6 Critical Pros and Cons Of User Generated Content

by Sean Ogino |

6 Critical Pros and Cons Of User Generated Content

Pros And Cons Of User Generated Content

As of March 2016, an estimated 298 million people are actively using mobile adblocking browsers. Click through rates for marketing emails are reaching new lows. This glaringly shows customers’ emotional as well as intellectual delinking with the communication that they receive from companies. Ads and regular marketing messages are often non-participative and monotonous, so customers’ lack of engagement makes sense. But the biggest reason for their disinterest is that such communication doesn’t come across through the impartial source. People view it as a marketing gimmick. This need for an honest and trustworthy source explains the popularity of user generated content. As it comes directly from customers, it’s seen as much more authentic than professional marketing content. But before diving into pros and cons of user generated content, first, try to understand the exact meaning of the term.

UGC is the term used to describe any form of content such as video, blogs, discussion posts, digital images, audio files, and other forms of media that were created by consumers or end-users of an online system or service and is publicly available to others consumers and end-users. User-generated content is also called consumer-generated media (CGM) or consumer generated content (CGC). It’s important to understand that almost all the advantages that UGC scores are mainly due to the unmatchable trust factor that it brings with it. Note that 70% of US consumers trust user-generated content more than other information on a company website!  In order to properly implement and use these valuable assets, though, it’s important to know the pros and cons of user generated content.

An example of user generated content on CoverFX's product page.
An example of user generated content on CoverFX’s product page.

Pros of User Generated Content

Increasing Engagement and Conversion 

The most obvious benefit on the list of the pros and cons of user generated content is the authenticity that it generates. As noted above, shoppers trust images, videos, and reviews that come from other consumers much more than content produced by marketers.

  • 92% of consumers worldwide say they trust word-of-mouth more than advertising.
  • According to a report by Forrester, 70% of consumers consider product and brand recommendations from their social circles trustworthy and 46% trust online reviews posted by other customers. In comparison, only 10% trust banner ads on websites.

This trust produces concrete results in terms of conversion and engagement.

  • 82% of shoppers say that user-generated content is extremely important when deciding on purchases.
  • Brand engagement rises by 28% when consumers are exposed to both professional content and user-generated product video.
  • Brands see 25% increase in conversions when user-generated photos are used instead of professionally made product shots by brands.
  • When UGC is included in advertising, online stores see 4x higher click-through rates and 50% drop in cost-per-click.
  • UGC can improve conversion rates  6.4% for clothing, 2.4x for jewelry, 1.7x for footwear and 1.6x for products in beauty and consumer electronics verticals.

Solving the Content Crunch

A study done in 2014 revealed that the number one challenge that marketers face (36%) is producing compelling content. The next most common challenge (21%) is making enough content. The issue of content crunch has become much bigger due to the over-explosion of content. Coming up with outstanding content on a regular basis is becoming more and more of a challenge. But through the content that customers submit, the burden of daily content creation can be eased. Besides, most of the UGC content springs from the daily lives of people- like a summer vacation, birthday parties, or reviews written about a recently purchased product. All of these instances are extremely relatable, and they’re usually evergreen.

Aiding Discovery 

Discovery is a less common concept when it comes to the pros and cons of user generated content, but it’s important nonetheless. 

Obviously, going to the store is not the only way to find products nowadays. Consumers now connect with brands across a multitude of touchpoints throughout the customer life cycle (CLC) from discovery through purchase and engagement. With mobile phones and laptops, which are now empowered by much more robust and powerful internet connections, customers simply dive into online research to know if there is anything in the market which is close to their taste or need.

This is where UGC can be a huge influencer. And the reason is its shareability which makes it a viral element on the internet. If the customer comes face-to-face with UGC campaigns or photos of your product or ratings and reviews about your product during his discovery phase, they create imprints of your product in his mind. And considering the fact that the number of worldwide users of social media is expected to reach some 2.95 billion by 2020, it’s too important a benefit to overlook.

Another mode of discover is SEO. One study has found that more than 30% of shoppers prefer to start shopping at a search engine. Based on this data, marketers can calculate the importance of a solid SEO strategy in driving shoppers to their product pages. UGC in the form of ratings, reviews, Q&A and even user-submitted images can be a catalyst in boosting site’s search rankings, as customers use common terms that increase visibility around valuable keywords. Remember that search engine algorithms value fresh and unique content…and UGC constantly supplies that. Moreover, search engines understand the consumers’ need to go through ratings and reviews. They show preference to web pages that render review content by default, without a click.

Improving Efficiency 

UGC isn’t just about images and reviews. It includes interaction with customers through answering their questions also. Irrespective of the clear communication that you put on product packaging, people will have questions about that product. Through a questions and answers platform, if a company representative or other customers answer such questions, it can reduce calls to call centers; and thereby the service costs.

On this note, user generated content has also been shown to reduce returns by providing more information to shoppers.

Cons of User Generated Content

Fielding Negative Content

It’s way too easy to feel the burn of UGC, as it is controlled by the users. By allowing users to post content on their site, companies are letting them have more control in the sense that they can post a variety of things, that may or may not be good for the company and brand image.

While tools like ratings and reviews moderation, visual commerce moderation and curation, and questions and answers moderation–which should be a combination of automatic filtering as well as human intervention–help, there will still be negative reviews and comments that you should publish. There are many benefits of negative reviews, in fact, including increased authenticity, valuable feedback, and more. In actuality, then, this item on the list of pros and cons of user generated content can be turned into a positive outcome.

Tackling Unknown Sources

As explained in the above point, UGC gives control to the users. But the anonymities and fake profiles that sneak through the internet and social media create the risk of getting information from unreliable sources. Other customers may doubt the authenticity of the users who have been submitting content. The way out here is to send an invite to those within your database or email list, and provide “verified review” badges.

Understanding the Legal Tapestry

Contrary to what many believe, not everything that a user uploads on social media with your hashtag is usable. Because the sole owner of that content is the uploader. Therefore, companies have to get proper permission from the user. They can do that through implicit or explicit user generated content permissions, which you can learn about in full detail here. While these rights management issues can initially seem daunting, they can be managed in a simple fashion through your visual commerce dashboard.

An example of a permissions request for visual commerce.
An example of a permissions request for visual commerce.

Clearly, just like everything in life, there are pros and cons of user generated content. But those downsides are manageable with measures like new emerging software that reduces the need for intensive labor and authentication of profiles. Looking at the tremendous impact that UGC can have on the overall functioning and ROI of the company, such measures deserve a chance. But for its implementation, getting a fair idea of the pros and cons of user generated content is necessary. This necessity becomes, even more, sharper when you get to know that only 9% of top 250 consumer brands place user-generated content directly on their product pages.

Sporting Goods User Generated Content Lets Fans Speak for Themselves

sporting goods user generated content

As I have discussed in this blog, most sports brands and sporting goods manufacturers have to figure out a way to fight the various hurdles of stiff competition, reduced margins, and high production costs for certain types of goods. There’s considerable erosion into the budget done by marketing activities, other ways of reaching out to the masses, and in building a positive image of the brand. But the puzzle is, you have to perform such activities to generate a substantial buzz around the product; and they cost a lot. Sporting goods user generated content can be that piece that solves today’s complicated, and somehow rigid, marketing puzzle.

As the name suggests, user generated content, or UGC, is the term used to describe any form of content that was created by consumers or end-users and is publicly available to other users. The main point in this definition is the word any. It can be textual, visual, as well as in the aural form. That’s why its scope is too huge. We will look into some of the most effective forms of sporting goods user generated content.

Sporting Goods User Generated Content: Visuals

The most potent weapon of this century as far as generating engagement among customers is concerned is visual content–both images as well as videos. By now statistics like content with relevant images gets 94% more clicks than content without don’t really surprise us. 

The bonus points that sports brand have is that the sports or fitness is a matter of passion for many. If you observe, people often share their photos showcasing themselves in gyms, playing a game with friends, or celebrating a fitness milestone. A sports brand just has to channelize it in an organized way by filtering out better photos. A collection of innumerable photos is quite possible with the help of a unique hashtag. This strategy can be used during the product launch, or promotion of loyalty or referral programs. Even in the absence of such flagship events, this strategy is effective when brand sees that there is a reduction in customer engagement and something needs to be done.

Nike has used the power of images effectively with a simple idea. It knew that it is the most followed brand on Instagram with 65.7m followers. Nike decided to galvanize this huge pool of followers by letting them use Instagram photos to customize their trainers. The campaign was called Nike PHOTOiD.

nike-photo-id

It helped Nike in two ways. First, it helped it in advertising the Nike brand. Second, as there was a chance of creative self-promotion for people, the engagement touched the peak in no time. The campaign was a huge success. At least, results say so.

  • 100,000 shoes created within the first week– and at the peak of the campaign, Nike had 600 shoes being created every hour.
  • Click through rate of 8% to buy the designer shoes on their Nike ID website.

Clearly, Nike succeeded in turning Instagram followers into customers!

Adidas also came up with an idea to leverage the indisputable power of visuals. It joined hands with ESPN to launch a new interactive ad campaign, which gave sports fans the chance to have their skills showcased on ESPN’s Monday Night Football.

https://youtu.be/QypkBliIEe4?t=27

It’s easy to use visual sporting goods user generated content without breaking the bank on a splashy ad campaign. Use visual commerce software to collect your customers’ photos via hashtag or on-site upload and use these assets–with the proper permissions–everywhere. Shoppable on-site galleries, marketing emails, social posts, and in-store displays are great places to start.

Visual commerce increases conversion by 5-7% on average. For sporting goods, it’s especially important as shoppers want to see the gear they might buy being used by other athletes, whether they’re playing a casual pickup game or in the World Cup.

eagle-creek-vc

 

Sporting Goods User Generated Content: Ratings and Reviews

The trust and authenticity that ratings and reviews bring makes them an important factor that affects the entire buying process of customers. 70% of shoppers trust this form of UGC over professionally-written marketing content. With sports gear, there is no dearth of people who feel passionately about such things. Customers need to know if your goods will hold up when they’re running, sweating, stretching, and more. If the product is genuinely good, these passionate people will throng your reviews platform with a plethora of positive reviews.

You can also become proactive when it comes to obtaining this sporting goods user generated content. As most of the ratings and reviews platforms come with the ability to give granular details, it’s very easy to know if there are people who constantly write well about your products or rate them highly. You can target these shoppers with tailored messages. Or, reward users for contributing with entries into contests, discounts, or loyalty points. Vivobarefoot, a British athletic footwear brand, uses their loyalty program–which works as a unified whole across all its sites–to incentivize review-writing, among other actions.

vivo-loyalty

Sporting Goods User Generated Content: Questions and Answers

Frankly speaking, a questions and answers platform has a two pronged impact. On the one hand it helps customers in getting important knowledge from their fellow customers as well as from product experts. This is crucial, as many types of sports gear have fairly technical specifications, and shoppers’ needs vary a lot.

