Retailer Follow Up On Negative Reviews Pays Off

According to The Retail Consumer Report, commissioned by RightNow and conducted online by Harris Interactive in January 2011 among 1,605 online US adults who shopped online during the most recent holiday season, consumers who have a bad experience, will not come back. And more than ever, unhappy consumers are turning to the social web to share their complaints.

However, retailers have an opportunity to fight back and use social media to turn unhappy customers into brand advocates, says the report that shows how retailers are using social media to win back customers and drive buying decisions.

68% of consumers who posted a complaint or negative review on a social networking or ratings/reviews site after a negative holiday shopping experience got a response from the retailer. Of those, 18% turned into loyal customers and bought more.

By listening and proactively responding on the social web, says the report, retailers have a chance to turn disgruntled customers into social advocates. The survey found that, of those who received a reply in response to their negative review:

  • 33% turned around and posted a positive review.
  • 34% deleted their original negative review.

Consumer's, however, have fairly low expectations that retailers will respond to their negative posts. Of the 32% of consumers that did not receive a response to their negative review from the retailer, the survey confirmed:

  • 61% of consumers would be shocked if a retailer responded to their negative comment on the social web.

The data underscores that customer experiences shape consumers' decision to buy or not to buy from a specific retailer. After a positive shopping experience, half of consumers cited great customer service and/or a previous positive experience as influencing their decision to buy from a specific online retailer.

  • 31% of consumers purchased more from the retailer.

However, poor customer experiences can stop consumers and kill a potential sale. The survey found that, after a negative holiday shopping experience with an online retailer:

  • 21% of consumers decided not to buy anything from the retailer.

Social advocacy can also help drive sales, the survey found:

  • Nearly a third of consumers researched what customers said on social networking and reviews websites while shopping online.

For those consumers that had a positive holiday shopping experience with an online retailer during the past holiday shopping season:

  • 21% recommended the retailer to friends.
  • 13% posted a positive online review about the retailer.

The survey found that 38% of consumers turned to the retailer's website for information or support with online shopping. However, one of the top frustrations consumers had when shopping online was a lack of consistent information from retailers. Specifically, 22% of consumers were frustrated by information that was inconsistent between the retailer's website and customer service agents.

And, a summary report from Marketing Charts concludes that retailers focusing on a young customer demographic might want to pay extra attention to results of this report as a high percentage of US youth ages 8-24 uses social networking sites, according to another recent study from Harris Interactive. Results from "YouthPulse 2010 indicate three-quarters of 8-to-24-year-olds use a social networking site and about two-thirds (68%) spend time on a social networking site daily.

For further research on how customer experiences impact the bottom line, including the fact that 85% of consumers said they would be willing to pay anywhere between 5-25% over the standard price to ensure a superior customer experience, RightNow makes the Customer Experience Impact Report 2010 available here.

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4 comments about "Retailer Follow Up On Negative Reviews Pays Off".
  1. Howie Goldfarb from Blue Star Strategic Marketing , March 16, 2011 at 12:20 p.m.

    Jack I have first hand experience with this. I have a gourmet dessert client in LA who occasionally gets the bad Yelp! review or negative blog review. At first she was scared of these people. Now she addresses each one and we have a few who are rabid brand ambassadors now.

    It's pretty simple. We view most companies and cold businesses, not people. Ones who don't care they just want to sell and then blow us off. Many act this way. But when they actually care and ask us why we are unhappy and how to fix it? People respond!

  2. Joe Jacobs , March 16, 2011 at 2:57 p.m.

    I've tried to make it a practice to let the vendor/retailer/restaurateur know that I've had a bad experience and why I thought it was bad.

    The ones that don't respond I never patronize again. The ones that do I give a 2nd chance to and they're grateful for the chance to make it right.

    But you have to speak up. If you don't say anything, they may never know anything is wrong. The manner in which you inform them is also key. Being respectful and less emotional when you tell them what happened usually pays big dividends. Besides, that's just the right way to conduct yourself in these types of situations.

  3. Silvia Bitchkei-campbell from Xclamation Marketing , March 16, 2011 at 10:18 p.m.

    Indeed a simple "Sorry for the bad experience, let us make it right." will suffice. If you take the time to listen and to react, your costumers will surely appreciate it. And the guts to admit that you made a mistake will add a much needed a personal touch that we all welcome.

  4. Laura Saati from e-dialog , March 17, 2011 at 10:33 a.m.

    This is proof positive that you really can “turn that frown upside down!’’ As channels continue to converge, this just illustrates how important it is – and how much the customer now expects – communication to be a two way street. And there’s no reason why we can’t apply these learnings from the social channel into e-mail as well. If you have a ‘ratings and review’ e-mail program for instance, what type of feedback loop do you have in place? If someone submits a poor review and/or is clearly disgruntled/disappointed with their experience with you, are you using your most profitable channel (e-mail) and investing in reaching back out to understand what happened and make it right? It sure sounds like it will payoff in the loyalty, share of wallet, long run if you do. Holiday 2012 will be here before you know it – it is never too early to begin the planning process and this sounds like a perfect place to start. For additional metrics and research on last year’s holiday season plus ideas for this year, check out The Relevant Marketer: http://bit.ly/eJV0gh.