Influence of Online Consumer Reviews on Brand Reputation

Abstract

Online companies experience valuable credibility and trust that their customers might not have had in the past, and the opinions of the internet are the major determinants in a brand\'s standing, client decision-making behaviour. This research aimed towards the investigation of whether online customer reviews affected brands’ perception and credibility. A correlation-based study with 104 communicants was the method of research to understand the influence of reading reviews on confidence in it, what effect the online reviews has on the trust in brand and how the process of recommending a brand based on reviews and the chances of reviewing for that brand relate to each other. The results revealed several key findings: customers most frequently reading negative reviews online, reported less trust in confusing brands, while those changing purchase decisions displayed higher levels of trust in brands influenced by online reviews; customers reviewing all positive comments were more likely to post reviews. As shown, managing online reputation, resolving customers\' complaints, and brand authenticity are attribute of prosperity in the digital marketplace. Driving online sales by having a pleasant website layout and integrating shopping cart capabilities are all important.

Introduction

I. INTRODUCTION

In the modern digital world, reviews carried on the Internet form a weighty factor to the role of brand image by influence. Such stations act as the never-ending performance review that is always accessible to millions and hence a tremendously influential bystander of a brand's image. Positive reviews speak for themselves as a rare chance to build trust and maintain credibility. The ongoing flood of compliments on specific services or high-grade products present the users with a quality of brand that can be trusted. Consequently, it contributes to the brand building reaching the best position in the market and attracting new customers. Have been imagining it as a word-of-mouth recommendation on commercial that shoots up in the sky and reaches a huge audience further into people's brains. People are now more likely to respond to it by buying the product.

In other words, modern age with digitalization that information sharing occurs at a high speed requires brand reputation management among online reviews to be a focus. Companies must work quickly in conducting customer reviews either the good or the bad one. A balanced approach which addresses reviews of positive and negative nature indicates the importance the business gives to customers’ contentment and gives the impression of the honesty. Good reviews can be treated as social validation and help to derive new customers, while the bad reviews can be considered as the feedback thereby helping to amend and add on more to the product. Through active involvement in online reviews in terms of comments, service provision management, answering reviews, etc., businesses can maintain a good online presence, mitigate the damage caused by any negativity, and consequently maintain their brand reputation.

II. ONLINE REVIEWS

An online review is a digital evaluation, typically written by a customer, about a product, service, or even an entire business. Imagine it as a word-of-mouth recommendation on steroids, reaching a vast audience through the power of the internet. These reviews often come in two parts:

1. Star Rating: This is a quick and easy way to convey overall satisfaction. A high number of stars indicates a positive experience, while a low number suggests dissatisfaction.
2. Written Review: This is where the reviewer dives deeper, elaborating on their experience. They might discuss the product's functionality, the quality of service received, or the overall impression of the business.

Online reviews live on various platforms like dedicated review sites (think Yelp or TripAdvisor), e-commerce websites (product reviews on Amazon), social media (restaurant recommendations on Facebook), or even a company's website.

The impact of online reviews is undeniable. They serve as a crucial source of unfiltered (though not always unbiased) information for consumers. Think of it like asking your friend about a new restaurant they tried - except your "friend" could be hundreds or even thousands of people! Positive reviews can boost trust and encourage others to try a product or service, while negative reviews can raise red flags and prompt caution.

III. BRAND REPUTATION

Brand reputation, in its fundamentals, is the totality of sentiments induced by the population about the company which embraces the company's standards, practices, products, and overall picture. It is emotion and intellect mixed that customers have for brand, which altogether influences the way they trust and remain loyal, influencing their purchasing behaviour. Constructing a positive brand name is, therefore, a steamroll in the present competitive business caste system. Brands that succeed at this continuously attract their customers who are aware of their offerings and become the only differentiator from their competitors. This perception of the company that has been created can be considered as the intangible capital that among other influencers consumer behaviour, it attracts and retains talent, it secures partnership, and it is welcoming media exposure.

IV. LONG TERM IMPACT ON BRAND REPUTATION

Long-Term Impacts and Scrappiness Strategies of Fast-Fashion Brands

While there is still much to be addressed in the world of brand management, giving the fact that reviews online contribute immensely to brand reputation such acknowledgment is of paramount importance.

