Sales or reviews, which matters more to consumer preference and online advertising? – evidence from eye-tracking and self-reporting

Abstract

Sales volume and the percentage of positive reviews are viewed as learning sources in online shopping. This paper examines the relative effect of these two attributes and determines the underlying mechanism that can be applied to online advertising. We verify the existence of negativity bias in online reviews through an eye-tracking experiment. Consumers underestimate the rating of products with high sales volume relative to products with low sales volume due to negativity bias. However, presenting a percentage of positive reviews cue can eliminate the rating difference. Furthermore, when both the percentage of positive reviews and sales volume are high, consumers prefer products with lower sales volume but higher percentages of positive reviews rather than products with higher sales volume but lower percentages of positive reviews. The percentage of positive reviews is more diagnostic than sales volume, which can be used as endorsements in online advertisement to positively affect consumers’ preferences.