In this episode we’re taking a deep dive into online ratings and reviews: why they matter to CPG ecommerce success and how brands can leverage them to supercharge sales online.
The digital shelf has become a key source of information for consumers about the products they want to buy. And it’s not just product descriptions on retailers’ websites but also star ratings and user comments that influence shoppers’ buying decisions. With that in mind, what should CPGs do to unlock the full potential of ratings and reviews? Are ratings and reviews equally important across all categories and what can brands do to measure the impact of ratings?
To answer these we’re joined by two exceptionally knowledgeable guests and fellow podcasters Peter V.S. Bond, the co-founder & co-host of The CPG Guys podcast and Sri Rajagopalan, co-host of The CPG Guys.
Together with Julia Peter and Sri discuss the enormous, not-to-miss opportunity optimized ratings and reviews offer to brands looking to win on the digital shelf.
A quick note on the legal conditions
e.fundamentals owns the copyright to all the content in The Digital Cast podcast and the transcripts, with all rights reserved and our rights of publicity.
We’re happy for you to do the following
Feel free to share up to 500 words of the episode’s transcript in media articles (The Grocer, Financial Times or the Guardian), on your personal website, in a non-commercial context such as an article or blog post (e.g. Medium), and/or on a personal social media account for non-commercial purposes, provided that you include the attribution to “The Digital Shelf Cast” and link back to the efundamentals.com/podcast. Media outlets with advertising models are permitted to use excerpts from the transcript as per the above description.
What we’d like you to refrain from doing
It is not allowed to copy any portion of the podcast content or use e.fundamentals name, images or likeness for any commercial purpose or use, including without limitation inclusion in any books, e-books, book summaries or synopses, or on a commercial website or social media site (e.g., Facebook, Twitter, Instagram, Linkedin etc.) that offers or promotes your or another’s products or services. Media outlets and journalists are permitted to use imagery from e.fundamentals. Please contact firstname.lastname@example.org
Julia Glotz: Now, before we start talking about ratings and reviews, we always love to quiz our guests a little bit about their own online shopping habits. Sri, I'm going to start with you. Tell me about the last item you purchased online, why you bought it and whether ratings and reviews played a role.
Sri: Actually, this one's really easy. The last thing I actually bought is a television. So, as you know, in the world of televisions is a very discretionary purchase. And when you do buy such a product, you spend a lot of time making sure that it is going to last for five years, let's say, give or take, which means one of the first things you're looking at is actually ratings and reviews. That's a pure coincidence folks I didn't make that up. So once you narrow your selection down to a brand, which is an important step in electronics, the very next thing you do is actually look at what social conversations people are having about that product.
There are two ways you can see how people are having social conversations about the product. You can go over to Facebook, but if you go to an actual retail website you can get super micro down to not just the brand, but the actual skill, or the actual item that you're buying and that's exactly what I did. I started looking. It had to be a minimum of four star reviews for me anything less than that I just automatically filtered it out. The second thing I did was I sorted those reviews for the latest reviews, and I only looked at the last 30 days, because electronics are constantly updated. These days via firmware, as well as virtually every manufacturer in every ecosystem, electronics is putting out a new version of the actual device once a year at least once every 18 months.
So I filtered it down to the last 30 days. And then I also looked at another item which is I wanted to make sure it's a verified purchase, so it's not a paid review, of course, folks like me come from the ecommerce industry so we get extra discriminatory. When we look at ratings and reviews, we know in about 10 seconds which one is genuine, authentic, which one is coming from a brand website, and which one is really authentically created on the website retailer. And there was also a minimum criteria: anything less than 50 reviews, I would automatically disqualify the listing and the reason I would do that is 50 feels like a number to me, which is enough for a crowdsource opinion on a product. I also discount anything over a couple of 100 as it feels to me like there's a lot of unauthentic stuff going on. So that was my ideal number about 15 below 204 star reviews, got to be the latest month it's got to be a verified purchase all of a sudden if you start thinking about it, Julia, that's a heck of a lot of criteria for ratings and reviews that I qualify something for myself on. How does that sound Julia?
Julia: Sounds like you would be a retailer's dream customer and nightmare both at the same time in terms of just how disciplined and how organized you are. Peter tell us about your last item and do you take a similarly disciplined approach to reviewing ratings and reviews?