A. Brand Perception and Loyalty

1. Brain formulation is a process that creates the image of the brand using online reviews over time.
2. Positive reviews create a dictum of confidence among the clients and goodwill for business whereas negative reviews can be damaging to a global reputation.

B. Market Positioning and Equity

1. The effect of the overall product feedback makes the brand in a difficult-to-overlook position on the market.
2. The brands with a quality assurance and customer reviews systems are the ones with a greater chance of remaining in the market and catching the first place in case of the competition.

C. Consumer Trust and Advocacy

1. Developing trust-based relationships with consumers is a determining factor in the brands' success in the long-term perspective.
2. Conversely, a brand's credibility gets cemented, and their trustworthiness augmented through customers sending out positive online reviews which validate their promises and commitments.

D. Resilience to Challenges and Adaptability

1. Brands' resilience is essentially their capacity to not get affected or suffer stemming from negative impact or obstacles.
2. Effective administration of the reviews online and dealing promptly with any potential problems is one of the most important factors that contribute to a strong brand's resilience.

V. REVIEW AUTHENTICITY AND TRUSTWORTHINESS

Concerning an online review and brand reputation, the notions of review authenticity and trustworthiness very frequently function as two sides of the same coin, although the behaviour of people as reviewers and the ways they judge their experiences with different brands may vastly differ. Authenticity part you can test, is authenticity that is the accuracy and reliability of the reviews, which describe real experiences of customers instead of being fabricated or altered. The reliability of the credible reviews comes through unbiased source, that the consumers really value since the reviews hold valuable things to their own satisfaction. On the opposite side, review trustworthiness or the trust and reliability of the reviews is something that should be held high. On the one hand, genuine remarks tend to earn people's trust and boost sales, but fake and biased reviews may spoil this belief, thus in turn acting against the brand. Until and unless mistrust in authentic reviews, fake reviews can make a big effect on brand reputation, destroy consumer confidence and trust in its products.

VI. REVIEW OF LITERATURE

 Min Zhang ( 2023 ) conducted research on The effects of comparative reviews on product sales. The study analysed 61,480 e-commerce reviews, employing a supervised learning approach to distinguish positive/negative regular and comparative reviews. Using a two-way fixed-effects model, it found that positive comparative reviews had a stronger impact on product sales than positive regular reviews.

Negative comparative reviews had a lesser effect than negative regular reviews, with positive comparative reviews having a greater impact overall. A follow-up lab study supported these findings, offering valuable insights for marketers in optimising online review strategies.

Fayez Ahmad ( 2021) conducted research on brand equity, online reviews and message trust: the moderating role of persuasion knowledge. In three experimental studies, this research explores the impact of brand equity on consumers' intention to write online reviews. Brands with stronger equity led to higher trust in messages, consequently increasing the likelihood of consumers writing reviews. Trust in the message mediates the brand equity-review intention link, and the study identifies a moderating effect of persuasion knowledge on consumer review intentions.

Bettina Lis ( 2020) conducted research on analysing different types of negative online consumer reviews. This German quantitative study investigates the impact of different types of negative electronic word-of-mouth (eWOM) on consumer attitudes toward laptops. Destructive and ethical eWOM cause a minor decline compared to functional criticism. Renewed positive eWOM can improve attitudes, with ethical criticism proving the most challenging to correct. The study employs a two-part experimental design to explore and confirm these findings.

Xiaolin Li, Chaojiang Wu et al. (2019) conducted research on the effect of online reviews on product sales: A joint sentiment topic analysis. This study explores the business implications of online reviews, investigating the impact of both numerical and textual reviews on product sales performance. Utilising a Joint Sentiment-Topic model, the research identifies topics and sentiments in review texts. The study suggests that numerical ratings mediate the influence of textual sentiments on sales. The findings enhance understanding of how electronic word-of-mouth affects product sales, offering practical insights for online vendors to optimise business analytics and boost sales by prioritising relevant aspects.

