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27 Feb
Marketers Can’t Ignore Online Product Reviews
Reviews on e-commerce sites have become a critical feature over the past couple years, and they’re becoming even more important now. In an earlier column, I cited Roy Williams on why this word-of-mouth (WOM) feature has become so influential. You ignore WOM at your peril.
Consider dipping into the traditional marketing budget to invest in a customer review system. A review system allows you to let your customers market your products for you. Need more rationale? Consider these facts:
· According to JupiterResearch, 77 percent of online shoppers use reviews and ratings when purchasing.
· Reviews drive 21 percent higher purchase satisfaction and 18 percent higher loyalty, according to Foresee Results.
· In a study of 2,000 shoppers, 92 percent deemed customer reviews as “extremely” or “very” helpful, finds eTailing Group.
· BizRate found 59 percent of users considered customer reviews to be more valuable than expert reviews.
· In a CompUSA-iPerceptions study, 63 percent of consumers indicated they’re more likely to purchase from a site if it has product ratings and reviews.
· 86.9 percent of respondents said they’d trust a friend’s recommendation over a critic’s review, while 83.8 percent said they’d trust user reviews over a critic, according to MarketingSherpa.
· 92.5 percent of adults said they regularly or occasionally research products online before buying in a store, found BIGresearch.
· According to Keller Fay, 63 percent of all WOM is positive. Across all Bazaarvoice clients, 80 percent of products rate 4 or 5 stars out of 5.
Not All Reviews Are Created Equal
Whether you enable review functionality and consumer-generated content from your e-commerce platform or from a third-party-hosted solution like Power Reviews and Bazaarvoice, it’s important to test and optimize for conversion and persuasion by focusing on the following areas:
· Review visibility:
· Feature reviews above the fold.
· Make them big enough to be visible.
· Provide a visual representation of the rating (e.g., a star system).
· Situate reviews near a point of attention or action.
· Review interaction:
· Make reading easy.
· Allow visitors to sort by rating.
· Show how the ratings are distributed on a specific product.
· Place reviews on listings, not just on the product detail page.
· Single versus Multidimension reviews:
· What are the key attributes across different categories? If you sell shoes, for example, provide a rating for different attributes, such as style, comfort, and value.
· Can review content influence purchase decisions? Is there enough feedback in the reviews to allow visitors to compare and make a selection?
· Credibility factors:
· Negative and positive reviews: Negative reviews can actually aid a purchase decision. No product is perfect. They allows visitors to see both product strengths and product weaknesses.
· Approval policy: Do you overmoderate reviews? Do they sound like a pitch? Must reviewers jump through hoops to post a reviews?
· Reviewer characteristics: Can the reviewer be trusted? Is there information to establish the reviewer’s credibility (did he review other products; can reviews be rated)?
· Review meaning:
· Do you display the number of reviews? Find ways to generate reviews so the database isn’t skinny and inconsistent from product to product.
· What questions do you ask? Would your reviewers buy again?
· Consider whether they’re qualitative or quantitative.
* Trust in “a person like me” has tripled, from 20% to 68% from 2004 to 2006. (Edelman Trust Barometer)
* According to a global Nielsen survey of 26,486 Internet users in 47 markets, consumer recommendations are the most credible form of advertising among 78% of the study’s respondents. (Nielsen, “Word-of-Mouth the Most Powerful Selling Tool”)
* Most word of mouth is positive. Across all of Bazaarvoice US clients, 80% of product ratings are 4 or 5 stars out of 5. Across all of Bazaarvoice
* A consumer survey by the JC Williams Group ranked consumer content as the #1 aid to a buying decision, cited by 91% of respondents. (JC Williams Group, 2006)
* Consumers trust friends above experts when it comes to product recommendations (65% trust friends, 27% trust experts, 8% trust celebrities). (Yankelovich)
* 91% of moms prefer brands that other moms have recommended. (Marketing VOX, October 2006)
* 86.9% of respondents said they would trust a friend’s recommendation over a review by a critic, while 83.8% said they would trust user reviews over a critic. (Marketing Sherpa, July 2007)
* When asked what sources of information they are “very likely” to consult before making a decision about their entertainment options, 62% named Web sites with user reviews as their top choice, even beating out a knowledgeable friend (59%). (Marketing Sherpa, July 2007)
* 91% of US adults regularly or occasionally seek advice about products or services. (BIGresearch)
* Adult Internet users surveyed chose recommendations from friends as the one type of promotion they consider most worthwhile. (DoubleClick)
* Review users noted that reviews generated by fellow consumers had a greater influence than those generated by professionals. (comScore/The Kelsey Group, October 2007)
* Two thirds of
* Recommendation is the number one reason for choosing a particular site. (Royal Mail’s Home Shopping Tracker Study 2007)
Consumer Demand for Ratings and Reviews
* 64% of consumers reported wanting to see user ratings and reviews, based on a study of 5,000 online shoppers. (Forrester, 2008)
* 71% of online shoppers read reviews, making it the most widely read consumer-generated content. (Forrester)
