWOM

communications, providing key points for practitioners, and outlining future

research directions.

communications can influence information adoption. Consumer adoption of eWOM can lead to changes in consumers’ attitudes and, as a result, affect their purchase decisions. Hence, consumers’ decision-making process is significantly affected by received information (Fan et al. 2013).

Researchers have identified a variety of factors that influence adoption of eWOM communications (Aghakhani and Karimi 2013; Chang and Wu 2014; Lis 2013;

Shuang 2013; Wang et al. 2015; Yu and Natalia 2013). Figure 6.1 summarizes the relationships between different eWOM characteristics and information adoption, consumer attitude, and purchase decision.

Several studies have shown that eWOM credibility is a basic requirement for eWOM adoption (Chang and Wu 2014; Cheung et al. 2009; Lis 2013). Through online surveys with 634 participants, Lis (2013) found that information credibility affects eWOM adoption. The study showed that publishing credible eWOM can be

Source credibility Information

credibility Argument strength Confirmation with

receiver’s prior beliefs Information comprehensiveness

Information consistency Quality Information diagnosticity Source attractiveness

Homophily

Social ties

Quantity

Valence

Platform type Brand commitment

Information adoption

Consumer attitude

Purchase decision Consumer

expertise Involvement

Fig. 6.1 Relationships between eWOM characteristics and information adoption (Sources:

Aghakhani and Karimi (2013), Bansal and Voyer (2000), Chang and Wu (2014), Cheung et al.

(2008, 2009a), Lis (2013), Luo et al. (2014a, b), Shuang (2013), Wang and Wei (2006), Wang et al.

(2015), Yu and Natalia 2013))

6 Impact of eWOM

an effective way to increase eWOM adoption and, as a result, purchase probability.

It was found that the effect of source credibility on eWOM adoption is moderated by the level of consumer involvement. Chang and Wu (2014) investigated the effect of source credibility and information credibility on adoption of negative eWOM;

they found there is a positive relationship between perceived information credibility and adoption of negative eWOM. Thus, the receivers of eWOM adopt the recom- mendation if they perceive that the source is reliable rather than unreliable. Using dual processing theory, a study conducted by Cheung et al. (2009a) found that dimensions of eWOM credibility such as argument strength, source credibility, and confirmation with receiver’s prior beliefs influence eWOM adoption.

Some studies find that helpfulness of eWOM affects information adoption (Aghakhani and Karimi 2013; Cheung et al. 2008; Luo et al. 2014a, b; Shuang 2013; Wang et al. 2015; Yu and Natalia 2013). By using the information adoption model (Sussman and Siegal 2003), Cheung et al. (2008) found that eWOM useful- ness has a strong and significant impact on consumers’ decision to adopt eWOM. Another study conducted by Rabjohn et al. (2008) used a questionnaire of 154 people and found that information adoption within online communities is sig- nificantly affected by helpfulness of information. Luo et al. (2014a, b) used data collected from two popular and well-known websites in China (www.jd.com and www.pconline.com). The study observed that two central factors—information comprehensiveness and argument strength—and two peripheral factors—informa- tion consistency and quantity—can affect information adoption. Research per- formed by Shuang (2013) employed collection of text data, network ethnography, and in-depth interviews and found that information quality and source credibility positively affect information adoption.

Using an experiment Wang and Wei (2006) found that the perceived information diagnostic of the product information positively affects acceptance of eWOM mes- sages. Also, the study found that eWOM information that is in line with a consum- er’s informational beliefs will lead to high acceptance of eWOM recommendations.

Wang et al. (2015) acquired the same results that diagnosticity of the product review and the perceived informant credibility will have a positive effect on the acceptance of eWOM.

Aghakhani and Karimi (2013) investigated factors that influence acceptance of explicit (intentionally provided recommendations from one social networking site user to another user) and implicit (profile information that is not directed specifically at another user, which can have a potential unintended recommendation effect) eWOM on SNS using ELM. The study proposed that argument quality (central route) has a positive effect on acceptance of explicit eWOM on Facebook. Source credibility, sender attractiveness, homophily, and social ties, which represent periph- eral routes, have a positive effect on acceptance of explicit and implicit eWOM on Facebook. Thus, this study claimed that credibility and usefulness of eWOM affect information adoption. Also, this study proposed that recipient expertise and involve- ment will have a moderated effect on information acceptance.

Luo et al. (2014a, b) found that the effects of three factors—information argument

strength, information consistency, and quantity—on information adoption are

moderated by website attributes. Specifically, argument strength does not affect information adoption on commercial websites, while it significantly affects infor- mation adoption on third-party websites. Information consistency and quantity have a significant impact on eWOM adoption on commercial websites but no effect on third-party websites. Chang and Wu (2014) investigated the moderating role of brand commitment and found that it can prevent the receiver of information from accepting a negative eWOM message.