Sebastian Ullrich (2018) conducted research on Negative online consumer reviews: effects pf different responses. This study investigates the impact of response options to negative consumer reviews in online shopping. Analysing data from 446 participants in an online experiment, it reveals that a positive customer review has a stronger mitigating effect on negativity compared to a positive brand response. However, the effectiveness is moderated by brand strength. Additionally, incorporating a reference to an independent, trusted source in responses is found to be a limited strategy for enhancing effectiveness in addressing negative consumer reviews.

VII. RESEARCH METHODOLOGY

A. Aim

To assess the influence of online customer reviews on brand perception and reputation.

B. Objectives

1. To grasp the impact of reading online reviews on the trustworthiness attributed to them.
2. To comprehend how online reviews impact the trust participants have in a brand.
3. To investigate the relationship between recommending a brand based on their online reviews and the likelihood of participants leaving a review themselves.

C. Hypotheses

1. Participants who read online customer reviews more frequently before making a purchase will have a lower level of trust in brands with mixed online reviews.
2. Participants who have changed their decision about purchasing a product based on negative online reviews will rate the influence of online reviews on their trust on the brand to be higher.
3. Participants who recommend brands solely based on positive online reviews will be more likely to leave reviews after a positive or negative experience with a product or service.

D. Sampling Size

A sample of 104 participants (males= 39; females- 65) was selected using a random sampling technique and a survey was conducted. This technique was used to get data from various demographic backgrounds.

E. Tools Used

A Structured questionnaire was self-developed, consisting of 10 questions regarding online reviews and their impact on consumer trust and purchase decisions. Likert scale was employed for questions requiring rating on a scale. It is a correlational study and Microsoft Excel was used for data analysis and visualization.

X. DISCUSSION

In today's digitally interconnected world, the influence of online customer reviews on brand reputation and consumer perception cannot be overstated. Social media outlets and e-commerce platforms have become ubiquitous, democratising the sharing of experiences and views about goods and services. With their unmatched access to a multitude of information, consumers can now make better informed purchases. Because of this accessibility, consumers are now able to freely share both positive and negative experiences, which helps to shape how potential buyers view brands. The significant influence that online customer reviews have on the impression and reputation of brands has been highlighted by recent research studies. The substantial relationship between customer trust and online reviews is one important discovery. Research indicates that customers frequently place an equal amount of trust in internet evaluations and referrals from friends and family. Good evaluations could operate as strong testimonials, drawing in new clients and boosting the steadfastness of current ones. Negative evaluations, on the other hand, have the power to harm a company's reputation and discourage prospective buyers from interacting with the brand. Numerous studies have been conducted on the influence of social evidence, such as online customer reviews, on how consumers perceive brands. Studies have indicated that when consumers come across positive reviews from other consumers, they are more likely to have a positive perception of the brand. On the other hand, unfavourable evaluations can negatively affect how consumers see a brand, undermining their faith and confidence in it.

In today's digital world, online customer reviews have a significant impact on both brand perception and purchase decisions. Harvard Business School research shows that a company can see a significant 5-9% rise in sales with just a one-star Yelp rating increase. Furthermore, customers place an equal amount of faith in online reviews as they do in personal recommendations from friends and family, highlighting the significant influence these reviews have on consumer behaviour. In a similar vein, research published in the Journal of Marketing Research highlights how important social proof—including internet reviews—is in influencing consumers' perceptions of brands. While negative reviews can seriously harm a brand's reputation and turn off potential customers, positive evaluations have the power to draw in and keep customers. Nevertheless, it is essential to have reliable and trustworthy online reviews' integrity and veracity, especially in the midst of influencer marketing and paid posts. Transparency and sincerity stand at the very beginning of safeguarding consumer trust during portending with during cation. As a result, the brands should actively listen to what consumers have to say about them and should deal with the customers’ domain and make efforts to build an appealing online persona for their customers. Researching which is ongoing is vital to understand how online shoppers’ behaviour trends and consumer perception is impacted in the long run by online reviews and their content. The analysis of the correlational relationship of the three hypotheses availed the findings of the impact of the online reviews on consumer behaviour and brand image where a total of 104 participants (males=39, females- 65) were selected through a random sampling technique and a Survey was the instrument. In the effort of getting all the information regarding the income, education, and family functioning, this method was used.

