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SBGA - How customer reviews can affect merchants and retailers bottom line

The digital revolution has arrived, and with it has come an unprecedented volume and variety of information related to how consumers shop online. It is obvious that having negative reviews and or poor star ratings can certainly affect your companies financial bottom line.

For both business to business and business to consumers, customer engagement new innovations have meant a complete about-turn in their marketing strategies. It has now become essential for all businesses to proactively collect positive customer reviews to improve buyer confidence for their products, services and other promotional opportunities.

Where companies and small businesses could once limit their customer interactions to mass mailed catalogues, trade show displays, cold calls and the occasional print advertisement, today’s consumers enjoy access to a multitude of product and service options at the click of a button and can easily determine the overall reputation of a business online based on their star ratings and total number of customer reviews in search engines and on all the top major review websites.

More information, More choices, More power

In the information age, the balance of power has truly shifted. Before customers ever decide to walk into your establishment, they’ve already researched your prices, the range of goods you offer, and how your offerings compare to other competitors within the industry. Through social media pages and business websites, and price comparison apps customers have an unprecedented level of control over when, where and how they engage with their chosen brands.

With the easy availability of data, have come new purchasing preferences and attitudes as well. Savvy buyers are no longer interested in traditional outbound advertising that pushes products and services towards them, instead, they want to be pulled towards authentic, trusted and personalized buying experiences. But the sheer amount of noise, in the online realm has meant that customers have to be increasingly careful about who they trust and who they do business with.

Increasingly, this has led consumers away from promotional materials and towards independent customer reviews, from friends, family, and other buyers.

Everyone’s a critic! The critics can influence your bottom line

The buyer’s journey no longer stops at the point of sale. Customers in the digital era are constantly sharing their views about the companies and brands they buy from, through multiple channels.  Of course this is nothing new. Since long before the dawn of modern media, people have relied on word of mouth to inform their buying decisions.  In fact according to Nielsen, 84% of people across 54 countries still trust referrals from their peers, friends, and family members over anyone else.

What’s changed is the method and reach of these reviews. Where once, a poor purchasing experience would only be relayed to a few members in your close social circle, today any dissatisfied customer can go online and post about their negative interactions on a variety of forums, including the company’s social media page or website, their Amazon product page, or a third-party website for business reviews.  Rather than a selective circle of close acquaintances, these criticisms are now being broadcasted to a massive online audience that’s more than willing to listen and be influenced by other customers.

Need to know statistics related to customer reviews

97% of customers read online reviews before visiting a local business. 12% of customers look for a new local business online, every day. (BrightLocal)
Consumers read an average of 7 reviews before they can trust a business. (BrightLocal)
88% of customers trust online reviews as much as personal recommendations.  (Dealerrater)
Negative reviews (1 or 2 star) receive an estimated 200%-300% more clicks than positive reviews. (G2 Crowd)
Websites with product page reviews convert at a 58% higher rate. (Shopify)
85% of business decision-makers read up to 10 online reviews before making a business decision. (G2 Crowd)

Increase Sales

According to PR firm Edelman, the mainstream public is currently undergoing an “implosion of trust”, based the company’s metrics over two thirds of the country now actively distrusts the intentions of mainstream institutions like, business, government and media.  A further 60% of individuals indicate that they are far more willing to put their trust in regular people over academics and technical experts.

It’s clear that businesses have a big credibility deficit, and reviews offer perhaps the only method of bridging that gap. The way other customers talk about, and interact with your brand acts as a signalling device for every savvy buyer.  Reviews and other forms of online feedback let buyers know how authentic your business is, and how willing you are to follow up on your promises of excellent service. Accordingly, excellent reviews on your website can motivate customers to spend up to 31% more, on your products and services; while 86% of customers will be swayed away from your business on the basis of a negative review.

However, the threat of negative reviews shouldn’t deter you from soliciting customer feedback. As the old saying goes, it’s impossible to please everyone all of the time; and customers will be well aware of this fact. A few negative reviews sprinkled amongst the positive ones, will simply help convince prospective buyers about the authenticity of your brand.

In fact, if negative feedback can incite a debate in the comments section then even better, friction between brand advocates and naysayers is always a net positive for your business.  Companies that understand these marketing realities have even begun to offer incentives to customers in return for honest reviews.

How customer reviews can affect your search engine rankings

SEO Company MOZ, publishes an annual survey that looks at how search engines such as Google rank web pages in their results. According to their latest study, the quantity and variety of reviews on a website contribute at least 10% to a website’s overall placement in the rankings. It makes sense, Google wants to provide users with the information they want to see the most, and we already know that customers love reviews. 

