New era signals and customer review platforms: conceptual and empirical analysis
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Published version
Date
2020-12
Authors
Lee, Jennifer
Shibly, Sirajul Arefin
Version
Published version
OA Version
Citation
Jennifer Lee, Sirajul Arefin Shibly. "New Era Signals and Customer Review Platforms: Conceptual and Empirical Analysis." Global Marketing Conference. Virtual (Seoul, Korea), 2020-11-05 - 2020-11-08. https://doi.org/10.15444/GMC2020.06.01.03
Abstract
Thanks to the development of the customer review platforms, which now exist for nearly all service categories, customers have access to more objective product information free from firms’ self-interest. The emerging market environment calls for further academic examination of how customers look for peer-provided signals when facing difficulty in evaluating product/service quality. Extending the signaling literature (Kirmani and Rao, 2000; Akerlof 1970; Saboo and Grewal 2013), the objectives of the present work are a) to introduce a novel concept of customer-provided New era signals as solution for quality evaluation problems (specifically, adverse selection and moral hazard), b) to empirically test a model of how different types of the New era signals (expert advisor vs. referent advisor) are sought by customers when facing such problems, and finally c) to examine how customers’ latent needs (cognitive knowledge vs. social trust) emerge in those circumstances. Based on the novel concept of New era signals, we conduct empirical studies to examine how customers look for New era signals (expert leader vs. referent leader) under different types of uncertainty condition based on their perceived risk (adverse selection vs. moral hazard). We conducted two experiments and adopted ANOVA for both studies. Study 1 was designed to evaluate the participants’ need for objective knowledge and trust based on the type of information asymmetry problem they are focusing on (adverse selection vs. moral hazard). The results find support for our hypotheses indicating that when focusing on adverse selection, participants are more likely to feel the need for objective knowledge whereas when focusing on moral hazard, participants are more likely to feel the need for trust. Study 2 was designed to evaluate the participants’ need for objective knowledge and trust as well as their likelihood to seek New era signals with high expert power and referent power based on the type of information asymmetry problem they are focusing on (adverse selection vs. moral hazard). The results find support for our hypotheses indicating that when focusing on adverse selection, participants are more likely to feel the need for objective knowledge and more likely to seek New era signals with high expert power whereas when focusing on moral hazard, participants are more likely to feel the need for trust. The participants’ likelihood of seeking New era signals with high referent power was not supported.
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Attribution-NonCommercial-ShareAlike 4.0 International