How Online Reviews Move Sales

ContentYou, Y.; Vadakkepatt, G.; Joshi, A. · 2015Journal of Marketing
Topicsewom elasticity·online reviews·meta-analysis·review volume·review valence·social media

You are deciding how much of next year's budget to put behind earning online reviews and posts, and where. One team wants to chase raw review counts across every site. Another wants to protect the star rating on a few key products. The research pulls together hundreds of estimates and separates two questions: does sales move more with review volume (how many people post), or with sentiment (how positive the posts are)? On average, sentiment moves sales more, so sentiment, not raw counts, should carry the plan. But the averages hide wide spread, so pin the money to the products, sites, and markets where the effect is strongest.

Online reviews move sales, but how much depends on the product, the site, and how crowded the category is.

Pooling many studies, the research finds that online reviews and posts are among the more responsive marketing levers, on average moving sales more than short-term advertising, with review sentiment even outrunning short-term personal selling. The payoff is not uniform. Before funding a reviews program, ask where it actually pays off: which products, which sites, and how many rivals crowd the shelf.

Action guide

  1. Size the reviews lever before funding it.Treat online reviews and posts as a meaningful sales driver, since on average they move sales more than short-term advertising, with review sentiment even outrunning short-term personal selling, but plan to the average effect, not a best case.
  2. Concentrate reviews spending where it pays off most.For hard-to-try, privately used goods such as electronics and appliances, both volume and sentiment effects run higher on average, and for durable goods review volume works even harder, so invest in generating and surfacing reviews there first.
  3. Earn placement on independent and specialized sites.Reviews on independent sites carry stronger sales effects than a retailer's own site or a general site, and specialized sites lift the volume effect; for sentiment-driven persuasion, community-based sites add lift on average.
  4. Track negative and average ratings separately, not as one number.In these studies, looking at negative ratings on their own, rather than a single average star rating, shows a stronger downward pull on sales, which the authors read as buyers weighing bad reviews heavily. A single average rating can hide that pattern. This is about how ratings get measured, not a rule that negative reviews always cut sales.
  5. Reset expectations in crowded categories.Both effects decline on average as the number of rivals rises, so check the expected sales response in that specific market rather than assuming the average holds.
  6. Trust the volume signal more when studies disagree.Volume effects stay stable across study designs while sentiment effects shift with them, so lean on volume when reconciling conflicting numbers across sources.

Evidence

  • On average, sales move with both review volume and sentiment; sentiment tends to matter more.
  • Online reviews and posts rank among the more responsive marketing levers, on average above short-term advertising and roughly on par with short-term personal selling (review sentiment ranks higher, review volume a touch lower).
  • Reviews matter most, on average, for hard-to-try, privately used products such as electronics and appliances (for durable goods, the extra lift shows up in review volume).
  • Independent review sites carry stronger sales effects than a retailer's own site or a general site, for both volume and sentiment; specialized sites boost the volume effect.
  • As rivals multiply, both effects shrink on average, consistent with shoppers facing too many choices.
  • Volume effects hold steady across studies; sentiment effects swing widely with how a study is built.

Key takeaway

Online reviews move sales, sentiment somewhat more than volume, but only as much as the product, site, and competition allow.

Source

You, Y., Vadakkepatt, G. G., & Joshi, A. M. (2015). A meta-analysis of electronic word-of-mouth elasticity. Journal of Marketing, 79(2), 19–39. https://doi.org/10.1509/jm.14.0169

Read the paper ↗

Evidence strength: Strong (about 340 how-much-people-post and 270 how-positive sales estimates pooled from 51 studies). Generalizes most confidently to sales effects for durable, hard-to-try, privately used goods reviewed on independent or specialized sites; less so to individual buyer behavior, review wording effects, paid or incentivized reviews, and product categories the underlying studies barely cover.