THE HIDDEN TRUTHS Merchant and Customer Perspectives on Reviews - PowerPoint PPT Presentation

About This Presentation
Title:

THE HIDDEN TRUTHS Merchant and Customer Perspectives on Reviews

Description:

www.e-tailing.com – PowerPoint PPT presentation

Number of Views:140
Avg rating:3.0/5.0
Slides: 49
Provided by: LynnMP1
Category:

less

Transcript and Presenter's Notes

Title: THE HIDDEN TRUTHS Merchant and Customer Perspectives on Reviews


1
THE HIDDEN TRUTHSMerchant and Customer
Perspectives on Reviews
Lauren Freedman President the e-tailing group
Jay Shaffer VP of Sales Marketing PowerReviews
1
2
Housekeeping
  • Following todays presentation, the subsequent
    White Paper will be emailed to all attendees
  • White Paper is also available at
    www.powerreviews.com
  • Webinar will be recorded for viewing with
    presentation available on PowerReviews website

2
3
Jay ShafferVP of Sales MarketingPowerReviews
  • Retailer by heart and by trade
  • Long career in customer advocacy
  • VP of Customer Experience _at_ Wine.com
  • VP of Marketing _at_ Directly Home
  • Director of Customer Acquisition _at_ Ofoto.com
    (KodakEasyShare)
  • Jay Shaffer is VP of Sales Marketing at
    PowerReviews, where he educates online retailers
    about its Customer Reviews Solution and promotes
    Buzzillions.com, its performance - based shopping
    research portal.

4
About PowerReviews
  • Fully outsourced and managed review solution
  • Focusing on the challenges of online retailers
  • Social tag-based reviews for greater relevancy
  • Individually expressive
  • Product specific conversations
  • Normalized data collection
  • Interests with merchant partners aligned
  • Monetize our relationship on Buzzillions.com
    shopping portal

4
5
220 Retailers Leveraging PowerReviews
6
Why Did We Do The Research?
  • Understand the use of reviews by current online
    shoppers convenience vs. commitment
  • Confirm our vision of Social Navigation how
    much do shoppers really like and want this new
    way of shopping?
  • How merchants define the success of reviews on
    their site?
  • How do merchants measure ROI?

6
7
Lauren FreedmanPresidentthe e-tailing group
  • Her company's annual mystery shopping and
    merchant surveys provide a comprehensive overview
    of the state of e-commerce, setting industry
    standards while simultaneously highlighting best
    practices.
  • Proprietary consumer and merchant research
    studies on in store pickup and gifting
  • Strategist, Merchant, Facilitator, Educator and
    Spokesperson for sites that have included
  • Toys "R" Us
  • The Vitamin Shoppe
  • J.Jill
  • Scholastic
  • West Marine
  • Mercado
  • ATG
  • Author, "It's Just Shopping, a comprehensive,
    behind-the-scenes look at the evolution of
    multi-channel selling.
  • In 1994, Lauren Freedman leveraged her 15 year
    retail and catalog career and passion for
    merchandising to found the e-tailing group, inc.
    The firm's mission is providing strategic and
    e-commerce solutions to online merchants as well
    as businesses targeting that market.

8
The Presentation
  • Consumer Survey Methodology Sample
  • The Consumer Perspective
  • The Merchant Perspective
  • Execution
  • Measurement Techniques
  • Future Initiatives

9
Consumer Survey Methodology And Sample An
online questionnaire was completed by 1,200
consumers (50women/50 men) who shop online at
least 4 times per year, spending 500 or more
annually
  • 70 of respondents shopped online more than
    once a month last year
  • 65 of those surveyed spend 750 or more online
    annually

Q3
10
Top-line Findings The Customer
  • Consumers show a dependency on customer
    reviews, becoming addicted to the value
  • These power shoppers, coined Social Researchers,
    have a propensity to always read reviews with
    significant time invested in the process
  • Reviews are valuable regardless of the product
    category
  • Customers prefer to know what other customers
    think rather than being shown the merchant
    point-of-view
  • Understanding the selections and preferences of
    like-minded individuals is appealing
  • Women are driven by convenience, reading reviews
    where available while men seek out multiple
    sources to satisfy informational needs
  • Decision-making is all in the edit as
    information that fosters customer selection from
    product pros and cons simplifies the task of
    narrowing downing choices
  • Tools that use customer feedback throughout the
    shopping research process add value to selecting
    and purchasing a product

