Retail websites that offer customer product reviews have a competitive advantage, while sites that don't are missing an opportunity to drive customer satisfaction and loyalty, according to ForeSee Results' analysis of the 'Top 40 Online Retail Satisfaction Index'.
The Top 40 Online Retail Satisfaction Index surveyed over 10,000 online visitors to one or more of the top forty online retailers (by revenue) during the 2006 holiday shopping season. The study found that almost half of the online shoppers who recalled seeing customer product reviews cited them as the primary factor in their holiday purchase decision-making.
Among the study's key findings on the subject of online product reviews written by other customers:
- Customer product reviews drive satisfaction and loyalty and provide a competitive advantage for sites that offer them;
- Customer product reviews are a powerful influencer of the purchase decision for the critical group of first-time buyers;
- Internet 'pure plays' lead in the adoption of customer product reviews, providing a competitive advantage over multi-channel merchants;
- Shoppers using web sites with customer product reviews were 5% more likely to buy online, 5% more likely to buy from the retailer the next holiday season, and 4% more likely to purchase from the retailer the next time they are in the market for similar merchandise.
Simple retail hygiene
According to Larry Freed, president and CEO of ForeSee Results, allowing customers to honestly and openly review products has become a hygiene factor for online retailers: "Shoppers looking for product information often turn to online product reviews. E-retailers that don't offer reviews run the risk of losing business to sites where shoppers can both read reviews and buy the product. This gets a little tricky for manufacturers' sites because there's always the risk that consumers, in their brutal honesty, will pan a product. But it's got to the point now where companies that want to sell online have to offer customer product reviews simply to be competitive."