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Determinants of eWOM to Consumers’ Purchase Intention

Conference Paper · May 2018

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Determinants of eWOM to Consumers’ Purchase Intention

Nurul Airin Binti Mohamad Ridzaa and Melissa W. Migin*a

Abstract
In an online environment, consumers are unable to physically touch or feel the actual product prior purchasing it. Therefore,
consumers tend to depend on electronic word of mouth (eWOM) sourced from product reviews and information in different online
platforms. Currently it is difficult to assess which eWOM’s antecedents influence consumers’ product/service purchase intention in
the context of the beauty industry. With that, the aim of this study is to examine eWOM’s source credibility, quantity, and quality on
consumers’ intention to purchase. The conceptual framework draws from the Information Adoption Model (IAM) and Theory of
Reasoned Action (TRA), which explains eWOM’s characteristics and behavioural intentions, more specifically on purchase intention.
Proposed targeted respondents are those active or frequent users of online shopping, age ranging between 22-41 years old. Data
collected will be analyzed using Partial Least Square - Structural Equation Modeling (SEM).

Keywords: electronic Word-of-Mouth (eWOM); Source Credibility; eWOM Quantity; eWOM Quality; Purchase Intention.

1 Introduction
The internet changed people’s lifestyle on the methods of purchasing products or services around the world. It became one of
the important tools that marketers use to gain more potential customers who were naturally restricted within the country’s
borders (Zhang, Craciun & Shin, 2010). Since the availability of electronic word of mouth (eWOM), news and information
spreads at a remarkable speed and offers a much lower cost in comparison to traditional WOM (Pourabedin & Migin, 2015;
Li & Zhan, 2011). Potential consumers are able to search and read product reviews and information through varying online
platforms such as networking sites, apps and websites (Migin & Falahat, 2016; Cheung & Thadani, 2012). Previous studies
found that eWOM to a certain extent influences consumers’ purchase intentions (See-To & Ho, 2014; Balakrishnan, Dahnil
& Wong, 2014). However, there is a dearth of research on a combination of perceived eWOM variables on its influence
towards consumers’ purchasing intention. The objective of this paper is to examine the effectiveness of perceived eWOM’s
source credibility, quantity, and quality on purchase intention in the context of the beauty industry. This research draws from
Information Adoption Model (IAM) and Theory of Reasoned Action (TRA) which explains eWOM’s characteristics and
behavioural intentions.

2 Literature Review
Wathen and Burkell (2002) stated that source credibility is one of the key factor that help in assisting a consumer to judge
online information as to whether it is true or factual. Since consumers are not able to touch or feel the product before having
an intention to purchase it, source credibility is used by consumers as an important predictor in the early stage in which
contributes to the perceived credibility of messages on the site (Dabholkar, 2006). The process is known as the
internalization of data or information that comes from a credible source such as celebrities. They then can influence behavior,
confidence, attitudes, and purchase intention, by which generally will occur when receivers accept a source of influence in
terms of their value structures and personality. Based on Ling and Liu (2008), credibility is the extent of the message reflects
reality after a consumer’s evaluation. Therefore, the study proposes the following hypothesis:
H1: Source credibility has a positive significant relationship on perceived eWOM credibility.

According to Liu (2006), the number of eWOM occurrences (also known as eWOM quantity) is used to evaluate
WOM. WOM quantity enhances and improves the number of consumers who have obtained the information in the market
and consumers’ cognitive level. The more prominent WOM quantity is, the more comment information about the products
or services the consumers will possibly gain which leads to information credibility. Therefore, the study formulates the
following hypothesis:
H2: eWOM quantity has a positive significant relationship on perceived eWOM credibility.

Bhattacherjee (2006) defined eWOM quality as convincing or trustworthy power of comments rooted in an
informational message. High-quality information often highlights the details of product features or use experience, which
enables consumers to have a more in-depth understanding of the products and services. In other words, the higher eWOM
quality is, the more prominent its influence on consumers’ perceived eWOM credibility will be. Therefore, the study came
up with the following hypothesis:
H3: eWOM quality has a positive significant relationship on perceived eWOM credibility.

According to Cheung (2009), the degree to which one perceives a recommendation or review as genuine, true,
believable, or factual is defined as the consumer-perceived credibility of eWOM. Awad and Ragowsky (2008) proposed that
perceived credibility is a prime determinant in a consumer’s decision-making process, and reduces uncertainty in both social
and business interactions. Thus, the more comprehensive and belief on the products or services’ eWOM credibility will be,
the higher the purchase intention the consumers will have. Therefore, the study proposes the following hypothesis:

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ASIA International Multidisciplinary Conference 2018
H4: Perceived eWOM credibility has a positive significant relationship on purchase intention.

Figure 1 shows the proposed conceptual model of this study, explaining perceived eWOM’s antecedents which affect
consumers’ purchase intentions.

Source
Credibility

eWOM Quality Perceived eWOM Purchase

eWOM
quantity

Figure 1: Proposed Conceptual Model

3 Methodology/Materials
Based on International Trade Administration (ITA), Malaysia has a high rate of e-commerce usage due to Malaysia’s internet
and mobile connectivity, as well as public sector’s encouragement. Targeted respondents in this research are required to
answer the questionnaire based on their perception on perceived eWOM’s antecedents that influence consumers’ purchase
intention. Besides that, targeted participants are individuals who has an account in any online shopping sites or apps of the
beauty industry, such as NYX, Hermo, Sephora and is an active and frequent online user. The sample chosen for this study
consists of Malaysian millennials as potential respondents, age ranging between 22-41 years old (Valentine & Powers, 2013),
having some online shopping experience or information about online product reviews.

For this study, purposive sampling technique is chosen. Moreover, to test the proposed hypothesis, the data obtained
from respondents will be analyzed using the Partial Least Square Structural Equation Modeling (PLS-SEM) as it is well
suited for predictive models (Hair et al, 2017). Furthermore, Hierarchical Component Models (HCM) or Higher Order
Components (HOCs) (Ringle et al., 2012) will be used to assess the data. HOCs will tend to have multiple layers of
constructs that contains two layers of constructs. The reason of choosing HOC is that the exogenous constructs are highly
correlated and may be biased to multi-collinearity.

4 Conclusion
In summary, knowing the right determinants of eWOM that influences consumers’ purchase intention is critical for retailers
so that they are able to better strategize their online marketing plans. Besides that, marketers from the beauty industry are
able to have a frame of reference that can help them to better understand the effectiveness of perceived eWOM’s source
credibility, quantity, and quality on purchase intention.

References
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