11
The Raw Value of Reviews
No matter how many reviews they receive
customers continue to add their voice. A product
may already have a rating of 4.9/5 but someone
will still write another positive review.
The consumers want their opinion out there as
can be seen by this example where Phyllis has
shared her story including sending images of her
dogs. Initially we were only going to ask for
up to 20 reviews but have learned that 50 reviews
are more valuable in terms of conversion and the
bottom line.
Petco Product Review
John Lazarchic VP of E-commerce, Petco
12
Confidence, Trust, and Conversion Result
The sticky by-product adds long-term value as
customers return and re-buy with trust already
established. The unbiased value proposition
of reviews provides another viewpoint that is
not directly connected to the merchant.
At Staples everything onsite has to do with
guest experience giving guests confidence in
buying, Peter Howard, Senior Vice
President, Staples Business Delivery
Staples Top-Rated Gifts showcase the customer
point of view
13
New breed of shopper - the Social Researcher
they place particular emphasis on social
feedback in making product decisions
  • 65 of online shoppers are Social Researchers who
    read reviews always or most of the time prior to
    making product purchase decisions
  • Of this group
  • 64 research products online more than ½ the
    time, no matter where they buy the product
    (store, web, catalog) vs. 54 of all respondents
  • 76 find top rated products as rated by customers
    to be extremely or very important vs. 62 for
    all of these online shoppers
  • 86 find customer reviews extremely or very
    important vs. 70 for all online shoppers
    surveyed

14
Researching dominates consumer behavior and
crosses channels 54 research online more than
½ the time before buying in any channel
  • Men tend to be heavier researchers as 26 stated
    that more than 75 of overall shopping involves
    researching products online vs.18 of the women
    surveyed

Q3
15
Most shoppers rely heavily on customer
reviews65 of the time customer reviews are read
always or most of the time prior to making a
decision to purchase a product
Q5
16
Customer reviews foster decision-making in all
stages of the shopping process 81 use customer
reviews to decide between 2-3 products or to
confirm thattheir final selection is the right
one 40 begin their shopping by reading them
Q7 (total 1171)
17
Of those who read customer reviews, 61
typically spend 5-29 minutes reading themNote
that ½ the respondents spend 10 minutes or more
reading these reviews.
  • A greater percentage of surveyed men (59)
    typically spend more than one hour reading
    reviews vs. women (41)

Q11 (total 1171)
18
74 want to read a minimum of between 2-7
customer reviews to have sufficient confidence to
judge a productNote 68 want to read more
specifically between 4-15 reviews
Q12 (total 1172)
19
Social Navigation (ability to narrow selection
by customer feedback)
  • 82 of survey respondents found reading reviews
    better than researching a product in-store with a
    knowledgeable sales associate
  • Social Researchers are 76 percent more likely
    to shop on a retailers website vs. a
    competitors site if it offers social navigation

20
Consumers express where and howthey want to see
reviews shown
  • When browsing reviews, shoppers
  • prefer to read first
  • most current (45)
  • most helpful (28)
  • When searching for products on a retailers
    website, shoppers prefer to
  • see top-rated products listed first
  • Highest customer rankings (53)
  • retailers best sellers (20)

People seem to enjoy the reviews, which serve as
a sticky feature where guest satisfaction becomes
the byproduct Matt Corey, VP Marketing, Golfsmith
Golfsmith landing page with Top Sellers
21
Social Navigation bridges the gap between online
and offline shopping experiences
Study participants found it extremely or very
helpful to narrow product selection based on
feedback from people just like them
  • with Like Interests (64)
  • with Similar Uses (59) for the product such as
    for travel or for home office
  • who sought out the same product Pros (56)
    such as durable, lightweight or easy to use

Online Shoes Social Navigation
22
The Merchant Perspective
23
Top-line Findings Merchant Strategies
  • Reviews are a must-have merchant functionality
    to compete online today
  • Reviews are not about ROI but ultimately about
    the evolution of the customer experience and the
    creation of communities
  • Reviews provide a profitable and customer-centric
    entry into social networking and Web 2.0
  • Merchant brand and their respective customers
    influence ability to generate reviews
  • Site-wide integration coupled with an exploration
    of cross-channel tactics are next evolution of
    the feature set
  • Long term, merchants believe that customer
    reviews will reward them with customer loyalty

