I am always skeptical about on-line recommendations but an old colleague of mine at Forrester, Peter Kim, seems to think consumer word of mouth has great value.
Scores of Internet merchants have recently begun following Amazon’s lead by posting customer reviews — both flattering and flaming — of products they sell, and directing shoppers to sources of the most highly rated items. For example, shoppers can now find frank assessments of everything from Rolling Stones concerts to computers on sites like TicketsNow.com and CompUSA.com, among many others, as well as portals like Pricerunner.com and, in the coming months, MSN.
The trend arises both from an increasing tolerance for candor among retailers and from the emergence of inexpensive technology to track and post customer opinions on individual Web sites. This promises to give customers a new way to shop. Perhaps more surprisingly, it has bolstered the sales of some early experimenters.
Take Petco, the pet supplies retailer. The company’s Web division last year tested the service of a new technology company, Bazaarvoice, of Austin, Tex., which essentially polls retail customers (and also helps merchants screen reviews for inappropriate content as they are posted on the site).
According to John Lazarchic, Petco’s vice president for e-commerce, 30 days after the company placed links near products asking visitors to write a review, more than 1,000 products attracted comments. Petco then featured the highest-rated products in marketing e-mail messages. Those messages generated five times as many site visits as previous approaches.
Earlier this year, the site devoted entire sections within each pet category to “top rated” products. Shoppers who browsed products that way purchased at a 35 percent higher rate than those who browsed assortments arranged in the traditional manner. And those who bought from the top-rated sections spent 40 percent more than those who did not.
“I think we’re one of the first, if not the first, to create a primary shopping experience that’s driven by the voice of other shoppers,” Mr. Lazarchic said. “It makes sense, though, because if you look at studies that are being done, consumers will trust the voice of another customer before they trust the retailer or manufacturer.”
Indeed, according to a survey by Forrester Research, a technology consulting firm, 6 percent of customers say they believe marketers’ advertising claims, and 62 percent say they feel there are too many ads in the media. Forrester also found that fewer than 10 percent of consumers said that television ads influenced their purchase decisions, while more than half said that the recommendations of friends and family changed their purchase plans.
“It’s pretty clear that people are trusting the words of other consumers more than what’s broadcast on the airwaves,” said Peter Kim, an analyst with Forrester.