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!

Of course, if you aren't leveraging the power of customer contributiosn right now, this news comes a little too late for this holiday season. However, it's never too late. The impact of user generated content is the gift that keeps on giving throughout the entire year! Get started just after the holidays.

This year we conducted similar research with Keller Fay in the UK. We found – believe it or not – similar results! We conducted a post-review intercept survey across several Bazaarvoice retail clients and found that Brits are driven by altruism when they write product reviews. We surveyed almost 3,800 Brits who wrote reviews on online e-commerce sites, and 94% of them said it was important to write reviews to help other consumers make good purchase decisions.

And their altruism doesn’t end with consumers; 82% of those surveyed said they wrote reviews to help companies make better decisions about the products they offer.

Also, most UK reviews are positive – 86% of UK reviewers said they left positive feedback online, and 11% said their comments were equally split between positive and negative. This reflects what we continue to find in the ratings J-Curve, which we discovered in 2006.

> See the press release here

> Download the full study results here

Letting customers rate products on e-commerce sites is the top Web 2.0 spending priority, according to online retailers in the US surveyed in August 2008 by Vovici for Internet Retailer. Well over one-half (57%) of online pure plays said customer ratings and reviews were a priority for them.

Internet Retailer said online merchants wanted these features because they drove sales. It also noted that PetsUnited, which operates 10 e-commerce sites, reported a 50% jump in average sales when shoppers ordered right after viewing a video, compared with after viewing just text and pictures.

"Shoppers that view videos and read customer ratings and reviews spend more," said Corbin de Rubertis, president of retail widget developer Qponix, in the Internet Retailer article. "Even in a weaker economy, retailers are going to spend money on better technology if it drives traffic and converts sales."

Emarketer also recites a study we launched with Vizu highlighting the importance of reviews to retailers:

Last year I wrote this article highlighting why ratings and reviews are the highest NPV marketing investment, and why they should get launched before the holidays. Coincidentally I wrote it one year ago yesterday, and it's still as relevant. You've got a few months left. Now is the time to move!

In their own words, "A whopping eighty-three percent of respondents polled indicated that online product evaluations and reviews had at least some level of influence on purchasing decisions."

They also found…

• 70% of respondents seek out information for a particular brand of goods and services.
• 32% reported posting their own online feedback on product or service experiences.

See more of the study here.

Now I say this study "again" supports the demand for reviews because we have been tracking and fielding studies for three years on this topic. See our comprehensive overview of over 100 statistics and case study results here.

• Recommendations from family and friends trump all other consumer touchpoints when it comes to influencing purchases, according to new data from Publicis media network ZenithOptimedia. The data comes from ZenithOptimedia's Touchpoints ROI Tracker, a comprehensive project comprising over 300,000 interviews across 34 countries and covering more than 4,000 brands in 126 product and service categories.
• Consumer touchpoints were each given a "contact clout factor," a number on a scale of 1 to 100 that indicates the relative influence of the touchpoint on purchasing.
• Recommendations from family and friends led the pack with an average score of 84. TV ads and Internet search were next, with an average score of 69 and 67, followed by magazine ads at 60, newspaper ads at 55, outdoor ads at 45, radio ads at 42, and Internet banner ads at 41.

Here's an interesting quote:

• Though word-of-mouth may be one of the greatest influences on brand choice, marketers still face a great challenge is making it scalable, said Bruce Goerlich, ZenithOptimedia's president of strategic resources, North America. "Word of mouth is incredibly powerful, but we as an industry are not doing as good a job as we could do in generating it," he said.

Maybe he hasn't heard of Bazaarvoice

What's even more interesting to me is that "traditional" forms of advertising, like TV and radio, scored significantly higher than the predominant forms of online advertising – search and banner ads – in spite of the sophisticated targeting capabilities of search and display.  After all, isn't the goal of online ad targeting – behavioral, contextual, etc. – to provide a level of relevance and utility that excuses the intrusion of advertising?  Trust would seem to follow, but not so.  Consumers know the difference and they put their faith in each other first and foremost.      

These findings may explain the stellar case study results we've seen from several of our clients – higher conversion rates and significantly lower return rates on products that have customer reviews.  We are seeing similar results from our Ask & Answer solution, not to mention significant reduction in call center volume and costs!  In addition to selling each other, customers are also highly effective at servicing and supporting each other with product expertise and answers to tough "buy or bail" questions that arise when shopping online.  Can other forms of advertising do that?   

Every day that customers trust advertising less is a day word of mouth becomes more critical to business growth. Yet there is ambiguity on who should own WOM marketing, what strategies are effective, how it should be measured, who should be targeted, and how to execute the right offline and online tactics.

I personally don't believe companies can be competitive or market leaders without having a comprehensive and operational focus on how their product and service drives word of mouth, along with a clear understanding of how to amplify the customer voice with word of mouth marketing strategies.

If you agree, you'll join me at this years WOMMA Summit, November 14 and 15 in Las Vegas. And, I'll sweeten the deal!…

When you register online, enter the code 'guestofbazaarvoice' for $75 off. And when I see you there, I'll buy (drinks that is…not your bets!).