The last time you planned a vacation, you may have consulted TripAdvisor to book a hotel, compare cruise lines, or explore sightseeing options. If so, you are among millions who have visited the popular website to get advice and tips on trip planning and feedback from the site’s vast library of user reviews.
Every month, 135 million people visit Yelp for recommendations and reviews on everything from restaurants and auto mechanics to hair stylists. The website, founded in 2004, has generated more than 95 million reviews, all contributed by the public — for free.
Websites like these rely on user-generated content for their success, and the more familiar they become, the more their profit margins grow. By 2015, TripAdvisor reported $1.5 million and Yelp reached $550 million in advertising revenue.
While user reviews and other content benefit both consumers and businesses of all types, it’s not always easy to persuade visitors to write a review or share original content, according to Assistant Professor of Information Systems Yili Hong.
There’s no question of the impact reviews have on a company’s success.
“Many businesses rely on user-generated content,” Hong says. “Yelp and TripAdvisor are very lucky, but other companies fail because they are not able to motivate users to contribute content.”
Advice that counts
User-generated content, like online reviews, provides valuable benefits to consumers.
“Numerous surveys show that buyers go to online reviews for information about a product before they make a purchase,” Hong says. “They are impacting the consumers and having an effect on businesses.”
So the fundamental question is, how can companies motivate people to provide more content?
Hong and his colleagues explored alternative approaches to solicit user-generated content in two papers he co-authored that have been accepted for publication in the journal Management Science.
In the paper “Stimulating Online Reviews by Combining Financial Incentives and Social Norms,” he and co-authors Gordon Burtch, Ravi Bapna, and Vladas Griskevicius of the University of Minnesota’s Carlson School of Management considered whether certain interventions would influence an individual to contribute an online review.
In two experiments — one in partnership with a large online clothing retailer based in China and another with Amazon Mechanical Turk, the crowdsourcing Internet marketplace — the researchers tested the impact of financial incentives and social influences.
“We found that financial incentives are very useful in stimulating users to take action, to write a review,” Hong says. “If you offer a certain amount of money, like $5, $1, or even a coupon, users are more likely to write a review.”
The study also showed that if companies pay people to submit reviews, they tend to give higher ratings, even if they are asked to be unbiased. That says, platforms may get more than what they bargained for. “But paying people for reviews is not unprecedented,” Hong says.
When consumers were told how many of their peers contributed reviews in the past, though it didn’t generate more reviews, it did inspire longer reviews.
According to Hong, this strategy, called “social norms,” or the prevalence of behavior in a particular population, has been effective in many applications, such as motivating voter turnout, encouraging travelers to reuse hotel towels, and increasing consumption of healthy foods.
“Social norms influence behavior because seeing what others have done provides information about what is socially ‘normal’ in a given context,” the researchers explained in the paper.
Simply put, people are influenced by other people.
A combination of money and peer pressure yielded the best results of all — a higher volume of longer reviews. It’s not proven, Hong added, but one can speculate that longer reviews are better, since the length suggests that they offer greater detail.
While the first paper focused on online reviews provided after an individual buys a product, “Effectiveness of Performance Feedback in Stimulating User-Generated Content,” examined how people respond when they receive feedback about the content they contribute.
This study used a mobile recipe app in which users upload photos and recipes of food they prepare and receive “likes” and comments.
The researchers crafted weekly push messages to tell users how many people benefited from their contributions, where they ranked among contributors and how many other users they beat in numbers of “likes.”
“People are different regarding their social value orientation,” Hong explained. “Some only care about themselves, others care about themselves and others, and some care about themselves at the expense of other people.”
The study revealed a fundamental gender divide: men were most responsive to the competitive message, while women were more altruistic, responding more often to the message about how many people they helped.
According to Hong’s research, past performance does, in fact, influence future results. Individuals who received higher numbers of “likes” tended to contribute more content when they received the push messages, while those who received fewer “likes” retreated.
“It’s similar to a high-performing middle school student,” Hong says. “If teachers say the student is doing well, they’ll work harder.” Likewise, if a student is not doing well and a teacher points that out, they get discouraged.
“The research shows that we should give high-performing users the notifications, but not the low-performing users. If they are not performing well, the platform should not send a push because it will discourage them.”
While user-generated content isn’t necessarily a direct link to profitability, it ultimately does impact a company’s bottom line because more content attracts more users and prospective buyers to the website. In the case of sites like TripAdvisor and Yelp, it impacts advertising revenue.
Hong and his colleagues determined that combining financial incentives with social norms is the most efficient way to generate more high-quality reviews. They also identified the types of messages that encourage men and women to contribute more content and learned how feedback stimulates content among high- and low-performing users.
Armed with insights like this, “companies can shape their strategy to encourage users to contribute content and get better results,” Hong says. “User engagement is all they need to achieve, and they want to capitalize on it. Our goal is to apply theory to determine which strategy will be better for which type of company.”