Questions and Answers can also become an effective tool for online reputation management. Knowingly or unknowingly people write things which are far removed from reality. And in the abundance of social media and multiple consumer forums, it’s almost impossible to keep track on each and every written word that is against your brand. In such matters, people make their opinions quickly-often blindly. It can be a dangerous thing when look at it from the brand’s status point of view. One bad experience, which can be a complete exception, may propel someone to write, for example, that the tennis ball that you are manufacturing doesn’t last long. If that’s not the case, it’s easy to use Questions and Answers to clear up any misconceptions.

The most noticeable part among all the above discussed forms of the UGC is that apart from being cost savers, especially when compared with the cost that goes into ads, they work on the principle of consumer participation. Looking at the ready-made madness and passion that this industry generates among its customers, it should top the priority list of every sports brand!

How to Increase User Generated Content Submissions with Psychology

increase user generated content

It’s clear there’s been a surge in the use of user generated content, or UGC, by marketers–according to SEMRush, 86% of businesses use it in their marketing efforts! While most of us know that solutions like visual commerce, ratings and reviews, and questions and answers increase visibility and conversions by adding authentic customer voices to brand content, it’s not always easy to increase user generated content submissions. 

We’ve provided a wealth of best practices about UGC solicitation, including specific articles about Visual Commerce solicitation and in-mail and offline reviews, as well as a reviews FAQ white paper that addresses many ways to increase user generated content. Top it all off with Annex Cloud’s Smart Engagement Algorithm, which automatically finds the best time to send engagement solicitation emails, and you shouldn’t have a problem gathering photos, videos, reviews, and Q&A content. However, in order to thoroughly optimize your UGC experience, you should understand what motivates people to share content with the brands they use and love.

While thinking about UGC, which is a form of customer participation, the marketing focus has to shift from a mere purchase behavior to psychological undercurrents. And motivation has a deep link with psychology. Without understanding the latter, the former cannot get exhibited and expounded. Thus, it becomes imperative to understand the term motivation in order to increase user generated content participation.

In general, motivation can be defined as a reason or reasons for acting or behaving in a particular way. It’s an internal mechanism that separates activity from inactivity. Motivations can be divided into two types, based on different goals to rise to an action. As suggested by Ryan & Deci, intrinsic motivation refers to doing something because it is inherently interesting or enjoyable, and extrinsic motivations regard doing something to obtain a separable outcome. When it comes to user generated content participation, are some motivators which are intrinsic as well as altruistic, while some are predominantly extrinsic. Having a close encounter with them along with relevant examples will help you in deepening your understanding about how to increase user generated content submissions. 

UGC Motivator #1: A Chance to Be Validated

 I’ve talked to nearly 30,000 people on this show and all 30,000 had one thing in common. They all wanted validation.” This statement of Oprah Winfrey, which came when she was bidding adieu to her wildly popular TV show, highlighted the growing need of the public validation that everyone needs today. It’s part of a mental mechanism that stops at the moment when someone’s ego gets satisfied when they see that what they say or do matters to others. In a sense, the need for validation is a need to be in control and recognized. 

Tourism Australia wanted to increase user generated content involvement and used this validation aspect to their advantage. They changed their usual Facebook tactics and decided to hand the page over to the fans by inviting fans them take and post photos with the hashtag #seeaustralia.

After two years, fans are posting over 1,000 photos every day. People from all walks of life, like locals, tourists and professional and semi-professional photographers contributed with their photos that captured the scenic beauty of Australia. The participation from the people grew organically when they began to see that photos shared by them are being at the forefront of the company’s page. This ignited flame of importance converted Tourism Australia’s Facebook page is now one of the biggest destination pages in the world.

 

tourism australia facebook

UGC Motivator #2: A Drive for Fun

Remember that in UGC, people are generally sharing the experience that they have had with a particular brand. It’s clear, then, that in order to increase user generated content, it helps to make participation as fun as possible. 

Fanta, a beverage brand, definitely recognized this when its team took their billboard advertising to another level. They created a small photo printer in the billboard ad and ad instructed onlookers to take a selfie and publish their content to Instagram. After submitting the photos with the hashtag FantaTastesLike, they were rewarded with a printed and branded copy of their photo to take with them.

fanta

 

UGC Motivator #3: A Desire for the Spotlight

The need to flaunt is a primitive human emotion. The selfie just made it more visible than ever. At some point, everybody wants to tell the world that they are experiencing something great, thrilling and unforgettable. And with mobile phones, everyone is a photographer. That’s why users are twice as likely to share something if they want a friend to see it. Marketers, thus, can increase user generated content participation by catering even more to consumers’ love for the limelight.

GoPro has already moved in that direction. It began promoting #GoProMusic, which highlighted fan photos submitted from their GoPro cameras at the Bonnaroo music festival.

gopro
GoPro tapped into the early excitement that every concert goer feels. They increased user generated content submissions through a real-time marketing strategy, which was firmly designed around promoting  content as fans shared their favorite Bonaroo moments. The takeaway is, try to find out events or happenings related to your brand, and design a real time strategy around them.

UGC Motivator #4: Altruism and Community

While some consumers share UGC more for the aforementioned reasons, many write reviews, answer questions, and contribute photos or videos in order to help other shoppers or the company they’re reviewing.  Indeed, one survey about travel reviews in particular found that the largest motivator for contributors was a “need to reciprocate great experiences provided by travel and tourism companies,” while helping other consumers was second.

The tone of ‘helpful’ reviews may be negative, as users want to warn others by pinpointing the negative aspects of the product or service. It has also been observed that people want to help companies by giving honest feedback through reviews and suggestions. There are many additional benefits of negative reviews, too.

Alongside the desire to help comes the desire to belong. One study found that one of the strongest motivations to contribute UGC is one “to participate and belong to online communities.” In other words, some users contribute UGC in order to “meet new people and communicate with others.”

Marketers who want to increase user generated content on their site should take note of these findings and emphasize a sense of community.

Clif Bar & Company, an organic food and drink manufacturer, realized this and took it a step further. They began the #MeetTheMoment campaign to raise awareness about environmental concerns by donating to several non-profits for each hashtag mention that their Instagram account received.

clif-bar
Obviously, it is advantageous if you choose a cause that is related to your product segment. It makes your brand more desirable as for many people it’s an act of pride to be associated with a brand that believes in social responsibilities. Learn more about cause-based marketing in this post!

In Summary…

As I have put across earlier, even though many marketers have begun the use of UGC as the prime mover of their marketing schemes, not many know the actual motivators. The fact that more than 50% of consumers want some direction and guidelines for creating reviews or other content, but only 16% of brands provide any proves the gap between brands’ distance from the reality of customer psychology when it comes to UGC. That’s what creates a call for the thorough and in depth understanding of all the points that are being discussed here. The gravity of this need becomes even wider when you get to know that 92% of consumers worldwide say they trust word-of-mouth more than advertising!

UGC for Electronics Manufacturers: A Vital Brand Voice

ugc for electronics

Different people have defined the term “brand” in different ways. For Cheryl Burgess, a brand is a reason to choose. Leo Burnett said that brand is anything that leaves a mental picture of its identity. But in essence, a brand is a promise to a consumer. A strong brand is one that keeps its promise through thick and thin, as that’s the only way to earn consumers’ trust.

These ideas clarify that a significant pursuit of the consumer electronics manufacturing industry, like many other industries, is to have a credible and authentic voice for its marketing. This pursuit has become even more intense, as traditional ads have suffered a severe trust deficit. Customers are rapidly moving away from them on social. According to managing director of brand communications agency Hard Edge, Andrew Hardwick, about $20 billion a year is wasted by marketers as social media users turn off advertising that simply doesn’t interest them. This setback has forced many marketers to look inside for that authentic voice. And inevitably, they have come across user generated content (UGC).

UGC for electronics is a sure bet. 92% of consumers trust online content from friends and family above all other forms of brand messages, 50% of consumers find UGC more memorable than brand-produced content, and 53% of millennials say that UGC has influenced their purchasing decisions. Even if you want to speak strictly in terms of electronics, 59% of millennials say they use UGC to inform their purchase decisions about major electronics. That number hovers around 46% when it comes to mobile phone purchase.

That’s precisely why consumer electronics manufacturers must look at UGC through a wider prism than that of a mere purchase driver. As it has the potential to build a brand, UGC for electronics should be elevated from an eCommerce tool to a brand building tool. But before going into the intricacies of how consumer electronics manufacturers can be profited by the wise use of UGC, it’s a must to understand its healing power when it comes to the financial malady of the sector.

UGC for Electronics: Profits are Being Squeezed

Almost every electronics manufacturing activity has been transferred to China with a view that Chinese manufacturing costs will remain the lowest available and that transport costs will stay within the boundaries of acceptability. But the profit margins have come under the threat due to rising labor costs and increasing competition from local brands who have become increasingly aware of the know-hows of international business standards.

Besides, due to rapid change in the customer taste and demands, electronics manufacturers have to cut short the product life cycle to come up with a new product. And to facilitate that, they need costly technological innovations. This has further eaten up their profit margins. Have a look at the following graph, which highlights the operating margins for most of the major companies in the consumer electronics business.

Clearly, consumer electronics manufacturers need to look at all the available options to reduce the cost at every level. And as we know, marketing and advertisements eat up lot of cost, the scissor should be used on them. The cost of running any UGC platform, like questions and answers, ratings and reviews, or visual galleries is negligible when placed in front of the traditional marketing and advertising expenditure. This should be the first reason for any consumer electronics manufacturer to incorporate UGC in all the marketing efforts at every stage of the product promulgation and customer life cycle. The following listings will show a way to put this theory into a practice.

UGC for Electronics: Product Launch

Customers can only be aware of the quality and innovation of your product if they actually know about it! The best phase to put that across to consumers is the launch phase. Therefore, the authentic customer voice that appears through ratings and reviews should come into the picture much earlier. The surest way to do it is to give certain consumers the product before the launch and get ratings and reviews from them. As 88% of consumers trust online reviews, this can be a potential supplier of the positive vibes that shove people to the “right” mindset, which can get transformed into a purchase decision. It’s always beneficial if the positive word of mouth takes its own course instead manufacturers pushing for it when they realize that the product is missing the goodwill that is necessary at the initial phase. It should snowball from the beginning.

The example of the iPhone is a case study here. Various market studies suggested that U.S. consumers were not yet ready for a device that combines the functionality of a cell phone, an MP3 player, and a camera. But in the end, iPhone proved to be the one of the most significant advancement in the world of electronics. As soon as people got that in hand, they were bowled over by its functionality and aesthetics. Word of mouth, through ratings and reviews and social media, spread across the length and breadth of the consumer community.

