As we celebrate this milestone, we are also close to celebrating our 5-year anniversary (Brant and I founded Bazaarvoice on May 2, 2005). With 80% of consumers now looking for customer reviews, it is hard to appreciate now just how few U.S. retailers offered customer reviews on their websites in May of 2005. Would you believe only four? Today we serve more than 50 of the top 100 U.S. retailers, more than 25 of the top 50 U.K. retailers, and similar numbers in Australia, France, and Germany. And we serve many clients outside of retail, from health care to manufacturing to financial services. We have rapidly grown into a company of 750 clients and 515 employees globally, operating across 25 international languages. I do not take our success for granted one bit and I'm very proud of and thankful for our partnerships with our clients. I'm also proud of the culture we have created here. We spend the majority of our waking time at work, and we strive to make that time as fun and meaningful as possible. Our passionate culture impacts the way we serve our clients and also give back to the community.

As I look back to my first Bazaarblog post, I think back to my analytical roots, spending seven years building Coremetrics, and reflect on how much we have achieved on the analytical front at Bazaarvoice. The "hidden" impact of 100 billion impressions is how we are writing the new marketing and merchandising textbook together with our clients. In a world of increasingly fragmented media, a dramatic shift to time spent in the online channel vs. other channels, and a rise in the prominence of the voice of the customer, the "hidden" impact is felt in how marketers and merchandisers adopt new practices based on user-generated content. And, to be totally frank, I underestimated the impact in how Bazaarvoice would change the world in this way. The Bazaarvoice School of C2C Marketing Seal to the left is from our first Social Commerce Summit in 2008, which quickly sold-out and was a magical event, full of clients speaking about writing the new textbook together (our fifth Summit is coming up in Austin April 19-21 and is almost sold-out already).

So this blog is dedicated to some of the most dramatic changes I have seen on the path to 100 billion. Here is a look back on just a few of them:

• Oriental Trading's CEO, Sam Taylor, leads a radical organizational change to reform merchandising based on user-generated content and wins the prestigious Gartner Group Customer Experience award (read the Bazaarblog post on the award, and another on specifics).
• The customer reviewer becomes the spotlight for campaigns (Free People example, and Urban Outfitters too). At that time, I believe this was an industry first. With 80% of reviews usually coming from the top 20% of your customers by lifetime value, this campaign technique will be adopted rapidly.
• Sephora uses in-store signs to get customers to read reviews via their mobile devices, and trains in-store associates to promote it. [Note: the sold-out Shop.org (NRF) and RAMA Retail Innovation & Marketing Conference in San Francisco this week will feature Julie Bornstein of Sephora - read her interview by NRF on the ROI of social media, a special Mobile Boot Camp, and me moderating a panel of rockstar venture capitalists.] Related to Sephora, Intuit's TurboTax did the same with their in-store displays, and made an impact at every Best Buy, Office Depot, OfficeMax, Staples, and Walmart store in the U.S.
• The broad multichannel marketing implications of user-generated content, from print, to TV, to online. I'll never forget the first time this reviews were promoted on in-store receipts and by whom.
• The transformation of channel advertising with BrandVoice and BrandAnswers. With 80% of consumers searching for reviews, the implications for channel advertising are huge and user-generated content in the channel is quickly becoming a business imperative for a supplier. And it isn't just UGC. BrandAnswers and Ask & Answer now bring in supplier-generated content as well as retailer-generated content to answer user-generated content in the form of product pre-sell questions.
• TurboTax partners with us to launch the "Friendalyzer", where you can see TurboTax reviews written by your friends on social networks, including Facebook (which now has 400 million users). Seth Greenberg of Intuit will be presenting the great results on this live at our Social Commerce Summit this April 19-21 in Austin. The implication for technologies like Facebook Connect are profound for user-generated content at large and we are in Inning One for these innovations.

