How and when ranking-based recommendations induce higher willingness-to-pay.

Web-based businesses create various product recommendation labels to facilitate online decision-making. Across three studies, this research demonstrates that relative to non-ranking-based recommendation labels, ranking-based recommendation labels increase e-shoppers' quality assessment belief and elicit a higher willingness to pay. Consistency among consensus attributes and perceived product differences moderate this effect. According to the findings, online retailers should use a multi-layer, diversified recommendation scheme and ranking-based recommendations for high profit-margin products to maximize their future revenues. [ABSTRACT FROM AUTHOR]