Retailers are increasingly using content created by their most rabid fans to promote their products. In this webinar, we take a data-driven look at the practice of incorporating reviews, ratings, photos and other types of user-generated content in your marketing.
Robert Moore: Okay, thank you everyone for your patience. My name is Robert J. Moore. I'm the CEO and co-founder of RJMetrics. And we are extremely excited to partner with Curalate today to bring you this webinar on fostering engagement with user generated content.
I'm joined today by Brendan Lowry from the Curalate team. And we will be working hard to bring you a lot of information on everything from the basics of user generated content through to some very interesting case studies on how it's being used today.
Just to give you a sense of the structure of the webinar here today, at the conclusion we will have a Q&A session. So for those of you who have questions, please tweet them with the hashtag #ecommerceugc. Our team will be keeping an eye on that hashtag and compiling questions for us to answer at the conclusion of the presentation.
Of course we are recording the show today so we'll be able to archive it and send you a link that you can share with your colleagues and friends, if you'd like to distribute this after the fact. And that follow up email from us will also include additional information that came out that exists, including the slides and any links or third-party resources that we chat about today.
So just to give you a sense of what to expect, and what you'll be learning here today. Really we're going to start with a focus on the importance of user generated content in your e-commerce strategy. We're taking a specific approach toward talking about UGC in e-commerce or at least among those people in the audience who are selling things on their website whether it's through traditional e-commerce or next generation e-commerce solution.
We'll also be revealing some never before seen data about how user generated content is used among the top 500 Internet retailers. That's based on study that we conducted here at RJMetrics. And you will be the first people to see that data. And, thanks to the Curalate team, we'll have some very interesting case studies on how some brands are implementing UGC today to drive sales and engagement.
And so, that's the plan for today. We will get our 15 second commercials out of the way up front so that we can get right to the good content. But we do want to tell you just a little about who each of these companies are, Curalate and RJMetrics. And I will turn it over to Brendan to chat briefly about Curalate.
Brendan Lowry: Thanks, Bob. And thanks to everyone who's joining us today. Curalate is the leading marketing and analytics platform for the visual web. We help brands drive engagement and revenue with both brand owned and user generated images across Pinterest, Instagram, and Facebook.
Today we're really excited to share with you newest product Fanreel, which helps brands with the UGC side of things by collecting user images across social, connecting those images to specific products, and then displaying those images in custom branded photo galleries for both browsing and shopping. And you'll actually see a few examples of Fanreel towards the end of this presentation.
Robert Moore: Excellent. Thanks, Brendan. Quickly on RJMetrics, we are a hosted business intelligence solution that helps online retailers make smarter decisions using their data. We're used by many of the fastest growing online retailers out there, basically to compile data from shopping carts, third-party data sources, customer relationship management systems and other channels under one umbrella, and allow our customers to explore and understand that data via a web-based dashboard.
A lot of our customers use us for things like understanding marketing ROI, looking at the impact of things like user generated content on everything from average order value to customer lifetime value, to retention and conversion rates. And, ultimately, we service a single version of the truth and a single source of the truth for our customers in the universe of e-commerce. So definitely take a few seconds and check us out at rjmetrics.com. We've got a free 14 day trial, and it's definitely something worth exploring.
With those plugs out of the way, let's dive into the good stuff here. Today's agenda, as I mentioned, we're focused on UGC. We'll start with the basics. And then we'll dive into why it matters. Not just for retailers, which I'll speak to, but also why customers are interested in UGC. But we will then talk through the data that I mentioned earlier about user generated content and its usage on the Internet retailer top 500.
We'll go through some UGC case studies where some newer brands are doing really interesting things with user generated content on their websites and within their social presences. And of course we'll have some takeaways, and just some items that you can do today to help tap into some of the benefits offered by user generated content.
As I mentioned, we'll finish up with a Q&A, so any questions that come up along the way, feel free to just tweet those with the hashtag #ecommerceugc. You'll see it there in the footer of our presentation throughout the show today. And we'll look forward to compiling those questions and answering them when we're all wrapped up.
But before we dive in, one thing just that we would love to know is a quick two question survey. If you could just complete the survey that is appearing now on your screen, just to give us a sense of who's in the audience so we can optimize the message we're delivering for the crowd. We'll give everyone just a few more moments to respond.
Okay, quite a broad spread of folks in the audience today. The largest category looks like they do sell products. Some people selling services. A lot of people selling both. So it looks like a pretty heavy crowd in terms of online-commerce. And for the folks not selling things online, I think there's still quite a bit of useful info in here about UGC that we can tap into. So let's get on with the show.
So, let's start out with a very basic question. What is user generated content? Obviously, to a lot of folks, the name says it all. User generated content is a content that was generated by users, or people who are not you. People who are your customers. For the purposes of our presentation today, though, we're going to put a little bit of a finer point on it. Which is that user generated content, for our purposes, is any fan engagement that is re-purposed by brands to drive sales or marketing messages.
