A panel discussion followed, featuring Patti Freeman Evans; Bryan Eisenberg, author of Call to Action, Waiting For Your Cat to Bark, and Always Be Testing; Mike Svatek, VP of Product Strategy for Bazaarvoice; and David Selinger, CEO and founder of richrelevance. The event was co-hosted by Bazaarvoice and richrelevance.

Forty-eight percent of online shoppers plan to reduce their expenditure over the next 12 months. With spending budgets thus lowered, customers are more anxious than ever to validate their purchases, sometimes after utilizing three or more sources. Consumers also make fewer in-store impulse buys and use online resources, such as ratings and reviews, earlier in the purchasing process, Evans said.

Evans challenged her audience to rethink the relationships they currently build with e-Commerce consumers. People return to familiar environments in difficult times, and savvy retailers will recognize their customers' needs to create an atmosphere of trust and value.

Panelist Bryan Eisenberg encouraged companies to use review language gathered from their Web site to re-write their product copy. As he put it, "Do you ‘get’ your customer? Are you speaking the same language?"

If you missed this event, join us for another exclusive briefing by Patti Freeman Evans in San Francisco on March 26, 2009. The event is free, but registration is limited; register today.

The New Rules of Engagement: Make it Relevant
Online Retail: Driving Relevant Experiences

March 26, 2009
9:00 a.m. to 11:30 a.m.
The Palace Hotel
San Francisco, CA

Register now at www.bmmreg.com/Engaged. See you there!

While the highly sought after "Influentials" segment garners much of the focus of word of mouth marketers, Forrester's findings provide ammunition for more broadly focused approaches to enabling and capturing word of mouth.  Rather than thinking in campaign terms, brands should be seriously evaluating tools and technologies that can widely capture consumer opinions, enable deep analysis of what these opinions reveal about brand strengths and weaknesses, and facilitate the distribution of word of mouth to those who actively seek it, from the brand directly or from other sources.  

Fortunately, marketing spending trends suggest that this is in fact happening.  The eMarketer brief also states that spending on word of mouth marketing totaled $1 billion in 2006.  Small by traditional marketing standards but quickly growing, with 2006 spending representing a 36% increase over 2005.   

We started answering that question today with the launch of our newest feature, called ShareThis(tm). It is a FREE feature for our clients allowing their shoppers and customers to share a review, profile or product to their favorite social networking or bookmarking site. And because we’re already hosted in their site, we can turn this live within days without IT involvement.

Dow Jones covered the launch, including commentary from Dell. Here’s a snippet from the article:

The feature enables a person who is, say, excited about the Dell monitor he just bought to share the news by posting on his Facebook profile a link to a review that he or someone else wrote. The post, which can also include an image of the monitor or the Dell logo and brief comment from him, will show up on his profile mini feed and in the news feed his Facebook friends see. Bazaarvoice says no money will change hands; shoppers won't be paid for posting reviews and Facebook won't get fees.

"It's making (consumers) an advocate" for brands on sites where the audiences are highly desirable to marketers, yet tend to be skeptical of online marketing, says Greg Sterling, of Oakland, Calif., consulting firm Sterling Market Intelligence. "It's trying to leverage a more trusted environment" and a form of marketing — word-of-mouth — that is particularly trusted by consumers.

It is also an effort to engage people who online-marketers have come to call "influencers" — people who through their expertise and efforts to share that expertise in online forums have gained outsized influence over other consumers. Sites like Facebook, del.icio.us and Digg are places where these people, and other less-active Web users, love to express themselves and have access to large numbers of other people.

"Now, for the first time ever, whenever (consumers) see a product they like, they can post it as a representation of who they are and what they like," says Sam Decker, chief marketing officer at Bazaarvoice.

I couldn’t have said it better myself!

You can see it live on these sample product pages from Dell, Toshiba and Jewelry Television.

We have future plans for this functionality, plus other ideas on social network integration with user generated content. Drop me a note if you’re interested in discussing them (sam at bazaarvoice.com).

If you’re a client interested in adding this to your site, it just takes a call or email to your Community Manager…otherwise you’ll be hearing from them! Remember, it's free! I mean FREE!

Deciding which projects were built before the holidays involved a strategic decision-making process that I went through each year for many years. Many of our retailers we talk to are going through these decisions right now, debating if they should add reviews before the holidays vs. other priorities. The case I would assert for adding reviews now — before the holidays — is on a simple premise of Net Present Value (NPV). The business case process I helped build at Dell was based on this simple financial principle.

