Product engagement and identity signaling: The role of likes in social commerce for fashion products

Motivated by a lack of understanding of user engagement with identity-relevant products, we distinguish between two mechanisms by which existing likes affect subsequent engagement: observational learning (OL) by observing the number of existing likes, and social influence (SI) by observing the likes of one's social connections. Using a novel panel dataset of 930 handbags, we find that, contrary to most OL studies, OL has a negative effect on subsequent likes, and the effect is mitigated by SI. By contrast, OL has a positive effect on clicks, and the effect diminishes as SI increases. We attribute our findings to identity signaling.