Customers’ Review Content and Their Referral and Repurchase Behaviors

In today’s digital economy, online reviews have become increasingly important for businesses and consumers. However, the downstream impacts of customer review content on reviewers’ own decisions are not well understood. The authors explore the relationships between customer review content and their subsequent referral and repurchase behaviors. To address the potential endogeneity of customer review content, they leveraged two sources of randomization to induce exogenous variation in review content – random assignment to customers of (i) incentives, and (ii) service employees. Results show that as consumers write longer reviews, they are less likely to make referrals. Consistent with the affective-cognitive model of information processing, consumer involvement in the cognitive process during review provision negatively affects their referral behaviors, whereas their engagement in the affective process positively influences referral decisions. Analyses of heterogeneous effects of review content on referral decisions across customers provide converging evidence for this underlying mechanism. Results are similar when customer repurchase behavior is the dependent variable. This study shows the potential for the customer review provision process to evoke behavioral changes at other touchpoints in the customer journey and underscores the importance of a holistic view of these journeys.