UGC for Electronics: Product Discovery

With almost innumerable touch points dancing on the horizon, the customer journey has become more and more complicated and non-linear. In the intricate web created by mobiles, tablets, NFC, social media, and consumer forums, it’s almost impossible to know through which door customer will enter into your business ecosystem. According to Google, shoppers consult 10.4 sources of information, on average, before making a purchase. What is more important here is to understand that 64% of US online consumers conducted online research before making a purchase in the past three months, and 54% have done so on a mobile phone.

Now, the above-mentioned stats suggest two things. First, thorough research before buying anything has become a distinguishable part of consumer behavior.  Second, digital devices, mainly mobile phones, are the mainstays of that research.

Naturally, this is the time and space to get your message in front of people who didn’t pay attention to you before. That should come somewhere to meet the customer in his journey. This is especially true for consumer electronics manufacturing, as its products are comparatively costly and carries a longer shelf value. This makes consumers more cautious of the public opinions about the product, as they want an absolute surety about the worth of the product. And when they are in this tumultuous frame of mind, positive reviews and a respectable presence on a questions and answers platform should cross the path of their discovery, so that all the qualms will drop then and there only. Take a note of the fact that 89% of consumers reported that reviews have an influence on their purchasing decision. UGC has this power to influence the purchase behavior during the discovery stage as it operates inside the premise of a digital world- the breathing valve of modern humans.

UGC for Electronics: Product Storytelling

The traditional way of communicating about products passé. The reason is that it has been done in an extremely monotonous way where consumers played the role of passive recipients. The communication of product promotion has been unidirectional from start to beginning. But new dynamics work differently, as consumers want to interact with the brand at all possible avenues and at all possible stages. This point gets an enormous weight when put under the reality that consumer electronics manufacturers have relied heavily on the layers of retailers, vendors, partners and distributers to achieve the sale. They never had the real and direct customer connect with the end user. But UGC can be a catalyst in pushing towards the change.

The scope of UGC includes photos and videos as well. That presents manufacturers to create a unique story around the product, as visuals are highly talkative. Manufacturers can ask their consumers to participate in this overall storytelling process. It can be propagated through product packaging. You can ask your retail partners to ship all of their deliveries in boxes, which will be adorned by the customer photos. Each box can carry a sticker directing them to take a photo with their boxes and post it to Twitter, Instagram, or Facebook with a dedicated hashtag. It will shift the paradigm of product communication from being coldly instructive to much needed vividly interactive.

All the aforementioned benefits look brightly plausible, as UGC for electronics allows consumers to see the product outside the confines of direct marketing. The outer layer of humanization that UGC brings inherently creates multiple possibilities for them to find their own reason for finding the product aspirational. Some may get swayed by the truthfulness of the reviews, or some may like the possibility of getting actively “engaged” in the branding process through submitting photos. And this swaying happens as there is nothing artificial about UGC. This unquestionable element of UGC  will make it the most quintessential channel of brand building for many consumer electronics manufacturers.

Note: To know exactly how UGC helps a business, you can have a look at this blog. Besides, don’t forget to go through this blog where we have placed The Ultimate List of User Generated Content Statistics. In this blog, we have captured the most recent UGC trends.

UGC: A Remedy for the Pain of Returns

UGC

A survey conducted by Body Labs found that 23 percent of all clothing purchased online gets returned. Naturally, the losses retailers have to bear due to returns is high, but the real point here is: why do people return products they have chosen to buy?

A study conducted by Shorr Packaging, found that the top reason shoppers return merchandise is because the product wasn’t what they expected. Several studies and reports have said that the discrepancy between the expectations customers have about products and what they actually get when products arrive on their doorstep is one of the biggest motives for returns. And in this case, the real question is: why don’t people get a complete view about products while still in the process of buying? You cannot completely eliminate returns, but you sure can minimize them.

While online fitting rooms have been pretty successful in lowering return rates, they are unfortunately only helpful for things like apparels and beauty products. They can’t do much for products like soap and hardware gadgets. Besides, a significant amount of resources has to go into setting such rooms. Thus, the solution to this problem needs to be much broader, universal and cheaper.  After looking into many things that could potentially meet these criteria, the only solution that seems to meet them all is User Generated Content, aka UGC.

UGC comes in many forms–ratings and reviews, questions and answers, and consumer generated photos are a few to name. Now, let’s see why UGC seems to be the best remedy for the stinging pain of product returns.

A) Ratings & Reviews:

Here’s a fact: consumers no longer believe in what marketers have to say about their own products. They want to know what people like themselves, namely other consumers, have to say about those products. They know that however sophisticated or creative a brand’s communication may be, it’s all marketing. And they know that ordinary people have no hidden agendas in writing product reviews. 88% of consumers say that they trust online reviews as much as personal recommendations.

Naturally, it’s much easier for people to have trust in such reviews instead of celebrity endorsements or glitzy ads. Besides the trust that they bring, ratings and reviews also allow people to focus on whatever they care the most. For example, if a customer is convinced about certain specific features of shoes like color and design, but is unsure about the size factor, he or she can look for reviews from people who wear the same size and figure out what specifically they have said about sizing.

 

This review adjusts shoppers' expectations about the product, a sandal. In this case, the shoe runs wide, so browsers should be careful if they have narrow feet.
This review adjusts shoppers’ expectations about the product, a sandal. In this case, the shoe runs wide, so browsers should be careful if they have narrow feet.

And the more reviews from past buyers they see, the more likely they are to not create wrong expectations about a product. It’s no coincidence that on average, a product will be ordered nearly 44% more often once it starts receiving and displaying customer reviews. In addition to reducing return rates, you’ll also reduce shipping costs which can’t be ignored considering that UPS and FedEx are increasing shipping rates by 4.9% at the beginning of 2017, and that the US Postal Service has already raised its rates an average of 9.5%.

B) Visual Commerce:

Unfortunately while shopping online, consumers can’t try things on and look at themselves in the mirror before making a purchase decision. This benefit belongs to physical stores. Thus, when purchasing online, your customers are always in the dark about how something will fit them or even how a product really looks like in real life. They might buy a piece of clothing because they like the way it looks, however, there are things like body posture, features, and skin tone to be considered as well, since they define the way a piece of clothing will actually fit.

User generated photos–which you can collect, curate, and display on your site with a visual commerce solution–come very handy in this catch-22 situation, because they show your products being used by real people. That gives your potential customers a realistic and trustworthy insight about what your products really look like in real life.   You can also ask your customers to share photos and videos using your products and display them on your product pages. That allows shoppers to look for photos and videos of people with body features similar to theirs and have a better idea about how a certain piece of clothing would fit them.

 

francescas-vc-popup

88% of shoppers seek out visual content prior to making a purchase. Again, it comes back to the same enormous benefit: customers will have a much better idea of what to expect from a product before they make the decision to buy.

C)  Questions & Answers:

No matter how accurate and detailed your product descriptions are, your customers will always have questions. Questions & Answers can help you with that. When shoppers are not sure about the size of shoes, for example, instead of searching for ratings and reviews, they can directly ask about it to experts from your company, or even to existing customers who have bought that item.

The benefit here is that the doubt gets resolved fast. Plus, as the answers come from experts and people who already purchased that product, they bring extra credibility. And in the end, the customers don’t create unrealistic expectations about the product. In addition to all of that, Q&A also heightens up  your level of customer service and customer experience when you respond quickly to customers’ questions,. Customers definitely feel valued and wanted when they get quick replies from brands. Besides, it also helps in SEO as fresh content will be constantly fed into the website.

To Wrap It Up: UGC has always worked well in making contests, ads and brand promotions viral. Its core characteristics like cost and ease to use along with the stream of authenticity are at the helm of its success. And luckily, the same factors also work in reducing online returns.

Note: To know exactly how UGC helps a business, you can have a look at this blog. Besides, don’t forget to go through this blog where we have placed The Ultimate List of User Generated Content Statistics. In this blog, we have captured the most recent UGC trends.   

User Generated Content for Consumer Manufacturing: A Must-Have

User Generated Content for Consumer Manufacturing

When you consider the products consumers tend to be the most passionate about, home appliances and the like might not come to the top of your mind. But the fact of the matter is that products ranging from coffee makers to dishwashers and more are used daily, so people know what they like and what they don’t. Consequently, there’s both a huge potential and a huge need for user generated content for consumer manufacturing. User generated content, also known as UGC, consists of any sort of content created by consumers, most notably customer photos in the form of visual commerce, ratings and reviews, and questions and answers. It’s a subset of advocate marketing, which is the practice of identifying, targeting, and activating high-potential customers to advocate on behalf of your brand in the form of actions like referring friends, contributing content, connecting on social, and more.

User Generated Content for Consumer Manufacturing: The Basics

It’s clear that Ratings and Reviews and Questions and Answers are vital types of user generated content for consumer manufacturing. Ratings and Reviews are almost a default part of any omni-channel or e-commerce manufacturer’s (or retailer’s) site today, and the logic for having this type of content only increases with average order value. Shoppers look to reviews to make sure that they’re making the right purchase from a trustworthy company. If they’re spending hundreds or thousands of dollars on an appliance or two, they won’t buy without reading dozens of opinions from other shoppers. Ratings and reviews may seem straightforward, but it takes guidance and effort to make the most of them.

Similarly, a Q&A platform lets customers ask questions that aren’t already answered on your product pages. Sometimes such questions will necessitate an answer from a product expert, while other times they’ll require a subjective opinion from another consumer. Either way, a rapid response to the question always boosts conversion.

User Generated Content for Consumer Manufacturing: A Dedicated Channel

Until now marketers have used advocates as an ingredient in other main marketing activities like referral programs. There is nothing wrong in it, as their opinions and content do make a difference as far as purchase decisions of other shoppers are concerned. But to me, it just makes sense to give advocates a separate and dedicated channel or platform where they can talk about your brands freely and frequently. With the assistance of digital tools and social media, spreading them on digital platforms is perfectly feasible. That’s perfectly possible…and Walmart has told us how to do it!

Walmart came up with Walmart Moms. Originally called ElevenMoms, it was an online community of its passionate buyers created by Walmart to allow them to express themselves. 22 moms, who became brand advocates of the brand, began to write blogs and share information on raising kids, shopping, household chores and more. Not just that. The main Walmart YouTube channel frequently posted videos of Walmart Moms making it comprehensively integrated into the huge Walmart brand.

walmart moms The good thing about this blogging was that the topics were not always related to the Walmart’s core products. Those moms talked about recipes, cooking tips, how to save money and other subjects of concern to mothers and families. Readers of Walmart Moms’ blogs were allowed to share content on social media via share buttons of Facebook, Twitter, Pinterest and Google+.

