Online Reviews: Creating value for businesses and their customers

Transcription

1 Online Reviews: Creating value for businesses and their customers

2 Welcome to the Trust Economy The marketing landscape has evolved. More than ever, your brand is in the hands of the consumer. Or in the words of Scott Cook, A brand is no longer what we tell the consumer it is it s what consumers tell each other it is. Online reviews have the ability to influence and change opinion before your customers have even made it into the store or hit check-out now. Trust has become a valid currency, and as a marketing or customer experience professional your ability to influence and improve consumer experiences and perceptions has to be centered on building a community of trust. This report draws from a number of Trustpilotcommissioned surveys and resources encompassing the views and behaviors of both consumers and businesses. Our findings suggest that organizations in the Retail and Travel & Leisure sectors are leading the way in harnessing online reviews to improve the effectiveness of SEO and SEM campaigns, increase website conversion and accelerate word-of-mouth marketing. That said, there remains significant scope for these businesses (and of course businesses across other sectors) to generate increased value from online reviews. Throughout the report we consider the viewpoints of both consumers and businesses, and consider how organizations can take steps to optimize how they currently use online reviews, or indeed introduce them into their infrastructure. The end goal businesses should be striving for is to leverage customer feedback not only to drive customer acquisition, but also to strengthen initiatives aimed at increasing customer retention, loyalty and advocacy. To that end, we recommend businesses take a cross-functional, collaborative approach to managing online reviews so that the feedback is leveraged across marketing, customer experience and product development initiatives.

3 The Data This report is drawn from two surveys commissioned by Trustpilot. Consumer survey: 1,905 adults of various ages were surveyed online by Censuswide in November All the respondents, of whom 789 were male and 1,116 were female, had made an online purchase in the past three years. Business survey: 1,500 adults from UK and US businesses were surveyed online between June 2014 and August of those respondents were existing Trustpilot customers. 21% 1% 3% 75% Respondents by geography United Kingdom United States Rest of World Unknown Key points to note: While we did not set out to solicit responses from one sector over another, approximately threequarters of respondents work within the Retail and Travel & Leisure sectors.. We have noted instances where existing Trustpilot customers responses were notably different from those provided by non-customers. By and large, responses were very similar across the two groups. Overall, the results from the UK and US were highly correlated. We observed the largest variations in response trends when we compared smaller companies with larger Enterprises.

4 The landscape for online reviews Posting and consulting online customer reviews is becoming the norm. Consumers are increasingly experience sensitive and more willing to share their opinions online to help others make informed decisions. Brands such as Amazon, ebay and TripAdvisor have led the way in educating consumers at a personal, experiential level and have helped to pave the way for broad acceptance and adoption. Our business survey strongly correlated with this 60% of consumers have written an online review in the past year 65% of business respondents had themselves written 6-10 reviews in the past year, with a further prolific 8% writing more than 10. It s reasonable to assume that a majority of this 73% also consult online reviews written by others before making their purchasing decision. The bottom line: consumers are writing reviews about your business, whether you ask them to or not. The ever-increasing array of websites and social media tools through which consumers can share feedback enables commentary about your brand, products and services. This commentary is readily accessible to your prospective customers, and can significantly influence their decision to purchase from you. The power of positive online reviews is evident. 62% of consumers claim they re more likely to do business with a company after reading a positive review 1in5 will go on to spend at least 10% more with that company

5 Yet the fear of negative reviews continues to be front of mind for many organizations. 50% Over 50% of business respondents stated that the biggest barrier to collecting and displaying reviews is their concern about potential negative exposure. Businesses should bear in mind that most of the reviews consumers write are positive (83% according to our consumer survey). But whether that number sits at 83% or some other percentage in the case of your business specifically isn t the main point. As we ve already established, in this day and age organizations can t control the conversation. If a customer wants to share their experience with others, they can and they will. The opportunity is surely to mitigate the risk of negative reviews by taking ownership of the process and dealing with reviews first-hand. Businesses are often concerned about opening themselves up to criticism, particularly in a public forum like Trustpilot. Yet if handled well, far from hurting the business negative reviews can actually lead to a positive outcome. Writing negative reviews compared to reading negative reviews say they are more 59% write negative reviews to protect others from a bad experience 15% likely to do business with a company that responded to a negative review and dealt with it successfully 78% claim negative reviews could deter them from making a purchase 90% + of unhappy customers will return if an issue is resolved quickly and efficiently Furthermore, it isn t just about leveraging the glowing reviews and effectively managing the bad ones. There is a wealth of insight in between. Balanced feedback grows when organizations actively collect reviews and the silent majority contributes. By asking all of your customers to review their experience, you re more likely to shift from a preponderance of black and white reviews to gathering more shades of grey the three and four star reviews that contain balanced and representative feedback. These reviews can help you spot major trends and actionable insights, perhaps more so even than one and five star reviews. Ignoring online reviews is no longer an option. Businesses today need to harness their power to help them manage their brand reputation and engage at a grass-roots level with consumers. Businesses that are open and transparent, that are perceived to be listening and taking action, are likely to fare much better than those that sit on the sidelines.