So it's not just anything in the universe that your users have created. It's specifically something that you can leverage that your fans have created in order to enhance your sales or marketing connections. So these fall into quite a few categories. Probably the most prevalent out there are ratings and reviews. And maybe when you see these so often that you don't always think of them as saying "hey, that's UGC." But really, if you look across the Internet, specifically within e- commerce, ratings and reviews are by far the most popular form of user generated content out there. And they've become a staple on a majority of online retailing websites.
Other forms of UGC, which are more of the emerging type are photos and videos. We're seeing an increase in the number of retailers use content of a more visual form that's being generated by their users, fans, and customers. As we'll speak to later, some of this is being generated and uploaded right on the e-commerce site. Some of it is being generated within social, and some are really creative hybrids of the two.
And there are also forms of user generated content that are not as obvious. So collaborative filtering is a great example where, I'm sure many of you have seen the classic "customers who bought this item also bought" variety of collaborative filtering. Which is basically taking advantage of information about past users behavior.
Now, if you think about it, there are a few different ways that this can be broken out. You may have seen filters that say "customers who looked at this item also looked at these other items." We have the example showing here which is "customers who bought this item also bought these other items."
And Amazon has pioneered quite a few things in this category. One of which is the customers who looked at this item actually ended up buying this other item each percentage of the time.
Collaborative filtering, while users aren't necessarily aware that they are contributing content to your website, ultimately their behavior, and the data created from that is shaping the way that your website is structured for additional users. And that's precisely falling into the user generated content bucket that we described.
So I mentioned Amazon already. Really the pioneers in this universe were Amazon and eBay. And if you think about it, it really is going on almost 20 years ago, at this point, that these companies were getting their start and really blazing the trail in terms of the way that user generated content, specifically within reviews were being promoted.
They're still continuing to innovate here. One of the things that I've been noticing on Amazon lately is that the reviews themselves now have reviews. So you can see in this screen shot here they are actually prioritizing the reviews that are displayed to customers on Amazon based on how other customers have ranked that review in terms of it's helpfulness.
So you can see here 17 out of 19 people found this particular review helpful. And being able to display reviews, whether it's based on meta-reviewing like that, whether it's based on chronology and is displaying the most recent reviews really gives a lot of power to the consumer in terms of finding out the kind of review information they want.
This, again, is really just taking that same population of tradition UGC reviews and that using meta-data and other information that's available in order to do a better job of making it valuable for customers.
And, if you really think about it, it may not seem so obvious today, but reviews at the time were quite revolutionary. Jeff Bezos actually, in the early days of Amazon took a lot of flack for being so open with reviews on the site. And people would challenge him and would say "why would you ever want someone to publish a review on your website that's negative about a product that you are attempting to sale?"
And Jeff Bezos has this quote that we pulled, this is back from the early days. He said, "We're taking a different approach. We want to make every book available; the good, the bad, and the ugly, to let the truth loose." And I think that mission has succeeded, and succeeded quite well as we'll see the prevalence of reviews of this type among the leading online retailers today, it's staggering.
And UGC, of course, continues to evolve. Urban Outfitters is one of the trailblazers in this area. User generated content is creeping up on all of their marketing channels, that's where the content is trending. And I think that this is something not specific to Urban Outfitters. I think it's something where they are early pioneers in this area. And ultimately the entire industry is going to start seeing the positive lifts in conversion, customer loyalty, and engagement that come from more creative use of the next generation of UGC content.
So why should retailers care about this? Well, let's talk some numbers. 75 percent of reviews posted on review websites are positive. 95 percent of unhappy customers will return to your business if it issues results quickly and efficiently. 71 percent agree that consumer reviews make them more comfortable that they are buying the right product or service. 70 percent of people consult reviews and ratings before purchasing. People are 63 percent more likely to purchase a product from a site if it has product ratings and reviews.
Let's stick with this last one here. I will read it again. People are 63 percent more likely to purchase a product from a site if it has product ratings and reviews. This is the power of user generated content. And as we talk about the evolution of what's happened with reviews since the early days of Jeff Bezos, where reviews seem like a liability, it's become extremely clear that the conversion lifts that happens as a result of having user reviews on a website is so substantial that it could really be the difference between the success or failure of a business.
A lift like that in conversion rate is not something that is easily found out there today. But there has developed a certain consumer expectation around this content existing. And it's something that's absolutely critical for online retailers.
As you can see here, to put a finer point on it, customer reviews create a 74 percent increase in product conversion, 74 percent, which is quite amazing. If you combine those last two pieces, it reveals that even the effect of this user generated content may even be more than consumers are aware of on their willingness to purchase a product based on the existence of consumer reviews.
So, let's talk about what happens over the course of a retailer's maturity when it comes to user generated content. As we see it, there are really three stages. There is onsite user generated content. This is ratings, this is reviews, this is an internalized system in which you collect and display user generated content onsite.