Peter: Well, given that my day job is in the ratings and reviews business it is very serious to me but that being said my last transaction occurred last night around 11 o'clock. When my wife told me that we were out of baby wash and she also wanted some Diet Coke I went on to my target app and I purchased both of those items for drive thru. And as soon as we're done with this podcast I'll hop in the car drive up and they'll put it in the trunk of my car and off all of their items that I've already purchased and I'm familiar with. So there was no need for me to go look at ratings and reviews to make purchase decisions or consider alternatives.
Julia: Now let’s start diving into ratings and reviews and a little bit more detail. According to power reviews 97% of consumers typically read product ratings and reviews before making a purchase. Now that is for ecommerce in general. Peter, what does this look like specifically for eGrocery and are ratings and reviews important across all eGrocery categories?
Peter: So the answer to that question is yes, it is important. There's some statistics that came out of a recent study that PowerReviews released last month. We had some longitudinal data points prior to the pandemic. We did this study in 2017 and about 17% of consumers said they were purchasing online groceries. By last month that number it increased to nearly 3 in every 4 people so 73% of consumers are purchasing groceries online at least once in the last 90 days. That's an enormous, enormous figure and that goes across different age demographics. Baby boomers, it's as high as 61%, obviously as you get closer to Gen Z, the number gets a lot higher, but the fact that 6 out of every 10 Baby Boomers have started to purchase online groceries is just showing the impact that the pandemic has had on our purchasing behaviour.
I know that I personally have increased my grocery consumption online dramatically since the beginning of the pandemic. I was pretty fully scaled in terms of durable goods and anything was shelf stable that could be shipped, including things like wine, but I was a little hesitant on groceries because of my focus on having very fresh produce and being able to select it myself so I have moved in the direction of being able to procure more perishables through online grocery and I think, most consumers that are now adopting it and become much more comfortable with doing that.
I don't say it's a complete wholesale adoption everybody's moving to do that but it has been very dramatic and what we know is that at least 97% of consumers are using ratings and reviews to some degree what we found in this in the most recent study was only 18% of consumers said they were not using ratings and reviews to do grocery purchases in particular, I think that's probably overstated. A lot of people don't realise how intuitive and passive their acceptance of that is. In the United States there's such a massive ubiquity of things like Amazon and ratings and reviews play a pretty significant component too often in SEO. They may not be aware of the fact that they're using ratings, but they are very much doing so in their day to day activities.
Julia: There's something really interesting that you just mentioned that I just want to jump on quickly and you talked about how one common barrier to purchase within a grocery is that concern around fresh produce, and not necessarily trusting someone else to pick fresh items, the way you would pick them. How helpful, useful otherwise are ratings and reviews in categories like fresh produce in particular? Can they help reassure shoppers about the quality, not just as the product itself but the picking, if you will?
Peter: Yeah I would say that. Grocery retailers have been slow to adopt ratings and reviews, certainly in the United States, relative to other retail verticals. But as they are starting to get into that it is very top of mind to them to start thinking about not just collecting a star rating and a free form review, but to start to capture contextual attributes relative to the category. So the way I would describe this is in apparel manufacturers are very interested in understanding is the product true to fit, does it fit a little big, a little small. Why? Because that helps them address the size that people select and it can reduce returns which is a real drag on the profitability of apparel and ecommerce.
Similarly, food is becoming very important in terms of capturing contextual information to improve so if you want to ask the freshness of the product other attributes like that, that's where going beyond just the star rating, and the contextual review and actually capturing relevant attributes is going to accelerate the path to purchase because you are addressing the very issues that consumers are considering when they're trying to buy the product.
Julia: If we think about the sort of CPG perspective here. What's the biggest mistake CPGs currently make when they think about ratings and reviews, what's the single biggest mistake that you typically see them make:
Sri: Julia unfortunately I see this every single day in my life for the last 10 years. So I don't think we need to debate in ratings and reviews is important or not for brands - I think Peters already eloquently explained that - I think minds need to gravitate within brands to ratings and reviews is actually the social two way street conversation about the product. Even within the grocery universe there are products that are consumed a few times a day every single day and then there are products that may be consumed once a week based on a very specific need state. For many food and beverage brands that are consumed every day, most consumers are brand loyal, once they made a decision, five years ago, they're not really switching for the brand. And when they shop eGrocery they're automatically going to add the product to their cart, and they're going to put it on subscribe, those sorts of scenarios to review obviously doesn't have a prominent role to play because they aren't actually surfing and looking at ratings and reviews.