Any feature you put on your site has a NPV, meaning the value to the P&L is the sum of the impact over some time period (say 2-3 years). Some projects may have an opportunity to drive immediate benefit, but the impact declines over time.  Other projects (such as reviews) have a growing impact, where the impact immediately is not as great, but the sum of the impact over time is much greater. With ratings and reviews, the value is in the content, which grows over time. The value is identifying and engaging your influencers, which grows over time. The value is in programs and marketing strategies leveraging this content and your influencers, which is a multiplicative effect as you leverage this in email, natural search, advertising, catalogs and other marketing vehicles.

I’ve launched over 100 projects / features on Dell.com on a $3.5B revenue site. It was high stakes. We came up with business cases for almost every one of those projects, and measured the impact of almost every one. There were projects ‘above the line’ and ‘below the line’ that didn’t make the cut. After 14 years of online experience, and Brett’s many years of measuring online impact through Coremetrics, we believe reviews is a priority for a very simple reason: it is the highest impact strategy, highest NPV project, to  any other project we’ve seen (unless your checkout functionality is broken!). Check out some of our case studies.

How long until you see benefit? In our experience with over 120 clients, not very long…

• Let’s say you launch reviews in late October (we can get you live in 2-4 weeks). You immediately email an invitation to customers of the last 6 months to come back and write a review.
• In come thousands of reviews (we’ve seen some clients get tens of thousands in one week!).
• By mid-November you can merchandise top rated products on your home page, in email, and start to benefit from natural search as people search for product reviews in search engines (We’ve seen 60% growth in week over week search visitors for many clients).
• Customers can share reviews and products with their friends and family, driving viral marketing.
• You and your merchants will have a new set of data through workbench reports and alerts to help decide what to merchandise over the holiday period.
• All this benefit takes you through January, which is also a healthy holiday sales month.
• After the holiday rush, you have the reviews platform in place to solicit these customers to come back and add more reviews to the system, which you can use to drive sales after the season and exceed your spring year over year sales goals.

We have case studies that prove more reviews equals higher conversions. The sooner you allow customers to review products on your site, the sooner you build an annuity that drives sales over time. This is what makes ratings and reviews (or any social commerce applications, such as Ask & Answer), a higher NPV project than most other projects. If you calculate the impact of reviews used multiple ways as they grow and the impact it has for you for the holidays and the rest of the year, this low effort project (20-30 hours of IT time with Bazaarvoice) also becomes the biggest ROI project. We have an ROI calculator to help you figure this out.

This is the holiday season that reviews will be used. Shoppers are expecting reviews now. Not have reviews on your site means you risk losing your customers to your competitors. Allurent did a study that shows that 67% of consumers who don’t find the information they are looking for on a site, will abandon that site in favor of another that has the information. According to Forrester, 77% of online shoppers seek reviews when purchasing, and over two years ago there was a study from eVoc Insights that suggested 50% of shoppers would not even buy unless they had reviews. Are you going to turn away half your visitors this holiday to other sites that have reviews?

The time to get reviews on your site is right now. This year the number of retailers with ratings and reviews has doubled, from 25% last year to 45% this year (according to shop.org and MarketingSherpa). Build a competitive advantage with how you use reviews over the year. Our Community Managers will help you with maximizing your social marketing potential through best practices on driving review volume and marketing strategies.

If you want to talk to me directly about prioritization, feel free to drop me an email (sam [at] bazaarvoice.com). You can see see this article I wrote on eBusiness prioritization for Dell’s magazine several years ago.

Basically his point is that we do have control on driving customers to buy from us, it's just a different lens. There are different levers and controls. Marketing has to move more upstream. The best part of the article is this Consumer / Marketer Control Framework:

Quoting Pete…

At the end of the day, we still control the message and the business processes that shape it, but we may need an alterative path to get there. Product quality, customer service, accurate claims, and employee empowerment are all within our control. And these are the input types that really matter, and always have.Our problem is we viewed our world of control through a narrow, increasingly dubious, lens: traditional advertising and paid media. 

I spoke at a Forrester Conference a few months ago and the audience asked what companies weren't doing as it related to User Generated Content. My co-panelsts suggested that more companies need to listen. My follow on to that was more companies need to ACT based on that listening. Notice the control levers below "Listening" in the right column above. All of them imply that action must be taken based on what consumers control.

The fundamental difference in Customer-to-Customer (C2C) marketing is that

1) Our marketing lens and sphere of control needs to be widened

2)  Our strategies, actions, initiatives, programs, tactics and measures (things we control) need to be centered on how the customers are controlling their experience and sources for product decisions ('marketing').

