More people are looking to online reviews, which are having a significant impact on their purchasing decision.
Deloitte’s Consumer Products group found 62 percent of people read consumer -written product reviews online. Out of those who read product reviews online 82 percent said their purchase decisions had been influenced by reviews causing them to buy a different product than originally intended or causing them to stay with their original choice.
Sixty-eight percent of Gen Y rely online reviews the highest of any age category, while 42 percent of those age 75 and over use online reviews, the lowest in any age category. The reach of consumer reviews is also offline with 69 percent of consumers who read reviews sharing them with friends, family or people they work with.
“This increasing market transparency can adversely impact the margins, market share and brand equity of consumer products companies,” said Pat Conroy, vice-chairman and US consumer products group leader at Deloitte & Touche USA LLP.
“In the past, clever marketers and advertisers shaped brands, but now consumers are increasingly empowered, everyone has a voice, and information and opinions are instantly dispersed.”
Conroy said that consumer product companies should learn to use reviews to their advantage or else deal with the outcome.
“As knowledge proliferates, there is a tendency for products to commoditize,” said Conroy. “In order to successfully compete, it’s imperative for consumer brands to build and maintain their images, create differentiation, and enhance loyalty.”
“For example, consumer product companies with exemplary supply chains can achieve differentiation by making their processes more transparent. Embracing higher-than-required quality and safety standards can reassure customers and built trust. And co-opting customers to create value with the company can create not only loyal customers, but also brand emissaries.”
