In its second-largest acquisition, Amazon buys the company for $970 million.
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When the University of Nebraska study reported a 26% lift at NetShops in conversion on reviewed products over those that weren’t reviewed, it was based on nearly 20,000 reviews gathered across NetShops’ multiple online properties. Market-leader Amazon.com’s review volume easily supports conclusions about customer behavior, especially in categories such as books and DVDs where products don’t change, which allows them to accumulate many reviews over time.
By contrast, the lifespan of products in other categories is considerably shorter. For example, seasonal product turnover is something retailer Evogear.com, a PowerReviews client, deals with every year as ski manufacturers launch new models. “So there is always this issue where at the end of the season all of the products have reviews, and then they start the new season and none have reviews,” Shaffer explains. So for now, Evogear has bypassed using its customer reviews for social navigation.
The most effective way to pump up review volume is to ask for reviews; some retailers also periodically offer incentives to encourage review submission, positive or negative. Cabela’s, for instance, has since 2006 collected almost 180,000 unique reviews covering about 85,000 products. Cabela’s e-commerce systems automatically send purchasers an e-mail that asks for a review three weeks after a purchase. Thompson says the response rate is about 20%. To jump-start the process, Cabela’s in the first 45 days of the program offered “Cabela’s bucks” redeemable on merchandise to customers who submitted a review.
Where any asset is valuable, the potential for abuse exists, and that includes the manipulation of reviews. Reviews vendors and retailers monitor for reviews that aren’t authentic. As Forrester Research analyst Mulpuru points out, “Those sorts of shenanigans would ultimately be the downfall of consumer-generated content.”
One thing PowerReviews does to ensure review authenticity is identify reviews from shoppers who’ve actually purchased online from a retailer with the badge “verified buyer.” Such reviews account for the majority of its reviews, the company says.
Bazaarvoice also integrates with its retailer clients’ authentication systems to monitor for fraud and now is working on technology to further refine its abilities in this area. Hurt says fraudulent or manipulated reviews aren’t at this point a significant issue for the company, but he points out that merchants interested in getting the most out of customer reviews must walk a fine line between patrolling against fraud and clamping down too hard.
“We’ve told multi-channel merchants that we can verify that online reviewers are online purchasers,” Hurt says, “but some have said not to do that, because 20% to 30% of those writing reviews are people who have purchased in a store, and the merchants don’t want to shut them out.”
Retailers are just now starting to unearth the deeper potential of online reviews. In a way, they’re nothing new, because marketers have always looked to customer advocacy to help them sell products.
But the Internet has taken advocacy to new levels, giving marketers access to a much bigger pool of feedback than ever before. And the rise of the consumer voice online demands marketers take it into account. This makes reviews a potential source of powerful information about customers that marketers can apply across channels and throughout their operations.
“The market wants content that drives sales. But content is difficult to produce internally and people are tuning out traditional advertising content, so marketers are looking at customer reviews as something they can use in any channel,” says Sam Decker, chief marketing officer at Bazaarvoice. “If I am marketing that laser printer, do I want to get marketing to write a bunch of content that tries to convert? Or do I want to leverage the content that already has been created by my customer evangelists?”