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Judith A. Chevalier, Dina Mayzlin
NBER Working Paper No. 10148
Issued in December 2003
NBER Program(s): IO
An NBER digest for this paper is available.
---- Abstract -----
We examine the effect of consumer reviews on relative sales of books on Amazon.com and BarnesandNoble.com. We find that 1) reviews are overwhelmingly positive at both sites, but there are more reviews and longer reviews at Amazon.com, 2) an improvement in a book's reviews leads to an increase in relative sales at that site, and 3) the impact of 1-star reviews is greater than the impact of 5-star reviews. The results suggest that new forms of customer communication on the Internet have an important impact on customer behavior.
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