It has been an amazing 4 years, 10 months, and I want to take this opportunity to sincerely thank all of our clients, employees, partners, investors, and advisors. We promise not to take our success for granted, and we are ramping up R&D and Client Services like never before. This quarter alone, we are attempting to hire at least 80 people, but our very high bar makes this difficult indeed (we have 14 full-time recruiters working in our office at Bazaarvoice today and there is nothing more important for our culture than its foundation: our people). If you know of someone that may be interested in joining us, see the many jobs available here and note our referral incentives.

The next 100 billion impression milestone will no doubt be achieved much faster than the first, but I expect our impact to be no less profound than with the first (see our many case studies, webinars, or whitepapers for more). Thank you, thank you, and thank you again for your support. And stay tuned to this blog as we continue this exciting journey. As I said in my first-ever blog post on Feb. 3rd, 2006 (and remains just as true today):

Welcome to the age of customer empowerment in our hyper-connected global village! We look forward to being your tour guide in this wild, wild ride.

It takes a very talented and experienced person to manage a global team of such complexity to the level that our clients, our executive team, and I expect.  But we found her.  I am incredibly proud to announce that Heather Brunner has joined us as our Senior Vice President of Worldwide Client Services.  Her first day was Monday, and we put out the press release on Wednesday.  Her ability to rapidly ramp has impressed our entire team, and I have already had several important client-facing meetings with her during week one.

I have known Heather for many years, first working with her when she was a Regional Vice President for Concero while I was the CEO of Coremetrics.  I was impressed with her back then, and Concero did a great job for Coremetrics during a very important, foundational period.  But Heather has grown her career so much since then.  Most recently, she served as the CEO of Nuvo, a wholly owned subsidary of Trilogy.  Prior to Nuvo, Heather was the COO of B-Side.  In past jobs, she has served as a the VP of Client Services at Coremetrics, the VP of Client Delivery and Operations at Trilogy, a Practice Director at Oracle, and a Senior Manager at Accenture (where I also began my career).

I am confident that Heather will be an incredible leader for our Worldwide Client Services team.  With nearly 20 years of experience in client services and operations, she really gets it.  Just as importantly, Heather fits our unique cuture perfectly.  We were recently named one of the best places to work in Austin again, and the executive team (now including Heather) sets the cultural tone for the rest of the company.  It is also impressive to note that she understands the importance of nurturing the soul with her decade-long community service to the United Way.  Bazaarvoice has been very focused on community since inception, as we strongly believe that companies also have a soul to nourish.

Client Services has been a major strength for Bazaarvoice, and I know that Heather will help us make it even better.  The teams reporting into her are already successful, with exceptional ratings from our clients (we survey them quarterly and take their input very seriously).  Heather will make sure we keep that high-bar as we rapidly scale globally.

Heather will be attending the Shop.org Annual Summit in Vegas as well as our upcoming Social Commerce Summit in London (the first was a sold-out success) with me.  I sincerely look forward to introducing you to her.

I was happy to see Andy leverage the valuable community we assembled at our first-ever and sold-out Summit in May by recording five video interviews. It was truly an amazing group of individuals, charged with word of mouth marketing at many of the largest companies in the world, from Bank of America to Wal-Mart. It was humbling to be in the presence of so many smart industry leaders, sharing best practices with each other in our rapidly emerging field. Because of them (as well as the hard work by our team), we have set a very high bar for our Summit next year.

Andy recently published his interview of me. We discussed how user-generated content is changing the merchandising culture at companies, helping them become more customer-centric and successful as a result.

Click here to view the embedded video.

Read on to see more interviews by Andy.

Andy previously published an interview of Ze Frank, another one of our keynotes and one of the funniest but smartest online personalities you will ever meet. Ze's interview at our Summit by Kelly Mooney (a Summit keynote speaker, author of The Open Brand, and President of Resource Interactive) was a personal mental highlight for me, probing into some very deep issues. Andy covers topics like viral marketing with Ze. By the way, that gong behind Ze in the interview is a very important part of Bazaarvoice's culture, and has been since the beginning. You can thank my co-founder, Brant Barton, for that, and you can find multiple gongs in our Austin office and one in our London office (so far).

