The study focused on the offline sales impact of online reviews for restaurants, hotels, travel, legal, medical, automotive and home services. About one out of every four Internet users (24 percent) said they used online reviews before paying for a service delivered offline. Out of those that referenced an online review, 41 percent of restaurant reviewers went on to visit a restaurant, while 40 percent of hotel reviewers stayed at a hotel.

Over three-quarters of review users in almost every category reported that the review had a major impact on their purchase with hotels ranking highest (87 percent). Ninety-seven percent of those who said they made a purchase based on an online review said the review was accurate. Review users reported that reviews written by other consumers had more of an influence than those written by professionals.

"This study underscores the importance of providing not just good, but excellent, service if a business hopes to generate positive consumer reviews which will result in greater sales," said Brian Jurutka, senior director, comScore Marketing Solutions.

Bazaarvoice data revealed an increase in ratings and review activity for the week of November 19-26,2007, with a peak on Thanksgiving evening as shoppers prepared for Black Friday. Bazaarvoice said it served 1,400 ratings and reviews per second at the peak, which took place at 9:25 pm EST on Thursday, November 22.

 "For many Americans, Thanksgiving evening is a time to study circulars and plan your Friday shopping strategy," said Brett Hurt, founder and CEO of Bazaarvoice.

"Our data shows that a new tradition is taking hold: opening the Web browser to read reviews online before shopping in the stores. This new data point, along with our recent research with the Keller Fay Group that shows that two-thirds of shoppers post online reviews about their offline purchases, is a strong indicator that the crossover between the online and offline shopping experience has become a retail reality in 2007."

On Cyber Monday the company served 71 million ratings and reviews, up 370 percent from the 19 million served on Cyber Monday in 2006. Cyber Monday activity peaked at 1,300 ratings and reviews served per second at 1:40 pm EST and remained solid until 11:00 pm EST. Bazaavoice said it expects usage to remain high through the rest of the holiday shopping season.

"We anticipated a large number of ratings and reviews for Cyber Monday," said Sam Decker, CMO of Bazaarvoice.

"Research from Shop.org and MarketingSherpa shows that review usage has nearly doubled in the US over the last year. We served more than three times as many ratings and reviews as we did last year, highlighting consumers’ increased reliance on reviews and the increased number of retail sites with review content hosted by Bazaarvoice."

Deloitte’s Consumer Products group found 62 percent of people read consumer -written product reviews online. Out of those who read product reviews online 82 percent said their purchase decisions had been influenced by reviews causing them to buy a different product than originally intended or causing them to stay with their original choice.

Sixty-eight percent of Gen Y rely online reviews the highest of any age category, while 42 percent of those age 75 and over use online reviews, the lowest in any age category. The reach of consumer reviews is also offline with 69 percent of consumers who read reviews sharing them with friends, family or people they work with.

"This increasing market transparency can adversely impact the margins, market share and brand equity of consumer products companies," said Pat Conroy, vice-chairman and US consumer products group leader at Deloitte & Touche USA LLP.

"In the past, clever marketers and advertisers shaped brands, but now consumers are increasingly empowered, everyone has a voice, and information and opinions are instantly dispersed."

Conroy said that consumer product companies should learn to use reviews to their advantage or else deal with the outcome.

"As knowledge proliferates, there is a tendency for products to commoditize," said Conroy. "In order to successfully compete, it’s imperative for consumer brands to build and maintain their images, create differentiation, and enhance loyalty."

"For example, consumer product companies with exemplary supply chains can achieve differentiation by making their processes more transparent. Embracing higher-than-required quality and safety standards can reassure customers and built trust. And co-opting customers to create value with the company can create not only loyal customers, but also brand emissaries."

Over eight in ten respondents in the Deloitte study who read consumer reviews said that they had impacted their buying intentions. They were either more determined to make a purchase or had second thoughts and made a different purchase.

Pat Conroy, vice chairman and US consumer products group leader at Deloitte Touche USA, said, "This increasing market transparency can adversely impact the margins, market share and brand equity of consumer products companies."

"Consumers are increasingly empowered, everyone has a voice, and information and opinions are instantly dispersed," he said. "Consumer product companies need to determine how best to capitalize on this new landscape."

In a separate study conducted by Deloitte in August with Sterling Commerce they found that 42 percent of U.S. online shoppers believed that having consumer reviews on Web sites increased trust in the sites.

Only 32 percent of U.S. ecommerce sites allow consumers to post reviews, according to an Internet Retailer Vovici study, the rest of the sites that do not allow consumer reviews are missing out on the opportunity to build site trust.

They take a look at the effects of negative reviews on small businesses and give an example of a spa owner who discovered she had a 2 1/2 star rating on Yelp.com.

Using Yelp’s email system, she typed out messages to each downbeat reviewer to find out more about what went wrong — and to try to make it right. And she sent a thank you to the happy customer. Then she added to her email newsletter a note encouraging regular clients to get online and share their good experiences. Several stressful months later, the spa’s rating had climbed to an acceptable four stars.

