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EXECUTIVE SUMMARY
1. The nature of the internet is that any random user can make their opinion
known at any time on a number of established sites. Because many of these
sites have high Page Rank values, negative reviews can often appear in the
search engine results above a company’s own website.
2. Very often reviews are negative in nature. Even though a firm may deliver high
quality customer service, clients must be invited to share positive stories.
Otherwise, negative reviews will show an unbalanced view and will not reflect
the level of service provided.
3. Positive reviews will boost sales:
• Customers that refine web searches by customer rating average a 22%
increase in sales per visit, increasing to 41% over several years
(BazaarVoice Research).
• Reviews will raise customer loyalty and sales alike (Deloitte & Touche).
• Customer reviews will have a positive impact on average order amounts,
with 27% of shoppers increasing spend by 5-10% (Hayes and Jarvis).
• To get positive customer reviews, you’ll have to ask for them. The good
news is many people will respond to your request and provide a positive
review.
INTRODUCTION
Since the growth of our consumer culture and mass media in the late 1800’s and early
to mid 1900’s, marketing has been in one direction: from marketers to consumers.
Companies spent millions to craft advertising messages to be sent out over TV, cable,
radio, newspapers and magazines. TV stations and newspapers employed reviewers to
help consumers decide good movies, restaurants and more.
In today’s wired world, the funnel is flipped. Now, everyone can access the Internet
from a computer or smart phone. They are a broadcaster, publisher and reviewer all
rolled into one. Within seconds of getting your product or service, they can make their
opinion known worldwide.
While mass advertising is still going strong and will for some time, personal
communications from your prospects and customers is now as visible and important.
Studies show that consumers routinely consult online reviews and ratings before they
make a purchase decision.
Proactive business owners are learning to take advantage of this brave new world.
We’ve had the internet for a few years now, long enough to discover valuable
information that sometimes seems contradictory. For example, we now know a few
negative reviews will actually boost your sales. Cutting- edge companies will take this
type of rich data and use it to drive growth and sales.
THE EXPLOSION OF CUSTOMER REVIEWS
How did customer reviews become so prominent? Here are the major influences:
NEED TO RESEARCH
Before consumers head for a brick and mortar store, they consult the Internet for
product research. Surveys by comScore, Yahoo! and BIGresearch indicate over 90% of
US adult consumers say they check on products and reviews online before they make a
purchase.
DEMAND FOR REVIEWS
Internet users are using customer reviews more than any resource. An Avenue A/
Razorfish report in the “Digital Consumer Behavior Study” showed that 55% of Internet
users polled look at other people’s reviews online. Only 22% check product comparison
charts, 21% look at expert reviews, and 1% consult shared shopping lists.
Source: Avenue A/eMarketer
CREDIBILITY
Similar to the Avenue A/Razorfish report, Marketing Sherpa found that 84% of Internet
users surveyed trust customer reviews more than expert reviews.
Source: Marketing Sherpa
ACCESS
One of the biggest reasons consumers use online reviews more is the huge increase of
the reviews available online compared to even a few years ago. In fact, Marketing
Sherpa reports that up to 50% of all Internet users over 18 have left a review online.
Source: Marketing Sherpa
GOOGLE LOVE
Reviews often appear at the top of the results page when consumers search online.
Reviews are chock full of keywords that match search strings. For instance, when a
consumer leaves a review for a Canon Sure Shot camera, that product name will appear
high on the page when someone searches for “Canon Sure Shot review” or “Canon Sure
Shot features.” Reviews are perfect search engine food.
Also, Google has changed their algorithm specifically to include positive reviews in
their results. According to the New York Times (Dec 1, 2010), Google announced, “it
had changed the way it ranks search results so that unscrupulous merchants would
find it harder to appear prominently in searches.”
EFFECT OF REVIEWS ON COMPANY SALES AND PROFITS
RESEARCH SUMMARY
Multiple research companies have investigated the customer review phenomenon. They
have discovered that reviews have significant advantages for companies:
ACQUIRE NEW CUSTOMERS
Source: Deloitte and Touche
HELP PROSPECTS MAKE DECISIONS
Source: comScore
INCREASE PROFITS
Source: comScore
BUILD LOYALTY
Source: Foresee Results
CASE STUDY: TEST OF CONVERSION RATE
Marketing Experiments Journal wanted to find out of customer reviews make an impact
on revenue. They kept track of the conversion rate from site visitor to customer with
reviews and without reviews. Interestingly, conversion increased 87%, moving from
0.47% to 0.88%. This has a significant impact on revenue:
SOLID CREDIBILITY
In a 2007 Nielsen survey, 78% of the respondents surveyed commented that they
believe customer reviews are the most credible form of advertising. This is true
whether a company actively promotes the reviews or not. These online reviews are
helping companies across the spectrum of industries, whether online or offline.
