Ratings – 21st Century Word-of-Mouth
For a consultant word-of-mouth is an essential way to get new business. People obviously talk and its important that when discussing over a pint who is the best person for a job that your name gets mentioned. The adage that “you’re only as good as your last job” has never been truer in an increasinly price and skill competitive market. An analyst doesn’t just need to have the technical skills but, soft skills to handle management, third party suppliers, team members and most importantly finance so that your bills get paid.
If we apply this need of word-of-mouth endorsement to a business then where do you look? On the company’s site? So would you buy insurance from a company that says they are price concious, tailor the pricing policy against “x” number of variables or favour ex-forces, women or young drivers? Would you?
Now it is illegal to advertise false endorsements or ratings on your site and more importantly if you post a comment or praise on your site then you need authorisation from the endorser to do that with their comment. So how would you go about getting recommendations or ratings for your products or services that you couldn’t host? Well in consultancy terms that is relatively easy, you could look at getting more comments on your blog posts, posting commentings on others, twitter followers, facebook friends… all these are quantifiable but, are they necessary? Are people going to look at these on a regular basis. I do feel so.
This change in word-of-mouth has lead to the growth of businesses such as TripAdvisor. Now I’ve done so research into this and also been on a few holidays using their recommendations as an indicator of ‘likelihood of good holiday’ and to be fair I’ve not had a bad problem. However, this isn’t the case for everyone and indeed some organisations have seen sales drop 25% because of bad reviews that were unjustified (see related posts: Telegraph).
Profits …., slumped by 25 per cent following the negative comments,
And despite several attempts to have the reviews taken down, TripAdvisor, which is based in the US, largely failed to respond to her requests.
“It was a really distressing situation. I felt quite powerless to stop it,” .
Telegraph (see related posts)
Now if you were to have all these comments on your site would anyone read them (well depends on your traffic volumes), would anyone believe them? Well that poses another question – one which Feefo have come up with some stats for:
According to Econsultancy, 64% of consumers read online reviews when purchasing technology items such as MP3 players and cameras. They also search for specific product names with the word ‘reviews’ or ‘ratings’ in the search term.
In a study conducted by social networking site myYearbook, 81 percent of respondents said they’d received advice from friends and followers relating to a product purchase through a social site; 74 percent of those who received such advice found it to be influential in their decision.
Click Z – April 2010
So look at your conversion volumes (say 10,000 product sales per month), look at what you’re already missing out in your funnel (for argument’s sake 50%). So that is an additional 10,000 items that you could sell. “Ah but, we don’t have the IT resource to implement anything, there is a change freeze” – so what? Get your customers talking about your products on things that they have in THEIR control – their social networking sites, their blogs, text messaging, sharing QR codes….
By putting the power of decision more firmly in the hand of purchases they will endorse your product further and not only is it likely that 50% conversion will increase to 75% or higher (don’t quote me) the volumes are likely to increase also… So more money for actually giving the power to your customers to TALK about your product.
According to Google’s statistics, showing stars in Adwords increases Click Through Rates by 17% on average. One Feefo client saw a six-fold increase in CTR in the weeks following the arrival of Google stars to their CPC campaign.
Feefo Press Release 2012
Feefo, I feel, is a great proposition because its not a site like Trip Advisor where ‘anyone can post’, its could almost be classed as a service to your customer. The fact that your products / services will get Google starts and improve click-thru rates by 17% is something that can’t be sneezed at either. It is also hosted off-site; and as research has shown this increases consumer confidence in products and brand.
Disclaimer: I have received no payment for this blog nor was asked to write it by Feefo.