Where ratings and reviews become extremely important for brands is innovation. In these days, innovation is almost exclusively found by a consumer and the path to purchase online. Digital is virtually like +90%of browsing these days on the path to purchase. And then, even though you know 75% of the time she may pick up a product in store I'm gonna re emphasize, she is finding it online. And when she finds an innovation online food and bev she is looking for ratings and reviews before she passes a judgement.
In a past life, it is so boring, how my thinking on this is, but in a past life the equivalent of that would have been a display in-store. And if you thought about it logically that makes no sense because a display in store is not a social conversation of the product, maybe it was word of mouth and now it's online. So I encourage brands when you launch innovation no longer are you in an ecosystem or a world where you should do that without having thought through the social conversation about your product. I think where a lot of eGrocery stores falter is that they haven't understood that even though you may be a strong brand, and the automatic choice for a consumer in that basket, when it comes to innovation, you have to get ahead of your ratings and review.
The one other thing I want to point out is food and bev is also largely shopped on the basis of price and price promo. And so there's a lot of shoppers that basically hunt for EDFA products and will do brand switching in about 10 seconds based on the price promos. I'm not referring to those categories. Let's also talk about categories like protein bars veganism, natural, organic, these shoppers are so discriminatory and their choices ratings and reviews become a huge part of the selection set for how they find their product. So no longer can a food and beverage manufacturers assume eDLP based situations. I’m already in the cart, it's a subscription so I don't need to focus here. It's really going to depend on the purchase occasion.
Julia: I'm so interested in what you were saying there about how you've basically spent the past 10 years trying to get CPG brands to understand this. What do you think is happening within these organizations that makes it so difficult to have that mindset switch?
Sri: As an industry leader in the space, I've largely represented beauty skincare, cosmetics, baby, in these sort of categories, the ecosystem of online purchasing and browsing moved a long time ago, let's say, five, seven years ago and that's where the consumers have been. When it comes to food and that most food and beverage in the country, even today, pre pandemic, was sold in stores. Let's say nine 95% of food and beverage are sold in store and then there was a small niche really innovation driven 3- 5% which was really sold online, or ecommerce. In that sort of a business model, it's purely logical in my eyes for a brand, at scale, food and beverage brand to not really take this art of ratings and reviews as serious as it needs to be, because 95% of the business model is sitting in an ecosystem where ratings and reviews are significantly less relevant.
Now you benchmark that against startup food brands, the examples of the protein bars, etc we discussed, they almost exclusively are born online so they add ratings and reviews from day one. Now, boom it’s March 2020. She is almost exclusively looking for products online. You don't have ratings and reviews, a startup brand has it. You've been shopped last 10 years consistently by the shopper, they come online, you don't have your search strategy together, you get conquested because ecommerce is not a priority. And guess what? She finds the startup brand, and then she notices right away you've been conquested the startup brand is right at the top via sponsored search, and she sees +50 ratings and reviews so you won't even make the considerations. Even though you were that elite choice she had for the last 10 years. And that's what I worry about. That's what I have a conversation with the industry about. If you're in food and beverage you needed to have done this a long time ago.
Peter: One of the issues is now the fact that consumer packaged goods brands are starting to scramble to understand how they're going to exist on the digital shelf. One of the biggest obstacles is when it reaches a senior level decision and as someone who is more mired in the traditional way of how a product is sold.
One of the things that confronts them is the fact that in displaying product ratings and reviews the concept of actually publishing a low rated review. That is to many of these people antithetical to how they would go to market and what our data shows us, one of the probably the foremost authorities on product page usage is DebateArt Institute, they did a study a couple years ago, the single most used component of the rating and review section on product pages, is the ability to filter and look at one star reviews. Why is that? Because consumers want to understand exactly how bad a product could possibly be. That is what they want to go see. And if you don't share those reviews with consumers, then you're not going to be considered authentic by them. So what do we say to brands that gets them over this issue, it's that, your best bet is to display them but make sure that respond at a minimum, to every low rated review show that you recognise and are responding to their concerns, and that will show through to the people who are reading the reviews, they'll say oh the brand actually responded they're trying to resolve it. And if you offer the ability of the consumer after it, their issue has been addressed to then update the review all the better. But don't try and hide it, you absolutely have to invest against it, it's very important.
What we say to retailers in particular as well, is ratings and reviews are critical because the brand that they help more than any other brand in the store is actually their own brand. Nothing moves, conversion from national brand to private label. Better than product ratings and reviews we did this analysis with one of our grocery retailers. And what we found is that simply by adding ratings and reviews to their private label brand, they were able to increase your ecommerce sales and private label nearly 60% And it's actually quite intuitive most people think, well prices involved Well it certainly is but it's built into the equation the real issue is quality.
