The Unexpected Power of Negative Reviews: How They Influence Purchases

So much of our shopping is done online now that it's hard to know what we're really getting in advance anymore. All we've got are other people's word to go on, which means product reviews are more important than ever. You'd think that would be a straightforward indicator of quality, but as it turns out, there's nuance there in the comments section.

Economists in Russia and Denmark have just released a paper analyzing the effect of negative online reviews on product sales. The presence of a bad write-up actually can have a positive effect on whether someone chooses to buy a thing — in fact, we are more likely to buy something with a slightly less than perfect rating than a totally perfect one.

The reason comes down to suspicion. Let's say there are two different kinds of consumers: naïve and rational. "Rational buyers use all available information to determine the quality of a product," according to the researchers, "while naïve buyers tend to take product reviews at face value and do not make any further inference." If rational consumers see a product with a smaller number of reviews but all of them are five stars, they may wonder if the sample size is large enough.

A product that's highly but imperfectly rated with lots and lots of reviews, however, seems like a better approximation of quality for rational consumers. And in some ways, including (rather than removing or censoring) bad reviews is a show of confidence. Judging customer reviews in any circumstances can be a tricky proposition in some cases, but given how shopping patterns have shifted online, they're well worth understanding.