Indeed, it was an ideal example of how a company can use an advocate community to indirectly promote its products while also making its brand even stronger. Even though Walmart isn’t a manufacturer of consumer appliances, there is a clear lesson here in terms of UGC for consumer manufacturing. As Walmart caters largely to families, it understood that household shopping is still largely handled by mothers and women. It would be best to give voice to that larger group which possess the possibility to influence most of its target customers…and it did succeed.

You can do the same here. When collecting user-generated content for consumer manufacturing marketing, make sure to target shoppers who are representative of your key audience. Have them share different content along with talking about your products. Then topics of that content can be anything like tips about how to use a particular product, their favorite recipes, household cleaning or craft ideas, and so on. The idea is to make them talk, which will eventually enhance your online presence and buzz around you.

User Generated Content for Consumer Manufacturing: Contests

We have observed this many times that companies don’t take enough efforts to utilize the over- brimming enthusiasm of their loyal customers and advocates. Remember that if they love your product, they’ll usually be more than happy to publicly say so. Take advantage of that and gather more user-generated content for consumer manufacturing by having UGC contests. Ikea recently created a #JoyOfStorage campaign, where it asked its Facebook fans to post pictures of Ikea products in their homes to win a prize. Ikea created archives of all the photos to make them available after the campaign.

An example of an Ikea customer photo from the campaign.
An example of an Ikea customer photo from the campaign.

I think this sort of campaign can work perfectly well in the consumer manufacturing industry. You can ask your customers to share recipes along with the photos of the finished food item. You can reward the best among all the received recipes. For other sorts of appliances, you should similarly consider what experiences the appliance leads to and is a part of. Does your washing machine tackle the toughest dirt? Does it help your customers look their best? Do your dishwashers remove the most stressful part of meals–cleanup? Thinking along these lines should lead you to the most interesting types of visual user generated content for consumer manufacturing marketing with your brand.

UGC and Cosmetics: A Vital Partnership

ugc and cosmetics

User Generated Content, as the name suggests, is the content created by users in the form of ratings and reviews, questions and answers, and images while using your products or services. As this content is created by customers themselves and not by brands or ad agencies, it’s considered to be 12 times more trustworthy in the eyes of everyday shoppers. The level of people’s trust is always high when they see that someone from their own league is really loving a business’s products.  And that’s precisely why UGC works in all kinds of industries and all sorts of marketing efforts. The cosmetics industry isn’t an exception–indeed, due to the intimate nature of beauty products, their sometimes-high price points, peculiarities of color and texture and more, UGC and cosmetics are a necessary combination for e-commerce. Let’s understand how cosmetics industry can be enormously benefited by the unbridled potential of UGC, and take a look at some examples.

UGC and Cosmetics: User Generated Photos

A major limitation of online buying is the lack of direct contact with the products. That luxury of touching and feeling the products lies with the physical stores. Obviously, people would prefer if they can touch and feel the product, or even try them. It is emphatically true for beauty products whose worth from the customer’s point of view depends on how it will look on him or her.

Even if the quality of the product, let’s say of a certain lipstick, is good, it doesn’t mean that every woman will buy it. Simply because the decision to buy a lipstick cannot be taken without considering her complexion and other features. That’s precisely why she needs to see a woman of her complexion and features wearing that lipstick. It will give her an idea about its suitability. This is where user generated photos can really pull the trigger by assuring her about the suitability of the lipstick!

A second major benefit of customer photos for beauty companies is that they can often work an aspirational angle. When a potential buyer sees all the different scenarios and looks that your products work in, your brand’s versatility and appeal are heightened.

One of the most straightforward ways to loop in customer photos with your marketing strategy is to use them with visual commerce software. A good visual commerce solution will automatically pull pictures and videos with a certain hashtag from Instagram and other social sources, and will also allow for direct uploads on your site. From that point, you can configure versatile galleries, use the content in marketing emails, put images on your PDPs, and more. Here’s an example from Sigma Beauty.

sigma beauty

You can also use visual commerce to enable Instagram shopping. Since Instagram is such a huge hub for beauty aficionados, it’s smart to make the journey from following to liking to buying as simple as possible.

And here’s a bonus tip: incentivize the contribution of customer photos with your loyalty program! To learn more about cosmetics loyalty programs, click here!

UGC and Cosmetics: Ratings and Reviews

The reason why ratings and reviews have always worked in every business segment has to do something with the human tendency of being cautious before buying anything. People want an assurance of the quality of the product that they are about to buy. And as we have already discussed, people cannot touch and feel the product on e-commerce websites to make even a rough opinion, they want something solid and strong as a proof. Ratings and reviews fill that void, and consequently boost conversion.

Just like with customer photos, if you have a loyalty program you should consider incentivizing the contribution of reviews. Ever since the hair care brand Ouidad started doing it they’ve seen a significant uptick in review submissions! ouidad loyalty actions

UGC and Cosmetics: Questions and Answers

Irrespective of the amount of information that you put on your product pages, certain shoppers will still want to know more. They might have questions like: What are the ingredients of the product, can it be allergic to a specific type of skin, and can it have side effects if used with other products, availability of the product, its durability and much more. If these questions remain in their minds, it’s likely that they’ll abandon their carts. Nobody buys when he/she is in doubt!

Questions and Answers effectively tackle this problem as by establishing a platform for your consumers to ask both specialists from your company and other consumers. Besides, it also helps in creating a community around your products where people can discuss and share their experiences. Naturally, it fillips the online presence of your brand. It goes without saying that the daily submissions of fresh questions and answers are key for your SEO prospects. It’s a clear cut win-win scenario!

Here’s a peek at what Murad’s Q&A solution looks like.

murad q&a

UGC and Cosmetics: Takeaways

1- Don’t let the photos shared by your customers go to waste. Put them on your social media pages, website, and other marketing campaigns.

2- Ask your customers to write what they really feel about your products. Even if some of those reviews are negative, they help in making your website authentic and boosting conversion.

3- Create a questions and answers platform where customers can ask their queries. That makes them more secure about their buying decisions and heightens engagement.

Note: For tips on referral marketing for cosmetics, take a look at this post. And to learn about cosmetics loyalty programs, don’t miss this one! 

UGC and Loyalty: The Secret to Multi-Pronged Engagement Success

ugc and loyalty

A loyal customer is someone who doesn’t let his favorable buying behavior towards a particular brand get affected under any circumstances. Come what may, he remains with that brand. Now, it’s obvious that he will provide high lifetime value to the brand through his purchase and repurchase. And via loyalty programs, they brand may reward him to thank his loyal attitude. But the real question is: Is that all that a loyal customer can offer to that brand? In my opinion, the answer is no.

The potential of a loyal customer is more than his accumulated receipts. As a marketer, you should be able to find out ways to use that potential with a maximum impact. And I believe that User Generated Content (UGC) is one such way. As the name suggests, UGC means content that is generated or created by users. It can be in any form such as text, images, or videos. UGC on brand websites is generally broken down into three categories: ratings and reviews, photos (which are often used in Visual Commerce), and questions and answers. We will look at these three categories and try to understand how they can bolster loyalty both with and without a dedicated loyalty program.

UGC and Loyalty: Ratings and Reviews

Go to practically any e-commerce site, look for a best-selling or highest-rated product, and check out its reviews. You will realize that even those who don’t share a long-term relationship with a brand praise its product highly if the product is really good. They don’t even feel any special affection for the brand and yet they have no shortage of words if the product is deserving.

Now, the point that deserves contemplation here is, if someone who isn’t loyal to the brand can shout from the rooftop about the quality of the product, then loyal customers will happily do that on a regular basis. They are already in love with your brand! In light of this reasoning it makes sense to take the following steps:

  • Invest in a quality product reviews platform.
  • Make sure that the platform integrates effectively with your ESP.
  • In addition to soliciting reviews after every purchase, as is the straightforward process, make sure to segment your frequent buyers and remind them to review past purchases. It’s easy to integrate their purchase history with a solid advocate marketing platform to make sure that you don’t miss out on gathering quality content from these devoted shoppers.

If you plan on taking UGC and loyalty to the next level, think about:

  • Integrating your reviews platform with your customer loyalty program
  • Offering loyalty points in exchange for approved reviews
  • Giving your top reviewers additional “surprise and delight” points
  • Running special promotions during which approved reviews (up to a certain limit) earn double the amount of usual points

By doing this, you are also making an advancement in making your most loyal customers as your brand advocates. Indeed, by writing favorable reviews, which has immense traction to pull more sales, your loyal customers are advocating your brand in a unique and subtle way.

ouidad loyalty actions
Ouidad rewards shoppers for contributing reviews, in addition to taking many other advocacy actions.

For more ideas about how to increase review volume, check out this post. If you want to thoroughly optimize your site’s ratings and reviews, don’t miss out on this guide!

UGC and Loyalty: Photos and Videos

With each passing day, the internet is becoming more and more visual place. Considering the power of visual content in spiking engagement and its ability to tell more in one picture or video than in 1000 words, it makes sense. That’s why you should ask your loyal customers to speak about their love for your brand and their beautiful experiences with your products and customer service people.

Pier 1 did this by crafting multiple videos of users discussing how they’ve have transformed their living spaces using Pier 1 products. As it was presented in a storytelling format in conjunction with the popular blog Apartment Therapy, it was highly engaging with a personal connection. And UGC naturally comes with a heap of authenticity. There is hardly a better combination than this.

You can do the same by curating stories from your loyal customers about how your product has made a change in their lives and why they have been loyal to you. You can add these visual testimonials in the online promotion of your loyalty program. While Pier 1’s example involves an influencer name and high production values, you can also incorporate visual UGC at scale and under-budget with Visual Commerce. In short, the Visual Commerce process involves:

  1. Starting a hashtag campaign on Instagram to encourage customers to share their photos and videos of your products. You should also consider allowing users to directly upload images and videos to your site.
  2. Using your Visual Commerce software to pull this visual content into a dashboard, where you curate it and ask for permission to use the content you like.
  3. Displaying this visual UGC in a variety of formats, from on-site galleries to PDP sliders to marketing emails and more.

If you have a loyalty program and integrate it with your Visual Commerce platform, you can also give users points for hashtagging on Instagram and/or for directly uploading content to your site.

olympus gallery banner
Olympus Camera gives users points for contributing photos to their customer photo gallery.

 

For thoughts on how to boost sales, recognition, and engagement with visual social content, take a look at our guides:

UGC and Loyalty: Questions and Answers

Questions and Answers are unique in the mixture of UGC and loyalty in that many times, shoppers with the most questions about a product will be first-time buyers, and it’s common that those most qualified to answer a question will be a product expert rather than another customer.

That said, loyal customers still have questions to ask, and they can still help answer others’ questions when they require subjective experience. You should incentivize the contribution of Q&A content by giving loyalty points to those who ask and answer approved questions.

Chaparral Motorsports encourages users to ask and answer questions with loyalty points.
Chaparral Motorsports encourages users to ask and answer questions with loyalty points.

