Impact of user generated content on user behaviour in e-commerce

Abstract

When users face uncertainty about purchases on e-commerce, they rely on mitigating this risk by taking the opinion of fellow consumers. The emergence of digital technology has created new forms in which consumers can share their ideas and experiences about the product or service. This is popularly referred to as "User Generated Content" or UGC. On e-commerce platforms, UGC is present in the form of ratings, text reviews, image reviews, Questions and Answers (Q&A) and social commerce features such as stories and posts. While the efficacy of ratings and reviews in e-commerce is unquestionable, there is limited research on the factors that result in this efficacy. Through qualitative research, we explore when the users look for UGC on e-commerce platforms, what information they look for and what factors affect the perceived credibility of the content. Through a statistical analysis, we also analyze how the usefulness of UGC varies across e-commerce categories such as electronics, fashion and travel and what factors discourage users from creating UGC. The data collection for the research was carried out through an internet-based Qualtrics user survey consisting of questions of various types – single choice, multiple choice, Likert scale, and image based with mandatory responses. We had a total of 105 responses across all age groups living in tier-1 cities with a varying usage e-commerce platform. Our qualitative research provided the following insights: i. Users prefer to look at UGC right after they reach the product page on e-commerce. ii. Number of likes and reviews by experts lend credibility to user reviews. iii. The quality of Q&As rather than the quantity lends credibility to the Q&As. iv. Average rating, number of ratings and number of reviews are the most useful information present in ratings and reviews. This is followed by the text and image reviews. Our quantitative research provided the following insights: i. Reviews & Ratings are more useful in categories dealing with high value products and services such as electronics, appliances, travel and furniture than low value products and services such as fashion, grocery and food delivery. ii. Low frequency of e-commerce usage is the most important cause users not providing ratings and reviews of their purchases. iii. Factors of privacy, lack of discounts and rewards, no reminder from app, no time to provide ratings and reviews and still being unsure about the purchase have no major impact on users not giving ratings and reviews on e-commerce platforms. Lastly, we have gone through the popular e-commerce platforms in the Indian ecosystem and used findings from our research to suggest features which would increase the perceived credibility of UGC and enhance the user experience.