The issue with private brands has always been quality. I like to say that I don't care whether you discount paper towel, 5% or 90% off the national brand if the minute it touches water it disintegrates it's of no use to me and I'll never buy it but if I've got 50 to SRI’s point 50 100 People who said no, the quality of this private label product is good, that is enough to get them to try the product. And when a national retailer is able to convert someone from a national brand to a private label. Yeah, you see a little bit of a dip in the overall revenue boy the margin explodes. And that’s when they start understanding that they understand the ability to really drive sales through ratings and reviews.
Julia: I think this is fascinating and I want to quickly go back to your point you just made a little earlier which was how brands should think about negative reviews and the fact that actually responding to negative reviews and making sure they are visible to potential shoppers adds to your credibility and authenticity. What should you do about ratings that are in that sort of middling sector so they're not five star reviews, they're not one star reviews they're three star ratings. What should you take and related to that, what do you do if you're not getting any ratings at all perhaps not the sort of critical mass you're looking for?
Sri: When I shop for televisions, I did exactly what Peter just said which is, I filtered down to one star reviews, and I read the last 10 of them just to see what people are saying. I double filtered that down to the latest month, all the latest reviews on top of the one star reviews, so I was that discretionary and judgemental on my purchases on what I wanted to have.
When it comes to food and beverage, and you're really hunting for innovation, or a specific item like a vegan protein bar, you're doing the exact same thing because you're putting in your body and consumers these days, want to be very discriminatory on what they put in their body so I want to double underscore that. The one other thing that I want to mention on what Peter said is, I use the word social conversation. Ratings and reviews is 1/3 of the social conversation there are other pieces to that social conversation and then I'm going to logically tie that straight into the question now you asked which is, what do you do with those mid tier reviews like the two and three stars and what happens if you can't get a critical mass to impress the consumer.
So, the social conversations have many pieces to it. The obvious one is the comment, given on the actual review. But then there's the frequently answered questions. Peter already referred to the actual answered questions which is different from frequently answered questions, and then you have this mega vehicle called social media, which these days is primarily, Instagram, followed by Facebook food and bev tends to be more Facebook than Instagram. Instagram really has harnessed fashion and apparel and electronics. And then you even have Tiktok, these days, which is very organic and influencer led primarily. So you have a surround sound system to communicate with your consumer.
When it comes to innovation my general advice to any brand is, you should not put any innovation online until you have a clear strategy on how you're going to manage your surround sound on some social conversation ecosystem. A big part of that is you should not put an innovation online until you have done, test learns with your product, and you've generated a minimum, mark my words of minimum of 20 reviews. How do you do that, should you be buying reviews. No, you should not be buying reviews, what should you do therefore to generate 20 reviews, generate a large enough test and learn ecosystem with your product innovation. And make sure you follow up and ask people, could you please give me a review, you should never be saying, “give me a five star review” like the CPG guys sometimes jokingly say on their podcast, but even if you hear our podcast, there's a single episode that goes by when Peter like, do not request, all our listeners, all of you to rate us by going to rate this podcast comes at CPG guys. And the same way, brands can do the same, and request that someone does, and usually what I find is there is a compliance that comes by at least five to 10% of folks will take the time to do it because they received the sample, they were prioritised by the brand in terms of being in that unique super set that actually received a sample early up front so that so he focused on generating reviews.
Second thing you can do is you can actually go to answer questions on the retail website, and you can also have the social conversation there about requesting reviews from consumers, and I can tell you right off the bat, most are not good at this today, because the way the ecosystem of brand responses has been created over time, when a consumer is really for liability and risk avoidance, what digital is changing is you have to be dynamic and fast on your feet, brands often won't have the luxury and answer questions of taking a month to answer it and making sure it's triple clear from a liability check perspective versus an aggressive move to give the answer quickly to the consumer we just want their hunting So brands have to rediscover how they do their communications PR and their legal piece to fix this.
Finally, what do you do with the two star and three star reviews. Anything that's a two and one star, you should move in to answer questions and try to answer. What disappointed the consumer, because in a past life the only way for you to know would have been the 800 number that is called customer service, all reviewers is the faster mechanism for a consumer to either complain, call you, let you know, talk about you, the same move that they would have done by a 800 number, they're now doing it via a review, you need to take it with the same importance, and you need to give it the same attention by moving into an answered questions getting in touch with the consumer, maybe getting it moving to a third message ecosystem, and work on fixing the issue, versus, accepting it as its quote unquote it’s life.