Even if you don’t have a loyalty program, you can integrate your Q&A platform with your ESP and past sales data to solicit answers from shoppers who purchased an item that another user has a question about. Also consider running shopping cart abandonment emails including an “Ask a Question” CTA, in case some browsers didn’t buy due to unanswered questions that they had about the product.

UGC and Loyalty: A Better Use of Your Pre-Existing Loyalty Program Infrastructure

Even if you are running a loyalty program of a smaller proportions, you are ready with the infrastructure that you need to take engagement to the next level. Data like names and numbers of loyal customers, their whereabouts, and social media activities is all crucial to pinpointing and activating your would-be advocates and arming them through this combination of UGC and loyalty.

Once you’re ready with this information, you can target your most active and loyal membership program participants with your UGC plan. Through powerful communication, you can persuade them to write reviews as well as share visual testimonials. Besides, as you have all the information, keeping an eye on their participation in the UGC campaign becomes even simpler.

There is another rationale too behind this integration as far as information is concerned. The gathering of the customer information needs a systematic investment of time and money. So, why not use the same stones to build a new building if you can? That’s what experts exactly mean when they talk about maximum utilization of resources. In fact, it’s actually a waste of that information’s full potential not to have UGC with it!

UGC and Loyalty: Takeaways

1- Don’t look at your loyal customers as a way to get repeat purchases only. They can offer much more than that! Even beyond UGC contributions, they’re also your secret to referral success!

2- Get loyal customers into the groove of the most trusted and authentic forms of content, i.e., UGC. Ask them to write about your product on your ratings and reviews platform. If you don’t have it, it’s high time that you should get it. Also, collect visual testimonials too to spread it along with your loyalty program promotion.

3- Measure everything. How many loyal customers are sharing videos and how many are writing reviews? How is it helping conversion? Who are your best contributors? It will give you an idea about how your UGC and loyalty integration is going.

Note: We genuinely believe that loyalty program can become even more effective when combined with UGC. Just take a look at Murad’s success story. After combining UGC with a loyalty program, it saw an 18% increase in the conversion rate along with the acquisition of 150,000 loyal members in only 6 months.  For even more UGC and loyalty insights, take a look at some of the following white papers and posts, too!

I’m a Female Millennial and This Is How eCom Sites Need to Market to Me

person-woman-hotel-laptop

Hi! I’m Eliza Fisher, Annex Cloud’s Marketing Strategist and Editor. I live and breathe e-commerce, and I have tons of thoughts about how I, as a female millennial consumer and too-frequent online shopper, should be marketed to.

Why should you care? Well, there are about 80 million millennials in the US alone, and we’ll have $1.4 trillion in disposable income by 2020. Many millennials, myself included, have notably strong relationships with their families and consequently influence more purchases than just their own. Also, we’re young, so now’s the time to earn our loyalty. As for the woman component–all opinions are valuable, but women drive 70-80% of all purchasing decisions

Now, of course, marketing is a wide field with many disciplines, so today I’m going to focus on the still vast, but more specific, area of on-site marketing.

When I come to a retailer’s or manufacturer’s website, whether I’m looking for an alarm clock, running shoes, snacks, or a vintage handbag, I want to be convinced of a number of things. Namely, that…

  1. I have enough information to know that I’m going to really, really like what I buy.
  2. I’m getting a deal.
  3. I’m working with a reliable seller who sells quality products, ships things on-time, won’t stiff me on extra fees, and will provide useful customer support.

Now, how can you convince me that you’re fulfilling these three criteria? Let’s break it down.

Giving the Female Millennial Consumer the Ability to Know That She’ll Love What She’s Buying

When it comes to believing that I’ll like a purchase, knowledge is power. You and your team can give me some of that, but a significant piece is going to come from other consumers as well. Retailers and manufacturers should provide information like:

  • Product details: Many online sellers do this, but it’s worth stating. Tell me about dimensions, fabric composition, ingredients, special features, and so on.
  • Multiple photos from different angles
  • Product videos can frequently be helpful, especially if the color, consistency, or use of your product can be ambiguous

Once we get these standards out of the way, there’s a lot that other consumers can tell me. I’m a frequently online shopper due to the convenience, expanded selection, and better prices I usually find, but there are some things I miss out on by not checking out products in person. When sites provide user generated content from shoppers just like me, I get a much deeper understanding of what I’m getting. I’m not alone, either–84% of millennials say that on-site user generated content influences their purchase decisions. Here are three specific tactics to consider.

1. Product Ratings and Reviews:

Unless I’ve already purchased the product in question, I always seek out product reviews. While I notice the product’s star rating, I scan the reviews to see exactly what other shoppers’ comments are and whether or not they apply to me. For example, I’m not a very skilled cook. When I’m shopping for cookware or other kitchen products, reviews from expert chefs won’t be very relevant to me. Or, when I’m looking at skincare products, I’m not paying attention to reviews from consumers who are concerned about wrinkles, but I do want to hear from those who also have acne.

For example, I’m not a very skilled cook. When I’m shopping for cookware or other kitchen products, reviews from expert chefs won’t be very relevant to me. Or, when I’m looking at skincare products, I’m not paying attention to reviews from consumers who are concerned about wrinkles, but I do want to hear from those who also have acne.

Murad, a skincare line, lets reviewers select specific concerns of theirs.
Murad, a skincare line, lets reviewers select specific concerns of theirs.

You should add filters and sorting options so users can easily and quickly find what’s most relevant to them. Check out my tips regarding review formatting, design, and navigation here. I go into even more detail about designing the most effective product reviews for your site in this ebook, “The New Wave of User Generated Content: 7 Concepts for 2017 and Beyond.”

2. Questions and Answers: 

Question and answer interfaces also provide me with helpful information that’s often more targeted than that coming from product reviews. I can ask a specific question and get an answer from someone who’s already purchased the item or from a product expert.

Snowboards.com uses Q&A to provide extra information about their technical, expensive equipment.
Snowboards.com uses Q&A to provide extra information about their technical, expensive equipment.

Honestly, I prefer it when many other shoppers have already asked questions and had them answered. I’m impatient and I often don’t want to wait to hear back from someone else before I buy something. You should capitalize on my eagerness to purchase by providing all the information I want at my fingertips. That’s why expertly soliciting and incentivizing contributions to your questions and answers platform is so crucial–check out my post about it here!

3. Visual Commerce:

Visual commerce is a systematized way of using visual content, usually customer photos and videos, to market your products by automatically sourcing images and configuring them in flexible displays. I’m a huge fan of it for two reasons:

  • I feel that customer photos usually convey products’ appearances more accurately. After all, I’m not a model and I don’t have an immaculate, well-lit photo studio instead of an apartment.
  • Consumer images are also a source of inspiration. Whether you’re using visual commerce to sell groceries, clothing, home goods, cameras, or anything else, it’s vital to get your shoppers to think of your products in new contexts. Maybe I dislike the stock photo of that dress, but it looks really great on a customer, or maybe I never thought of roasting peaches before…the possibilities are endless!

 

francescas product page vc
Francesca’s uses visual commerce on their PDPs to give shoppers a fuller understanding of their clothing.

 

My team and I have written a whole lot about visual commerce and its business case, best practices, and use cases. Here are some links.

Between these three forms of user generated content and the information that you and your team provide, you should have no problem giving me all the tools I need in order to know if I’ll really enjoy your product. With that, let’s move on to the question of convincing me that I’m getting a deal.

Convincing the Female Millennial Consumer that She’s Getting a Deal

There are many pricing and discounting techniques that merchants of all kinds should consider using to drive conversion. Here are some that work on me.

1. The Contrast Effect

This simple principle means that “some perception (say, weight, brightness, or sweetness) will appear greater or lesser depending on a perception that came immediately before it.” In the world of pricing, it just means that deliberately mixing in more expensive items with less expensive ones will make the less pricey ones look like a much better deal.

Case-in-point: Williams-Sonoma was struggling to sell a $275 breadmaker. Their team then introduced a $429 breadmaker and placed it near the other one in their catalog. Sales of the cheaper appliance nearly doubled!

2. Use Referrals, and Make the Referral Discount Attractive:

When you use regular discounts as incentives for actions like signing up for your email list or referring a friend, make sure that they’re coherent.

Of course, it makes sense to incentivize these actions–particularly referrals. You automatically get at least one user’s email address when they make a referral, and at least one other consumer gets exposed to your brand. 77% of shoppers are more likely to buy when they learn about a product or company from a friend, and Annex Cloud just published a case study showing a 10:1 ROI and a 38% increase in orders thanks to Social Login and Sharing and Referrals.

When I decide to send a friend a referral, it’s a pretty big deal. I only do it when I’m positive that the business has something that my friend wants, or when the deal on my end is too good to pass up. Of course, I’ll weigh my potential referral discount against any other discounts going on.

Here’s an example of what an ineffective referral discount strategy looks like. Let’s say I’m looking for a new suitcase and I found something I like on eBags. I also know that Christmas is coming up and that my mom is interested in purchasing some luggage for someone else.

eBags offers me 20% off just for signing up for their email list. Pretty good, right?

ebags email discount

It is! If I’m looking at a $150 suitcase, 20% off saves me $30! Now, as I’m exploring my discount options, I come across their Refer a Friend page. It tells me that I can earn $10 in rewards points while sending 20% to my mother, who wants to buy some luggage too.

ebags raf

There are two big problems here. First of all, my referral discount is a third the size of my sign-up discount. Even if I were a returning customer who was no longer eligible for the sign-up bonus, the referral offer just doesn’t sound good in comparison, and I’m more likely to go to another site in search of a better deal.

Secondly, my mother will get the same discount whether she goes through me or uses the sign-up bonus. Let’s say I send her a text telling her about eBags and letting her know that I’ll be sending a referral code very soon. Then I get distracted by something else, while she goes on to the site for the first time. She might be too impatient or unmotivated by the non-difference in the discounts to wait for my referral link, and ends up purchasing using the email sign-up discount.

What’s the problem for you here? I’m less motivated to share again, and you haven’t properly tracked the source of my mother’s purchase. Check out our referral best practices ebook for more tips about referral incentives.

3. Reward My Loyal Behavior:

One of the things that eBags did correctly in the example above was to loop their refer a friend program in with their loyalty program.

On your end, loyalty programs should be used to make sure that I keep coming back and to turn me into an advocate by incentivizing referrals, review-writing, photo-sharing, and so on. The analog to these two ideas is that I want to feel like I’m getting a deal because I shop with you frequently and because I go out of my way to do things for you.

Luckily for both of us, when you reward me for advocating for your business, I accrue points more quickly. That means that get the sense that I’m racking up discounts and consequently treat myself more frequently, while you see customers return to buy more often.