24
Customer Experience Tops the List ofWhy
Merchants Add Reviews to Their Site
Building customer loyalty and driving sales
ranked 2 and 3
25
Reviews Support Branding and Foster Loyalty
Ace is known as the helpful place where
reviews contribute by reinforcing the brand
message. With many of our customers being first
time buyers, its an opportunity to also build a
loyal base. Dana Kevish, E-commerce Marketing
Manager, Ace Hardware
Ace Home Page Links Top Rated Featured
Products, Top Sellers Whats New
26
Competitive Pressure is a Real Factor
The social networking connection to ratings and
reviews gave us an entrée into Web 2.0 without
being over the edge. Brad Wolansky
VP of E-Commerce, Orvis REI was behind in the
game through site usability examination we found
that customers were leaving the site to look at
reviews elsewhere and that was eye-opening.

Ben Viscon, Director E-commerce, REI We
recommend reviews to clients as the best entrée
into social shopping, particularly in a retail
context where the summary functionality is useful
from the shopping experience perspective.
Rich Zapf, Sr. Product Manager, GSI
Commerce Customers expect relevant content hat
helps them make a purchase. It is important to
meet that expectation. Jay Gordman,
Director of eCommerce, NetShops
27
Customer Involvement Builds Community
We make a concerted effort to listen to our
customers its part of our brand message thats
communicated on our home page and entrenched in
our heritage where reviews facilitate such
listening. Peter Cobb SVP and Co-founder,
eBags
eBags Home Page - Dont Listen to Us, Listen To
Our Customer messaging supported by over 1.2
million reviews.
28
Customers Passion For and Time Spent with
Reviews Astounds Many Merchants
First and foremost reviews were seen as
essential to our customers more so than the
product description It's been seven years
since we introduced reviews so we believe in
them. Spokesperson, Zappos
Zappos product page with reviews prominently
featured
29
Ancillary Benefits of Reviews
  • Reviews are intrinsic low maintenance
    customer service tools
  • Reviews serve as assortment advisors
  • Reviews optimize search by providing an organic
    lift
  • Reviews provide credible transparent feedback
    uniquely connecting merchants to their vendor
    partners
  • Loyalty and repeat purchasing is prevalent as
    Paragon Sports saw that repeat customers
    increased 20 percent since they implemented
    reviews with no other changes being executed
    onsite.

30
Execution
31
Top-line Findings Performance and By-Products
  • Customer review measurement techniques are in
    their infancy
  • The sweet spot of reviews not surprisingly is at
    the product page with email marketing also
    delivering positive results
  • Biggest challenge is around populating both
    breadth of assortment and the depth of any given
    sku with some variance based on the passion of
    the merchant community
  • Customer satisfaction and site engagement are the
    biggest impact points from product reviews

32
Beyond Categories That Typically Contain
Reviews,They Would Be Welcome In More
CategoriesToys Video Games (69), Sporting
Goods (55) Gifts/Specialty Foods (54) topthe
list of categories where respondents would find
reviews extremely to very helpful
Q10
33
The Majority of Merchants Have Less Than 10 of
Customers Completing Reviews
  • Key participation influencers
  • Nature/timing of follow-up emails to garner
    reviews respective incentives
  • Community nature of the audience result in
    significantly greater participation
  • Mountain Gear (50 of customers emailed have
    posted reviews) REI (3000 reviews in 3 weeks)
  • Cross-channel participation from store
    shipments
  • Drove more participation at Famous Footwear than
    any other marketing effort
  • Focus on overall number of reviews More
    important to merchants than rather than of
    customers

34
of Reviews By Product is in the 0-10
RangeThough Outreach Efforts and a Strong
Community Contribute to Higher Penetration
  • Merchants with high turns believe 10
    penetration of reviews is strong
  • Split personality impacts the long tail where
    best sellers are populated and poor sellers have
    no reviews based on email review generating
    strategy
  • Merchant longevity and product turn also
    factors in maintenance of high penetration of
    products (i.e. luggage and backpacks at eBags)

35
The Product Page is the Review Hub
79 of merchants rated the product page as where
reviews performed most successfully within their
sites
  • Tactics for integrating reviews
  • Educate the shopper that reviews are part of the
    site experience
  • Draw further attention to feature product
  • Peruse our top-rated products
  • Liquidate deep inventory

