Empirical Study on E-negative Word-of-Mouth on Products Sales

Abstract

E-negative word-of-mouth (NWOM) usually has critical influence for consumers to make purchase decision. By collecting the data from Tianmao, we analyze in-depth the effect of negative reviews and find a cascade effect in that a threshold of negative reviews may dominate the valence of a product’s reviews. The results also suggest that the amount of negative word-of-mouth from an early period affects the sentiment of later ratings and has a more significant effect on product sales than in the later periods. Moreover the effect of negative word-of-mouth is more pronounced for experience products than for search products, and less popular products are more vulnerable while big brands are immune. The findings have meaningful implications for e-marketers to monitor and respond to negative word-of-mouth more effectively.