klaggle webinar: are you leaving money on the table
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Are you Leaving Money on the Table: Understanding the New Info Shopper to Increase SalesTRANSCRIPT
Are You Leaving Money on the Table?
Understanding the New Info-Shopper
to Increase Sales
July 2011
Webinar Agenda
The Online Info-Shopper is the New Reality Independent Retailers as a Point of Online Research and Influence How Social Content Plays a Role in Consumer Purchasing Decisions Cutting Through the Clutter Real Retailers Experiencing Real Results Q&A
The Online Info-Shopper
Personal Technology ShoppersResearch Products Online
Before Making a Purchasing Decision
97%
Source: Lightspeed Research 2011 Consumer Research Online Report
Personal Technology
THE most popular category to be researched online – 26% more than computers or clothing/apparel
79% of personal technology shoppers will ALWAYS research online vs. 58% that conduct in-store research
Source: Lightspeed Research 2011 Consumer Research Online Report
Info-Shoppers Older - Educated - Affluent
Source: The e-Tailing Group 2011 Social Shopping Study
Changing Consumer Shopping Dynamics
% of Overall Shopping that Involves Researching Products Online
Source: The e-Tailing Group 2011 Social Shopping Study
Mobile Online Research
Shopper access via mobile puts even greater pressure on Retailers to provide a comprehensive information experience.
36% of shoppers research products via mobile devices before visiting a physical store.
38% research retailer websites via mobile devices during an in-store visit.
Source: Deloitte 2011 Spring Consumer Pulse Survey
Mobile Online Research Also Takes Place In-Store
Personal Research Drives Consumer Confidence
83% feel more confident about their purchase when doing research online vs. 15% talking to a knowledgeable sales person
Saves Significant time
79% of shoppers state that online research saves them time vs. traditional in-store research
Source: The e-Tailing Group 2010 Social Shopping Study
Choosing a Reputable Retailer
58% of shoppers select which retailer they will purchase from based on their online research.
Trust is a Critical Factor
A trustworthy retailer is so important that 1 in 12 consumers would pay a higher price for a product.
Source: Reevoo 2011 Consumer Purchasing Report
Offline Sales
45% of in-store purchases are directly influenced by online research
Source: Forrester
Retailer Sites as aCritical Point of
Influence
Retailer Sites
Not the Starting Point but the Destination and Point of Consumption is YOU!
Research Starts with Search
..but is conducted on Retailer sites
Source: The e-Tailing Group 2011 Social Shopping Study
Critical Point of Research Retailer Sites are the No. 1 destination for
product research and information for Electronics
Source: The e-Tailing Group 2011 Social Shopping Study
Research Tools Valuable on Retailer Sites
Source: The e-Tailing Group 2011 Social Shopping Study
Most Important Capabilities on a Retailer’s Site
% of very to extremely important when it comes to ultimately selecting and purchasing a product
Source: The e-Tailing Group 2011 Social Shopping Study
Social Content
Social— “Everybody is doing it!” Yes…and No
Source: The e-Tailing Group 2011 Social Shopping Study
The Role of Social
Consumers Expect Social Tools in the Online Shopping Process
The Basics Continue to be Important
Source: The e-Tailing Group 2011 Social Shopping Study
ConsumerInformationExperience
ValidationTrust
Satisfaction Confidence
87% Check Online Reviews Prior to Making a Purchase
92% Trust Peer vs. Expert or Manufacturer
Reviews
Influence of Consumer Product Reviews
Most Important Capability for a Retailer to have on their site
Product Ratings and Reviews have become the one of the most critical parts of the shopping research experience
83% Have More Confidence in Online Consumer Review
Content than they do from a Sales Clerk
87% Will Not Purchase a Brand New Product Before Reading Review
Content
Packing the Most Powerful Punch
90% of Product Purchasing Decisions (online and offline) are influenced by Consumer Review Content – up dramatically from 71% in 2010
Consumer Product Review Content offers
“Social Proof” of Product Quality.
63% of Consumers are More Likely to Buy from a Retailer with Consumer Product Reviews
Source: The e-Tailing Group 2011 Social Shopping Study
Consumers Seek Review Content on Retailer Sites
Retailer Problem
Many Independent Retailers find it difficult to create sufficient product review content from their customers
65% of shoppers will leave a site with no review content
Lost Opportunities
More Reviews Sell More Product
More Reviews Lead to Higher Conversion
Source: Reevoo 2011 Six Essentials of Social Commerce Report
Presenting Balanced Perspectives
Trust and confidence are enhanced when shoppers see ratings and review content that reflects mixed reviews
Source: Reevoo 2011 Consumer Purchasing Report
Negative Reviews Are Not Bad
“A counterintuitive theme that has emerged is that reviews that rate products negatively can be associated with an increase in product sales if the review text is informative and detailed.”
“If the negative review attributes of the product do not concern the consumer as much as it did the reviewer, the such informative statements can lead to increased sales.”
