Guest Comment: Ads versus the customer voice- who wins?

Today’s consumers are smarter than ever. They quickly spot and discount hype, largely ignore traditional advertising and tend to distrust advertising messages delivered by huge companies.

Advertisers work to capture sales while battling against ever-expanding ad options, shorter attention spans, rising production and placement costs and the growing mistrust of consumers. Traditional marketing campaigns only scale moderately, and that’s only if the costs per impression decreases or the advertising effectiveness increases.

So how can brands market products in an environment of increasingly wary consumers? Simple. Let consumers create their own messages.

If it’s a question of trust, consumers’ words beat yours. According to a global Nielsen survey, consumer recommendations are the most credible form of advertising, cited by 78% of respondents. The Edelman Trust Barometer tells us that trust in ‘a person like me’ has tripled, from 20% to 68% from 2004 to 2006, and in 2007 ‘a person like me’ is still the biggest influencer to consumers. Royal Mail’s 2007 Home Shopping Tracker Study in found that two thirds of UK social networkers are more likely to buy a product as a result of a recommendation.

In January 2008 Bazaarvoice conducted a study with JupiterResearch which found that 94% of UK online researchers use customer reviews, and 97% of them are willing to trust online customer reviews. As trust in other consumers grows, smart brands are adding customer reviews to their websites to give shoppers ready access to the unfiltered opinions of others. Today, it’s common to find customer reviews on everything from cars to dishwasher tablets.

Ironically, the consumer voice translates into effective advertising messages. Positive customer reviews are now used as trusted messages in more traditional advertising, including email campaigns, in-store signage and in printed and online adverts. Marketers are gathering and promoting unedited, transparent and completely honest customer reviews and using them throughout. And these messages are resonating well with consumers.

The world’s largest retailer, Wal-Mart, added customer reviews to its website in June 2007. Six months later, the company integrated customer messages into their marketing across the board. This retailer sells everything from groceries to electronics to truck tires in its US stores, serving millions of customers daily. Wal-Mart printed its reviews URL, www.walmart.com/ratings, on sales receipts to both encourage (and instruct) customers to review their new purchases, and also drive traffic to walmart.com.

Wal-Mart encourages in-store shoppers to read customer reviews of products by including the ratings URL on the store shelf product fact tags. A weekly newspaper and direct mail adverts feature “products our customers like best” and drive shoppers to www.walmart.com/ratings to hear directly from other buyers. You can see details and examples at our blog here.

UK lingerie retailer figleaves.com has used reviews to highlight products in email marketing, and recently launched a contest via its blog to encourage customers to be the lucky 10,000^th reviewer. The site also recently added question-and-answer functionality, so lingerie owners can answer questions posed by shoppers looking for the best products at www.figleaves.com. figleaves average more than 200 questions a month.

Boden US recently added ratings and reviews to its site, and within weeks created an email featuring top rated weekend getaway clothing that was given four and five stars by customers.

Real voices do translate to real results. When retailers or manufacturers add reviews to their websites, important metrics increase. For example, figleaves found that, on average, products with reviews have a 12.5% higher conversion rate than those without. Products with more than 20 reviews have an 83.85% higher conversion than those products without reviews.

Email marketing using customer reviews resulted in 10.4% increase in average order value for US retailer Bath and Body Works. What’s more, US-based PETCO, a leading specialty retailer of pet supplies, experienced a 20% lower return rate on its products that included reviews – a huge statistic for a company that sells more than 10,000 pet-related products.

A topical subject, but customer-generated content costs scale well in tough times. Gathering customer reviews using a hosted solution gives companies a predictable monthly cost, and yet as the customer reviews grow, the marketing impact grows - and costs stay flat.

Customer reviews drive natural search results as content levels on your site grow, while customer opinions can help you efficiently plan for product expansions or improvements. Plus, when customers are persuaded by the relevant and credible word of mouth by people like them, they rely less on discounts as an ‘excuse’ to buy. Discounts aren’t as important when they find a product, service or experience that is a ‘must-have’ based on the reviews they read. Customers feel confident making a purchase when they read reviews, answers and experiences from others.

Even more good news: Brits are chipper about products. Not only do UK shoppers trust one another, but they also tend to leave positive reviews – even more so than their US counterparts. The first question a brand manager has about product reviews is, “What about negative reviews?” Let’s look at the data. When we analysed all reviews on UK sites, we learned that 88% of reviews have 4 and 5 star ratings. This compares to 81% on US sites.

UK reviewers are also keen to share these opinions with others. Our study also found that 80% of UK reviewers have written six or more reviews online, much higher than the average US shopper. So, even more than in the US, UK shoppers are engaged with brands and retailers, they want to share their opinions, and their opinions are overwhelmingly positive – all great reasons for smart UK brands to capture and share their customers’ opinions.

www.bazaarvoice.co.uk