Check out how Bebe rewards their loyal customers:

bebe loyalty rules

Annex Cloud has seen that when companies switch from a traditional, points for purchase model to a loyalty program integrated with advocate marketing actions, loyalty program revenue increases by at least 300%. Check out our ebook all about advocate loyalty for more details.

Convincing the Female Millennial Consumer that You’re a Reliable Seller

We’ve already touched on a few things that are marks of trustworthiness–namely, user generated content and referrals. If a site has good, but not suspiciously good, reviews for its products as well as helpful customer photos, I’ll know that other shoppers are satisfied. If I come to a site after being referred by a friend, it’s clear that someone I personally know trusts that site. How else can you establish reliability?

1. Fast, Free Delivery and Returns:

This should be painfully obvious. I’m impatient. I’ve been trained by Amazon Prime and other businesses to expect my orders to arrive in two days. When they’re even a day late, I sometimes get a little offended. What can marketers change on their website to soothe my concerns? Just meet the standards that other companies are setting.

I would prefer to pay a little bit more money, whether it’s a shipping subscription, it’s factored into the price of the item, or I buy another item to meet the minimum shipping threshold, rather than think that I have to pay extra for shipping. I have a Prime subscription and I pay for ASOS’s unlimited two-day delivery and free returns.

At the end of the day, I know that I’m somehow paying for delivery, but I want to think that I’m just paying for a product. When I look at the checkout screen and see an actual number amount next to the “shipping” section, it feels like an unnecessary charge. Conversely, when I’m checking out and see that shipping is free, I feel like I’m getting away with an exclusive deal.

The other side of free shipping consists of free returns. I want to know that you stand by your product and won’t make it hard for me to return it if it doesn’t suit my needs.

Amazon irked me recently when I used a gift receipt to return something my brother had bought me for my birthday. He and I both have Prime memberships, yet Amazon still knocked about $10 off of a potential $40 store credit for return processing. While free returns are nice across the board, this seemed like a pretty significant insult to two very loyal customers.

If you find that your margins just can’t handle free returns, consider doing what Modcloth does. They’ll deduct a processing cost from your refund unless you choose to return your purchase for store credit. In that case, the return will be free and they’ll give you an additional $5 store credit. I chose this option recently, and will almost assuredly now use my Modcloth store credit towards a larger purchase on their site due to my perception of this sunk cost.

 

Modcloth has flexible return options.
Modcloth has flexible return options.

2. Ever-Present Customer Service:

While I know that every company must make judgments about its resources, customer service is obviously a huge deal. How you enable communications between support and shoppers is equally crucial. True to my millennial stereotype, I hate picking up the phone. I vastly prefer digital text communication, ideally through chat. Here are two ways of illustrating what I want.

A few years ago, I purchased a pair of shoes from ASOS. The first time wearing them out of the house–on a casual stroll around my neighborhood–one of their straps broke. I tried to find a way to directly talk to customer support on their site but found myself in an endless maze of questions regarding the nature of my complaint. Of course, none of them applied. Frustrated, I took to Facebook and posted a photo and a short, snappy caption on ASOS’s page.

Unsurprisingly, I got a rapid response over Facebook Messenger, asking for my email and order number in order to start the refund or replacement process. The language of whomever was on the other end of the chat was casual and cheerful enough that, combined with the ease of the process, my annoyances were forgotten. So despite the fact that ASOS didn’t have the ideal tools for me to file a complaint, their speed and demeanor were enough to make me forgive them.

On the other hand, we have Salesforce’s Pardot. Admittedly, this is not an e-commerce site, but there’s still something to learn from them. If you sell anything that’s technically complex or pertains to a field of professionals or devoted hobbyists, your customer support requirements will be similar. Pardot is a marketing automation platform that does emails, drip campaigns, scoring, data capture, and more. Users spend a lot of time on Pardot’s site because the features are extensive and time-consuming.

Pardot has several resources when it comes to support: an FAQ of sorts, a live chat, user forums, “office hours,” and then the ability to file a ticket via email. All of these options combined should give users everything they need to master the software, but instead the resources are spread far too thin. The FAQ is far too rudimentary, the live chat is only available for about an hour out of my workday, the user forums are messy, the office hours are overcrowded, and the email tickets take too long. In essence, nothing is helpful and the site would definitely benefit from shedding some of its efforts in order to devote more attention to others. My picks–focus everything on live chat and spend a few hours every few weeks beefing up your basic FAQs. While it doesn’t take a lot of time to maintain a user forum, it looks terrible to refer a user to it. You’re supposed to be the expert.

The Female Millennial Consumer Concludes, For Now

While any list of marketing ideas is going to be incomplete, hopefully I’ve helped. Remember, you need to effectively…

  1. Give me the ability to know if I’ll like your product.
  2. Make me think that I’m getting a deal.
  3. Assure me that you’re a reliable seller.

Four Automotive Marketing Must-Haves

automotive marketing

Until now, the automotive marketing pros as a whole, including manufacturers, dealers, and suppliers of various automotive parts have relied heavily on customer satisfaction, and rightfully so. Because sustenance of any business without satisfied customers is as impossible as the sustenance of a person without food. But customers’ expectations from business organizations have changed and heightened. Thus, even your satisfied customer will be attracted towards any other competitor of yours who can fulfill those expectations. That’s precisely why automotive marketing teams have to maximize their focus beyond customer satisfaction to customer loyalty.

Customer Loyalty for Automotive Marketing

Even though reports say that brand loyalty in the car section during the first quarter of 2015 was 52.8 percent, buying a car is a huge financial commitment. This very costly and long buying cycle nature of the car industry demands that loyalty cannot be solely focused on the purchase decision. There is another section which will ensure that customers will come back to you- the repair and service section. Why? It’s very simple to understand. A small dent on a car means a lot to a customer, though repairing it may cost very little to a dealer. A free fix of the first dent is the way to install first brick of the loyalty wall. You can add concierge services in this league too. It’s clearly appealing to the customers who need more than point-of-sale cash discounts. Because in the context of the automotive industry, maintenance, and repair services—if done well—can be a key to earning consumer loyalty. And there is visible proof, too! BMW has been offering new BMWs four years of free maintenance for its customers. Obviously, it’s a big win for the car owners, but it has benefited the car maker as well. In the words of

There is another section which will ensure that customers will come back to you- the repair and service section. Why? It’s very simple to understand. A small dent on a car means a lot to a customer, though repairing it may cost very little to a dealer. A free fix of the first dent is the way to install first brick of the loyalty wall. You can add concierge services in this league too. It’s clearly appealing to the customers who need more than point-of-sale cash discounts. Because in the context of the automotive industry, maintenance, and repair services—if done well—can be a key to earning consumer loyalty. And there is visible proof, too!

BMW has been offering new BMWs four years of free maintenance for its customers. Obviously, it’s a big win for the car owners, but it has benefited the car maker as well. In the words of Peter Miles, BMW’s North America’s executive vice president for operations, “They’ve got to come back.” And he is right as that offer was too good to be refused. Prior to this fabulous maintenance program, only about 42% of customers got service at the dealership. Now it’s almost 100%. Apart from incremental revenue, it is giving the opportunity to BMW to have more dialogue and communication with its customers. It can know what actually their needs are and it may be able to deliver something on that front. Who knows, it might bring back the customer who is on the verge of having a positive inkling towards a competitor. That’s how loyalty can help you!

Boss Audio, a leading supplier of audio equipment for cars, motorcycles, ATVs, and more, is experiencing it with our Customer Loyalty solution, which rewards both social and on-site actions.

Boss Audio

 

For the ultimate guide to a loyalty strategy that excels, check out ‘Advocate Loyalty: A Four-Point Strategy.’

As a supplier, even if you have loyal customers, you aren’t utilizing their full potential if you are satisfied only with the revenue that is coming from them. These customers have accounts on social media. They have friends. They have other interests. So, you just have to dig a little deeper in their accounts and you will realize that their accounts are full of potential customers. You have to motivate your loyal customers to talk more about your products and services to influence the purchase behavior of those who are within the range of your loyal customers. And that’s where the concept of the referral comes into the picture.

Referrals for Automotive Marketing

Since the lengths and breadths of auto supply industry are too huge, someone from your loyal customer’s connection, especially if you are working in the B2C sector, will always be in the need of proper information and suggestion when he wants to buy various parts like tires. If that suggestion comes from a person who is close and dear, there is hardly anything that might avoid him or her to have a trust on your loyal customer’s recommendation.

After all, referred customers convert 4 times more often that shoppers acquired by other means, and have a higher lifetime value. Besides, you can incentivize this whole process of referring to motivate your loyal customer to become your vocal brand advocate. One of our clients, Chaparral Motorsports, is using our Refer a Friend solution to do just this…

 

chaparral mobile raf

Another client of ours is seeing a 10:1 ROI and a 38% increase in sales thanks to our Sharing and Referrals and Social Login solutions!

Ratings and Reviews for Automotive Marketing

Just the way referrals strongly affect the decisions of at least 71% of shoppers, ratings and reviews also affect customer decisions in the same way. Case in point: 70% of consumers trust reviews written by other customers more than any content generated by brands. The only difference is referrals come from someone they know, but reviews are posted by unknown people. But most importantly, they are posted by ordinary people who “really” use those cars parts, unlike celebrities. Thus, it becomes easier for people to believe in such reviews.

Very rightly your customer wants to be absolutely sure about many things before he wants to buy from you- safety, cost, quality, performance, fuel efficiency, eco-friendliness, maintenance assistance, technology, and design are a few to name. When he zig zags through the catalogs of multiple reviews, the fog of doubts gets thinner and thinner with each positive review. Slowly and steadily he begins to believe in the overall verdict of thousands of people and the positive framework of the mindset towards your products get developed. Believe me, this is the psychological and emotional need of a buyer that prepares him to invest a high amount of money in car parts.

The other benefit of reviews is that now almost all cars parts and accessories come with the same features and same qualities when they fall in the same price category. They are identical in that prospect. So, if you could garner more positive reviews for your products, it may become an added reason for people to buy it. It can become a differentiating factor along with being social proof.

But, it’s important to note that no one wants to go through a complicated process just to write a review. Your customers are no exceptions. The process should be as simple as possible. That’s why Annex Cloud has come up with in-mail reviews. The core idea behind it is to create a system where review forms can be inserted into emails. It allows your customers to share their reviews and thoughts without having to visit a separate page. Take a look at the following example for Kal Tire, a giant Canadian tire seller. By using our in-mail reviews to solicit feedback from online and in-store customers, they got twice the amount of responses compared to the industry average.

Kal Tire

Get all of your Ratings and Reviews FAQs answered right here!

Questions and Answers for Automotive Marketing

Questions and Answers is another equally powerful form of user generated content that automotive marketing teams, both those working for car manufacturers as well as for car part and accessory supplies, can use. Even if you put all the possible information about your products on your product pages, customers will still have some questions ringing in their heads about durability, availability, compatibility, tips, etc.

