Online WOM effects and product type: Evidence from Tmall

This paper examines the persuasive effect and the awareness effect of online user reviews on product sales. Using publicly available data from a China-based B2C e-commerce site under the Alibaba Group-Tmall.com, we show that rating of online user reviews has no significant impact on product sales after controlling the influence of product price. However, we find that the review volume has significant and positive influence on product sales. More, to uncover the underlying mechanisms behind online WOM effects, we compare search products and experience products. Our results show that the effect of online user reviews is much larger for experience goods than for search goods. Our results also show that product price has no significant impact for search product, but has significant negative impact for experience products.