How do customer reviews impact e-commerce?


The impact of customer reviews in e-commerce

The e-commerce sector is continuing to expand, with increasing numbers of purchases every year. The European B2C e-commerce market was worth 718 billion euros in 2021, and this figure has been constantly growing since 2016! But as more online stores open, customers are finding it harder to choose between them. This is where customer reviews come in. In this post, we’ll consider the impact of customer reviews in e-commerce.

The role of customer reviews in e-commerce

Before we think about impact, let’s look at user interest in reviews.

Research by French polling firm IFOP said 88% of consumers read online reviews before they buy. Other people’s comments are an essential part of the purchasing process.

If most of a brand’s reviews are negative, 66% of users will postpone their purchase and 30% will turn to the competition.

In short, the numbers prove that customer reviews are crucial in the e-commerce sector, as they are in other fields.

How do reviews influence buying decisions?

To understand how customer reviews affect buyers, it’s important to ask why we love reading online comments so much. Researchers call these recommendations “digital word of mouth”.

Advantages of digital word of mouth

Godes and Mayzlin (2004) differentiated between digital word of mouth and classic word of mouth, explaining that digital word of mouth has no borders: an online review can reach people anywhere on the planet.

Also, a review has no expiry date. If a product is still the same as it was 10 years ago, a review of it from 2014 will have the same effect as one from 2024.

Goldsmith and Horowitz (2006) emphasised the advantage of anonymity. When a user can leave an anonymous review, or write under a pseudonym, they feel much freer to say what they truly think. This means potential buyers reading the comments can access genuine feedback.

Duhan et al. (1997) mentioned another benefit of digital word of mouth: the amount of information. As more consumers try products and leave reviews online, those following in their footsteps have more and more material they can use to compare reviews and make their own relevant and authentic decision.

Why do reviews influence buying decisions?

Ultimately, reviews influence buying decisions because:

  • They are based on live experience
  • They are provided by users worldwide over time
  • They improve the quality of information received by consumers, who can compare sources and develop their own opinion

To learn more about the research in this area, read this article.

The impact of positive online reviews

Increased average spend

Consumers will spend 31% more than planned if a company has excellent reviews. This means positive reviews will increase your average spend and revenue as an e-commerce business.

Enhanced customer confidence

In some fields, reviews are worth their weight in gold. Take cosmetics, for example. If Yves Rocher receives positive reviews about an anti-aging cream, this will reassure potential customers, who will be happy to add it to their baskets. Positive reviews boost your prospects’ and customers’ confidence in your brand.

Improved customer satisfaction

Positive customer reviews are a valuable source of information for e-commerce store managers. They quickly show you what you’re doing well and what you can improve. What’s more, replying to customer reviews (whether positive or negative) will make your target audience think better of you. Your replies will prove you’re making an effort to keep them happy day after day.

Good to know: Google My Business listings are soon to disappear. Customer reviews on Google will no longer be highlighted by the US tech giant as much, which is why we’re not discussing the effect of customer reviews on your website SEO.

The impact of negative online reviews

It’s normal to receive some negative reviews. But when all your reviews are poor, it can be worrying and have terrible consequences for your online reputation.

They can also lead to a domino effect. It starts with a single negative review. If it’s not dealt with, this can turn into 10, 50 or even 100 negative comments. And the more negative reviews you receive, the more your online reputation suffers.

Negative reviews can:

  • Reduce your sales
  • Diminish customer confidence in your e-commerce site and your brand
  • Affect your business’s profitability

Research by BrightLocal revealed that 54% of consumers only buy from a business if it scores four or more stars in reviews.

How to reduce the impact of negative reviews

As an e-commerce trader, you need to have a strategy to reduce the impact of negative reviews.

Here are some best practices to use, starting today:

1. Respond quickly 💬

Respond quickly and politely when a negative review is published. Your reply should be, empathetic, comprehensive and apologise for the issue. We also suggest you offer the customer a solution or a discount. This will give them a positive impression of your brand.

2. Encourage positive reviews 📝

Positive reviews are a good way to counteract negative reviews and improve your overall rating. So, ask satisfied customers to leave reviews on your website or a customer review platform.

3. Track negative reviews ⚙️

Another element of good practice is tracking negative reviews. Whenever a lukewarm or negative review is published, you need to know about it. To track, use tools like Google Alerts or Hootsuite. This will highlight issues as they appear and enable you to calm things down before they get out of hand.

4. Solve problems in real time ☎️

If a negative review needs a more detailed conversation, phone the person up! You can also give your number for them to call you. A discussion will humanise your customer relationship and reduce the negative impact of the review.

5. Learn lessons from negative reviews 📚

Finally, we suggest you read negative reviews very carefully. They might help you improve your product, customer service and/or e-commerce website as a whole. You might find reviews lead you to introduce Click & Collect, offer new delivery solutions or translate your e-commerce site so it’s understandable worldwide.

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The impact of customer reviews in e-commerce: recap

To recap, customer reviews are likely to work in your favour if they’re positive. But if your rating is low (under three stars) and you don’t respond to negative reviews, your store may have to close earlier than planned…

As a reminder, here are some techniques you can use if you receive negative comments:

  • Respond quickly
  • Collect as many positive reviews as possible
  • Monitor feedback to understand why your target is disappointed or frustrated
  • Call up customers who leave negative reviews
  • Learn from buyer comments

Want to delve deeper? Here are some examples of replies to negative reviews that satisfied the recipients.

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