Can a 1-Star Customer Review Really Impact Sales?

It seems like you truly can buy almost anything online in today's market place. From the usual clothes and electronics, to the more peculiar items such as costumes for your dog, or UFO detectors, it can all be found online.   For many companies, having an e-commerce site is a necessity and can contribute to the brand image, provide another channel of revenue, and add convenience for the customer.  However, e-commerce sites pose an important question as to whether or not customer reviews should be included.  In recent trends, brands are providing a means for customers to leave feedback about specific products. Although this is ideally a simple solution, it's important to keep in mind that this can pose problems.

Personally, I have always read at least several customer reviews, if available, before purchasing a product online. In my opinion, customers feel more secure reading what their peers have to say about a product rather than simply reading the company’s description, which can leave out important details or even contain a slight bias.  In a survey conducted by Dimensional Research, it was found that 90% of respondents who read positive reviews claimed that the review influenced their buying decision.  Additionally, 86% of the respondents stated that negative online reviews also influenced their buying decisions.  Clearly, opinions from other customers weigh heavily on the input of shoppers and are taken into consideration during the purchasing process.

In a recent New York Times article, Dr. Simonson, a marketing professor and researcher at Stanford University, conducted a study in which participants were asked to determine which of three Canon cameras they would purchase. Participants were afforded the opportunity to read user reviews and other information about the cameras before making their decision.  Simonson's findings contradicted a previous, well-accepted theory - known as the “the compromise effect”. This theory stated that consumers would gravitate towards the “middle” option (middle price, features etc.), if given three choices.  Simonson's new study indicated that consumers who were more educated about the products they were purchasing would make decisions based on perceived value and in short, not consistent with the “compromise effect”.  In fact, more participants chose the higher priced camera with more features over the “middle” option.

This information is extremely interesting and useful for marketers, because it implies that consumers are becoming savvier, and traditional marketing strategies may no longer address all of the most important aspects of the purchase process. Customers are beginning to rely more on concrete information, and honest, un-biased reviews over a brand name or brand perception.

The power of customer reviews is not something that companies should fear, but rather embrace.  If you have a loyal customer base and quality products, then consumers won’t have any issues raving about the brand in their peer reviews or sharing their positive experience on social media.  However, for those companies that are out of touch with their audience - this may pose a problem.  The best way to ensure high reviews is to be in-tune with the individual's needs.

As Bill Lee mentions in his article in the Harvard Business Review “Memo to the CEO: Customers are the Key to Growth”, many companies don’t know what their customers value in their companies’ products or services.  Too many brands are focusing on big picture marketing strategies like social media and event campaigns.  However, success lies in reaching out to the individual, knowing what they like and want out of the brand.  By hearing the consumer and meeting their needs, companies can create loyal customers and advocates for the brand.

These loyal consumers are then the ones who are willing to share their positive experience via Facebook, twitter, Tumblr, retail sites, or any other social media channel. By providing a “share” feature for reviews of a certain pre-determined caliber, companies create an environment in which customers can instantly share and recommend their favorite products or services with followers.  This in turn will increase a brand’s social media presence organically, and at no additional cost.

In conclusion, a few negative remarks online will not have an lasting effects on the sales of a product, however, multiple positive reviews can greatly increase sales and create customer loyalty.  By finding out what it is that consumers want and reaching out to them on a more personal level, the target audience feels engaged and more connected to the brand. These loyal customers will provide highly rated, positive reviews to influence additional future consumers to click “Add to Cart”.


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