6 The changing mindset of business Businesses and consumers agree online reviews help consumers make informed purchasing decisions. 79% 77% of business respondents believe that reviews play a highly or extremely important role in influencing consumers decision-making of UK consumers using the Internet consult online reviews before making their purchasing decision Customer reviews have the potential to benefit virtually any type of organization. Until now, it has been the more traditional word-of-mouth style businesses, e.g. Retail and Travel & Leisure, that have led the way in harnessing the power of online reviews and tapping into the exponential nature of the Internet. There are a number of reasons why a company operating in another sector may not yet be exploiting customer reviews to the same degree. B2B organizations for example may find it difficult to see the relevance. After all, they don t serve consumers, and they tend to engage in longer and more complex sales cycles. However, selling to a business doesn t mean you re selling to a faceless entity; it s still a person or people you re dealing with. Just as is the case in their other life as a consumer, it s safe to assume that a prospective customer would value the opportunity to tap into the experience of their peers before buying from you, and share their feedback post-purchase. As another example, B2C organizations that deliver services like utilities or insurance products may find it difficult to consistently generate 5 star reviews, whether due to regulations that limit their agility, or because there are simply more things that can go wrong throughout the customer lifecycle. It is important for these companies to set achievable customer review KPIs (using Trustpilot terminology, a target TrustScore for example) rather than ones an online retailer might set. Consumers themselves are apt to compare businesses against their peers, not against a company like Apple. They will reward a business that differentiates itself from its competition and responds to feedback, even if it doesn t always deliver a 5 star experience. This is already evidenced by the fact that B2B organizations develop and actively promote case studies and press releases that feature happy customers. Increasingly, we re seeing companies in this sector complement those assets with online reviews. New business models that rely on consumers themselves to supply and trade inventory rely even more heavily on reviews. Examples in the Travel & Leisure sector include both Airbnb and HouseTrip. These companies truly put their reputation in the hands of the customer.

7 HouseTrip Improves Competitive Edge With Trustpilot Reviews Overview HouseTrip is an online marketplace that offers more than 350,000 holiday rentals to global travellers. The company, which bills itself as an ideal alternative to hotels, has more than 200 employees working in its London, Lausanne and Lisbon offices. With entire holiday homes to rent in 20,000 locations, HouseTrip s goal is to give families a better option for private, spacious, comfortable accommodations that typically cost 28 percent less than hotel rooms. Criteria Prior to adopting Trustpilot, HouseTrip had relied on social media monitoring and forum management as primary brand reputation tools. However, Ryan Levitt, PR Director at HouseTrip, says the company wanted to do more to encourage word-of-mouth marketing. The brand ultimately added Trustpilot to its website due to its ease-of-use and familiarity among HouseTrip s target audience. The company now asks all of its guests to submit reviews, and the PR team monitors reviews daily so that it can respond to any negative posts and solve customer concerns when necessary. Business objective The holiday rentals market has heated up recently, as guests learn how many options they have beyond traditional hotels. With competition in the industry intense, HouseTrip s success depends on delivering an excellent customer experience: easy booking, high-quality properties and attentive service. The HouseTrip Happiness Pledge means that more than 95 percent of its guests recommend the service, but the company needed a way to help its satisfied customers extol its value publicly. Specifically, HouseTrip sought to: Manage its brand reputation by responding to customer feedback in a public forum Provide a forum for that feedback that guests find easy to use Improve customer satisfaction and loyalty rates to help grow market share Results Last year, more than 25 million European travellers chose to book holiday homes instead of hotel rooms. HouseTrip is ensuring more of those weekend getaways, beach holidays and family vacations are booked through its service. By amplifying the voice of its customers via Trustpilot reviews, HouseTrip can showcase positive feedback and respond to negative comments. The company now has almost 3,000 Trustpilot reviews and a 9.5 out of 10 TrustScore. As its customers share feedback from their holidays in Barcelona, Marrakech, Istanbul, Miami and scores of other locations, HouseTrip gets the word-of-mouth engine that is so essential to its business. The company relies on Trustpilot reviews to share customer stories, increase customer satisfaction and loyalty, and improve search engine optimization (SEO). At the same time, HouseTrip believes that Trustpilot reviews help the company acquire new customers.