Peter: Let me emphasise a little bit more of what Sri said, if you're launching a new product, do not let it hit the digital self without product ratings and reviews and even seeded questions and answers on the product page, because in the absence of having the actual product to hold and look at and consider you need that content, ideally is inclusive of the ratings and reviews or images of how the product is being used by consumers.
The best way to do that prior to launch is address that through a community, particularly if everyday influencers, people that in exchange for a product sample will write an authentic review, not a good review, and they're not getting cash payment for this. This isn't Kim Kardashian or some other big influencer, this is your mother, your sister, your cousin, your nextdoor neighbor, your coworker. These are people and they are the people who, over time, have joined a community where in exchange for samples, they'll write authentic reviews and what's important about those people in particular, is that you're going to get longer reviews, more meaningful reviews, they're going to address when you give them the sample will ask them, “what do you think about the flavour”. Bbe honest about it, not tell us how great our flavour is, it's really about that so when you can start by leveraging a community like that, to build out you're going to get very meaningful content and ultimately that is what will shine through to the consumers reading the review, and it will be bad because having come from a sample.
I'd much rather do that and allow consumers to in their own mind when they see that tag in that batch say okay well I'm going to, in some way, adjust my perceptions to Sri’s point of how I want to process that. But if it's getting you the meaningful content that addresses the issues and frees up and removes the blockage to the adoption to trial that product and that's a really effective way to get it done.
At a minimum you need to be addressing those low rated reviews. If you have the bandwidth, try to address all the reviews. If you're going to adopt this process, you need to know before you launch exactly which group in your organization customer service whatever is going to be point on answering questions and responding to reviews, and you need to do it in a very timely basis, you have to establish SLA so we're going to do that that's what's going to make you successful. If you put it out there, and you don't do that, and low rated reviews go unanswered and questions that are posed go unanswered you're not going to build up a lot of equity for your brand in the eyes of consumers.
Julia: Based on what you just said about making sure you've actually identified whose job is going to be to respond and engage with those reviews based on your experience, where in the organisation should that responsibility sit, does it matter is customer service the natural place for that or where do you think that that responsibility should lie?
Sri: It's a conversation I've been having with any brand I have touched over the last 10 years. Based on that, here's what I feel. Number one, brands need to have an overall strategy for social conversations. I don't like the word simply ratings and reviews, because then that's what brands will do. Ratings and reviews are nothing but a social conversation, and a judgement of the quality and the effectiveness of the product and whether the consumer likes them or not. So, it is yesterday's 800 number and it needs to be treated that way. Which means, the first thing I tell brands is this: back in my Johnson and Johnson days we coined a five-letter word for ecommerce capabilities. It's called SCANNER sales content assortment navigation and guess what the r is – ratings & reviews; that serious. It's like one of the five must have capabilities. So what I tell brands consistently is, as you would have a search strategy with your agency, you have to have a surround sound ratings and review strategy. So where you start with that is the following people need to get involved, the most qualified person in the role to answer questions from a consumer of any sort, whether it's a review, whether it's rating, whether it's a frequently answered question is the brand manager. Nobody knows the brand better than that person, but the support cast that needs to come to the brand manager is PR and communications to make sure that the data that they're actually putting out is meaningful to the consumer and it's accurate.
Second is the r&d team specially for food and beverage when it comes to, because we're talking equals three today, when it comes to ingredients, quality, things of that nature. Nobody's better qualified than the r&d team. Nobody's better qualified than customer service, to try and respond to the consumer in the way that they can actually have the conversation. Customer service is usually well trained on how to go back and forth, and generate the excitement back for the consumer to engage in the conversation, and then your social media team is the fourth which was largely today is starting to move more to instant PR sort of meets that cast of characters, it's not one unique individual, but the best qualified person in the nucleus of that is the brand manager.
Now to get this sorted cast of characters so you can give an accurate answer to the consumer, the last thing you want to do is give a knee jerk inaccurate response. The only way you can orchestrate this is if you have a strategy to orchestrate this, if you're trying to do this kneejerk 90% of the time you will find one of those cast cast of characters to partner with you and it dies in complete 75% of the time you'll find two it'll die incomplete. So it's extremely important you have ratings and review strategy. That's exactly everything, there has to be an SLA from PR and communications and SLA from r&d of how fast you will respond. In my mind. If a question is generated by the brand manager around a review, and around concerns from the consumer, or even love from the consumer. It's a 24 hour SLA, it's not a seven day SLA.