Questions and Answers acts as a platform where customers can place their questions to steer clear of these doubts and confusions. Those questions then are immediately transferred to the person of your organization who is in the best position to give the best answers. Or, when the question needs a subjective opinion, you can automatically solicit customers who purchased the same product to answer the question.

Apart from quelling the doubts and making the picture clear for the customers, a quick response from a qualified individual increases authenticity. It also sends a message to the customers that you really care about their concerns and it’s highly important in building a long lasting rapport with customers. Along with a strong product, these are the things which boost the quick filling of the customers’ shopping carts! And that’s what Chaparral Motorsports has achieved by making better use of our Questions and Answers platform. They’ve linked it to their loyalty program in order to foster maximum feedback, too.

chapparal question promotion

To Conclude…

If you were one of the very few sellers of the auto parts or cars, your job was to make sure of the mere availability of your products when customers wanted them. Just by doing this, your sale was guaranteed. But that’s not the case anymore. Now there are plenty of options for each segment and each price range. That’s why it becomes even more difficult to create an everlasting impression on the customer’s mind. Thus, retaining existing customers is an unavoidable task along with some efforts to acquire new ones. New tools like loyalty and referral programs, ratings and reviews, questions and answers have therefore become even more important than ever in the automotive supply industry.  

Learn more about how to build a successful referral program here.  Check out this blog to discover all the basics of a robust loyalty program. To refine Ratings and Reviews to optimize conversion, this guide of ours is a must read!

The Most Valuable Content Marketing Trends for 2017

content marketing trends for 2017

Content is not merely the written word anymore, and it shouldn’t only discuss your products. Content, whether it’s blog articles, videos, pictures, GIFs, emojis, or whatever else, has become a way to inform, entertain and educate your audience about everything that happens in and around your respective industry. Indeed, content is changing and so is the way it is being presented and marketed. Here are our picks for the hottest content marketing trends in 2017.

Content Marketing Trends for 2017 #1: Click Bait Will Cease To Exist

There isn’t a single person in the whole world who hasn’t been victimized by click bait. The catchy and intriguing headlines prompt us to click to see if anything new or interesting is there. Instead of that, we are bombed with ads, pop-ups and a page that seems impossible to navigate away from.

clickbait
But there’s good news here that makes more one of the most relieving content marketing trends for 2017. Now social media platforms have realized that nobody is happy with this infinitely irritating ploy. In a recent CNN Money article, Facebook, perhaps the biggest social media giant, issued an earnest diktat to marketers: Stop creating click bait titles or we’ll put a blanket ban on you. Facebook is also working on a new algorithm to kill click bait headlines along with the provision to ban repeat offenders.

Content Marketing Trends for 2017 #2: Live Streaming Video

This is undoubtedly the most vital and dominant of content marketing trends for 2017, and there are plenty of reasons behind it. If we consider the overall consumption of all content formats, videos are a clear winner. Even if we talk about engagement, hardly any other content format beats video. That’s why many are predicting that video will comprise 70% of all internet traffic by 2017. Besides, videos don’t just ensure higher penetration and engagement. They positively affect the conversion rates and thus the bottom line too.

video conversion rates
As live streaming videos are unedited, authenticity naturally comes with them. Through videos, you can have a question-answer session with your customers, which is as interactive as anything. Sometimes, reading an article on mobile can be taxing and may repel people from your content. Consuming content via video is way too easy. Besides, you can often explain your product or service in a better and detailed manner with videos.

In short, live streaming videos satiate the basic needs of customers- authentic, interactive and easily digestible content. It is not at all surprising then that all social media platforms are developing live streaming capabilities to get ahead of the curve. Some are even going further by integrating niche live stream apps such as Twitch and Periscope. Just like Snapchat, Facebook is even testing advertising during live video broadcasts as well as live video filters. Indeed, the future is video.

Content Marketing Trends for 2017 #3: Native Advertisements

The biggest truth of modern advertisement is that people hate ads that are entirely salesy and interruptive. That’s why ad-blocker use is at an all time high. Users want a natural feeling in the ads they see. That is, the ad should match the form and function of the platform on which it appears. That’s what native advertisement is all about! The ability to keep the user experience untouched along with the smooth integration into its host environment has been the core reason why native advertising has been extremely successful. So much so that The New York Times has cited it as a singular reason for surviving in an ad-block-heavy digital environment, as companies like Buzzfeed are built on native advertising. The following Buzzfeed example explains how the native news feed ads work. These are promoted posts that show up next to real news in a publisher’s news feed like the one you can see here:

native ads
Even social media has embraced it with open arms. As you can see below, apart from the “Promoted by” text, a promoted tweet looks just like any other.

promoted tweet
Their non-interfering nature in the customer experience certainly enhances the chances of ad views…and that’s the beginning of any conversion process. Thus, upcoming times will see more of such ads, as well as new formats. Maybe we’ll see clickable promoted filters on Snapchat, ads inserted into Facebook comments, or something entirely different.

Content Marketing Trends for 2017 #4: Long Form Content Will Dominate SEO

Contrary to what many people think, the study conducted by Search Engine Land concluded that long form content not only gets read more, but gets ranked better, too.

longform content
But, it’s not at all surprising. When someone is looking for articles on the particular topic, he is in need of quality and relevant information. The length is not a hindrance if the content is able to fulfill the above-mentioned criteria. In fact, Google has mentioned the following advice in its Google Webmasters Blog: “Users often turn to Google to answer a quick question, but research suggests that up to 10% of users’ daily information needs involve learning about a broad topic. That’s why today we’re introducing new search results to help users find in-depth articles.”

Not just that… Google is gratifying long form content writers and distributors with better saturation in their “Answers” features and enhanced rankings. As the green signal for long form content has come from Google itself, we can be assured that this trend is all set to shine. But Google is well known for the incessant introduction of algorithms to keep the content unique and relevant. As a marketer, you should keep a close eye on what Google does. This trend of long-form content  may not be a permanent thing!

Content Marketing Trends for 2017 #5: How We Publish Will Continue To Evolve

This is a content marketing trend in 2017 that, well, will continue far past next year. The past few years have shown that your own website isn’t the only destination to publish your articles or blogs. Social media platforms have innovated themselves in terms of how marketers can publish content on them. For example, LinkedIn released Pulse – a native blogging platform in 2014 and in 2015, Facebook came up with Instant Articles – a feature to enable publishers to post interactive articles inside Facebook. The rationale here is very simple. Social media enjoy immense user base all across the globe.

The kind of reach that social media will give to your blogs is almost impossible to get by posting blogs solely on your website. Marketers, as well as social media leaders, have a complete realization of this fact. And allowing marketers to post the content on various social media platforms may become a simpler way to monetize the platform. Marketers will get maximum mass reach. Thus, it’s kind of a win-win scenario. It gives a reason to believe that more social media platforms and other digital platforms will be the places where content marketers like you might place more and more content.

This won’t just be a phenomenon on social media. Many retailers–whether they’re in the same or disparate industries–team up to do contests, one-off product lines, and more. Tons of merchants are also syndicating their Ratings and Reviews and should be syndicating their Visual Commerce. There will definitely be more and more content collaborations, guest posts, takeovers, and so on between different companies as well as influencers.

Content Marketing Trends for 2017 #6: Objective Algorithms Will See A Surge

Quality is highly subjective.  What is great content to you might be bad for someone else and vice-versa is also true. It can really be a great source of conflicts as it’s really hard to decide how to decide what actually quality content is. Thus, we will see that more and more publishers will rely on objective algorithms, similar to Facebook, to govern which content will get more attention on their sites. It will result in a focusing on true engagement and distribution rather than just getting more clicks to divert people on the content piece. Naturally, quantifiable measures like data on finish rates, time on site, readability, and engagement spans will get more prominence. It will affect the way marketers take efforts to publish their content on right platforms that have more traction and traffic.

Content Marketing Trends for 2017 #7: User Generated Content

With the easy availability of mobile phones and a plethora of social media and video sharing platforms, your customers are taking and uploading photos even of the least important events and happenings in their lives, as well as the most important. Thus, it’s a logical step to make use of such an authentic and easily available content to remain in the eyes of the people by using user customers’ photos. User generated content has thus got importance and it will go on increasing.

Truly, users and customers are your best marketers. In fact, 70% of consumers place user generated content above generic written content. UGC is not just about photos- it includes reviews, recommendations, comments, and questions and answers too. In short, UGC is like asking your customers to create content for you to display it on your website, social media networks and even in-store. People have 12 times more trust in such content as it is derived from the common lives of everyday  people. They relate to it more easily and naturally. Besides, it’s very difficult and time-consuming to come up with a fresh content on a daily basis.

To learn about the most exciting content marketing trends in 2017 specifically for UGC, check out this guide!  You might also find our Visual Commerce best practices ebook, our guide to Visual Commerce for Fashion, or our Ratings and Reviews FAQ sheet helpful!

The Ultimate List of User Generated Content Statistics

user generated content statistics

Researching a product by watching product review videos on YouTube, searching a hashtag on Instagram, or looking at product questions and answers on the company’s site has become an integral part of the modern customer journey. But to use user generated content (UGC) to its full potential, it’s necessary to know its current status and where it stands. Here’s an assembly of the most important user-generated content statistics for e-commerce.

User Generated Content Statistics: UGC Has An Enormous Scope

  • Consumers between the ages of 25 and 54 produce 70% of all UGC. (SparkReel)
  • Social Media contributors have increased by 176 Million in the last year (social media today)
  • There are between Two to Four Billion uploads of images on social media per day.
  • 25% of search results for the world’s 20 largest brands are links to user-generated content. (Kissmetrics)
  • UGC is dominating web content. Pinterest pin creation is up 75%, and Airbnb reviews are up 140% year-over-year. (Kleiner Perkins Caufield Byers)
  • Companies that have launched Facebook and Instagram ad campaigns using consumer-generated photos have seen up to a 50% increase in click through rate, over brand-created images, leading to a 5X Return on Ad Spend. (Instagram partners)
  • Consumers on average spend 5.4 hours per day with user-generated content.

Don’t believe it? Check out our post, The Multifaceted Impact of UGC!

User Generated Content Statistics: UGC Is Omnipresent

  • The power of visuals is unquestionable. Over 1.8 billion of photos are uploaded and shared by consumers on social media daily.
  • According to this source, 350 million of photos are uploaded daily on Facebook and 80 million on Instagram, along with 432,000 hours of videos on YouTube.
  • According to SEMRush, 86% of businesses now use user-generated content in their marketing efforts.
  • User-generated videos on YouTube get 10x more views than the content uploaded by brands.

Curious about the state of UGC around the world? Our reports on UGC in Europe and UGC in Asia will give you the scoop!

