The Online Review Revolution
Why do online customer reviews matter?
For businesses and consumers alike, online customer reviews have become an essential part of the information ecosystem. Put simply, online customer reviews influence consumers. A 2015 survey by Smart Money People, found that up to 87% of all customers are influenced by reviews.
How are reviews used by businesses?
Digital marketers use online customer reviews to keep visitors on their site for longer, and ultimately increase their conversion rate. Savvy CMOs are also partnering with review platforms that can deliver a deep vein of actionable customer insight to their businesses.
So, where is the industry heading?
In the UK, the Competition & Markets Authority is currently reviewing the way that the online reviews and endorsements market operates. This is really exciting stuff and potentially game changing. There look to be three key ways forward:
1. Open platforms
There are broadly two type of review platforms - open and closed. A closed platform restricts who can and can’t write a review. This is a significant issue. By cherry picking who can and can’t write a review, closed platforms can artificially increase overall review ratings. Despite claiming that they help to ‘build trust’, they in fact risk guiding a consumer to a product or provider that isn’t right for them.
Examples of open and closed platforms
Open: TripAdvisor, Smart Money People, Review Centre, TrustPilot
Closed: Reevoo, BazaarVoice, Feefo
2. Stronger verification
Technological advances mean that abuse of review platforms can be tackled. As a fail-safe, businesses should be able to report suspicious reviews, and mandate that their review platform investigate these.
3. Become proactive
Businesses should proactively seek reviews from their customers at appropriate points in the customer journey. This helps to build a critical mass of consumer reviews, and enables customers to become active brand advocates. Businesses should also manage the reviews that they receive reactively to harness their insight.
In summary, not engaging with reviews is increasingly a missed opportunity. In the Financial Services industry, where issues of trust and transparency prevail, online customer reviews must be used to build trust and transparency, not add to the confusion.