Recommendation Systems


In decision-making are recommendation systems important. Customers are able to provide their suggestions to other customers, but also to inform firms about their opinions. This is useful for firms, because firms are able to understand their customers better. This could also lead to more profit, but this is depending on several factors. Is it possible that the recommender systems manipulate the customers? In the articles related to this topic, there is already spoken about word-of-mouth and observational learning. Those could lead to an increase in sales. Recommendation systems will provide customers information about opinions of other customers; this will give them an expectation of how well they will like the product or service. People will be influenced by certain events in their environment when they make a choice. This is related to Word-of-mouth and observational learning. Customers do belief that the recommendation system will provide them the best alternative; therefore they will choose what the recommendation system gives them. This could be useful for firms, because they are able to stimulate the sales of certain products or services. Is it possible to manipulate this? I don’t think so. If customers don’t like products or service, they are nowadays able to let everybody out there now it! Of course, the reliability of the system is important as well. If the system is not known or seen as reliable, the ratings will not be accurate. Therefore this will also been noticed by customers, therefore they will not even belief the ratings.

References

Adomavicius, Gediminas, Jesse Bockstedt, Shawn Curley, and Jingjng Zhang. Do Recommender Systems Manipulate Consumer Preferences? A Study Of Anchoring Effects. SSRN Electronic Journal.

Chen, Y., Wang, Q., and Xie, J. 2011. Online Social Interactions: A Natural Experiment on Word of Mouth versus Observational Learning. Journal of Marketing Research 48(2) 238-254.

Cosley, D., S. Lam, J. Konstanz, and J. Riedl. 2003. Is Seeing Believing? How Recommender Interfaces Affect Users’ Opinions. CHI 2003 Conference, Fort Lauderdale FL (ACM, New York), 585–592.

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