* 77% of online shoppers use reviews and ratings when purchasing. (Jupiter Research, August 2006)
* 58.7% of shoppers said they used product reviews to make decisions. Reviews rated higher than clearance sale pages (56.4%) and featured sale pages (51.3%). (Shop.org, November 2007)
* In an online survey of 4,000 consumers, 70% said they had done internet research on “everyday grocery products,” and 63% said they had done so for health and beauty products. (Prospectiv, 2007)
* Among the 46% of respondents who had posted or planned to post reviews about their online shopping experience, 88% said those reviews either were, or would be positive. (Nielson, 2007)
* Almost two-thirds (62%) of consumers read consumer-written product reviews on the Internet. (Deloitte & Touche)
* Seven in 10 (69%) consumers who read reviews share them with friends, family or colleagues, thus amplifying their impact. (Deloitte & Touche)
* More than eight in 10 (82%) of those who read reviews said that their purchasing decisions have been directly influenced by those reviews. (Deloitte & Touche)
* 55% of surveyed Internet users consulted other people’s opinions online, making reviews the #1 resource for product research. (Avenue A/Razorfish “Digital Consumer Behavior Study,” October 2007)
* In a study of 2,000 shoppers, 92% deemed customer reviews as “extremely” or “very” helpful. (eTailing Group)
* 59% of their users considered customer reviews to be more valuable than expert reviews. (Bizrate)
* 63% of consumers indicate they are more likely to purchase from a site if it has product ratings and reviews. (Major consumer electronics retailer/iPerceptions study)
* 81% consider the availability of customer reviews to be “very important” (33%)”somewhat important” (48%). (Major consumer electronics retailer/iPerceptions study)
* 86.9% of respondents said they would trust a friend’s recommendation over a review by a critic, while 83.8% said they would trust user reviews over a critic. (MarketingSherpa)
* When asked to note their most trusted information source, 60% of Canadian online buyers said consumer reviews compared to 31% who said newspapers or magazines.
(J.C. Williams Group)
* 84% of consumers earning more than $150,000 annually visit sites where customers review and rate products and services including restaurants. (The Luxury Institute)
* 71% of
* 39% of those who bought from sites with reviews cite the reviews as the primary factor influencing the purchase decision. (Foresee Results Study, 2006)
* 70% of online consumers said they use the Internet to research everyday grocery products. (Prospectiv, 2008)
Retailer Demand for Ratings and Reviews
* The Shop.org State of Retailing Online study, conducted by Forrester Research, found only 26% of the 137 top retailers surveyed offered customer ratings and reviews, but 96% of them ranked customer ratings and reviews as an effective or very effective tactic at driving conversion. (Forrester)
* 81% of marketers surveyed say that their social media spending will meet or exceed their traditional advertising spending within the next 5 years. (TWI Surveys/Society for New Communications Research, November 2007)
* Dave Seifert of Bass Pro Shops noted at a Shop.org round table discussion that Top Rated Products were “the #1 merchandising technique ever utilized on their site.” (Bass Pro Shops)
* After their order, PETCO asked customers, “What online tool most influenced your purchase decision?” The #1 answer was product ratings and reviews, with site search coming in a distant second. (PETCO)
* 43% of retailers have reviews – double in one year. (Marketing Sherpa, February 2007)
* Ratings and reviews is the second most important site feature behind search and online buyers who cite ratings and reviews most useful site feature has more than doubled from ’05 to ’06. “Retail Marketing: Driving Sales Through Consumer-Created Content” says retailers who adopt ratings and reviews as a differentiator and retention strategy will gain market share. (Jupiter)
Consumer Demand for Ask & Answer™
* 76% of online shoppers surveyed report that content is insufficient to complete research or purchase online “always, most often or some of the time.” (eTailing Group, 2007)
* Online businesses lose as many as 67% of consumers due to a lack of online product information. (Allurent)
* 83% of online shoppers would make purchases if sites offered increased interactive elements. (Allurent)
* One in four (24.5%) shoppers said they left a store because of a lack of assistance. (Shop.org, November 2007)
* 90% of UK shoppers surveyed said they wish they could communicate directly with businesses – using live chat, forums or call-me-back facilities – via their websites; one in three require it from the UK businesses they currently use. (1&1, October 2007)
* 42% of consumers said they prefer being able to find the answers they need online on their own if they had a question or wanted help while shopping online. (Harris Interactive, May 2007)
* 68% of consumers trust “people like me” first for product advice. (Edelman Trust Barometer)
* 42% of 1,179 online consumers surveyed have left a site without purchasing multiple products because they couldn’t get a question answered about one of the products in their shopping cart; 41% decided not to make a planned purchase because they couldn’t readily find a piece of information about the product or service. (JupiterResearch, September 2007)
Conversion Results
* Online shoppers who look at TripAdvisor reviews on the Hayes & Jarvis site book trips at double the rate of online shoppers who have not seen the TripAdvisor reviews, based on first four months after launch. (TripAdvisor, 2008)
* 79% of online
