The inverted U-shape of consumer reviews and conversion rates: The moderating role of store longevity and transaction volume on service-selling platforms

Abstract

This study investigates the intricate relationship between consumer review quantity and conversion rates on online service-selling platforms. Leveraging data from a large platform, the research uncovers an inverted U-shaped relationship, where conversion rates initially improve with increasing review quantity but decline once a threshold is exceeded. The study also explores how store longevity and transaction volume moderates this relationship, revealing that established stores and those with higher transaction volumes can mitigate the negative effects of excessive reviews. These findings offer actionable insights for platforms and merchants on balancing review quantity to optimize conversion rates. Moreover, the conduction of this study also underscores the importance of reassessing established theories in the evolving landscape of e-commerce.