Peter: Let me add to that. So what the brand manager ideally is doing is framing out what amounts to a playbook, it's a almost a fact document of frequently asked questions. And it's not just about the answer that you give. It has to be reflective of the tone of the brand. So what I mean by that is how you respond to a question on a product for a Disney toy is radically different than how you respond for a brand that's an over the counter medicine right there's the level of seriousness the words that are used the tone is going to be very different. That's where the brand manager comes into the equation, they build the playbook and they hand it over to customer service, to actually then respond, and that will facilitate, to Sri's point, very rapid response because they know someone asked about this, your two or three different answers. Maybe they're the same answer, but with a couple of different words so it doesn't look on the page like you're copying and pasting but you give them the framework to answer that question very quickly. And what I loved about what Sri said is the very end which is social media. And it's not just about, they're going to respond on social media, but it's also about what they amplify on social media.
Brands need to understand that when they collect ratings and reviews that it is a goldmine of information, that if you use analytic tools that use natural language processing to organise and identify themes adjectives words that are commonly found in ratings and getting the review component of that. And you start to identify whether they are associated with positive or negative sentiment. That will give you a cue if your brand is actually resonating the way that you hoped it would. When you launched it, and maybe you need to actually adjust your messaging to reflect what people are saying about it or you actually need to reformulate your product to address the negative reviews, but once you've got that right you need to start using that content and applying it all throughout the marketing funnel.
That's the real key here because if you let it sit in the rating and review section of the product page, it's way down on the marketing funnel. You want to drive awareness you want people to see your product so you want to do things like include five star verbatims in sponsored ads on Instagram, and Facebook, you want to put verbatims on your homepage because if they've come to your homepage, they've already. They moved from the awareness to the interest phase of the funnel, but now you can start directing them to specific products on your brand page where you can take them to all the way down to the very bottom of the funnel, right, if someone's put a product in their cart, and we're all aware of what the term cart abandonment is, why not, when you're sending out an email to someone who has abandoned the product in their cart actually include the star rating, and the review count associated with that product to say “hey, we know you left this product, it's highly rated”.
We know just doing something as simple as that has a significant impact upon the actual conversion of back from the abandoned cart to actually buying the product so there is so much that you can do with ratings and reviews that go beyond just sitting on that product page, even taking some of those ratings and reviews and putting them in the image carousel. Our studies say, one the most important part of the product page is actually the image carousel for people who've never used a product because they want to see what it looks like. But as many as 40% of them never scroll below the fold. So even if you have a rating and review section, they may not even get to it, because they're just not inclined to do that, putting a verbatim or a summary of your review count and average star rating as an alternate image can convert an enormous amount of business for you, that you wouldn't have otherwise been able to do so there's so many places that this applies, up and down the funnel on product pages on listing pages on a listing page.
If I'm presented with 10 items, and you don't show me that little snippet of the average star rating in the review count you want me to go and click on all 10 of those items to learn that? We know in eGrocery particularly 50 to 75% of basket ads occur on the listing page so, in a low value purchase acquisition, just seeing that star rating and review account, may be enough to move from consideration right to purchase overtaking intent, and evaluation. It's really incredibly powerful. So if you're not sharing that content with your consumers everywhere you can on product pages, you're missing a lot of conversion opportunities.
Julia: So here's a question for both of you then: Who does this well at the moment, who are the CPG brands in grocery ideally but perhaps elsewhere if we can't find any good examples in grocery, that have been really smart about how they use ratings and reviews?
Sri: There are actually many, many, so I would ask you to pay attention to the startup brands, and the more niche, the need state gets, the more you're going to find they have embraced the digital ecosystem. The larger the brand is - and they've dependent largely on store orders for the distribution - the retailer really is not required. And even today, if you look at it a majority of retailers still haven't embraced ratings and reviews holistically and are still depending on a brand's DTC site to push out ratings and reviews to the retail website. So without naming names, the brands that are actually doing this well are the brands that are already in DTC, in some capacity.
