Procter & Gamble announced last month that it would start using consumer reviews on its brand sites for the first time. The FMCG company now lets people post their views on its Head & Shoulders and Ariel websites about how the products perform.
It’s no surprise the consumer goods giant has seen the value in this. Customer endorsements are important tools for any marketer. They can help brands distinguish themselves from competitors, boosting sales and keeping the tills ringing. Positive feedback attracts other customers, while negative comments help companies refine their ranges and develop better variants to tempt shoppers.
Customers, in turn, use other people’s advice and reassurance to help them make purchase decisions. In the past decade, the emergence of online feedback on etail sites, blogs and forums has provided consumers with more resources than ever to base their decision-making on.
Pollsters Opinium Research questioned 2,008 adults in the UK in July this year for Feefo, an independent feedback forum that works with a number of etailers, to assess just how much impact feedback had on purchase decisions.
The research found that 53% of consumers are more likely to purchase a product if it has good online reviews from past customers; and 51% look for good service reviews about the store staff.
Feefo marketing director Ed Lennox explains that with less disposable income due to the recession, customers are looking to ensure they make the right purchase decisions first time and stores have to make every effort to encourage repeat purchases.
“With dark clouds hovering over the economy, the need for reliable, honest, trustworthy feedback is at its greatest. Consumers want to know that the shops or the products they are interested in have a trustworthy reputation. You don’t always get to hear customers complaining about issues out loud, so feedback systems are the only way to help address this,” he argues.
Websites such as eBay, Amazon and YouTube have been active in demonstrating the benefits of publishing both negative and positive feedback. One YouTube video received more than 3.5 million hits after an angry musician posted a song about United Airlines damaging his guitar and the lack of response he received to his initial complaints.
Lennox argues that consumers are savvier now and look for feedback before they venture to the high street or to etailers. He adds: “The days of spontaneity and blind purchases are long gone. Retailers and etailers are seeing the benefits of talking to customers, and being open has both positives and negatives as part of the overall brand experience.
“Marketers are under pressure to find cost-effective ways of ensuring customer retention and such openness will benefit them in the long run.”
Not every brand has always succeeded in this. Critics argue that some feedback on sites is not as honest as it first appears. It was recently speculated that sellers on Amazon Marketplace were trying to bribe customers into removing their negative comments, although this has not been proved.
Reliable online feedback is particularly important to encourage people to spend in areas where they might otherwise be nervous. Feefo’s research shows that 31% of internet users are still reluctant to shop online due to a lack of trust. This lack of faith is a tricky thing for smaller online brands to overcome, especially as they compete in a crowded market with larger, trusted brands.
Similar concerns have been expressed by the Office of Fair Trading, stating that a quarter of the population has a lack of faith in the companies that sell products online. Lennox admits this is a tough barrier to crack, but customers are willing to read independent reviews and decide for themselves whether the risk is worth taking.
“For any marketer, every piece of feedback you get allows you to improve your service, refine processes and improve a customer’s shopping experience. For smaller retailers, the challenge becomes how loudly you amplify the honesty of your feedback. It needs to be viewed as raw, unedited and clearly not a thinly disguised advertisement,” he warns. He adds that companies that are open and display the bad as well as the good feedback will benefit.
While all retailers will benefit from taking note of feedback and building up consumer trust, customer endorsement may particularly benefit online businesses hoping to see sales growth. Online retailers seem to be taking note; the latest figures show July’s internet sales rose by 15.7% on June, to a total of £4.2bn. This was a year-on-year growth of 16.8%. Despite this growth, online retailers have often been around for less time than offline ones, so they are less familiar to shoppers. “Trust is earned over time, not given easily,” notes Lennox.
Feefo’s research found that 31% of consumers are more concerned about getting a good deal than worried about buying from a shop they have not previously heard of. Only 13% of respondents feel stung by buying from etailers they hadn’t heard of, with just 11% admitting they have in the past purchased from a bogus shop and been unable to reclaim money.
Feefo says this is one of the reasons that etail is thriving, despite the economic downturn. According to the Interactive Media Retail Group and Capgemini, website features that are likely to keep customers satisfied involve “provision of advice” and “reassurance about purchases” – this includes recommendations and customer reviews.
It appears that whatever Britain’s economic woes, consumers still wish to feel they are buying viable products from reputable brands – not just the cheapest option. The use of unedited testimonials and other forms of customer feedback is helping brands build a relationship with people that goes beyond merely taking their money.
Those companies able to convince people that not only do they listen to their advice but act on it, are set to boost their profits in the long run. While it is likely that the country will take a while to recover completely from its economic woes, brands can overcome a threadbare bottom line immediately through careful use of feedback.
