January 31, 2008, 12:00 AM

The Power of Customer Reviews

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Retailer Cabela’s Inc. has realized a sales lift in the area of 5% to 10% from marketing e-mail featuring top-rated products as reviewed by customers on its web site. Director of e-commerce Mark Thompson says the company, which still is gathering data on exactly how online reviews are affecting key metrics, also has seen returns on reviewed products drop by as much as 3/10 of a percentage point in the first nine months of implementation. He did not disclose what Cabela’s return rate is.

But Cabela’s, which uses Bazaarvoice technology, hasn’t stopped at e-mail in exploring how customer reviews gathered online might affect the performance of other channels. Thompson says the retailer has a long tradition of customer testimonials because customers buying outdoor sports and adventure gear have a strong sense of identity with the brand; for instance, sending snapshots of how they’ve used equipment purchased at Cabela’s on vacation. As a result, Cabela’s in June started flagging in its catalog some top-rated products as reviewed by customers on its web site.

“We’ve always used testimonials in our catalogs, so we decided to incorporate more of that type of content into the catalogs with our ratings and reviews,” Thompson says.

Selection of products displayed with comments lifted from online reviews depends in part on how well a review’s language is crafted. “If it’s a comment like, ‘Great product, thanks,’ we probably would not use it. It would have to be more descriptive. Some people can elaborate better than others,” he says. Cabela’s is equally selective in implementing reviews in signage in its 26 stores, a venue for review content it is just starting to test.

Poor reviews

As retailers experiment with new ways to leverage online customer review content, one of the newest paths has led not to use in other channels but deeper into site operations. For one thing, merchants are using poor reviews to get improvements from manufacturers and as a reason to boot products from the lineup.

One retailer who does not wish to be identified was getting good sales of a product that was an element of a popular kit. When major complaints about the item surfaced in reviews on the retailer’s site, the retailer dropped the item from the kit and included another product of higher quality.

In addition to altering product lineups, retailers are incorporating what they learn through reviews into site search and navigation. Such “social navigation” functionality enables shoppers to search and refine results according to product attributes deemed important by those who’ve reviewed products, which can differ from attributes singled out as important by product manufacturers or retailers.

PowerReviews offers such functionality, and Onlineshoes.com, which first rolled out customer reviews from the vendor in July, extended reviews to navigation in October. PowerReviews performed integration with Mercado Software Inc.’s site search technology to enable social navigation on the site.

Jimmy Healy, Onlineshoes.com content marketing specialist, says PowerReviews provides a template allowing customers to review products in a tag-based system, submitting feedback in the categories of pros, cons, best uses, star rating and fit. PowerReviews’ system stores the gathered information in tables, which then are fed into Mercado’s site search software. The different categories of information then become searchable attributes. “Basically the software takes any kind of data and turns it into a search refinement,” Healy explains.

These searchable attributes provide an added alternative to standard navigation features, including such categories as price. The format also allows reviewers to enter text comments, and if enough reviewers call out a product attribute not listed-for instance, that a pair of shoes is “good for my aching back”-that attribute may become one of the regularly-occurring attributes in the PowerReviews template for the site.

Reviewed products sell

Healy’s still gathering data on how social navigation based on customer product reviews is affecting metrics such as conversion. One outcome he already is seeing is that products that sell are typically attached to reviews. Another trend is a dip in navigation off generic search attributes such as brand name or price versus the newer attributes. “Instead of clicking them, visitors are clicking on the five main PowerReviews navigation features. They’re starting first by looking at what other customers are saying,” Healy says.

The rate of conversion off those standard navigation features, however, has not dropped. With the rate of conversion off the new attributes competitive with the rate of conversion off the standard attributes, the net effect is an overall increase in conversion.

Healy already is thinking about how else he can leverage customer review content on the site. One build-out under consideration is a tool that would enable shoppers to compare side by side several products by attribute.

“What customers are inputting when they write a review could be very helpful in comparing products. If you had asked me a year ago about developing a comparison tool for the site, it would not have included any of that information. But now it looks like it might be some of the strongest information we will have for that tool,” he says.

Healy notes one other finding so far: When it comes to driving conversion, it matters less how many stars a reviewed product receives than how many reviews it’s racked up. In fact, he believes there now are customers who will not make any purchase without first reading some reviews.

Critical mass

That highlights a limiting factor in leveraging reviews in other channels or putting them at the center of marketing and planning: the problem of getting enough reviews on a site to provide meaningful insight. Any of these expanded uses of review content requires a critical mass of reviews-enough to serve as a reliable basis from which to draw conclusions or even make assumptions.

“If you only have one or two reviews, it might suggest all kinds of things that aren’t true,” says Jay Shaffer, vice president of marketing at PowerReviews. Shaffer adds that a minimum of 20% of products on a site need to be covered with at least three to five reviews each to support social navigation; otherwise the pool of reviewed products from which social navigation draws isn’t broad or deep enough.

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