CompUSA Turns On to Word of Mouth

Like many companies, venerable electronics retailer CompUSA has observed the ballooning force of consumer-generated media and recently determined that it needed to address the phenomenon.

Particularly in the high-consideration realm of computer and home entertainment components, online word of mouth has only grown in importance. The simplest and best way to embrace the trend, CompUSA decided, would be to add consumer reviews to its site.

Once it made that decision, the company had to decide whether to build or buy. It opted to outsource the implementation to Bazaarvoice, a new venture from Coremetrics founder Brett Hurt that hosts and manages customer reviews on e-commerce sites.

Though officially just launched, Bazaarvoice has been around since fall. Its work for CompUSA, undertaken in September and October, was among the firm’s first client deployments. Others include PETCO and Golfsmith.

Strategy and Implementation

User reviews have been more commonly implemented by shopping search engines and aggregators like Shopping.com, rather than by retailers like CompUSA. (Exceptions include Amazon, most notably, and CompUSA competitor Circuit City.) It’s easy to see why. Bad reviews are likely to deter sales of a product, and it takes a leap of faith for a retailer to actively push an honest product rating mechanism to its customers.

CompUSA was unconcerned; the company believed the presence of negative product assessments would improve customer loyalty in the long run.

“It’s the customer’s voice, and not just our merchant voice saying, ‘Hey we want you to buy the camera,'” said Steve Fernandez, analytics business development manager for CompUSA.com. “The conversion point, sure that helps pay for everything in the end, but if you help satisfy the customer… you can help win the customer, not just close the sale.”

At the outset, the company had a little chicken-and-egg problem. It wanted the reviews to coax prospective buyers to the site, but couldn’t promote the feature until it had reviews.

“You start at zero and you don’t have much to sing about,” said Fernandez. “You have this odd marketing balance where you say, ‘Well, I need to have some people come and use this thing so we can turn around and tell people we have it.”

The number of reviews on the site has grown steadily, but not as quickly as CompUSA would have liked. To help things along, the company recently launched a promotion entering anyone who writes a review in a drawing to win cash. That effort started last week and runs through February.

Additionally, it decided to enable anonymous ratings of its products, something Bazaarvoice initially urged against. Fernandez said it was the right thing for its site, since many of its products have very short purchase windows.

“With electronics, you’re dealing with two- to four-month lifecycles,” he said. “ATI just came out with a new video card, which means two more products are falling off. It’s a constantly moving target.”

In other words, the less time between a product’s launch and consumers’ review of it, the better.

Results

CompUSA’s said the reviews have had a positive impact both on conversions and average order value. Visitors who read the company’s product reviews were 50 percent more likely to convert than those who didn’t. And those same people spent an average twenty percent more per order than the typical customer.

Another benefit has been organic search optimization. As of this morning, user reviews on CompUSA were the first-ranked search result on Google for the term “Xbox 360 platinum review,” and the company’s product reviews rank well in other categories as well. Traffic from these searches directs to landing pages that are hosted by Bazaarvoice but live on CompUSA’s domain.

“With the reviews refreshing, you have fresh content that’s varied,” said Sam Decker, VP of marketing and products for Bazaarvoice. “The search engines love that. That’s driving incremental visitors and customers to their site, customers that [are] high in the consideration phase.

He added, “Paid search is becoming a lot more expensive. It’s a fantastic strategy to bring in new visitors through natural search.”

Fernandez agrees with that assessment, but he describes the organic search traffic as a “soft benefit,” at least so far. Visitors coming in through product review landing pages accounted for less than one percent of CompUSA’s total referral traffic in November and December. However, he said it’s reasonable to think its share will increase.

With time, Bazaarvoice believes CompUSA will also discover that its consumer reviews increase loyalty and reduce returns, though the client has yet to record those outcomes.

Word of Mouth

A further benefit, one CompUSA has only begun to realize, is the product and site intelligence its customer reviews provide.

Fernandez believes word of mouth insights generated by user reviews will improve quality control and customer service.

By way of example, he relays what one CompUSA customer wrote in a recent product review. The reviewer described how on a visit to a CompUSA store, an employee had an image on a Flash drive, and he allowed the customer to plug the drive in and print from several different printers to compare the products. As a result of that review, the company is considering offering comparison printing as a service in all its physical branches.

In another instance, the information offered on a product description page did not match the actual product. Customers noted this and posted the discrepancy in reviews, after which CompUSA spoke with the manufacturer and corrected the error.

“We’re not gun shy,” said Fernandez. “If we see reviews from customers challenging the claims of the manufacturer… we will go to the manufacturer and ask them either to defend their position or clarify their claims.”

Said Bazaarvoice’s Decker of the client, “They’re taking our insights and taking it into the stores. They really understand the value of customer community.”

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