Devastating impact of passive reviews on sales conversions clearly revealed
London, 12th April 2011 – Social commerce company Reevoo today highlighted the perils to retailers and brands of relying solely on ‘passive’ customer review systems. Passive review collection systems – in which anyone may leave a review via a feedback form – generate six times as many extremely low scores of 1/10 in comparison to proactive review collection systems. Since such low scores trigger conversion rates 5x lower than good scores, the inevitable result of passive systems is damage to retailers’ brands and to their bottom lines.
Figures collected by Reevoo show that, compared with systems in which all purchasers of the product are proactively contacted, passive review collection systems have a remarkable negative bias [see graphs below]. Passive reviews generate: * 6x as many extremely negative scores of 1/10 * 4x as many scores of 5 or less * 20% fewer consumers giving extremely positive scores of 8, 9 or 10.
The subsequent impact of poor ratings on sales is dramatic. Reevoo’s own statistics – which come from analysis of its records of more than £1bn of transactions every year – show that: * for products scoring 6 or below, the average conversion rate is 0.6% * for products scoring over 6 but under 7.5, average conversion rate is 1.9% * for products scoring 7.5 to 9 the average conversion rate is 3.3%.
Reevoo, Europe’s largest social commerce company, is a strong proponent of proactive review collection. CEO Richard Anson said: “Choosing the right system can mean the difference between a product receiving a glowing 8/10 score, driving sales and improving conversion – or an undeserved score of 4/10 that misleads consumers, damages your brand and costs you sales.
“The confusing polarisation of opinion that you see with passive systems – where readers are confronted with nothing but very positive and very negative reviews – is no help at all to consumers. In fact, consumers are likely to stop paying attention to your reviews altogether, ensuring you won’t see any of the benefits to your conversion and sales figures, and the effort you put into collecting them is wasted. Anything other than a proactive approach is pure folly,” he added.
Passive review systems make no effort to solicit reviews from customers, instead relying on site visitors to leave reviews and with no checks to ensure that ‘reviewers’ are genuine customers of the product. Unfortunately, because anger and disappointment are great motivators, unhappy customers are far more likely to write reviews in passive systems than happy ones, resulting in much lower scores and more negative reviews.
By contrast, proactive review systems like that operated by Reevoo reach out to all customers to request reviews. The benefit of proactively soliciting reviews from customers is two-fold: capturing the opinions of these purchasers makes reviews more reflective of the true range of consumer opinion and removes the inaccurate negative bias results in higher average review scores.
Developing trust in online markets, and ensuring that continuing innovation in the UK’s £50 billion online economy is met with strategic enforcement to tackle emerging or complex fair trading issues, is one of the OFT’s focus areas during 2011-12.