Source: Nielsen Survey 2007
ISSUES
Over time, researchers have discovered unique characteristics of online customer
reviews. Some of these results contradict expectations and require innovative
approaches to take advantage of them. For example:
DIFFERENCES BETWEEN REVIEWS AND TESTIMONIALS
Testimonials are comments from a company’s customers that appear on its own
website. Reviews are comments on third-party sites. Several issues arise from the use
of testimonials:
• Testimonials generally do not appear high in search engine results. Any
marketing benefit is lost if testimonials are buried when users search for
specific brand names.
• Testimonials are looked upon with skepticism by consumers. While they may not
totally disbelieve the information, many think testimonials have been sanitized
or heavily edited.
Part of the danger with testimonials is that, if they are positive, consumers think they
may be “puffed up.” If a business includes negative testimonials to increase credibility,
some will think that other, perhaps more damaging testimonials were excluded.
NEGATIVE REVIEWS
One of the surprising things research shows is that negative reviews (unlike
testimonials) sometimes actually help sales. Negative publicity is usually expected to
hurt sales and profits. Several research studies have found the opposite in certain
cases.
For example, the movie Borat made fun of the country Kazakhstan. Yet after the film
came out, Hotels.com reported a 300% increase in requests for information about the
country (Yabroff 2006, p.8).
Similarly, negative reviews online can actually help boost sales. This is due to several
reasons:
• Negative reviews help consumers that want “to be thorough.” When they read
negative reviews, they feel they are getting information that, along with positive
reviews, gives them a clear picture of the product. Hence, they can make an
informed decision. In this case, negative reviews help move the sales process
forward.
• Negative reviews help balance positive reviews. If every review is 100% positive,
consumers begin to doubt all of them. Negative reviews provide balance. As a
result, they make all the reviews more believable and trust is increased.
• Negative reviews let marketers set the record straight. Sometime negative
reviews are completely wrong. The reviewer may be acting with sincerity but
have all their facts wrong. For example, let’s say someone says your company
“doesn’t honor its 30% off coupon.” There’s a good reason for that – you’ve
never offered a 30% off coupon.
• Negative reviews provide a golden marketing opportunity. If a company handles
a disgruntled customer with consistency, transparency and sincerity, other
customers will be impressed. If you explain what happened, and the steps
you’ve taken to make sure it does not happen again, it shows consumers you
care for their business.
LOW VOLUME OF REVIEWS
One possible problem with reviews is when they are so old consumers doubt whether
they are relevant. A similar problem arises if there are scant reviews available. Web
users begin to wonder if the service is even still viable.
In fact, an eMarketer study revealed that 78% of US Internet web users feel between 4
to 7 reviews is the minimum number of reviews they need to help make a decision.
Reviews are most productive when they have been published within 6-8 weeks of the
time a web visitor views them. As a result, it’s best to have fresh reviews on a steady
basis.
REPUTATION MANAGEMENT
The web is so vast, there are seemingly limitless websites a web user can post a
negative review of a service or product. They range from large search engines like
Google, review sites like Yelp, forums, blogs, message boards, and more. Much of it is
put up anonymously. Even if you wanted to take legal action, who would you target? It
is even to difficult to go after the site itself. Some sites like RipOffReport.com have
pledged never to remove any negative information.
STRATEGY AND RESPONSE
To meet these challenges, research shows there are two effective responses:
• Make sure there is a significant number of positive reviews to negative reviews
• Where possible, manage where reviews appear on the web
POSITIVE REVIEWS
The good news is that you can get plenty of positive reviews just by asking. Many
clients who love your service just never think to leave reviews. If you make it easy,
most are happy to do so. Taken as a whole, 80% or more of the reviews on the internet
is positive (2007 Forrester Research). Just look at Amazon.com. They have thousands
of reviews because they ask for them and they make it simple.
Studies show around 5-20% of people you ask to leave a review will actually do it. Just
the fact that you ask them makes your customers feel valued and recognized. This
feeling promotes positive reviews. You have to set up systems that make it easy. If you
don’t ask, you won’t get the positive reviews you deserve and negative reviews will be
abnormally high in comparison.
MANAGE REVIEW SITE PLACEMENT
It’s not possible to control every site customers use to leave comments. However, a
company can create a place where they gather reviews. When people see many reviews
it encourages them to leave one, and the cycle continues. In time, the company has a
“critical mass” of their own reviews on their site or other sites they control.
Eventually, Google, Yahoo, Bing and the other search engines will start to recognize the
site. The reviews will begin to populate the top slots on search engine result pages
(SERPs). As they become more visible, more users see them and then leave their own
reviews. Each review is filled with search engine friendly keywords. The whole process
helps makes the site a word-of-mouth magnet, a location where there is enough data
that it becomes “The Authority” for reviewers and people seeking reviews on your
product.
The challenge is that, the longer a company waits to start their own word-of-mouth
magnet, the longer other sites will gather reviews simply because web users have
nowhere else to go. If that happens, it makes it more difficult to establish enough
reviews on a company’s site to take the Authority role.

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