Online customer reviews play a central role in shaping purchasing decisions across a wide range of consumer markets.

Whether selecting a restaurant, choosing between new appliances, or wondering if that secondhand seller will actually ship your order, reviews and ratings offer useful insights into product quality, customer service standards and overall value. 

We know reliable reviews can be a great critical tool for informed decision-making and feedback, helping consumers and business work together to drive up quality and transparency across the market. 

But is it possible to measure that value and gain more understanding of what the collective efforts of millions of consumers’ contributions means to the economy and market function? 

Unlocking the value of trusted online reviews  

This is what Euroconsumers latest piece of research to quantify the economic value of customer reviews has set out to do. The research also offers another perspective on the challenge of fake and misleading reviews.

Fraudulent reviews can cause consumers to inadvertently pay more for lower-quality products. Businesses that invest in quality and service then risk being undermined by traders who manipulate review systems to gain visibility and sales. 

But as well as minimising the harm from fake or misleading reviews, there’s an important job to be done to maximise the potential value of online reviews. In this scenario, we empower consumers to improve the market through transparency and fair competition.

This new research offers a fresh lens on the discourse surrounding review assurance systems—shifting the focus from the pitfalls of fake reviews to the possibilities unlocked when systems grow trust through verification and robust quality control mechanisms.

Quantifying the economic value of online reviews

To gain a full understanding of the economic value of online customer reviews and Euroconsumers latest report, The Economic Value of Online Reviews  contributes major new evidence to this field. 

The Economic Value of Online Reviews research set out to measure the impact of online reviews on both business performance and consumer trust – recognising that both go hand in hand to create vibrant, fair and sustainable markets. 

Economic experts from the University of Siena and the Università Cattolica del Sacro Cuore worked alongside our experienced consumer research team to create a first-of- its-kind-view on the market impact of online customer reviews. Here’s how they developed the findings: 

• •  A survey about online reviews was conducted among a representative sample of 4,200 adults aged 18–64 in Belgium, Italy, Portugal, and Spain. Consumers shared their experiences of both consulting and posting customer reviews and took part in two practical experiments which tested which aspects of customer reviews were most relevant to their final buying decision. 
• •  The results from the consumer research informed a newly designed economic analysis to investigate, quantify and evaluate the value of online reviews.
• •  The economic analysis investigated the evaluation from two different perspectives: first, by applying an economic lens to quantify the value of online reviews in terms of enhanced efficiency of the overall market system (i.e. the overall social welfare created), and secondly, a business lens to quantify the impact of various different factors on consumer decision-making and behaviours regarding online reviews.   

This holistic analysis of users and businesses resulted in a deeper understanding of the economics of consumer online reviews. The rest of the blog showcases the headline findings.

1. Findings from direct consumer experiences and perspectives on….

Consulting customer reviews

• High usage and utility of online reviews: 6 out of 10 consumers check reviews before buying something online, the biggest users were Italians (65%) and Spaniards (61%), followed by Portuguese (55%) and Belgians (50%).  Over three quarters (78%) of respondents said customer reviews played an important role in their buying decision.
• Price matters: the price of a product significantly influences whether or not a consumer checks the reviews. The higher the price, the more likely consumers are to check reviews, it’s no surprise then that people consult customer reviews most often for household appliances and high-tech devices.
• Customer reviews most popular: the most popular source of reviews across all the countries were customer reviews on the online store where they bought the product. These were used by 53-68% of respondents.
• Experts are still valued: people don’t only make use of customer generated reviews. Just over half (51%) put the most trust in expert sources and 44% in external expert sites. The least trusted source were social media influencers, only 17% of respondents had high or very high trust in this source.
• Fake reviews are a big concern: 75% of people said fake reviews hurt trust, and 63% believe that fake review brokers exist. However, despite reporting these concerns, around 72% of consumers feel somewhat confident in detecting some fraudulent reviews though only 3% believe they can identify all of them. There also seems to be trust in the review publication system: 61% of respondents trust that verified reviews are genuinely from purchasers, and 52% are confident that online stores can filter out fake reviews.

Posting customer reviews

• Active consumers: Three out of four respondents said they had posted at least one customer review or rating for a product or service in the last two years.  The hospitality sector attracts the most reviews, restaurants and accommodation are the most likely services to get a consumer write up. 
• Positive posts: Consumers are more likely to post a review when the product exceeded their expectations (64%) versus when it was worse (45%) or in line with their expectations (44%).  
• Highly rated: When it comes to ratings, the vast majority (92%) rank products as either ‘good’ (39%) or ‘very good’ (53%) – that’s a global average rating of 4.4 out of 5 stars.  Those who read a review before purchasing a product gave an average rating of 4.5 which was higher than that given by those who hadn’t read a review (4.3 average).

The value of online reviews to consumers

• Stores and platforms influence consumer value: The credibility of online stores and digital platforms positively influences the value that consumers put on reviews, by bolstering perceived trust, credibility and usefulness of the reviews. 
• Usefulness influences value: the usefulness of a review positively influences its value, mediated by perceived trust and credibility. This effect was found to be more pronounced for consumers who believe they can discern genuine from fraudulent reviews. 

2. Assessing the ‘value of information’ in online reviews from an economic perspective

Behavioural experiments were carried out with consumers designed to give an indication of how consumers valued the information in customer reviews.  Here’s how they were set up: 

• In the first experiment, consumers were asked to choose one of three types of TVs at different price points. Each item was presented with slightly different information, for example, the most expensive one had good ratings and verified reviews, mid-priced one had just ratings and un-verified reviews and the cheapest option had no reviews at all.
• The second experiment tested the importance of headline star ratings and review content for three identically priced products. Using coffee machines this time, the lowest rated had richly informative reviews, the mid-rated one had short reviews and the third had the highest rating but no written reviews.

The behavioural experiment indicated that customer reviews are valuable to consumers, in particular those which are deemed to be reliable. 

In fact, the results put the “value of information” in the order of 3-4% of the price of the product for reviews and a further 2-3% when such reviews are verified

Although these results are from research experiments and not real life data, the finding that consumers are willing to pay 5-7% more for a product with verified reviews is significant.

Build a system to support the economic value of  reviews

This new evidence enriches the expanding body of research on consumer generated reviews. By emphasizing the informational value these reviews offer to consumers and highlighting their corresponding benefits to businesses, it provides a valuable and timely contribution to the literature.  

The research shows the benefit of increasing trust in online reviews for both individual consumers and businesses alike. These initial findings should be subject to further analysis, ideally based on actual product sales data and consumer decisions.

Euroconsumers sees a strong opportunity for industry, policymakers and consumer organisations to work together to cultivate a competitive and vibrant digital economy, backed up by reliable online review systems that enable the flow of trusted information to empower consumers and improve the market. 

Disclaimer: Euroconsumers, through its consulting firm Synallagma, collaborates with independent academics and researchers to advance policy in the digital services space. This study was funded by Amazon EU S.à r.l. The academic authors acknowledge receipt of a grant from Synallagma, which ensured their full independence. The views expressed in this report are solely those of the authors and do not necessarily reflect the positions of Amazon.