So what does a first page ranking on Google get you? Well to start with 75% of search traffic doesn’t go past the first page of a Google search. With the highest ranking results receiving 33% of all clicks, and the third receiving a paltry 9%, you can imagine how much a second-page ranking could affect your overall online visibility.

What’s that you say? Online clicks don’t say anything about your actual conversion rate? Think again. More than a third of searches are local, and 18% of local mobile searches convert into sales within the day, while 78% result in an offline purchase at some point.  Simply put, if your competitors are ranking above you due to their integration of online reviews, then you have a serious problem to deal with.

Use reviews collection to improve customer engagement and relationships

In an ultra-competitive marketplace your business needs to be constantly improving and innovating, if it wants to remain profitable. The wealth of data provided by customer reviews is integral for creating these sorts of improvements. 

Any business manager worth their salt should be analyzing trends within customer reviews to identify areas where processes need to improve. By involving customers in your decision-making you can make them feel a sense of ownership and loyalty to your business, that wouldn’t exist otherwise.

What does improved customer retention bring to your business? Well when you consider the fact that attracting new customers can be anywhere from 5% to 25% more expensive than retaining existing ones. Or when you realize the fact that a mere 5% increase in customer retention can improve your overall profitability by up to 95%, then the importance of creating strong customer engagement comes into far clearer focus.

It’s a Self-Sustaining System

An empty comments section is likely to remain empty, but just one piece of feedback can create enough of an impression to lead to five more reviews. Of course, the more reviews you have, the more your website’s content is being updated with fresh, targeted keywords, leading to consistently high placements on search engine results, which in turn creates more visibility for your brand.

Crafting a review management and acquisition strategy

Promote positive reviews on your website and marketing

Nowadays most business websites will include a testimonials section that covers positive feedback from happy business partners and clients. Similarly, many brands will share positive feedback from customers on their social media pages. While these activities are unlikely to attract too much interest from uninitiated customers, people who are already interested in your offerings will definitely be influenced by the positive word of mouth.

Small businesses that often struggle to elicit feedback on their product pages should make use of this strategy, by including a properly referenced external review alongside the relevant product or service page.

Proactivly ask your customers For reviews

Include an easy to fill out online form on each product page, and ask customers to fill it out.  According to the Pew Research Center, 10% of American shoppers will always fill out reviews when prompted, and a further 40% will do so on occasion. Why miss out on an easy opportunity to get feedback? Ask.

Another great place to elicit this sort of feedback is through your email marketing. When you’re sending out promotional material or offers to your customers send them a simple feedback form alongside.

In certain cases you may decide to highlight particularly positive reviews, by asking customers to create a video testimonial for your product. Make sure to inform the customer about how their image will be used in promotional material going forward, and definitely don’t edit out any of the customers’ feedback. Word of mouth marketing thrives on authenticity.

Link to review profiles on your website

Links to related profiles on Facebook, Twitter, Yelp and other channels should be prominently displayed on every page. For physical outlets, prepare a printed brochure that guides customers towards every possible online touchpoint for your company.  Customers should be able to reach you at any time with their feedback.

Listen to your customers! The customer is always right!

However, in some cases a discussion with your customer might reveal real problems within your business. In this scenario you should work to remedy the issue however possible, and then return to your customer to solicit an updated review.

Dealing with negative reviews can help build trust in your brand

Never Delete Negative Reviews – As long as the review stays within the boundaries of good taste you should allow it to stay up. According to A PowerReviews and Northwestern University report, product purchasing actually peaks when its rating hovers around 4.2 to 4.5 star (out of 5) ranges. Any higher than this, and customers begin to suspect that your feedback might be too good to be true.

Embrace Negative Feedback -   From a public relations perspective you’ll gain nothing from engaging in protracted comments section argument with the customer. If the customers’ complaint seems legitimate then you’d be best served owning up to your mistakes and proposing solutions that could help them rethink their experience.

Alternatively, if the customer is simply mistaken about how your products or services work, you could use the forum to politely clear up misconceptions.  Whatever you do, make sure to respond quickly and positively to the negative feedback.  In some cases you might even be able to turn a critic into a loyal customer.

Recognize What you can learn – Not even the most mainstream business will be able to offer a one size fits all solution, inevitably, customers will differ in their needs and preferences. With those differences will come negative reviews.

Recognize What you can learn – Not even the most mainstream business will be able to offer a one size fits all solution, inevitably, customers will differ in their needs and preferences. With those differences will come negative reviews.

 

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