Way back in 1995 (I know – only 15 years ago, but a lifetime in technology) Amazon, already a revolution, did something even more revolutionary. They asked their customers to post reviews of their products on their website. And most people who knew about Amazon in those heady, early days thought they had committed commercial suicide. Why would you give your customers the opportunity to criticize your products in a public forum?
Since then more than 5 million customers have posted tens of millions of reviews on Amazon.com, according to the Seattle-based company. And the business has flourished; becoming one of the worlds most recognized and admired brands. It has changed consumer behaviour by being the first successful web retailer to embrace consumers views. "What we try to spend our time on is harnessing customer passion," says Russell Dicker, Amazon.coms senior manager of community.
Retail experts say one of the most profound changes in consumer behaviour over the past few years is the emergence of such “information-based shoppers”. Typically, they are educated workers with broadband connections who are strapped for time and suspicious of TV ads. So they increasingly shop online. Not only for things to buy, but for ways to travel, places to stay, places to eat, and so on.
So why is this relevant to an SME? The reality is that if you’re in any sort of consumer-facing business, online feedback from the client is now more the norm than the exception. If you’re running a small hotel or a B&B, tripadvisor.co.uk can be your best friend or your worst enemy. Many of the online business directories offer consumers the opportunity to comment, for good or bad. So why would you add extra pressure to yourself and harness it on your own website, as Amazon did fifteen years ago?
Here’s why. Firstly, it helps other customers through a third party endorsement. Many consumers won’t buy online now without checking out reviews from other people, and those first impressions count. In America, some 70% of people say they consult product reviews or consumer ratings before making a purchase, according to an October 2008 survey by Penn, Schoen & Berland Associates, a research and consulting firm.
We all recognise the value of testimonials, but this is one step further. Partly it’s about believing in the fact your service and products are good enough to allow your customers the latitude to express their views. An interesting stat - Amazon found that the average grade for reviewed products is 4.3 out of 5 stars. Consumers are overwhelmingly positive when it comes to online reviews. Yet – and here’s the rub - even negative reviews can boost sales. Shoppers appreciate reading reviews, full stop, and even negative reviews add to the level of trust you build with them as a retailer. Honesty is a valuable asset.
Secondly it helps your customers feel part of a community. Just look at the way Amazon has allowed any customer with a passion to build lists of their favourite reads, music and hot gadgets at no cost to them and it increases through sales exponentially. Everyone’s an expert, everyone’s important, everyone has a voice. Being a reviewer gives you a status and a place in the Amazon community - and also helps Amazon sell far more books, DVDs and so on.
According to a recent study by Forrester Research, online shoppers list product reviews as the most desired feature of a website. It’s a brave move – but if you sell online what’s stopping you from adding this feature to your website?
Deborah Done, the author of our Big Ideas, is founder and director of Nab Communications, a freelance public relations agency which provides sensible and value for money PR advice to regional and national businesses. www.nabcommunications.co.uk
The Big Idea: Why Introducing Customer Reviews can be a Brave Move for your Business
July 16 2010