User Generated Content Statistics: UGC Generates Trust

  • 92% of consumers worldwide say they trust word-of-mouth more than advertising.
  • According to a report by Forrester, 70% of consumers consider product and brand recommendations from their social circles trustworthy and 46% trust online reviews posted by other customers. In comparison, only 10% trust banner ads on websites.
  • 70% of consumers trust reviews written by other customers above professionally written marketing content.
  • Customer-made reviews about a product are trusted 12x more than promotional marketing content.
  • 51% of US consumers trust user-generated content more than other information on a company website.
  • 71% of consumers say that reviews are important before buying a product.

User Generated Content Statistics: Millennials Love UGC

User Generated Content Statistics: UGC Affects Buying Decisions

  • 82% of shoppers say that user-generated content is extremely important when deciding on purchases.
  • Brand engagement rises by 28% when consumers are exposed to both professional content and user-generated product video.
  • Brands see 25% increase in conversions when user-generated photos are used instead of professionally made product shots by brands.
  • 43% of people are more likely to purchase a new product when they have learned about it through social channels or from friends and family.
  • Consumer reviews are responsible for 74% increase in product conversion.
  • When UGC is included in advertising, online stores see 4x higher click-through rates and 50% drop in cost-per-click.
  • UGC can improve conversion rates  6.4% for clothing, 2.4x for jewelry, 1.7x for footwear and 1.6x for products in beauty and consumer electronics verticals.
  • When consumers see UGC while shopping, conversion rate goes up 4.6%. When they interact with user-generated content, conversion rate spikes up to 9.6%.

Curious about how Ratings and Reviews impacts the buying process and what you can do to optimize it? Don’t miss out on our Ratings and Reviews FAQ sheet or our guide, Optimizing Your Site’s Ratings and Reviews!

Why Annex Cloud Is A Great Vendor For UGC Solutions

  • Only 9% of top 250 consumer brands place user-generated content directly on their product pages.
  • Marketers face the following obstacles to using user-generated images and videos from social media: the process is manual and labor intensive (31.7%), they don’t have adequate software and technology (26.8%), and they don’t know how to filter the right content from social media (24.4.%).
  • Only 27% of marketers have been able to devise a system for aggregating, organizing and managing the visual assets.
  • 54% of marketers say they cannot monitor how visual content assets affect conversion.
  • 30.8% of marketers say that a solution that automates the discovery of influential user-generated content would have time-saving benefits.

The Multifaceted Impact of UGC

impact of ugc

In simple terms, user-generated content (UGC) is content that is created by your customers. It can come in multiple forms- feedback on Facebook or Twitter, ratings and reviews on your site, images or videos shared on Instagram or Pinterest, product questions and answers, and much more. In short, it’s social content that’s trusted 12 times more than content from brands. Now let’s take a look at the impact of UGC.

The Impact of UGC on Differentiation:

Customers are less responsive to traditional advertisements than ever, and ad blocking is a pervasive problem. Even ads that are momentarily successful often become too dull and monotonous because so many other brands are doing the same. UGC is a great way to break this shackle of monotonous communication.

Asking for content from multiple customers brings arrays of new ideas and presentations. Besides, most of the UGC content springs from the daily lives of common people- like a summer vacation, birthday parties, or sipping a cup of coffee in the rain. And all these are way too relatable to others. Thus, a well-planned UGC content campaign can easily differentiate you from your competitors. It’s great fodder for advertisements, social campaigns, and more. Look at how Forever 21 uses customer reviews in emails. forever 21 ugc email

The Impact of UGC on Consumer Psychology:

Most people are risk-averse. Don’t you feel more secure when you invest money in a popular stock, or when you go to a doctor referred by a friend? Why? Because subconsciously you know that so many people cannot be wrong. It’s psychological proof. The same can be created with UGC. But this time, it takes the form of social proof. Ratings and reviews are the main pillars of this replicated social proof. Consumers write what they feel about your product. As it’s obvious that all the reviews are not going to be ultra-positive and not all the ratings are going to be 5.

But the beauty of UGC is even negative ratings and reviews, of course, up to a certain level, work in your favor. What it implies is, your review mechanism is genuine and it’s not a work of paid services. Furthermore, on such platforms, customers think about collective consciousness. They take into consideration the average rating of the products before coming to the final buying decision. And more than often, the trust which develops due to positive ratings and reviews which are in the majority, the chances of buying are high.

The fact is that 71% of US consumers say that customer ratings and reviews are important and 76% are more likely to purchase a product if they see a lot of positive reviews can be considered as a testimony to the above claim. For example, this shoe from Vionic has 106 reviews and 4 out of 5 stars.. When a customer in search of a quality walking shoe comes across a page like this, they’ll be much more motivated to buy.

vionic reviews

The Impact of UGC on Community:

It’s as valuable as gold if you can create a sizable community of passionate customers around your product that talks, shares and tweet about your brand on a consistent basis. Due to the way in which social platforms work today, even those who are not a part of that community will get to know about your product and brand. And it kills many birds with one stone. Naturally, it augments your online presence. It adds more wings to your efforts in generating brand awareness and engagement. Through the links, which your community members share in their updates, the traffic to your website will also a clear upsurge. Thus, it’s not even an option for you…getting a vibrant community should be high up there in your priority tasks. In fact, many etailers have already executed it!

Olympus Camera’s UGC community is the next level of customer-created content. Users, who are rewarded with loyalty points for submitting their photos, can upload their own photos and comment, like, and share others’ work. It’s all about people coming together over their love for photography. olympus gallery new

The Impact of UGC on Discovery:

The customer’s journey is rapidly changing. Going to the store is not the only way nowadays. Consumers now connect with brands across a multitude of touchpoints throughout the customer life cycle (CLC) from discovery through purchase and engagement. With mobile phones and laptops, which are now empowered by much more robust and powerful internet connections, customers simply dive into online research to know if there is anything in the market which is close to their taste or need. It applies to all the products- from big ticket items like a TV or a car or even toothpaste. This is where UGC can be a huge influencing factor.

Due to its shareability, UGC comes with a potential of becoming viral on the internet. In customer’s discovery phase, if he comes across the UGC campaign or page of your product or ratings and reviews about your product, naturally you have become successful in presenting your product as an option in his mind. And this can happen with millions of other customers. Considering the fact that the number of worldwide users of social media is expected to reach some 2.95 billion by 2020, it’s quite a possibility.

To Conclude…

The bottom line is that UGC can increase site revenue by up to 20%, and increases chances of purchase by 105%. Every company strives hard for customer engagement and there is hardly anything as beautiful as UGC to achieve it. In essence, it is co-creating with your customers. And you don’t just co-create content, but you co-create experiences and memorable moments too. Actually, it’s a diametrically opposite approach to the past marketing strategies where customers were the passive recipients of the one-sided communication. UGC has given customers the voice and thus can feel more involved with your product. Once this involvement is there, other parameters like sales and growth occur like a natural phenom!

To learn more about what you can achieve with user generated content, check out “The New Wave of User Generated Content: 7 Concepts for 2017 and Beyond” and our case studies with Skis.com, Group.com, and Melissa & Doug!

4 User Generated Content Mistakes You Can’t Afford to Make

User Generated Content Mistakes

Just like everything in life, the usefulness of user generated content (UGC) like ratings and reviews, questions and answers solution, and visual commerce depends on how you approach it and how you implement it. If done meticulously and wisely, user generated content can have an extremely positive impact on company’s visibility, website traffic and sales. Unfortunately, some UGC campaigns suffer a premature death due to some very avoidable mistakes. This article aims to illuminate those common user generated content mistakes so you can maximize revenue!

Publishing without Permission

The first commandment of UGC is you shall not publish without permission. Though user-generated content is voluntarily created and can be voluntarily submitted, its use without the consent of the content owner can be a serious offense. This usually happens when companies reuse customer photos that they’ve found on social platforms like Instagram and Twitter. Reviews, questions, answers, photos, and videos that customers post directly on your site are generally safe.

Publishing content without permission can be extremely fatal. Just one example is enough to prove my point. Duane Reade suffered a $6 million lawsuit when they posted a photo (without permission) on Twitter of Katherine Heigl holding two of their bags! For more detailed information about visual commerce permissions and rights management, check out our new white paper—The Fundamental Guide to Visual Commerce Permissions.

One-Time UGC Use

Many marketers make a mistake of using user-generated photos, reviews, and Q&A for a shorter span of time or in less repetitive manner. The fact is that this sort of content is evergreen and can really help keep customers’ interest level intact. Repurposing your UGC across marketing channels can make a little content go a long way. It is very important to extend the shelf life of the quality customer content and it is easily achievable by accumulating contributions that drove the most engagement and use them for future campaigns.

Another way to harness the power of quality customer content is to use it for social ads on Facebook and Instagram. You will see higher click-through rates for those ads. Email campaigns are fruitful too–Forever 21 sets a good example by including real customer reviews in this marketing email from earlier this summer.

This Forever 21 marketing email avoids one of the biggest user generated content mistakes by reusing their content.
This Forever 21 marketing email avoids one of the biggest user generated content mistakes by reusing their content.

Only Using Perfect Photos

One of the biggest user generated content mistakes comes from a slight misunderstanding of its purpose. As a marketer, you should understand that the very reason why UGC became a currency of modern marketing was consumers’ lack of faith and trust in traditional advertisements.

I have come across many UGC campaigns that don’t look like UGC campaigns at all. If you only use images from your brand or influencers, you’re missing the point. Shoppers want to see real customers enjoying your products! The example of Belkin is useful for this particular point. They created swanky iPhone cases in a partnership with Lego. Belkin asked their customers to show off their creativity and how each one personalized their case by tagging their Instagram photos with #LEGOxBelkin.

This visual commerce gallery is a healthy mix of professional-looking and amateur photos.

There is something imperfect, deglamorized in those photos which make them even more authentic…and UGC is nothing but a vehicle which carries the message of authenticity to your customers.

Letting Conversations Fade

One of the biggest conundrums of UGC is there is no UGC without customer engagement and there is no customer engagement without UGC. That’s why it becomes critically important to maintain the ongoing momentum. The efforts to encourage people to participate in your UGC activity should be ceaseless. Keep a close watch on your brand mentions and related hashtags so that you can like, comment, and share user-generated photos and statuses from your enthusiastic customers. It also enables you to answer the questions of your customers, which strengthen the relationship bond between you and customers. And this is how the mindset of loyalty shapes up in your customers!

UGC for Fashion: An Overview

What you need to know about using UGC for fashion

Out of all the advocate marketing solutions out there, user generated content (UGC) stands out as a no-brainer for the fashion industry. As this segment is highly visual and depends heavily on variables like size, fit, and quality, showing off the multitude of ways in which customers interact with apparel and accessories makes perfect sense. … Read more

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