Do actions speak louder than voices? The signaling role of social information cues in influencing consumer purchase decisions

The rise of social media has facilitated consumer social interactions. Many product-focused online social platforms have included design features that can convey more information about product quality as well as the credibility of the members of the social community. Drawing on information signaling theory, we empirically examine how the two social information cues frequently found on online social communities, action-based social information (i.e., peer consumer purchase) and opinion-based social information (i.e., peer consumer review), influence consumer purchase decisions. We also explore the moderating role of consumer characteristics, consumer engagement and consumer expertise. Analyzing panel data (n = 39,897) collected from a popular online beauty community, we found that consumer purchase decisions are indeed influenced by the two social information cues and that action-based social information is more influential than opinion-based social information. Furthermore, our results show that both consumer engagement and consumer expertise play an important moderating role in consumer purchase decisions, albeit in opposite direction: Whereas consumer engagement exerts a positive moderating effect, consumer expertise is found to have a negative moderating effect. This study contributes to existing literature by providing an evaluation on the signaling role of online social community features in consumer purchase decisions. The results offer important and interesting insights to IS research and practice. (C) 2014 Elsevier B.V. All rights reserved.