Staying competitive with the help of social proof - A quantitative study on the strength of different social proof tactics in an online context and the moderating effect of brand equity

Abstract: The recent growth in global e-commerce sales caused by the Coronavirus pandemic has created cause for retail brands to re-evaluate the employed social influence tactics on their online product pages in an effort to remain competitive. Two tactics which are commonly used on these online product pages are popularity information statistics and customer reviews. Drawing from theory about similarity and uncertainty social proof mechanisms, helpfulness and affect infusion, it is hypothesized that being exposed to customer reviews on an online product page will result in greater values of key marketing variables than being exposed to popularity information or no social information at all. To add nuance and contribute to existing literature, the moderating role (customer-based) brand equity has on the strength of the two tactics for the same dependent variables is examined. Adopting a 2 (strong brand vs. weak brand) × 3 (customer review, popularity information, control) between-subject experimental design, and using Amazon.com as a setting, the quantitative survey data yielded a number of findings. Firstly, the results show that overall, without consideration of brand equity, exposure to a customer review led to statistically greater values for some key dependent variables than a control, but not for popularity information. Therefore, the hypotheses were either partially empirically supported or rejected. Furthermore, our results show that brand equity does positively moderate the impact that social proof tactics have on consumers. Specifically, low brand equity positively moderates the effect that customer reviews have on key variables (except for purchase intention). Whereas, popularity information had no significant effect on any of the dependent variables for a weak brand. For a strong brand, no significance was found for either customer reviews or popularity information. As such, an interesting implication is that the optimization of social proof tactics is more important and of greater value for a low equity brand than it is for a high equity brand. However, due to the double jeopardy effect, low equity brands face a serious dilemma, as they will have more difficulties in acquiring positive customer reviews and committing resources to social proof tactic optimization on their product pages than high equity brands will. This study therefore further exposes this pressing issue which low equity brands face, and their need to find ways to overcome this issue in order to reap the empirically supported consumer- and firm-related benefits.