ONLINE REVIEWS: DO THEY AFFECT CONSUMERS CONFIDENCE?

Abstract

E-commerce has gradually become a very important business activity. However, the
penetration of B2C e-commerce in Indonesia is still below other major Asian countries.
Consumer confidence in conducting online transactions is found to be one factor that hinders
consumers to be involved in e-commerce. Reading online reviews is one way for consumers to
gain more information about an online product or seller. It has become a popular media to
promote a product or service. However, the impact of online reviews toward consumer
confidence is still mainly unobserved. This study is based on the perspectives of 173 business
school students to assess the impact of online review attributes (product reviews, e-commerce
reviews, and seller reviews) towards consumer confidence. Data was analyzed using a
regression analysis and interaction analysis to assess each variable’s contribution towards
consumers’ confidence as well as the whole model. The role of gender as a moderating variable
was also explored. The results show that online reviews significantly influence consumer
confidence to use e-commerce. However, gender does not moderate the relationship between
online reviews and confidence.