Click here to view the embedded video.

Andy also previously published an interview of Steve Leveen, the founder and CEO of Levenger. Steve is a very smart leader, and brought his son to our event. Steve gave me some great tips on raising our daughter, Rachel, and is a very kind person (as is his son, by the way).  In Andy's interview of Steve, they talk about the use of video reviews and Flickr as a natural medium for Levenger's sophisticated customers.

Click here to view the embedded video.

If you have not subscribed to Andy's blog yet, do it today. Incredibly useful tips are published on an almost daily basis. I found myself recently evangelizing on why to follow it to the founder of Hey Cupcake, a local joint in Austin. I connected with the founder, Wes Hurt, recently after reading about him in Tribeza because we may be related (it is a long story). You must try these cupcakes the next time you are in Austin – they are unreal. But I'm off topic – I was telling Wes to read Andy's book and subscribe to his blog because he will quickly learn how to build his business as a result. I also found myself telling Wes the story of how Krispy Kreme lost its "specialness", parroting Andy telling me the same story.

On Andy's blog, he will soon be publishing the remaining two interviews he did at our Summit: Bryan Eisenberg (highly respected industry consultant, co-founder of the Web Analytics Association, keynote speaker at our Summit and several other conferences, prominent author [ClickZ, Call To Action, and Waiting for Your Cat to Bark?], and Bazaarvoice Advisory Board member) and Seth Greenberg (former CEO of eHobbies.com – one of the online pioneers, former Shop.org Board peer, and leader at Intuit).

* Note: we are proud members of WOMMA and our own Sam Decker serves on the Board of Directors while WOMMA's President is my fellow Board Director at Bazaarvoice, Ed Keller (keynote speaker at our Summit, author of The Influentials, former CEO of Roper, and co-founder and CEO of The Keller Fay Group).

While all of the findings are of interest (mobile, widgets, personalization, etc.), this year I was most struck by three big trends:

•  The global traffic share gains of YouTube, Facebook, Hi5, Wikipedia, and Orkut – all making the global top-10 for the first time.  I remember when Time selected "You" as the "Person of the Year" for their Dec. 2006 cover.  They may have called it too early.  Social connection online has truly arrived.  The growth of these sites are staggering, highlighting the power of community, user-generated content, and word of mouth online.
• The share gain of Amazon.com relative to large, multichannel retailers.  They led the way with customer reviews over 10 years ago, and have become a Wikipedia of sorts for broad, product-focused reviews.  And they continue to innovate at a staggering pace, spending over $3 billion per year on R&D.
• The uncharted territory we are in with the recession, truly making this our most important presidential election in history.  Although Bazaarvoice is growing at a very fast pace, beating our financial projections repeatedly, we are also cautious and watching the economy closely.  And I know that most, if not all, of our clients and partners are doing the same.

In case you missed the link above, you can read the full report here.

And if you have some more time this weekend, you may also want to check out Steve Jobs' recent keynote on the iPhone 2.  While I carry a BlackBerry myself (my wife carries an iPhone), the power of the iPhone's new programming language (and SDK) to deploy corporate applications as well as the new AppStore (reminds me of Salesforce.com's AppExchange) signal a new type of Apple.  With these moves, they are embracing being an "open" platform and focusing on B2B at the same time.  This should lead to an accelerated adoption of Macs in corporations, as the iPhone uses the same OS and user behavior historically shuns change (or seeks familiarity; heck this is human behavior not just 'user' behavior).  In any case, his keynote may lead you to believe that the iPhone 2 will be the dominant mobile computing platform for corporations in our near-term future.

