The business of online customer reviews

The internet has opened up a world of options for consumers and businesses that want to buy goods and services without needing to visit a bricks and mortar location.

However, knowing whether or not a potential purchase is a good deal or worth avoiding is tricky in this context, so many ecommerce sites build customer trust and aim to boost engagement by providing reviews on product pages.

This trend has generated an entire industry in its own right, with significant upsides for shoppers as well as a host of problems and pitfalls to take into account.

Here is a look at the business of online customer reviews and what impact it has on the wider marketplace at the moment.

Brand trustworthiness & the importance of independence

Unless a customer trusts a company, they will be unlikely to commit to making a purchase online. A trusting relationship can be established if reviews are available on-site and their presence will improve the overall user experience, although questions over the ethics and legitimacy of these feedback portals remain.

Indeed the fact that fake reviews are still sold to the highest bidder, in spite of attempts by major ecommerce brands like Amazon to crack down on this practice, should give customers pause for thought before they click through to the checkout.

This is where independence comes into play, as according to BuyersGuide.org more consumers are wising up to the perils of relying solely on product reviews submitted directly to retail sites. Third party platforms which rank and rate products and services independently, while still giving users that ‘word of mouth’-style recommendation that is so sought-after, are gaining traction.

Even the retailers themselves can embrace the advantages of these independent customer review services, with the likes of TrustPilot allowing organizations of all sizes to attach a level of credence and candor to their operations. This is especially important for lesser-known firms and start-ups, as it gives them a reputational boost even if their brand has yet to gain the same level of mainstream recognition as established rivals.

Revenue generation & other advantages

There are plenty of perks that come with embracing some form of customer review platform, chief amongst which is increased revenue from the higher sales and lower bounce rates that will come from including peer-to-peer testimonials alongside products and services.

Furthermore this feedback is eminently shareable, and can be a gateway to gaining momentum on social media, just as much as it will deliver benefits for standalone website performance.

In addition, customers that are able to post reviews and comment on the feedback from other users will be more likely to return and make another purchase further down the line, so it is a means of stimulating loyalty for the long term, as well as making short term gains.

It is simple to see why customer reviews are such big business, and why they can be exploited in an underhanded way in some circumstances. On the whole they are a big positive for all parties, so long as businesses remember to manage them effectively.