In today’s competitive marketplace, building customer loyalty can be challenging.
Not only do shoppers have more choice, but they’re less trusting of a brand's own advertising and marketing hype.
There are various ways you can attract and retain customers, but user-generated content is by far the most powerful (yet least utilised) tool. Read on to find out how retailers can use authentic voices to encourage brand loyalty and increase conversions.
Retailers rely on brand trust and customer loyalty to sell their products. However, both of these crucial elements have been in steady decline over recent years – a trend expedited by the COVID-19 pandemic. According to figures from KPMG, global net trust has fallen to -4% compared with pre-pandemic levels, with grocery and non-grocery retailers among those most affected. But with 74% of UK consumers saying they would boycott a brand they didn’t trust, maintaining trust is essential if you want to secure repeat business.
It’s not just a lack of trust that’s hampering retailers’ efforts to retain customers. Thanks to the explosion in online shopping (another trend accelerated by the pandemic), there’s a wave of new online retailers vying for consumers’ attention. Shoppers are now spoilt for choice in an increasingly crowded online market. As a result, consumer loyalty is falling and retailers are having to work harder to attract and retain customers.
Even the big retailers can no longer rely solely on their name to keep savvy shoppers coming back. According to research by PWC, 32% of people say they would stop shopping with a brand they loved after only one negative experience, highlighting just how fragile customer loyalty really is. In this day and age, second chances are far from certain.
The question is, what can retailers do to generate trust and build lasting brand loyalty in a tough market? As we discuss, harnessing the power of user-generated content and authentic customer voices is one of the first key steps.
The power of user-generated content
The digital equivalent of word of mouth, user-generated content such as ratings and reviews brings the authenticity of someone impartial, and has become one of the main forms of social proof. It also tends to carry more weight than retailers’ own messaging, with over three-quarters of people saying they’re more likely to trust content shared by ‘normal’ people than content shared by brands.
“There is a big trend of UGC and people trusting the opinions of other people more than those of companies, which makes sense,” says Nosto’s Patrick Obolgogiani. “Younger generations, in particular, tend to like to see what their peers think about something – it is about social proof.”
With 64% of people saying they’re ‘often’ or ‘very often’ influenced by consumer reviews when buying, the power of user-generated content is clear. Sharing opinions, experiences and recommendations online has become second nature. So it will come as no surprise that ratings and reviews are now a core part of any shopper’s online buying experience. These days, most retailers, no matter how big or small, display customer reviews on their website at key moments in the shopping journey. And with user reviews thought to influence over £23 billion of UK consumer spending each year, it’s easy to see why.
5 Ways authentic voices can build trust and loyalty
Satisfied and loyal customers contribute 2.6 times as much revenue as other customers, so anything you can do to build loyalty will always pay off. Using authentic voices to communicate your brand story is one of the best ways to attract prospective customers and retain existing ones.
Want to know more? Here are five ways user-generated content like reviews and ratings can generate trust, nurture loyalty and, crucially, increase sales.
1. Customer reviews build trust and demonstrate transparency
Trust is one of the main factors that drives long-term customer loyalty. And that’s where reviews and ratings can play a vital role. Showcasing authentic customer feedback proves you’re credible and trustworthy, which can be very reassuring in an industry saturated with choice.
Transparency is also a key motivator for customers, with 93% of people saying a brand’s honesty and transparency are important when buying products or services. Using a third-party review platform like Trustpilot is a great way to demonstrate these traits as shoppers know you haven’t edited or falsified your customers’ feedback. There’s no better way of saying “we’ve got nothing to hide” than displaying customer feedback – both good and bad – for everyone to see.
2. Responding to reviews shows you value your customers
Taking the time to respond to reviews shows you value your customers and their business, which is vital if you want to build brand loyalty. If your customers know they’re buying from a company that cares, you’ll not only gain their trust but they’ll be more likely to recommend you to their peers.
Engaging with customers also shows the human side of your business, while personalising your response establishes an emotional connection that’s often missing from the online shopping experience. We might live in the digital age, but consumers don’t want their interactions with retailers to feel robotic or too corporate. According to Edelman’s 2020 Trust Barometer, 36% of those surveyed said they’d go elsewhere if a brand is inauthentic in its interactions. It proves that even today, personal relationships are still essential when it comes to generating loyalty.
3. Customer feedback can help you to improve the shopping experience
Reviews provide valuable insights that allow you to better understand your customers’ innermost wants, needs and expectations. You can then use this ‘feedback loop’ to improve your business operations and deliver a better overall customer experience, which is key to generating loyalty.
It’s a strategy that’s worked well for Swift Direct Blinds. “Not so long ago we noticed that a number of customer reviews were commenting negatively on the quality of one particular fabric we were using in one of our blinds,” says the company’s Head of Marketing, Simon Weigh. “We flagged it up and the factory looked at it and noticed a minor problem, but it was an important thing to correct. We ended up changing fabric suppliers as a result of that insight.”
4. Reviews give you the chance to address complaints and fix mistakes
Unhappy customers are more likely to leave a review than satisfied customers, so it’s important to have a robust response strategy in place. Although negative reviews can be disheartening and sometimes frustrating, they’re not necessarily a bad thing.
For a start, they give you the chance to explain a situation fully if something does go wrong. As counterintuitive as it might seem, negative feedback can also reassure other potential buyers. Anyone viewing your product reviews can assess whether that particular issue is likely to affect them and, if they’re satisfied with your response, they may even feel confident enough to make a purchase.
Of course, handing the microphone to your customers can be daunting. But by viewing consumer insights as an opportunity rather than a threat, your customer service will improve, and brand loyalty will naturally increase.
5. Product reviews can address shoppers’ wider queries
As the cost of living soars, cash-strapped shoppers are more cautious about their spending. If they do choose to purchase something, they want complete confidence that they’re buying the right item. Is it true to size? Will it fit in the boot of my car? Is it dishwasher safe? And that’s where reviews can help. Hesitant shoppers can scroll through a retailer’s reviews to find answers to questions beyond those addressed in the product description.
Being able to access this level of information reassures shoppers, meaning they’re more likely to part with their cash. It’s also a great way to notch up your trust rating and increase brand loyalty. After all, if a customer knows they can find all the information they need on your website, they won’t need to look anywhere else.
The voice of the consumer is more powerful than ever. By fully embracing this change in dynamic, retailers can forge meaningful connections with customers and generate long-term brand loyalty.
For more information on how user-generated content can build brand loyalty, read our beginner’s guide.