Stimulating Online Reviews by Combining Financial Incentives and Social Norms
Forthcoming, Management Science
44 Pages Posted: 9 Oct 2016 Last revised: 2 Nov 2016
Date Written: August 26, 2016
In hopes of motivating consumers to provide larger volumes of useful reviews, many retailers offer financial incentives. Here, we explore an alternative approach, social norms, wherein we inform people about the volume of reviews authored by peers. We test the effectiveness of using financial incentives, social norms, and a combination of both strategies. In two randomized experiments, one in the field conducted in partnership with a large online clothing retailer based in China, and a second on Amazon Mechanical Turk, we compare the effectiveness of each strategy at stimulating online reviews in larger numbers and of greater length. We find that financial incentives are more effective at inducing larger volumes of reviews, but the reviews that result are not particularly lengthy, whereas social norms have a greater effect on the length of reviews. Importantly, we show that the combination of financial incentives and social norms yields the greatest overall benefit, motivating reviews in greater numbers and of greater length. We further assess the treatment induced self-selection and sentiment bias by triangulating the experimental results with findings from an observational study.
Keywords: online reviews, randomized experiment, social norms, financial incentives, intrinsic motivation, user generated content
JEL Classification: C93, H41, M13, M31, M48, M52
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