The power of social recommendations

Very few of us make a big purchase without doing at least a little bit of research. Would you buy a car with taking it for a test drive, choose a wedding venue without a visit, or buy a house without an inspection?

Conventional wisdom has necessitated that you try-before-you-buy when choosing big-ticket items. And yet, consumers are now more comfortable than ever buying ‘big’ items online without ever stepping into a bricks and mortar store.

The ‘try-before-you-buy’ ethos has simply shifted to trusting the opinions and advice of others who have purchased before you, with more and more people turning to social media to ask friends, family or even complete strangers for advice and recommendations.

Positive and negative comments alike about customer service experiences and product ratings are proliferating across social networks and review forums, creating a virtual trust exchange among consumers. The power of this consumer-led ‘crowd spruiking’ trend is growing and the only way for online retailers to benefit is simply to make customers happy – with great products and consistently amazing service.

The value of testimonials and product reviews is well known, and businesses have used comments from happy customers to promote themselves for decades. There are two key differences that make crowd spruiking so powerful and challenging for online retailers.

Firstly, in many cases businesses have no control over what is posted online for all to see. At best they have a ‘right of reply’ on moderated consumer forums. Check out WOMO, Whirlpool or Productreview.com.au to see a consumer’s views, good and bad, about a range of products and services. For Facebook and Twitter, a business can respond to criticism, but it has to be actively engaged, consistently monitoring and prepared to be completely transparent.

A second key difference is that the volume of comments is rapidly increasing and gaining prominence on search engines. Anyone who is nervous about buying a product online, sight unseen, can literally find dozens, if not hundreds, of real user-generated reviews or experiences to help influence their decision and mitigate the risk of buyer’s remorse.

Posts on Facebook and Twitter asking for recommendations from friendly networks are commonplace, as customers are increasingly turning to and trusting other customers rather than a sales assistant or company’s advertising messages.

Crowd spruiking is a global trend. Nielsen’s latest Trust in Advertising research discovered that trust in word-of-mouth recommendations increased 6 percentage points since 2007. Recommendations from friends and family were found to be the most trusted, with 84 per cent of consumers around the world saying they trust these above all other sources of advertising. Sixty-eight per cent trust consumer opinions posted online, up 7 percentage points from 2007.

The research also confirmed that word of mouth recommendations were influencing purchasing behaviour more than paid advertising. Recommendations from family and friends prompted the highest levels of consumer action with 84 per cent, while consumer opinions posted online prompted 70 per cent of respondents to buy.

With no bricks and mortar store, pure online retailers such as Ergoflex, is testament to the fact that consumer purchasing preferences are rapidly changing and are now influenced considerably by real user-generated recommendations. Our customers are now telling others to read the various user experiences for themselves and are openly spruiking if they believe the product and the customer service is good enough to buy, sight unseen.

Tips for making word of mouth work for your online business:

  • Don’t be shy. Communicate openly with customers over social networks and respond quickly to resolve any issues
  • Prompt your customers to write a review
  • Go above and beyond. Focus on customer service and keep it consistent, even if this means bending over backwards to keep promises. One lapse in service levels can create an angry reviewer with huge influence
  • Be honest about what your products and services can deliver. If your product doesn’t meet expectations or promises, it will be judged accordingly

About the author

Matthew White is the Director of Ergoflex Australia.

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