Document Type

Article

Abstract

In online markets, collective ratings by prior buyers are often displayed in a marked place and influential for later consumers. While the aggregated ratings transfer overall evaluation towards products, they might also bring biases to potential consumers. In this study, we hypothesize that collective rating, as a piece of information, acts as 1) a predisposition which affects people’s perception towards other information; and 2) a risk level of product’s performance which changes the way people perceive consensus or deviant word-of-mouth information from online reviews. Using online reviews of multiple product categories from Amazon.com, our study reveals the impact of collective ratings on consumers’ perception of WOM information and sheds light upon the conflictive results on perception biases of product reviews. Implication for understanding and facilitating consumer perception of online reviews are discussed.

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