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Next Steps with Negative Reviews

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by Pehr Luedtke, CEO

The following article was originally published in the April 2010 – Online Insights: Customer Centricity issue of Online Strategies Magazine

Though it may seem counterintuitive at first glance, negative reviews enhance consumers’ shopping experience and boost retailers’ bottom lines by providing credibility and perspective. In this article, we offer some best practices to help retailers take advantage of the value of their negative product reviews.

First, consider the broad-ranging findings: A recent Forrester report noted that 50 percent of online shoppers decided to proceed with a purchase of a product after reading negative reviews on it. And MarketLive Performance discovered that websites with customer reviews earn six percent higher conversion, on average, than those without them. PowerReviews.com client Alpaca Direct experienced a 23-percent sales uplift on products that had customer reviews–including negative ones. Jim Hobart, Alpaca Direct co-founder, sees the critical value in customer reviews, both good and bad, in retaining and acquiring new customers: “Reviews help build that initial trust. They’re key to the long-term success of our company.”

How can you replicate the successes of businesses that have experienced sales uplift and deeper levels of customer engagement from negative customer reviews? How do you eliminate the possibility of irreconcilable differences with your customers? Start with the following relationship rules:

Relationship Rule No. 1: Build Trust
Negative reviews can actually help retailers build trust among their customer communities. According to usability testing conducted by PowerReviews, consumers do not believe the “perfect product” exists; in fact, consumers expect to see negative or constructive feedback in some of the reviews and discount those products that do not have negative reviews.

sumers often find negative reviews to be the most helpful. Let’s say, for example, that consumers consistently find that a camera underperforms at fast-moving sporting events, but a potential buyer is planning on using the camera primarily for still-life photography. The impact on the potential buyer is that other consumers have taken the time to point out a flaw, but that flaw is not relevant. This increases purchase confidence.

CurrySimple, a supplier of ready-to-heat Thai sauces, has used negative reviews to identify opportunities for product testing and improvement. CEO Mike Moran makes it a practice to respond directly to negative reviews that surface on the site. These types of exchanges have helped to establish more opportunities for customer interaction with the products. The dialogue specifically addressing feedback oftentimes compels customers to make contributions of their own: sharing their food experiences, providing ideas on special uses of spices and helping other customers understand the value of particular products in their own words (as opposed to the company’s). Reviews have not only increased traffic to the company’s site by roughly 25 percent, but CurrySimple has also experienced a steady conversion uplift of 40 to 50 percent within three to four months of adding reviews to the site.

Some tips for building trust:

  • Don’t hide negative reviews;
  • Respond to negative reviews in a timely manner;
  • Identify core problems by gathering specific ideas as to what went wrong;
  • Suggest alternatives or provide a solution; and
  • Assess the product(s) in question from a merchandising and product-improvement perspective.

Relationship Rule No. 2: Get Engaged
RedCats USA, recognized as a global leader of home and fashion brands, recently reached the one million customer-review mark on its site OneStopPlus.com. VP of E-commerce Jason John affirms that the constructive feedback reviews provide are essential to building engagement: “We believe our overall success is based on creating a two-way dialogue with our customer. We actively and continually encourage our customers to voice their opinions. We intend to continue focusing on customer reviews as a key customer-engagement tool.” Redcats often incorporates customer input (including suggestions for product enhancements and improvements) into future offerings.

Tips for driving deeper levels of customer engagement:

  • Invite your customers to write a review via post-purchase e-mail;
  • Use order-history links to provide another opportunity to encourage customers to write a review;
  • Plug promotional contests or special offers for writing a review;
  • Use e-mail campaigns to showcase your top-rated products.
  • Remind customers to review products on homepage banners, e-newsletters and other online communications; and
  • Use offline touchpoints to solicit reviews: in-store purchase receipts, packaging inserts and in-store signage.

Relationship Rule No. 3: Plan for the Future
Tapping into the insights of a more engaged customer community will provide retailers with countless opportunities to improve the customer experience. Increasing relevance and usefulness for the consumer is central to sustaining trust, growth and deeper levels of engagement with your customer community, ultimately resulting in significant gains in conversion and customer retention. However, what you do with the customer review data beyond enhancements and product improvements is just as critical. Brands and retailers who utilize review feedback to help guide shoppers to products that are well suited to their lifestyles and their intended uses will gain the competitive advantage.

A tool such as social navigation provides a more helpful and relevant user experience for the customers on your site by using customer review data to help shoppers filter their product search results by Pros, Cons, Best Uses and User Personalities. This allows shoppers to narrow their choices by consumer-generated attributes, not just by star ratings.

While still in its nascent stages, the merging of search and social is rising to the top as a trend to watch. The implications of this convergence can yield tremendous value for retailers whose reviews are SEO-friendly at both the product level and category level. Finding smarter tools to make your review technology more robust will help you leverage user-generated content to drive more sales.

Utilizing the insights you gain from positive and negative customer review data will help you stay focused on better customer experience now–and and well into the future.

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