Is Distance Really Dead in the Online World? The Moderating Role of Geographical Distance on the Effectiveness of Electronic Word of Mouth

Abstract

The authors investigate how the geographical distance between online users is associated with electronic word-of-mouth (eWOM) effectiveness. Their research leverages variation in the visibility of eWOM messages on the social media platform of Twitter to address the issue of correlated user behaviors and preferences. The study shows that the likelihood that followers who are exposed to users’ WOM subsequently make purchases increases with followers’ geographic proximity to the users. The authors propose social identification as a potential mechanism for why geographical distance still matters online in eWOM: because consumers may form a sense of social identity based on their physical location, information regarding the spatial proximity of users could trigger online social identification with others. The findings are robust to alternative methods and specifications, such as further controlling for latent user homophily by incorporating user characteristics and embeddings based on advanced machine-learning and deep-learning models and a corpus of 140 million messages. The authors also rule out several alternative explanations. The findings have important implications for platform design, content curation, and seeding and targeting strategies.