The correlational analysis of three hypotheses provided insights into the influence of online customer reviews on consumer behaviour and brand perception. Firstly, participants who read online reviews more frequently before making a purchase exhibited a lower level of trust in brands with mixed online reviews, as evidenced by a negative correlation coefficient of -0.125, confirming Hypothesis 1.

This suggests that individuals who regularly consult online reviews tend to approach brands with mixed feedback more cautiously, reflecting a heightened scepticism. Secondly, participants who changed their purchase decisions based on negative online reviews were observed to rate the influence of online reviews on their trust in the brand to be higher, with a positive correlation coefficient of 0.428, supporting Hypothesis 2. This indicates that negative experiences with products or services may lead consumers to rely more heavily on online reviews when assessing brand trustworthiness. Lastly, Hypothesis 3 was corroborated as participants who recommended brands solely based on positive online reviews were more likely to leave reviews after personal experiences, irrespective of the outcome, with a positive correlation coefficient of 0.390. This underscores the significant impact of positive online reviews on consumer engagement and feedback behaviour, highlighting the pivotal role of online customer reviews in shaping brand perception and influencing consumer decisions.

XI. RECOMMENDATIONS

Based on the results and findings of the study regarding the influence of online customer reviews on brand perception, several recommendations can be made to help brands effectively manage their online reputation and leverage the power of online reviews:

1. Interact Proactively with Online Reviews: Companies ought to keep a watchful eye on and interact with online reviews on a range of venues. Quickly reacting to reviews—both positive and negative—shows that you value client feedback and are dedicated to making sure they are satisfied.
2. Handle Negative Feedback constructively: Negative evaluations offer insightful information about areas in need of improvement. Companies ought to be considerate of their consumers' concerns and respond to bad reviews with empathy. Rebuilding trust and lessening the effect of bad ratings can be achieved by providing answers and resolving problems.
3. Promote and Incentives Positive evaluations: By streamlining and simplifying the review process, brands may motivate happy customers to write positive evaluations. Customers might be encouraged to share their positive experiences by offering discounts or rewards for submitting reviews.

Conclusion

In today\'s technologically connected world, the impact of online customer evaluations on consumer perception and brand reputation is irrefutable. Thanks to the convenience of sharing experiences and the availability of information, consumers are now able to use online reviews to influence how brands are seen. While negative reviews can seriously harm a firm\'s reputation and turn off potential customers, positive reviews operate as potent endorsements, drawing in new business and enhancing brand loyalty. Further evidence supports the significance of social proof in determining how consumers perceive a company, emphasizing the influence of favourable evaluations on their sentiments. Going forward, it will be crucial for brands to interact with online reviews, respond to consumer complaints, and keep their online communications genuine and transparent. Brands can maintain their competitiveness in an increasingly digital environment, cultivate consumer trust, and effectively manage their online image by doing this. Furthermore, continuous investigation and examination are imperative in comprehending the dynamically changing nature of customer behaviour on the internet and the persistent impact of online evaluations on business image.

References

[1] Ahmad, F., & Guzman, F. (2021). Brand equity, online reviews, and message trust: the moderating role of persuasion knowledge. Journal of Product & Brand Management, 30(4), 549-564. [2] Lis, B., & Fischer, M. (2020). Analysing different types of negative online consumer reviews. Journal of Product & Brand Management, 29(5), 637-653. [3] Li, X., Wu, C., & Mai, F. (2019). The effect of online reviews on product sales: A joint sentiment-topic analysis. Information & Management, 56(2), 172-184. [4] Ullrich, S., & Brunner, C. B. (2015). Negative online consumer reviews: effects of different responses. Journal of Product & Brand Management, 24(1), 66-77 [5] Zhang, M., Li, Y., Sun, L., Wang, G. A., & Du, J. (2023). The Effects of Comparative Reviews on Product Sales. Journal of Interactive Marketing, 10949968231196578.

Copyright

Copyright © 2024 Sourabh Jain, Dr. Rajesh Kumar Yadav. This is an open access article distributed under the Creative Commons Attribution License, which permits unrestricted use, distribution, and reproduction in any medium, provided the original work is properly cited.