The Power of Online Customer Reviews in Fashion E-Commerce - an Empirical Analysis across Categories and Brands

Online Customer Reviews (OCRs) have become a powerful marketing tool for e-commerce companies and an important information source for customers in online shopping. We study the influence of OCRs on sales and conversion rates of experience goods along different levels of product involvement and brand equity. We make use of a unique dataset with about 2.8 billion product detail page (PDP) views, 85.3 million sold items along 40 product categories and .9 million OCRs from a leading European online fashion company. We find that the rating valence (i.e., the average rating), has a positive influence on sales and conversion in general. Further, we identify the positive influence of OCRs on sales and conversion to be stronger for products with a high level of product involvement. Finally, this study shows that brand equity has a negative influence on the relationship between rating valence, sales, and conversion. From a managerial perspective, this study helps to use OCR as a marketing tool in the most efficient and effective way as companies should implement category and brandspecific OCR strategies.

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