Lennox says: “Producing a dialogue with customers rather than the usual corporate diatribe means that the customer feels valued. Customer loyalty starts with a problem and a voice in the wilderness. If you listen and respond positively, you not only save the sale, you win the customer for life and many of their friends forever too.”
WE ASK MARKETERS ON THE FRONTLINE WHETHER OUR ‘TRENDS’ RESEARCH MATCHES THEIR EXPERIENCE ON THE GROUND
Insight manager, The Carphone Warehouse
We proactively encourage customers to give us feedback so we can continually improve the customer experience we provide. Positive feedback is always great to receive and useful for internal recognition but negative feedback is arguably more valuable because it highlights areas where we need to improve.
Mobile phone retailers have a reputation for the hard sell and many consumers regard the whole industry as untrustworthy. This provides a great opportunity for those retailers that are willing to listen and act quickly in the interests of customers.
We focus more and more of our efforts on customer feedback. For example, earlier this year we put an end to sales commission across our stores and now link employee pay directly to the feedback that customers provide.
We ask customers to rate the level of service they receive in store. The data is then used as part of a balanced scorecard, which is linked to staff pay. It therefore pays – quite literally – for us to listen to our customers.
Marketing director, CD WOW!
It is essential that customers have the opportunity to give feedback. Positive feedback reinforces the vision and direction we have for the company; and negative feedback helps us improve our business. Both types of feedback can be very constructive.
Ultimately, you know where you want to take your business and customer interaction can assist you in achieving your overall goals. More and more people are browsing online to gather information. There may be certain types of products they feel more comfortable buying offline, such as big-ticket items like TVs, but having a good reputation as a trusted website will put you in a great position to secure sales.
We look at all communication from our customers as having paramount importance as it should ultimately improve our service.
Sales and marketing director, Domino’s Pizza
Feedback is vital and companies can’t afford to miss out on offering customers the opportunity to provide it – good or bad. Feedback is essential for making both positive and negative changes within a business, which certainly help you to differentiate and evolve your brand.
Feedback is also a critical part of identifying and monitoring customer trends and enabling brands to continue developing and evolving. The number of people shopping online has increased significantly in the past few years and consumers are becoming more and more internet savvy.
It is important for businesses to use any information gained from customer interactions but this has to be treated with caution. Customer feedback can be extremely useful for identifying trends and themes, but businesses shouldn’t make major changes based on just one suggestion or opinion. Any changes suggested through customer feedback should be evaluated first to see whether they are viable and in line with the brand’s objectives.
Founder of Charles Tyrwhitt
Looking at customer feedback has become an important part of my daily routine as it provides an instant snap-shot of the “state of the nation”. The response from customers has been fantastic.
Our website has experienced an increase in visitor numbers due to the feedback that we display. We have more than 100 unique new visitors per week from “long-tail search” terms as a direct result of the feedback that customers leave.
Feedback also clearly increases sales – website visitors that look at comments from previous buyers have a conversion rate three times greater than those who don’t. Our repeat order rate was also five times greater, showing that customers are also more likely to buy from us again.
Marketing manager of New Generation Ski School
As a ski and snowboarding school, we used to rely on recommendation from reps to bring us new customers. But with the market growing and customers facing more choice, we noticed that significantly more customers were starting to do their homework on the web before going on holiday. We are often told by clients that the fact that we display real feedback on our web site is why they chose us over other schools.
Feedback has changed the way we operate and even made us think twice about the policies we have in place. An industry-wide policy is to run a course of lessons with a minimum of four people; however, we found through feedback that some of our clients found this unfair and it put them off booking with us. Consequently, we decided to go against the industry norm and change the service we offered by offering group lessons with a minimum of two people.
It¹s something that¹s completely different from our competition and has also improved satisfaction (and sales!) with our clients.
It matters less what we say about ourselves in our marketing, as all of our competitors will be claiming the same thing. It¹s what our clients say about us that really counts, it is the best marketing tool we can use, especially in a market where there are a number of seemingly similar providers.
Sales and marketing director of Clifford James
Our customers expect value-for-money from our brand. Monitoring feedback from our customers is the best way to make sure that we are delivering on our promise and to identify the areas that need improving.
In the past we tried traditional research methods of sending out customer surveys but received minimal results. In contrast, we¹ve had over 11,000 responses to date from using a customer feedback system, that has been a very cost effective market research tool bringing an immediate measure of customer satisfaction. By directly addressing any negative feedback we have reduced customer dissatisfaction by over 50% in key areas.
Making all of the feedback, good and bad, available to the public presents our company in its truest form, because we don¹t edit or remove any comments. Acting on individual feedback also tells our customers that we listen to them. For example, we found that at least a quarter of negative comments we received were related to our courier company and that some customers had problems understanding our return policy for goods. By being able to quickly identify problems we made a few small changes and noticed our customer satisfaction levels improve immediately.