8 Evaluating the business benefits Not surprisingly, a majority of business survey respondents selected the following as the top three benefits of reviews: Help acquire new customers Identify opportunities for improvement Increase customer loyalty 20% 2% 12% Competitive differentiation Help acquire new customers Improve alignment between customer service and marketing teams Improve organic search ranking 7% 3% 26% Increase customer loyalty Leverage in social media / word-of-mouth marketing Reduce cost of paid search 14% 13% 3% Use the feedback to identify opportunities for improvement Utilise as real-time customer sentiment barometer (i.e. to complement existing NPS / Brand Health Index / VOC programs) There are some interesting variations. For example, existing Trustpilot customers ranked improve organic search ranking as the number two benefit. We believe that Trustpilot customers are potentially more likely to have gone further in the journey than non-customers. For example, a Trustpilot adoption journey often follows the steps below: 1. Begin proactively collecting reviews from customers 2. Monitor and analyze customer feedback 3. Implement improvements (if needed) to increase the company s TrustScore over time 4. Display reviews on the company s website, social properties, etc. and link reviews to Google AdWords Step 4 in particular can play a major role in improving the company s organic search rankings. When we consider company size as a variable, the order changes completely. Companies with over 1,000 employees cite identify opportunities for improvement as their top benefit. It is also notable that larger organizations are more likely to integrate reviews within their social media marketing campaigns than smaller companies. We were surprised that real-time customer sentiment barometer didn t score more highly. Mazuma Mobile, a Trustpilot customer, states that this is their number one benefit after using the platform for four years. It could be that many businesses are still working to their initial plans and measurements, or have yet to gain enough experience, insight or ROI.

9 Managing online reviews In recent months there has been much industry press heralding the arrival of the CXO-level Customer Experience executive bringing a 360 approach to how organizations manage the complete customer experience. It s early days yet, however- this remains more the exception than the rule. When asked to identify the barriers to collecting and managing online reviews, insufficient resources was cited as a top two data point. In organizations with 501+ employees, this response was selected nearly 10% more frequently than in smaller companies. In companies with more than 1,000 employees, respondents were three times more likely to cite unclear which team s remit this should fall under as a barrier to adoption. The implication could be that in larger companies there is limited resource flexibility and ownership potentially spans multiple departments thus making this a more complicated, and perhaps political, decision. This is something we have noted to explore further in future surveys. In over 70% of organizations the Marketing, ecommerce or Sales team takes the lead in managing online reviews and how they are used, whereas the Customer Service function holds primary responsibility in less than 20% of cases. This correlates with other findings that reflect that many organizations currently prioritize customer reviews as a key driver for customer acquisition more so than to gain insights and increase customer loyalty. 14% 2% 8% 38% Within your organization, which department has primary responsibility for managing and making sure reviews are leveraged across the business? Marketing Customer service 19% ecommerce 19% Sales/Business development Product/Innovation

10 WoM = ROI By actively publishing, sharing and syndicating reviews, Marketing and Customer Experience professionals can super-charge word-of-mouth marketing. 48% 50% of respondents syndicate review content on their website and / or across the web of respondents integrate reviews into Google Shopping and Google AdWords campaigns According to GroupM, 93% of consumers use Search when shopping online*. Customer reviews are user-generated, keyword-rich content, and that s great for improving your ranking on search engines. On Google, Google Seller Ratings can help a business stand out from the pack early in the search phase. A series of site performance tests by Google found that on average, ads with Seller Ratings generate a 17% higher CTR (click-through rate) than the same ads without ratings, which in turn of course brings down CPA (cost per acquisition). Google Seller Ratings - how it works Google aggregates reviews from a variety of independent 3rd party review sites and creates an overall star rating for each advertiser. This score is then displayed as part of your Google AdWords ad *GroupM: Intent to In-store: Search s Role In The New Retail Shopper Profile