* Shoppers who browsed the site’s new “Top Rated Products” page, which features products rated most highly by customers, had a 59% higher conversion rate than the site average and spent 16% more per order than other browsers of products. (Bass Pro Shops)
* Shoppers who browsed the site’s “Top Rated Products” page, which features products rated most highly by customers, had a 49% higher conversion rate than the site average and 63% more per order than other site shoppers. (PETCO)
* Giving shoppers the ability to sort products within a category by customer rating led to a sales increase of 41% per unique visitor. (PETCO)
* A large apparel retailer saw site-wide conversion rates increase by 90% (Q1 07 vs. Q1 06) just months after launching Bazaarvoice Ratings & Reviews. (Bazaarvoice customer case study)
* MarketingExperiments tested product conversion with and without product ratings by customers. Conversion nearly doubled, going from .44% to 1.04% after the same product displayed its five-star rating. (MarketingExperiments Journal)
* Conversion rates are higher on products with less than perfect reviews (less than 5 stars) than those without reviews at all, indicating that the customer feels that the product has been properly reviewed by other customers. (Burpee)
Average Order Value Results
* Consumers were willing to pay between 20 to 99% more for a 5-star rated product than for a 4-star rated product, depending on the product category. (comScore/Kelsey, October 2007)
* Top-rated products site navigation path featuring 4- and 5-star products in each category delivered 35% higher conversion and 40% higher average order value. (Bazaarvoice)
* Reviews usage drives higher spending: 27% of users report an increase of 5-10%; almost 7% report an increase of 20%+. (Avenue A/Razorfish “Digital Consumer Behavior Study,” October 2007)
User-generated Content Beyond the Web
* 64% of Social Researchers (those who refer to user-generated content when shopping) research products online more than half the time, no matter where they ultimately buy the product (store, Web, catalog, etc.). (eTailing Group, 2007)
* Nearly one out of every four Internet users (24%) reported using online reviews prior to paying for a service delivered offline. (comScore/The Kelsey Group, October 2007)
* More than three-quarters of review users in nearly every category reported that the review had a significant influence on their purchase, with hotels ranking the highest (87%). (comScore/The Kelsey Group, October 2007)
* 97% of those surveyed who said they made a purchase based on an online review said they found the review to have been accurate. (comScore/The Kelsey Group, October 2007)
* Nine of 10 local shopping trips made by multi-channel consumers for products researched online resulted in purchases worth $125 more than the products researched online—up 25% from the prior year. (Dieringer Research Group, 2006)
* Consumers who shop online for digital cameras and TVs spend 10% more on in-store purchases than consumers who do not search online. (ChannelForce for Yahoo Search Marketing)
* 90% of those surveyed say they have a better overall shopping experience when they research products online before shopping in-store. (Harris Interactive, October 2007)
* 92.5% of adults said they regularly or occasionally research products online before buying them in a store. (BIGresearch)
Email Campaign Results
* Email study: PETCO realized a 5X increase in email click-through rates by including relevant ratings and reviews content in the campaign promotion. (PETCO)
* Top rated product email drive 46% higher revenue per email in A/B test. (Golfsmith)
Search Engine Optimization Results
* In a study of a major electronics retailer site of 30,000 monthly natural language search visitors, converted 60% more often, spent 50% more, and viewed 82% more pages than search visitors to other pages. (Bazaarvoice case study with major electronics retailer)
* In a study of online
Return Rates and Customer Satisfaction
* Reviews drive 21% higher purchase satisfaction and 18% higher loyalty. (Foresee Results Study, January 2007)
* Online
* Products with reviews have a 17% lower return rate than those without reviews. (Bazaarvoice PETCO Case Study, 2007)
* Products with 50+ reviews have a return rate that is half of those with fewer than five reviews. (Bazaarvoice PETCO Case Study, 2007)
* One study from IBM Institute for Business Management shows that while those adults in the
Evolution of Advertising and Media
* The average 1970s city dweller was exposed to 500 to 2,000 ad messages a day. Now it’s 3,000 to 5,000. (
* In 2005, MTV viewers had to put up with 21% more prime-time commercials per hour than in 2004, says TNS Media Intelligence and media firm MindShare. (
* 75% of people don’t believe that companies tell the truth in advertisements. (Yankelovich)
* 67% of moms would rather talk to a peer than hear from a celebrity about products. (Marketing VOX, October 2006)
* Just 20% of mothers say advertisers connect with them. (Marketing VOX, October 2006)
* Advertising is so ubiquitous that it’s turning people off, it’s desensitizing people to the message, says Rance Crain, Editor-in-Chief of Ad Age. (
Search
* 26% of search results link to user-generated content. (Nielsen BuzzMetrics)
* SearchVoice study: of 30,000 monthly SearchVoice visitors, they convert 60% higher, spend 50% more and viewed 82% more pages. (Major electronics retailer case study)
* The ability to refine site search results by customer rating led to 22% more sales per unique visitor on a same-session basis and 41% more sales per visitor on a multi-session basis. (Bazaarvoice)
Syndication
* RSS study: Burpee measured a 43% higher click-through on RSS feeds with reviews than without. (Burpee)