There, that wasn’t too difficult, was it?

The WSJ goes on to provide some basic suggestions for monitoring and managing the reputation of a local business, including a reminder that even small sites can impact your Google reputation.

…the search engine’s Maps service — which is automatically triggered when a location is included in a query — collates reviews from sites across the Web. For Ms. Borgman’s spa, for instance, Google currently assigns an aggregate 4-star rating based on 30 reviews culled from Yelp, InsiderPages and Citysearch. Google Maps also often provides links to blogs and other Web pages where the business has been mentioned.

You don’t need to shell out big bucks to monitor and manage your online reputation, we’ve created a free guide to online reputation monitoring.

Comments

The new feature will allow customers to submit ratings and reviews of merchandise available online only as well as products sold in stores.

"Reviews and ratings is the No. 1 customer-requested feature online at Walmart.com, and we’re pleased to offer this service to better help our community of customers shop smart and make informed decisions about the products they purchase both in our Wal-Mart stores and online," said Cathy Halligan, Walmart.com’s chief marketing officer.

Wal-Mart had a test of customer reviews and ratings in June to receive customer feedback and gauge overall results. Customer reviews more than doubled the company’s expectations during the test phase and they received the most reviews in the categories of electronics, home and garden, media and baby.

"We know close to 75 percent of Wal-Mart’s 130 million customers are online which presents a significant opportunity for our online reviews and ratings platform to connect our customers to one another, and also help them further engage, communicate, share opinions, and learn more about products available at Wal-Mart," added Halligan. "It’s all part of our continued commitment to be the premier multi-channel retailer."

Wal-Mart says that customers can submit a review by viewing a product online or by email invitation sent a few weeks after they have placed and received an order. The product reviews are published within five days of submission.

Ford Manipulates Forum Posts To Promote Mariner

Granted, this matter doesn’t involve “taste” in a food-related sense, but the same concept applies.  And, although we’ve noticed questionable online reviews in the past, Ford’s tendency to pick and choose the ones that suit its needs is even more troubling.  Jalopnik’s Ray Wert broke the story.

“We just got the latest press missive from Ford on the 2008 Mercury Mariner in both hybrid and non-hybrid flavors,” he begins, noting that the release included “supposed owner comments culled from the posts of consumer auto-site forums.

“As you can expect,” Wert continues, “the remarks provide glowing recommendations on the ‘08 Mercury mini-SUV using words like ‘best,’ ‘love’ and the always forum fan fave of ‘WOW!’  All of this gushing got us wondering whether every Mariner forum post on the consumer auto sites is filled with gushing car-love.”

Wert then reveals, “It turns out that’s not the case.  We were able to come up with some forum posts that seem to indicate maybe the Mariner isn’t ‘A HIT’ with every online consumer.”  Stories involving cheap materials, noisy brakes, and poor ergonomics follow.

Ford’s marketing approach is rather underhanded; it’s also extremely pathetic.  Couldn’t the company find someone with more credibility than “Ex-Toyota Driver on www.autos.msn.com” to compliment its vehicle?  Ford, I think you’ve got a little sulfuric acid on your chin.

This was one of the takeaway messages of an article by Michael Kanellos.  “Perhaps no other time in human history has there been so much nitpicking,” he writes.  “All you have to do is troll a site like Yelp.com for a few minutes to find a cavalcade of complaints disguised as constructive criticism or – just as bad – positive, and largely tangential, compliments.”

Indeed.  Aston Martin can get away with charging over $100,000 for its base model; Daewoo couldn’t even keep its U.S. arm in business.  Which company do you think sells the better car?

Now, if you happen to own a company, this nuttiness may play out in your favor.  Daewoo certainly didn’t mind those positive reviews, and Kanellos’s research led him to believe that a fast food joint could score as well as “Campton Place and other celebrity chef restaurants.”  (Kanellos’s research also led Andy Beal to write about him, and I owe a hat tip to our friend at Marketing Pilgrim.)

But if you’re approaching user reviews from a buyer’s perspective – this bears repeating – please, please, please be careful.

Oh, and if anyone ever lets you choose between a Daewoo and an Aston Martin . . . well, I’d recommend that you take the latter, sell it, and buy an Acura and a Lotus.

More than eight in 10 UK consumers researched online before booking a hotel and 62 percent did the same with restaurants.

Seventy-seven percent of UK hotels and 80 percent of restaurants said the growth in consumer-generated content is a business opportunity.

Kathryn Pretzel Shiels of American Express said, "The industry is clearly taking steps to better understand this channel. In fact, 67% of UK hotels and 77% of UK restaurants say they actively monitor content posted on independent review sites."

The study also asked hotel and restaurant operators about online marketing and found that 57 percent of hotels and half of restaurants used affiliate marketing. Seven out of 10 hotels used direct e-mail and just 17 percent of restaurants did.