11 Put customer reviews at the center of your business We recommend: 1. Set a reasonable benchmark for yourself based on what your starting point is. Make sure to compare yourself with other companies in your space. 2. Determine your priorities and set appropriate objectives. Underpin these with quantifiable, trackable metrics and conduct A/B testing where possible. 3. Don t manage reviews in a departmental silo. Establish a cross-departmental strategy so that the whole organization has clear line of sight and can reap the benefits. 4. Seek out insights - you re more apt in the beginning of the journey to receive some critical feedback. This will give you more data points to help you spot trends and diagnose your customers care most about and what they care least about. This will help you prioritize your troubleshooting efforts accordingly. 5. Be responsive and open - the more quickly and professionally you respond to issues that are raised in the public forum, the more seriously you ll be considered by prospective customers. 6. Don t forget to reappraise your objectives and metrics as you integrate deeper into the business and standardize your review strategy.

12 Appendix Explore the data further here are the key stats from the business survey in graphical format. QUESTION 1. Do you currently collect and display customer reviews? Do you currently collect and display customer reviews? 69% 14% 17% Do not collect Collect only Collect and display 7% If you display reviews, where do you do so? 34% 59% In-store Website Social networks

13 QUESTION 2. What do you believe are the most important benefits customer reviews can generate for a business like yours? (please tick the top 3 that apply) By number of responses Competitive differentiation Help acquire new customers Improve alignment between customer service and marketing teams Improve organic search ranking Increase customer loyalty Leverage in social media / word-of-mouth marketing Reduce cost of paid search Use the feedback to identify opportunities for improvement Utilise as real-time customer sentiment barometer (i.e. to complement existing NPS / Brand Health Index / VOC programs) By % of responses Percentage of respondents 80% 70% 60% 50% 40% 30% 20% 10% 0% Competitive differentiation Help acquire new customers Improve alignment between customer service and marketing teams Improve organic search ranking Increase customer loyalty Leverage in social media / word-of-mouth marketing Reduce cost of paid search Use the feedback to identify opportunities for improvement Utilise as real-time customer sentiment barometer (i.e. to complement existing NPS / Brand Health Index / VOC programs)

14 QUESTION 3. How much value do you believe consumers place on customer reviews to help them during their evaluation process? 1% 19% 48% 32% Extremely important Highly important Somewhat important Not important QUESTION 4. How many times in the past year have you written a review about a product or experience with a company? Over 10 8% % % 0 12% 0% 10% 20% 30% 40% 50% 60% By % of responses

15 QUESTION 5. Which of the following do you currently measure using customer reviews? If you collect reviews, which of the following do you currently measure? 63% 78% 46% 38% 17% 4% QUESTION 6. If you collect reviews, at which stages during the customer lifecycle do you collect them? Percentage of respondents 90% 80% 70% 60% 50% 40% 30% 20% 10% 0% At which stages during the customer lifecycle do you collect reviews? 20% Right after purchase 58% Within one week of purchase 18% 21% After each customer interaction Ad hoc 3% Don t know

16 QUESTION 7. Do you believe your organization does a good job delivering a consistent experience across customer interaction channels? 13% 1% 34% Extremely well Fairly well Somewhat Don t know 52% QUESTION 8. Do you syndicate review content on your site and / or across the web? 17% Yes 48% No Don t know 35%

17 QUESTION 9. If you collect reviews, are they integrated in Google Shopping and your Google AdWords campaigns? 12% 38% 50% Yes No Don t know QUESTION 10. Do you collect reviews via an independent third party solution(s)? 14% 35% No, we manage this ourselves Yes, via a single third party provider Yes, via more than one third party provider 51%

18 QUESTION 11. What do you believe are the biggest barriers preventing organizations from collecting and displaying customer reviews? (select all that apply) 60% Percentage of respondents 50% 40% 30% 20% 10% 39% 44% 31% 51% 5% 0% Too expensive Questionable ROI Worried about potential negative exposure Unclear which team s remit this should fall under QUESTION 12. Within your organization, which department has primary responsibility for managing and making sure reviews are leveraged across the business? 14% 2% 8% 38% Marketing Customer service ecommerce 19% 19% Sales/Business development Product/Innovation

19 QUESTION 13. Do you believe online reviews have a definite positive financial impact for organizations collecting them? 3% 18% Yes Unsure 79% No