 

I think Pete's title, "We're Still in Control", was interesting and ironic. We hear that "customers are in control". His point is the way we have traditionally thought about control (media, advertising, company-to-customer marketing) is too narrow. I think the phrase has struck a chord because of this narrow view. If we listen, act, and build our strategy based on this fundamental truth (customers are in control), then ultimately, we have more control.

You can read the summary here. In short the study found that 58% of online shoppers prefer sites that feature ratings and reviews…

This is one more data point to support others (see our stats page):

• 71% of online shoppers read reviews, making it the most widely read consumer-generated content. (Forrester)
• 77% of online shoppers read consumer product reviews and ratings (Jupiter)
  
• Ratings and Reviews is the second most important site feature behind search and online buyers who site ratings and reviews most useful site feature has more than doubled from ’05 to ’06.  (Jupiter)
• 92% deemed customer reviews as “extremely” or “very” helpful and ~ 71% used keyword searches to find products. (eTailing Group)
• After their order, PETCO asked customers, "What online tool most influenced your purchase decision?" The #1 answer was Product Ratings & Reviews, with site search coming in a distant second. (PETCO)
• CompUSA exit survey: 81% consider the availability of customer reviews to be Very important (33%) / Somewhat important (48%) (CompUSA & iPerceptions study)
• 63% of consumers indicate they are more likely to purchase from a site if it has product ratings and reviews. (CompUSA & iPerceptions study)
• 39 percent of those who bought from sites with reviews cite the reviews as the primary factor influencing the purchase decision. (Foresee Results Study, 2006)
•  48% of online shoppers seek reviews before purchasing (eVoc Insights)

This is third party research. We also have about 20 case studies demonstrating different ways clients are using reviews to make impact in conversion, AOV, margin, loyalty and lower returns.

Is there enough support that ratings and reviews are effective. Um, yeah. But we are always looking for more!

WOMMA is an organization that I really believe in.  Like Shop.org (where I served on the Board of Directors for over two years), it is a non-profit dedicated to serving its rapidly growing industry well.  My co-founder, Brant, Sam, and I have all had the pleasure of speaking (teaching?) at WOMMA events.  As a matter of fact, Sam is speaking again on April 18 at WOMMA's "Word of Mouth Basic Training" conference in New Orleans, alongside people like Dr. David Weinberger, who co-authored "The Cluetrain Manifesto" (the book that inpired me to select our "unusual" company name).  Sam is a busy man and is also speaking at Forrester's Marketing Forum 2007 on April 12 in Miami.

This week, we also proudly announced that WOMMA's founder, Andy Sernovitz, joined our Board of Advisors.  Since I write this in the same post, please note that this news is unrelated to Sam joining WOMMA's Board (the election process isn't influenced by the founder, but rather a nominating committee of WOMMA members that carefully screen applications and then put their selection to the entire membership to vote).  In any case, I have known and respected Andy for many years.  We have been on parallel tracks, since both of us graduated from The Wharton School, building online businesses and organizations that we are passionate about.  Andy and I were destined to work together, and I am happy that the time has finally come.  I have no doubt that he will make a huge impact at Bazaarvoice.

It was a very busy week at Bazaarvoice.  We also announced a major partnership with our friends at Loyalty Lab.   I have known Mark Goldstein, Loyalty Lab's CEO, since he was CEO of Bluelight.com (a former Coremetrics' client).  He is an impressive entrepreneur.  Mark and his team have been great to work with, and I know we will do exciting things together.  Bridging customer loyalty and online word of mouth is a natural marriage.  As a matter of fact, customer ratings and reviews have already been proven in several studies to increase customer loyalty and satisfaction.  The latest study was put out by my friends at ForeSee Results, the original creators of the ACSI (if you don't know what the ACSI is – learn now, as it impacts the U.S. stock market in radical ways).  If you haven't seen the study, I can email you a copy or you can get it here.  Loyalty Lab will turbocharge the building of customer loyalty when combined with our solution.

Frankly, we expected a large number. Jupiter reports 77% of online shoppers seek product reviews and Forrester suggests reviews are the most widely read consumer generated content on the Web. And we learned from BuzzMetrics that 25% of google searches on top brand names bring up consumer generated content — that's where our SearchVoice SEO pages become very useful!

We're pleased that for our first big holiday there were no glitches or downtime. The origin servers and content distribution network are telling us to 'bring it on'! And so we shall.