How Digital Word-of-Mouth Affects Consumer Decision Making: Evidence from Doctor Appointment Booking

51 Pages Posted: 12 May 2016 Last revised: 25 Jan 2019

See all articles by Aishwarya Shukla

Aishwarya Shukla

Simon Fraser University, Beedie School of Business

Guodong (Gordon) Gao

University of Maryland - R.H. Smith School of Business

Ritu Agarwal

University of Maryland - Robert H. Smith School of Business

Date Written: Nov 11, 2018

Abstract

This paper presents the first study that utilizes detailed clickstream data on online Word-of-Mouth to uncover mechanisms underlying its influence on consumer decision making. We leverage a feature launch on a major doctor appointment booking platform to study the impacts of online WOM on three dimensions of a consumer’s choice process: the consideration set size, the time taken to consider alternatives (web session duration), and the geographic dispersion among the choices considered. We further investigate the effects of online WOM on demand. We have several novel findings. First, the impacts of WOM on the decision-making processes are not monotonic, but rather are contingent on the density of WOM (number of rated doctors) in a market. When the density of WOM is low, the availability of WOM makes patients consider more doctors, browse for a longer duration, and consider doctors that are geographically more dispersed. In contrast, when the density of WOM is high, the availability of WOM makes patients consider fewer doctors, browse for a shorter duration, and focus on doctors that are geographically more proximate. Finally, our results show that the presence of WOM can have a cannibalization effect: when the ratings are published, the highly rated doctors reap the benefits (in the form of increased demand) at the expense of unrated doctors. Our study contributes to extant literature on online WOM by providing new insights through which WOM influences consumer decision making at a new level of granularity..

Keywords: Online ratings, consumer decision making, physician quality, online word-of-mouth, natural experiment, consideration set, location choice

JEL Classification: M01

Suggested Citation

Shukla, Aishwarya and Gao, Guodong (Gordon) and Agarwal, Ritu, How Digital Word-of-Mouth Affects Consumer Decision Making: Evidence from Doctor Appointment Booking (Nov 11, 2018). Robert H. Smith School Research Paper No. RHS 2778683. Available at SSRN: https://ssrn.com/abstract=2778683 or http://dx.doi.org/10.2139/ssrn.2778683

Aishwarya Shukla

Simon Fraser University, Beedie School of Business ( email )

Vancouver, British Columbia V5A1S6
Canada

Guodong (Gordon) Gao (Contact Author)

University of Maryland - R.H. Smith School of Business ( email )

4325 Van Munching Hall
College Park, MD 20742
United States

HOME PAGE: http://www.rhsmith.umd.edu/faculty/ggao/

Ritu Agarwal

University of Maryland - Robert H. Smith School of Business ( email )

College Park, MD 20742-1815
United States

Here is the Coronavirus
related research on SSRN

Paper statistics

Downloads
397
Abstract Views
1,523
rank
79,209
PlumX Metrics