Why Product Reviews Matter

Imagine your target customer. They’re in the market for a product like yours. Opening their web browser, they search. The search brings up your product, or maybe it doesn’t. Your potential customer compares options. What brands offer this product at what price? Are there different models available? What are the differences between them? They settle on a product and purchase. So, did you get the business? If not, it may be because of product reviews.

When Reviews Matter Most

According to a 2017 study by Northwestern University’s Spiegel Research Center, How Online Reviews Influence Sales, a whopping 95 percent of shoppers read online reviews before making a purchase. The presence of product reviews alone can have a significant impact on purchase decisions. The likelihood that a product was purchased was 270 percent greater when that product had just five reviews versus a product with no reviews.

However, some factors can influence just how much reviews are taken into account. The price of the product, the degree of risk involved in the purchase, the number of reviews, the average star rating, and the presence of harmful reviews all contribute to how seriously a consumer relies on reviews when making a purchase.

Product Price

spiegel research center survey how online reviews influence sales

Image source: How Online Reviews Influence Sales

When a consumer is in the market for a higher-priced item, they want as much information as possible before making a purchase. Reviews often provide opinions and information that the product page may not include.

These opinions provide the purchaser with peace of mind that the product is approved and being used by others. The Spiegel study found that this peace of mind had a direct impact on purchase decisions. The conversion rates on more expensive products increased by 380 percent when reviews were displayed.

A higher-priced item means more risk to the purchaser, but it does not follow that more expensive products are the only items where reviews are taken into account. When reviews were displayed for a lower-priced product, the conversion rate still increased by 190 percent over a product with no reviews.

Degree of Riskiness

Higher prices mean a higher likelihood that reviews will increase the chance of purchase. Similarly, a riskier product that lists reviews will increase conversion rate. Riskier, or higher-consideration items, include purchases of products that affect the health or safety of the consumer, products that reflect the consumer’s personal identity, and new products or brands. Reviews help build trust between consumers and companies or products that are new or personal to them.

Number of Reviews

So how many reviews do you need to see an increase in sales? It is probably less than you might think. The Siegel study found that “initial reviews,” that is reviews featured on the first page have the most significant impact on purchasing decisions. Nearly all of the increase in purchase likelihood occurs within the first ten reviews a customer reads, but the first five reviews drive the bulk of this increase. However, having more reviews can improve other important factors like the average star rating of a product.

Average Star Rating

The average star rating provides a quick snapshot of a product’s reviews without having to take written content into account. Many consumers begin their search for products with a specific score in mind, especially if the website includes a star rating search filter. However, having a five-star rating does not guarantee a consumer will choose your product. The Spiegel study found that purchase likelihood typically peaks in the 4.0-4.7 star range, and begins decreasing as ratings approach 5.0. Consumers tend to see products rated five stars as “too good to be true.” They may even believe that negative reviews have been removed or changed to achieve a desirable rating, affecting a company’s credibility.

Negative Reviews

The presence of negative reviews is actually a positive for a consumer. According to the Spiegel study, 82 percent of shoppers specifically seek out negative reviews to verify the authenticity of positive reviews. Negative reviews increase the credibility of the product and the company in the eyes of the consumer.

A customer interacting with negative reviews will also spend an average of four times longer on a website than one without negative reviews. Overall the presence of negative reviews actually increases the products conversion rate by 67 percent.

How Reviews Impact SEO

Customer reviews can also help your search engine optimization (SEO) by creating long tail keywords that you may not have thought to include.

For example, let’s return to our target customer scenario. Your potential customer searches for the product they are looking for. They enter “really comfortable winter boots.” Did your product appear in the search? If your product page for winter boots does not include reviews, maybe not. Now, let’s say your page includes reviews. A customer who has reviewed your winter boots called them “really comfortable.” Now your page for winter boots includes the phrase “really comfortable.” Your product’s likelihood of appearing in the search results has just increased.

So, how can you use reviews to your best advantage?

1. Focus on the first five

The first five reviews that a customer reads have the most significant impact on their purchase decision. Your products, especially higher-priced items, should have a baseline of five reviews to capitalize on the increased conversion rate.

2. Embrace negative reviews

Negative reviews build credibility with shoppers. They also contribute to a products average star rating, keeping it below five stars. Rather than trying to eliminate negative reviews, monitor them and respond to them.

3. Encourage reviews from verified buyers

Verified buyers are consumers who have purchased an item directly from your company. According to the Annual BrightLocal Local Consumer Review Survey 2016, 50 percent of consumers will leave an online review for a business if they are asked. It is as easy as emailing your customers after they have made a purchase.

spiegel how online reviews influence sales survey

Image source: How Online Reviews Influence Sales

Overall, 80 percent of reviews originate from follow-up emails asking shoppers to review their chosen products. These reviews usually have a higher rating as well. The average star rating is 4.34 from verified buyers compared to 3.89 from anonymous reviews.

Anonymous reviews are submitted by consumers who are motivated to go to a site and post a review on their own. Their reviews are more likely to be low, usually due to a bad experience with the company or product. Anonymous reviewers are also affected by “social influence bias,” that is, they see the product’s rating upon navigating to the page to leave their review. The product’s existing rating may influence an anonymous reviewers opinion.

Luckily, there are ways to lend more credibility to verified buyers’ more favorable reviews. When a customer leaves a review through a follow-up email, mark the review with a “verified buyer” badge. Verified buyer reviews marked with a badge have a positive impact on sales, as they are considered more credible and trustworthy than reviews without that designation. Purchase likelihood increases 15 percent when consumers are exposed to reviews written by verified buyers over anonymous reviews.

4. Product sample new items

Product sampling is a great tactic to establish a baseline of reviews on new products. With proper execution, a product can be released with reviews that will give consumers confidence even though they are purchasing a product they have never used before.

5. Make it easy

Make the process of posting a review as simple as possible. Of course, give the option to offer commentary, but a simple rating system that a customer can complete with a few clicks is effective and efficient. Alternatively, if submission requires your customers to use a specific device or platform they may not make an effort, so streamlining your review engine to work with different technology is critical.

Online reviews have the power to influence sales, giving retailers powerful incentives to develop effective strategies to collect, display, and monitor reviews on their websites. Reviews that are viewed as representative and credible can give your product a significant advantage over competitors.

By | 2017-11-14T18:04:57+00:00 November 17th, 2017|Business, Customer Satisfaction, Ecommerce|0 Comments

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