Because the moment you enter DTC, you're in a true surround sound ecosystem of ratings and reviews. And once you generate those you're pushing into a retail website. Brands that have no notion of DTC whatsoever, you're going to find their ratings and reviews, only on a handful of retail websites that have their own platforms, but those that are using the syndicated methodology, you're not going to find a single ratings and reviews because retailers are not asking for it as they don't have the methodology whatsoever. So I draw this clear line in the sand: the weight and the muscle power here is more than the hands of niche need state brands in terms of who's doing this well. And if I started giving you names that list will actually be pretty long.
Peter: I'll just throw one very obvious one out there, the secret sauce. Without question the secret sauce for the success of Amazon is product ratings and reviews. They're the ones that really drove it into the industry. They understand the value that it brings. It's what drives adoption and it contributes to search and it ultimately leads to conversion. I'd say they've done a great job, third party analytics firms do analysis on retailer product pages, they say that at Walmart, the single biggest driver of SEO is review volume, so they're very focused on generating as much content as possible to help and brands that are selling through those platforms. If you're not doing as much as you can to generate content, you're not going to appear in the search results.
I would say those two in particular and what Sri said about the brands that started digitally native. That was their bread and butter because no one knew what their products were, they've never seen them in stores. And the great thing about them is they have an advantage over a lot of brands that aren't selling DTC is that they actually have order feeds; they have a list of people who have purchased the product. So simply soliciting feedback from those consumers knowing that they're verified purchasers, gets them well on the way to generating meaningful content. Perishable manufacturers that haven't been selling online they don't do direct to consumer and so their ability to easily leverage that asset to generate content, it's challenging for them and so as this adoption of ecommerce for grocery has exploded over the last year, they're all scrambling to try and figure out how to do that so the digitally native brands that have been able to sell online for years, they're the ones that are doing extremely well.
Sri: But I do want to give an actual tangible real life example that you listeners can kind of hover over to launch your browser and look at. So let's say you're searching for rice, just brown rice. Go to Amazon and type brown rice. I like Uncle Ben's rice. It's been part of my Quaker family of products for forever. So you think when someone's searching for brown rice, they're not going to be very discriminatory in their judgement, there's going to be like, three products, just go ahead and run this search for brown rice and see how many skews you get on Amazon that narrow your search down to Uncle Ben's rice: 6293 four and a half star reviews, and you can sort those reviews, dissect them by four star five star latest verified purchase. Brown rice, which you normally think is easy shopping. Why does the brand do this and generate 6293 reviews? Because the brand understands that post pandemic, the discretionary buyer behaviour is almost exclusively done online, they're not simply doing it because they need to answer a question they're also doing it because it influences the SEO algorithm of the retailer to show up on page one. As a podcast guest of ours very famously said “if you don't show up on page one, it's like bedding a dead body on page two and forward.” So do this not just for the conversation but for the SEO ranking as well. Hope that example helps folks.
Julia: I think that's a great example, I'm really glad you mentioned that. So if you are a CPG brand within a grocery, listening to this and ratings and reviews perhaps haven't been part of your strategy to date, where you haven't focused on it much. Where do you start, what's the first thing that you need to do?
Peter: The first thing you need to understand is, where is your brand available for sale. If you're completely direct to consumer versus, you have a distribution strategy that includes other retail sites like Amazon or Walmart or Target that's going to be your first decision because getting content onto those sites is important. Then you need to work with a ratings and reviews platform that allows you to not only collect and authenticate the content for your own display, but be able to match that against retailer assets, and then share that content so that it's displayed on the retailer site, and it's attributed as having been sourced from your brand site. So if you go to walmart.com or target.com, most of the content that appears on those sites if you drill down and read the individual reviews, it will say this review was written on brand.com. So, that requires using a platform like PowerReviews so you need to understand that's going to be much more important than the only handful of players that are in that space.
The second thing you need to start doing is once you've decided on that you need to figure out what are the assets that you have to be able to generate content. You need to figure out “do I have an order feed?” If I don't have an order feed, do I have a CRM database? If I do, that can be a very effective way to just send a message out to your existing people who've already opted into being part of your CRM and to say “hey listen, we'd love your feedback on our products” that can generate an enormous amount of content, you can use your social media channels and ask people who have self-selected to follow you on social media, to do the same thing, these are all very affordable methods.
And then certainly, if you're launching new products and they've never tried it. Avail yourself of your everyday influencer community so you needed to start generating your content. Then you need to start thinking about how you're going to analyse your content, learn from it so using analytics tools to assess what people are saying about it, and then start your display strategy, certainly, at a minimum, on the product pages of your own site, but also on the listing page is your homepage as I mentioned, social media, in any of print advertising. If you're still doing print advertising, think about retailers circulars on an ad block, why not include the star rating on an ad block certainly on a digital ad block?
