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Customer product reviews more prevalent, profitable

While some Web 2.0 technology may face adoption challenges in the coming year, Kingston Technology says customer product reviews have quickly improved conversion rates.

Fostering communities around a product has received a great deal of press in recent years thanks to the growing phenomenon of Web 2.0 (or social networking) technology, but for Kingston Technology Company Inc., a Fountain Valley, Calif.-based maker of memory chips and cards, building product communities didn't seem worth the effort.

"You always think about that, because it's hip and trendy and you feel like a loser if you're not doing that," said Mark Leatham, director of flash business development for Kingston. "But frankly I don't see an environment where people are going to talk about their shared experiences with our 2 GB USB drive. It's just not going to happen."

Customer product reviews have been another matter, however. Since September, Kingston has been soliciting customer reviews of its products on its own website and pushing those reviews out to retailer

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BazaarVoice is not the only company beefing up its customer product review services. This week, San Francisco-based PowerReviews released PowerReviews Express, a service aimed at small and midsized retailers. PowerReviews Express offers capabilities similar to the company's enterprise product, starting at $80 per month, according to PowerReviews.

While some Web 2.0 (or social networking) tools will probably face adoption challenges during the recession, others -- like customer-generated product reviews, which have already demonstrated measurable value -- should be safer, analysts say.

Kingston has already seen a 92% increase in conversion rates for its products on the Office Depot site. There are other proof points as well:

  • According to a July study by the Opinion Research Group, 83% of consumers say product reviews influence their purchasing decisions.
  • More than 77% of online shoppers seek customer product reviews before making a decision, according to Jupiter Research.
  • According to a Yahoo/Harris Interactive poll from 2006, 60% of e-commerce purchases are influenced by recommendations from friends or family.

Before signing on with BazaarVoice, Kingston had already developed a place for reviews on its internal product pages, but "it was very rudimentary," Leatham said. "It's difficult to manage reviews."

In addition to syndicating to Office Depot, Kingston plans to deploy reviews on the

It's also providing Kingston's production and engineering teams with insight into the product. At one point, for example, reviewers pointed out that they lost the cap to their USB drive, convincing the company to develop a model with a swivel covering.

"These bits of information are very important to move the product forward," Leatham said. "It's a really good way to see how the market thinks about your product -- a poor man's focus group. You get a real good feel from the marketplace."

BazaarVoice currently manages reviews for 50 manufacturers and, provided a product has a stock keeping unit (sku), it can match that product up with retailers. There is no charge from BazaarVoice for the retailers to accept syndicated content, which has many of the retailers introducing their manufacturing partners to the service, according to BazaarVoice's chief marketing officer Sam Decker.

"Content is becoming a differentiator," Decker said. "If there are two inkjet printers and one has 14 reviews, that one will stand out."

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