Operations, Information and Decisions Papers

Document Type

Journal Article

Date of this Version

2006

Publication Source

Journal of Management Information Systems

Volume

23

Issue

2

Start Page

149

Last Page

171

DOI

10.2753/MIS0742-1222230207

Abstract

We analyze how online reviews are used to evaluate the effectiveness of product differentiation strategies based on the theories of hyperdifferentiation and resonance marketing. Hyperdifferentiation says that firms can now produce almost anything that appeals to consumers and they can manage the complexity of the increasingly diverse product portfolios that result. Resonance marketing says that informed consumers will purchase products that they actually truly want. When consumers become more informed, firms that provide highly differentiated products should experience higher growth rates than firms with less differentiated offerings. We construct measures of product positioning based on online ratings and find supportive evidence using sales data from the craft beer industry. In particular, we find that the variance of ratings and the strength of the most positive quartile of reviews play a significant role in determining which new products grow fastest in the market-place. This supports our expectations for resonance marketing.

Copyright/Permission Statement

This is an Accepted Manuscript of an article published by Taylor & Francis in Journal of Management Information Systems on 08 Dec 2014, available online: http://wwww.tandfonline.com/10.2753/MIS0742-1222230207

Keywords

differentiation, online reviews, product positioning, product variety, resonance marketing, word of mouth

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Date Posted: 27 November 2017

This document has been peer reviewed.