How relying on online reviews impacts private label brand preferences

Consumers are shifting purchasing behavior from physical stores to online vendors and increasingly relying on reviews from peers to make purchase decisions. Brands are keen to use these reviews in promotions and to facilitate product innovation. But there is an unforeseen outcome: this paper shows that when consumers rely on online reviews, they are overall less loyal to brands and more likely to purchase private label brands. Using a large North American sample from a commercial dataset, this paper empirically investigates these relationships and reports implications for retailing and marketing researchers and practitioners.