Research On The Effectiveness Of Feedback Mechanisms In E-commerce Platforms

The advances of information technologies and the Internet significantly facilitate the growth of e-commerce in recent years.Simply accessing to the Internet,consumers can conveniently browse endless product choices and a mass of purchase-related information.As one of the most important information sources,feedback mechanisms assist consumers to know product quality,to reduce purchase uncertainty,and thus to promote decision making.More and more e-commerce platforms correspondingly expend many efforts in the developments of feedback mechanisms to boost product sales.Even so,not much has been fully understood regarding the effectiveness of feedback mechanisms,especially from the perspectives of seller strategic behavior,consumer perceived variation,and platform design.These research gaps between the academic studies and their contributions to the industry motivate us to explore the economic effects of multiple feedback mechanisms systematically and to provide practitioners insightful guidance.Based on the policy shock on e Bay's feedback mechanisms,allowing for sellers selectively adopt a consumer review system,we first study how different dimensions of information quality sway the effect of feedback mechanisms on product sales.Specifically,customers are sensitive to the availability of consumer reviews.Products that receive consumer reviews earlier(later)are much more likely to increase(decrease)sales.However,the influence of initial positive(negative)reviews lasts and intensifies over time,revealing an inherent weakness of the consumer review system.More interestingly,customers place more weight on timely seller reputation.While short-term reputation substitutes for the effect of long-term reputation,there is a complementary relationship between different types of short-term reputation.In addition,customers tend to rely on the consistency of information across consumer reviews and seller reputation.A high-level seller reputation can either strengthen the effect of positive reviews on sales or deteriorate the sales effect of negative reviews.Delivering available,timely,and consistent information is vital for customers to make decision making.Second,we propose a key construct,perceived effectiveness of feedback mechanisms(PEFM),to investigate the differential effects of PEFM on the relationship between consumers' satisfaction,trusting beliefs,and repurchase intention.PEFM consist of two components: perceived effectiveness of product recommendations(PEPR)and perceived effectiveness of consumer reviews(PECR).Despite the importance of these feedback mechanisms in electronic transactions,there is still little understanding of their combined effects.We find that 1)PEFM,including both PEPR and PECR,negatively moderate the relationship between consumers' satisfaction toward vendors and trust in vendors;2)PEFM,either PEPR or PECR positively moderate the relationship between trust in vendor and repurchase intention;3)PEPR and PECR are not equally conducive in trust transfer.These findings indicate that product recommendations and consumer reviews substitute for prior experience with products but are complementary with customers' trusting beliefs.Third,we examine the informative role of a subdivided or aggregated consumer review system.We formally develop analytical models to depict the interactions between sellers' full or partial information strategies and consumers' responses by distinguishing the consumer perceptual process and rating process toward different consumer review systems.Next,we take multidimensional product attributes with corresponding weights into consideration.Our results illustrate that the sensitivity of product misfits,instead of the relative importance of product attributes,dominates the profit maximization.We then make a comparison to help e-commerce platforms design an optimal feedback mechanism.When a great number of consumers satisfy the delivery time,the aggregated review system is the best design.Otherwise,platforms should host the subdivided review system.Additionally,there is a variance boundary universally in the consumer review systems,which does not only prevent consumers from expressing their real feelings but also is not convenient for online sellers to observe consumers' feedback and make strategic adjustments.