REI Product Page reviews prominent within
tabbed selling structure
36
Email Execution Starts with Post-order Feedback
Blue Nile Email sent 9/12/07 Subject line We
Value Your Feedback
Note Unfortunately, not all companies are in a
position to send email post transactions putting
a damper on their ability to populate reviews
37
Email Outreach Is EffectiveJust under 1/3 of
these merchants tested reviews within emailwith
most reporting very successful results
Mountain Gear 2.5-3 incremental revenue
increase from those who were emailed to complete
a review and subsequently placed an additional
order. Golfsmith 42 more sales via
promotional emails with reviews vs. the control
group Petco Emails sent with highly reviewed
products vs. standard reviews saw a 5-15 bump
over standard
  • Email will likely be an important growth area
    based on such strong early results and its
    inexpensive cost to deploy.
  • Its role includes introducing top rate products
    while simultaneously populating onsite reviews as
    the following examples illustrate.

38
Email Top Rated Gift Ideas
Net Shops Email sent 10/10/07 Subject
line Save up to 30 on our top rated holiday
gifts
39
Email Contest with Gift Card Incentive
Orvis Email sent 10/4/07 Subject line Win
100 by Reviewing Orvis Gear
40
Measurement Techniques
41
Reviews Impact Customer Satisfactionand Site
Engagement
Sales are somewhat impacted with AOV seeing a
lesser boost
42
Reviewed Products See Exponential Growth
A performance mentality exists with comparables
to non-reviewed product topping the list of
merchant measurement techniques
  • Increase in sales and conversion along with a
    reduced return rate are also key merchant
    indicators
  • Interest in understanding how positive reviews
    perform versus negative also how existing top
    sellers are performing with populated reviews
    also cited

43
Often Difficult to Determine the Impact of
Reviewson Sales and Conversion
Dont Know Dominates Overall Conversion Increase
Don't have metrics can't measure when multiple
features are involved. Beach Audio Natural
search elements are key people write the word
tent and that mention is critical. REI 30 in
sales per visitor on reviewed products luggage
84 increase. Orvis
44
Reduced Returns and Cross-channel Impact
Unexpected consequences of onsite review
Petco Products typically saw a 1 return rate
but with reviews return rates dropped to .83 on
higher ticket items and for products that have 50
reviews, returns decreased by 4 Golfsmith
Return reduction from 5.2 to 2.7 since reviews
were implemented REI Measuring the print-button
in anticipation of consumers armed with copies of
product reviews secured online for use during
store visits
  • With analytics getting more sophisticated, there
    will be increased scrutiny relative to the
    performance of all metrics, even those that are
    free, given the finite nature of onsite real
    estate and outbound email efforts
  • We would expect that merchants will continually
    refine their presentations to achieve
    best-in-class execution

45
Future Initiatives
More in-depth integration, cross-channel
initiatives, search optimization and evolving
email solicitations will follow product page
placement and email outreach
REI - Integration of search results at the
category page level Paragon Sports - Integrate
product thumbnails with reviews on landing
pages Golfsmith - Sort ratings and reviews by
handicap The Knot - Integrate top choices within
editorial content highlighting products using
language such as more brides satisfied with this
product vs. any other. Famous Footwear - Use
reviews to reach out to store-base via in-store
signage and identification of top rated
products eBags - Profile by customer segment as
a precursor or enhancement to the interest in
social networking Zappos - Leverage analytics
to optimize the numbers and elevate existing
merchandising
46
PowerReviews Merchants Next Steps
  • Reviews in printed catalogues
  • Brookstone
  • Wine Enthusiasts
  • In Store Applications
  • Kiosks
  • Review Summary Shelf Cards
  • Emails
  • Top Rated
  • Inclusion of Star Ratings
  • On Site Merchandising Zones
  • Top Rated Items
  • Featured Products with Ratings
  • Dynamic Landing Pages Most Comfortable,
    Lightweight Shoes for Travel

47
  • Buzzillions.com Social Shopping Portal

48
Contact Us
  • PowerReviews the e-tailing group
  • 665 Third Street, Suite 117 1444 West Altgeld
    Street
  • San Francisco, CA 94017 Chicago, IL 60614
  • p. 866 345-1461 p. 773-975-7280
  • f. 650-697-1962 f. 773-871-3528
  • www.powerreviews.com www.e-tailing.com
  • Jay Shaffer Lauren Freedman
  • jay_at_powerreviews.com lf_at_e-tailing.com
Write a Comment
User Comments (0)
About PowerShow.com