New York University Study on Consumer Reviews
Source: A. Ghose, P. Ipeirotis, Estimating the Economic Impact of Product Reviews
Cutting Through The Clutter
Time Spent Researching Information-Intensive Products
40% of shoppers spend a day or less research products online
Source: The e-Tailing Group 2010 Social Shopping Study
The Need for Immediacy
67% of shoppers spend less than 30 minutes researching a product online before making a decision
Understanding Review Content Quickly
Number of reviews needed for consumers to feel confident about their
research
Source: The e-Tailing Group 2010 Social Shopping Study
Preference
Products have multiple attributes and different attributes can have different levels of importance to consumers.
Tastes for product attributes tend to vary across individuals. Thus, unless the person reading a review has the exactly the same preferences as the person who wrote the review, a single number, like an average product rating, is not sufficient for the reader to extract all information relevant to a purchasing decision.
New York University Study on Consumer Reviews
Source: A. Ghose, P. Ipeirotis, Estimating the Economic Impact of Product Reviews
“By compressing a complex review into a single number, we implicitly assume that product quality is one-dimensional.
Determining RelevancyNew York University Study on Consumer Reviews
“Consumer reviews are complicated, since consumers may provide a mixed review by praising some aspects of a product, but criticizing others such as “this camera has great picture quality but its too big and heavy”. The importance of breaking out individual product features is critical in a consumers’ choice process.”
“…reviews are allowed to be only rated as an integer from 1 to 5. Therefore, the average star rating assigned to a product may not convey a lot of information to a prospective buyer who is trying to understand which aspects of the product are important.”
Source: N. Archak, A. Ghose, P. Ipeirotis, Deriving the Pricing Power of Product Features by Mining Consumer Reviews
Consumer Relevancy
“Manufacturer-provided product descriptions are static and do not contain information about intangible product features such as the quality of design, ease of use, robustness and so on, yet they are important determinants of consumer buying decisions.”
“Consumer shopping decisions are not only affected by the average rating, but by the actual textual contents of the reviews. Since intangible product features are hard to measure objectively, the most relevant information the consumer can rely on is users’ opinions about features that are embedded in in the reviews to identify product features that are most frequently discussed by consumers.”
Source: N. Archak, A. Ghose, P. Ipeirotis, Deriving the Pricing Power of Product Features by Mining Consumer Reviews
The Need to be Brief
“While longer reviews may theoretically provide more information about a product, they may also be perceived as more bloated, about ego, less relevant and helpful.”
“Thus, everything else being equal, consumers have a preference for shorter, more readable reviews, which can have a strong positive effect on sales.”
Source: N. Archak, A. Ghose, P. Ipeirotis, Deriving the Pricing Power of Product Features by Mining Consumer Reviews
Bottom Line
Make information easy to find and consume
Summarized Product Review Content
Consumers are busyYou have little time to catch their attentionPreference and relevancy is different for every consumerRatings and reviews on product features are much more relevant to shoppers and can increase salesKeep it brief
Summarized Product Review Content
Real RetailersReal Results
Brick and Mortar Retailer – 8 stores
Avg. Product Page Views 140,953
Bounce Rate Dropped 53%
22.09% to 10.39%
Time on Site Increased 37%
June 2011 – 588 Carts (up from 245)
“Klaggle content gives us the ability to provide valuable information to shoppers, draw more visitors to our website and assist with our in-store sales. We highly recommend Klaggle ratings and review content”
Bob Buzzell CEO, Penn Camera
Brick and Mortar Retailer – 1 store
Conversion rate increased 275%
2% to 7.5%
Cost of Acquisition reduced to $23.81
Return Rate dropped 40%
“Incorporating PowerReviews content into search and navigation was a no brainer. User reviews are one of the best way to sell a product or seal a deal”
Sarah Marcus Director of Marketing, Abes’s of Maine
Source: PowerReviews Case Study
Brick and Mortar Retailer – 1 store
Avg. Product Page Views 33,040
Overall Sales Increase of 23%
12% Online
11% In-Store
Bounce Rate Dropped 75%
23.59% to 5.93%
Time on Site Increased 31%
June 2011 – 145 Carts (up from 70)
43% conversion rate
“Klaggle helps us be more competitive with larger retailers. With the Klaggle ratings and reviews, our sales have increased by as much as 23% and have helped us increase our sales results with customers outside our typical geographic market area by 15%. We love the Klaggle content!”James Wyner
Director, Fotofriends
Are You Leaving Money on the Table?
Take Aways
Consumers are in control of the product research experienceThink “trust” and the influence of all content and how consumers will react and respondEnsure your site is a destination that well serves the information hungry shopper
Present a product page complete with strong descriptions, in-depth user-generated content, rich media and recommended products.Place prominence on consumer review content and present the whole picture to garner the greatest trust Monitor and embrace social media in order to understand customer behavior that sets the stage for future selling efforts
Thanks for Coming
Stephen Candelmo, CEO Klaggle
800-670-4615
For a copy of this presentation, please send me an email!