Sincere or Falsehearted? Investigation of Online Reviews and Merchant Response

ABSTRACT Academia and industry widely believe that merchants’ customized response is an indispensable tool for handling online reviews, particularly negative reviews caused by service failures. However, whether merchants actually fulfill the promises they make in their responses remains unclear. On the basis of the literature on online reviews and service recovery, this study utilizes a series of textual features of online reviews and merchant responses via text analysis, including review topics, review sentiments, and response pertinence, to construct a novel indicator. This indicator, the consistency between merchants’ words and deeds (hereafter referred to as CWD), can be used to infer the degree of merchant response fulfillment. In particular, this study first proposes two indicators, namely, response and action levels, and then measures their difference to evaluate the CWD level of merchants. CWD can reflect the effort exerted by merchants to achieve service recovery. This study significantly contributes to the literature on service recovery and online reviews. The research findings derived from this study can help urge merchants to provide consumers with improved products and services. They can also be applied to the online ranking system to enhance platform fairness and protect the long-term interests of consumers and other stakeholders.