We know that that can drive a substantial amount of click through so you want to be able to start working with a platform that has the capability to collect, the capability to moderate, to make sure it's authentic so to address fraud issues, and then also to be able to integrate with other platform providers and capabilities around how you display. And then from there be able to actually measure it and show that it's actually moving the needle, being able to discern between people who went to the site and interacted with UGC or didn't and understand what the implication of that conversion rate is, that's really what's going to be successful.
Sri: Peter gave you all the technical aspects of all the capabilities so I'm gonna give you the human element. Once you've finished listening to this podcast treat it as a wake up call. Wake up tomorrow morning. Get some oxygen, get some sunrise and stop being the executive no matter what level you are and what file you have that says ratings and reviews are not important because I'm in that category or I'm already inside a basket purchase because she almost always exclusively, I'll repeat, almost always, exclusively, she finds your brand online, especially the innovation that you're introducing. Post pandemic. This is not negotiable. Now, what does that mean to your brand?
You have to internalize based on who you are as a brand, the DNA of the brand equity that you seek to preserve grow or drive, but no longer is ratings and reviews a capability that you can just watch and let others kind of harness and take away from you so be the champion that actually is right in the middle of this, and drive the brand equity that your brand deserves with you right at the centre as a brand store.
Julia: Fantastic. Now at the end of each podcast episode We ask our guests to give our listeners one essential piece of advice that we call your #22ndsmart. Sri I think you have already done that brilliantly just now, but Peter, if you had to give us 20 seconds one piece of advice to a CPG listeners, listening today, what would it be?
Peter: Think of this concept of UGC or user generated content the industry term for ratings and reviews. Think of it as a journey, and not a destination. And by that, it means you don't just worry about going and collecting reviews and then you walk away. You need to be constantly paying attention to what's my volume, what's my average star rating, what's my recency, do I have coverage on my entire assortment? What's the average review length so am I getting meaningful reviews? And lastly, what's the overall sentiment. So that's where natural language processing comes in. So using analytics to address all those and and pay attention to those that will ensure the long term success of your ratings and reviews programme.
Julia: Now before we wrap up, could you also tell our listeners, where they can connect with you, and crucially where they can listen to the latest episode of your podcast.
Peter: The podcast, you can find it on as many as 40 Different platforms including if you have a home assistant like Google or an Amazon Echo, you can just ask it to play CPG guys, but just Google CPG guys, or go to your favourite platform and look for that you will find our podcast we are we are ubiquitous at this point it's kind of crazy and then for me the best way to find me is on LinkedIn, and just look for Peter VS Bond, and that's the best way to get ahold of me straight.
Sri: My humble request to your listeners to find us, is go over to LinkedIn, straightforward on your app or on the website, and in the search bar, simply type CPG guys and we will be the first page to show up, and you can just click the Follow button to follow us. If you want to get in touch with the CPG guys you can just direct message us at contact at CPG guys.com and of course Peter and I are both on LinkedIn you can always drop us an invite.
We do believe what you do Julia's drive industry transformation towards digital acceleration so that you can put the consumer right at the centre so I want to thank you for that mission that you're taking on with this podcast, and hopefully your listeners can continue growing, as well as they can participate with you in this digital transformation and acceleration phase of CPG.
Peter: We see this as a bit of a community. So if you go to CPG guys.com you'll find a list of our favourite podcasts, we listened to and what I can tell you is the digital shelf cast is prominently featured as one of the podcasts, we turn to because we think of ourselves as a community and we want to make sure that we're amplifying each other.
Download our FREE Guide to Category Management for the Digital Shelf The world of grocery shopping has changed forever. Category Managers now need to expedite their know-how of what it…
eGrocery is evolving at eye-watering speed, but does your team have the skills to make the most of the online opportunity? Read on and learn: Why CPG businesses need to…
In this episode we’re taking a deep dive into online ratings and reviews: why they matter to CPG ecommerce success and how brands can leverage them to supercharge sales online.
We all know ecommerce is exploding, but do you know how to fuel your CPG’s online success fast and at scale? Read on to find out: Why digital shelf analytics…
Together with the Consumer Brands Association we're looking at 5 key trends that will shape the CPG industry post-pandemic.
It's time CPGs get ready to win on Instacart. So read and learn: What's all the hype around Instacart and why CPGs should care Why CPGs need to act on…