Web Shoppers Trust Customer Reviews More Than Friends
September 10, 2009
Social networks, expert opinions also influence purchases

By Alex Palmer

Online shoppers trust the online reviews of strangers more than the recommendations of their friends, new research finds.

“Conversations Among Consumers,” a new report from online retail marketer Ripple6 and the e-tailing group, finds that shoppers buying products on the Internet are influenced both by online social networking sites and face-to-face conversations with friends. But when it comes to whose opinions influence the shoppers, strangers have as much if not more impact than friends.

The survey, which drew on the responses of 1,000 online shoppers, found that while 46 percent of e-shoppers find value in product recommendations from their friends, 47 percent look to onsite customer reviews when making a decision.

Online consumers also look to expert information (43 percent), information from individuals they consider “like me” (40 percent) and product comparison tools (38 percent) to help decide what to buy.

Two-thirds (67 percent) of respondents spend at least one hour per week on social networking sites like Facebook and MySpace. Forty-three percent said they make purchases as a result of time spent on these sites. Sixty-five percent of respondents see value in connecting directly with other shoppers who bought similar products.

Representatives from the e-tailing group and Ripple6 believe these results point to consumers’ desires for more online communities where they can share recommendations and opinions about their purchases. In a statement, Ripple6 CEO Sang Kim said, “This research confirms that most of the things consumers find valuable are those delivered by community.”

But friends still play an important role in influencing consumers. Eighty-three percent of online shoppers said they are interested in sharing information about their purchases with people they know, while 74 percent are influenced by the opinions of others in their decision to buy the product in the first place.

Nielsen Business Media

A good article in Business Week, Will Work for Praise, on motivating content creators with evidence that status is more powerful than cash for getting users to create content.
From my perspective there are a whole host of ways to encourage users to participate and engage in a site through content creation.  I met with Tim Chang, principal at Norwest Venture Partners a few weeks ago.  We were talking about game development and how effectively tapping into the seven deadly sins play a huge role in game engagement.   Community engagement is no different.  We need to give our users a reason to play games, write reviews and help create the StyleHop community.  For all these, tapping into base desire is critical.

What many startups miss is that while the promise of status is a powerful and important motivator, it’s not the only one.  We are developing our community with a mix of incentives that tap into desires for status, greed (read discounts) as well as positive influencers like contributing to our mission of democratizing fashion.

Focusing only on status and creating mavens is a natural mistake of many fashion sites…..the mavens and wannabe-mavens are the first ones to come to your site and they are the most enthusiastic.  However, this is a trap.  You can’t forget that big destination sites need to help everyday folks solve problems – that’s job one.  While mavens can help support this goal with original content, their deep interest in being heard can often times overwhelm broader goals.  Many social shopping sites are peaking out on traffic because they are leaning too much on helping the maven’s build status – There are too many sites where we go and feel like we are being bombarded by experts.  It’s like that great boutique you want to love but you don’t go in because the sales people are too pushy.

Fashion shopping destination sites need to make shopping for fashion easier if they want a mainstream audience.

Will eBay incorporate social shopping into its fold?

Link to another Vator.tv interview with Erik Stuart.  Erik clearly understands the dynamics at play in social shopping and has pretty good advice for ThisNext.

Charlene Li, co-author of “Groundswell” and a thought leader on social and emerging technologies made some predictions for 2009 that included one for Social Shopping:

Shopping Goes Social. After a devastating holiday season, retailers will eagerly seek a way to improve results other than driving demand with deeper discounts. One option they will investigate will be how to insert people and social connections into the buying process, illuminating and influencing for the first time the Black Hole Of Consideration. As they lick their wounds in the first half of 2009, retailers will watch from the sidelines as media companies implement open social technologies like Facebook Connect and the Open Social Platform. But as the holiday season launches early after Labor Day, shoppers will find options to see what friends are recommending, buying and rating integrated into the shopping experience.

Charlene is spot on.  There are going to be lots of different takes on how to make this a reality.  At StyleHop we are building the first fashion affiliate e-commerce engine that allows you to order your product search results based on the rankings of your self-identified fashion peers. Take three women living in Des Moines. One may want to see the top designer jeans as ranked by other women in her neighborhood, another by her friends, and another by women in the East Village of NYC. Each may have similar demographic characteristics and even similar initial “clicks” but, by identifying their unique fashion peers, they each get highly specific lists of styles that work for them.

This is so much better than black box behavioral analytics which consistently give back poor recommendations in fashion. Peer review has credibility and gives a woman shopping online the ability to shop quickly and confidently knowing that, when she buys an item, the people she wants to look good in front of have already pre-approved her purchase.

An excerpt from Gavin O’Malley’s post Lines Between Media Channels Increasingly Blurred

From 2006 to 2008, the share of U.S. consumers using shopping Web sites doubled from 17% to 35%, according to a study released Monday by public relations firm Ketchum and the University of Southern California Annenberg Strategic Public Relations Center.

More revealing, perhaps, is that 44% of those online shopping consumers reported reading consumer reviews and comments found on the sites, the study found.

Social Media expert, Noa Gafni, recently covered us in her blog, Webutantes.