Whose online reviews to trust? Understanding reviewer trustworthiness and its impact on business

Why do top movie reviewers receive invitations to exclusive screenings? Even popular technology bloggers get free new gadgets for reviewing. How much do these reviewers really matter for businesses? While the impact of online reviews on sales of products and services has been well established, not much literature is available on impact of reviewers for businesses. Source credibility theory expounds how a communication's persuasiveness is affected by the perceived credibility of its source. So, perceived trustworthiness of reviewers should influence acceptance of reviews, and consequently should have an indirect impact on sales. Using local business review data from Yelp.com, this paper successfully tests the premise that reviewer trustworthiness positively moderates the impact of review-based online reputation on business patronages. Given the importance of reviewer trustworthiness, the next logical question is - how to estimate and predict it, if no direct proxy is available? We propose a theoretical model with several reviewer characteristics (positivity, involvement, experience, reputation, competence, sociability) affecting reviewer trustworthiness, and find all factors to be significant using the robust regression method. Further, using these factors, a predictive classification of reviewers into high and low level of potential trustworthiness is done using logistic regression with nearly 83% accuracy. Our findings have several implications - firstly, businesses should focus on building a good review-based online reputation; secondly, they should encourage top trustworthy reviewers to review their products and services; and thirdly, trustworthy reviewers could be identified and ranked using reviewer characteristics.