• Avenue A | Razorfish reports in their "Digital Consumer Behavior Study" that 55% of surveyed Internet users check other people's opinions online when researching products, topping product comparison charts (22%), expert reviews (21%), and shared shopping lists (1%).  If you are currently evaluating site feature investments for 2008 and beyond, get your hands on this report and read more about why you should invest in ratings and reviews. 
• Internet Retailer reports in "Web Site Design, Content and Rich Media" that consumers that read product reviews are likely to spend more online.  The largest group of surveyed users, 27.1%, reported spending 5-10% more, while almost 7% reported spending 20%+ more!  Need a business case for reviews?  Do the back of the napkin math for your business.  For a $25MM online retailer, if 7% of buyers spent 20% more, a reviews solution would pay for itself multiple times and easily fund investments in other site features.  
• Deloitte & Touche USA reports on the influence of reviews on purchase decisions by category.  Every listed category shows significant influence, from electronics (45% of respondents influenced) down to motor vehicles (13%, the lowest, but still significant).

Specifically, the study looks at the influence that online consumer-generated reviews for offline services (e.g., restaurants, hotels,  automotive, medical, legal, etc.) has on purchases of those services. 

• Nearly 25% of surveyed Internet users reported reading online reviews prior to paying for an offline service!  
• Online reviews were a significant purchase influence for approximately three-quarters of review users in all eight offline service categories.  Hotels ranked the highest at 87%, while legal services ranked the lowest at 73%. 
• Impressively, 97% of users that attributed their purchase decision to a review felt that the review was accurate. 
• Review users felt that reviews from fellow consumers were more influential than those authored by professionals. 
• Depending on service category, users were willing to pay from 20% more (home) to 99% more (legal services) for services with a consumer quality rating of 5-stars (Excellent) versus just 4-stars (Good).

These are amazing statistics.  The Web is still primarily a research medium but multi-channel brands still struggle to quantify the impact that online content has on offline purchasing behavior.  Reviews are a useful bridge, since both online and offline purchases can be attributed back to specific reviews using web analytics tools, buyer surveys, customer feedback at the point-of-sale, and other means. 

While many local service providers may struggle to engage their customers to review their purchases online, due simply to size and scale challenges, the global and national brands behind those local providers – major restaurant and hotel chains, automotive service franchises, healthcare providers – should take steps to empower their local business affiliates with tools to capture consumer reviews and measure their influence.  

But recently Second Life is taking a beating.  Check out these recent articles in Time and Wired.  Even though many corporations have rushed in to grab their own virtual real estate, it turns out that not that many people are there to shop.  They are primarily there to gamble and have sex, and this shouldn't be surprising.  Many of the first businesses on the Internet were about gambling and sex.  It's the early-adopter syndrome in a medium that let's you hide your real identity and pretend to be someone else.

To be clear, I am bullish on the 3D-Web long-term.  There is no doubt that as virtual reality becomes more real and accessible to the masses, as opposed to the clunky and odd experience of Second Life today, virtual shopping will take off.  When Internet Explorer and Firefox embed 3D-Web browsers into their 2D-browsers, that may mark the tipping point.  I am also confident that this is going to take many years – at least as counted in "Internet time".  In other words, I'm talking about 3-5 years.

The 3D-Web will provide a more tactile experience than today's Web, and online shopping will blossom.  Our company has shown the potential of a more tactile experience – customer reviews allow peers to "touch and feel" a product sold online, and sales significantly increase with a corresponding reduction in returns (as customers expectations are set by each other, the element of negative surprise is reduced).  Feel free to ask us about our over 20 case studies to learn more.

Until then, I'll be watching Second Life to see how it evolves.  But I don't expect much in the near-term, to be frank.  Once a medium is hyped to the extreme and then has a counterbalancing crash in popularity, it takes years to recover.  I'm not sure that Second Life will get a second life – the word of mouth is already too negative and the community is tainted.  But there will be many 3D-Web efforts to follow…

Update 9/8:
TechCrunch reports that ICANN's CEO, Paul Twomey, keynotes at a conference with the message that virtual worlds are the future of global commerce.  William Gibson, one of my favorite authors and the inventor of the word and concept of "cyberspace", would be proud.