When you go to the next level of maturity, you can actually reach out and start to tap into your users, your fans, etcetera, on social networks and start to collect information there. And really the third level of maturity here that we're just starting to see online retailers use is engaging users on social networks and then pulling that content back onto the original website, which is the point where conversion takes place.
If you think about these three pieces of the maturity model, it makes a lot of sense that that's the direction that most retailers end up going in over the course of building out their UGC strategy. If you think about onsite content, the level of conversion is very high onsite, obviously, because that's where people go to buy.
So if you've got someone who's already there, and they are in a position where they're looking at a product already, you've got a really high probability of being able to make a sale. However, you're limited to the audience that you already have. The level of engagement on a global level is actually very relatively low. And while it increases conversion, it doesn't really achieve the objective of increasing the number of people that are there in the first place, and that are being by this content to buy.
If you move on to social, you start to correct against that problem, but you get a little bit of the flip side. Which is that you have a much broader audience, you're able to engage more people on a regular basis, you are putting content in the places where they are already going, even when they are not making a purchasing decision.
However, the conversion that exists on social channels by and large, at least today, is effectively nil. It's very rare for a full transaction to be taking place on social channels. And getting people from social, back to a website, into a purchasing situation obviously requires many more clicks, each of which has subsequent drop off. And it becomes very, very difficult to have a conversion impact at the moment that this content's being delivered.
When you get to social onsite is where it starts to be very interesting. You have opportunities now for not only engaging a much larger universe of people through social channels, but you've got direct hooks into the website and the point of purchase. So when you're able to combine these things by taking information from the social universe and incorporating it into the very place where your transactions are happening, this is where retailers are really seeing the highest depth of maturity and also really being able to make the biggest impact on both the conversion and the engagement pieces of their businesses.
So, the main takeaways from this is that, for retailer, you really want to frame the conversation by driving engagement on site. At the end of the day, you want to sell more products. And it's very important to figure out ways by which you can leverage user generated content. Do that.
But it's very, very important, of course, that you're pulling user generated content back to your product pages in order to generate those conversions because that's where the real lift can take place. So, with that said, I'll turn it over to Brendan who's going to talk about not just why retailers like UGC, but why do the customers want UGC. Take it away.
Brendan Lowry: Bob has done a great job providing us all with details on how UGC has grown over the past few years and the way that it's impacting retailers. Let's transition and talk for a few minutes about the benefits of UGC when it comes to customer behavior and why consumers actually want to engage with UGC throughout their online shopping experience.
There are really four main, key functions of UGC that improve the overall customer experience, which will ultimately lead to more sales, which is really the end goal for every Internet retailer. So, featuring user generated content, and specifically user images on site will help create a new level of social proof for incoming visitors and browsers.
It also enables brands to merchandize much more effectively, and it helps them establish trust among their customer base. And, finally, it allows you to celebrate your fans in some really creative, new and unique ways.
And, as a consumer, you actually experience these four functions every day in the real world, when you're shopping in person at your favorite stores. Imagine for a moment walking into an Apple store that was completely empty. There may be a few employees lingering, but there really isn't a single customer around. It would feel strange.
You may not notice it at first, but after a while you'll probably start to wonder 'where is everybody?' And, whether we realize it or not, every time we walk into a store, we're getting these social signals. From the amount of customers in the store, to the type of customer, to how they're actually interacting with the products, people rely on these signals when making everyday purchasing decisions. So, whether it's social proof, merchandizing, trust, or fan celebration, when someone shops online, they're looking for these same exact cues.
And UGC helps bridge that digital divide. I didn't bring those "I'll find social cues," to the actual online shopping experience. And the first example is social proof, which is driven by the assumption that surrounding people possess more knowledge about a given situation. And, as a result, people assume the actions of others are correct. They then tend to follow those peers and the actions that they're taking.
When we're approaching this from an Internet retailer's perspective, it's clear that website browsers are actually inherently looking for social proof to help them make purchasing decisions. And by featuring user images of your products being worn or used, you'll actually achieve this.
The second item is merchandising. So now that users are being influenced by their peers, and they have an interest in taking that next step to purchase, how do we make them make that decision faster? And, as you know, one challenge for Internet retailers is that, for most physical products, they're easier to evaluate in person than online.
By bringing user images on site and featuring these next to product photos, you're providing your customers with a way to visualize themselves using your product in the real world. This tactility reveals how a product actually works, fits, or even operates. Which the standard product or model photography may not fully achieve. Together these two really complete the story of the entire product for your customers and, again, help them make that purchasing decision faster.
The third function of UGC is trust, which Bob has mentioned a few times throughout this discussion. And this should be really straightforward. At the end of the day, as a consumer, who do you trust more, corporations or your peers? A recent study by Nielsen found that 84 percent of people trust recommendations from the people they know. That number, clearly as you can see these different statistics, trumps any form of advertising.
And here's an example of really the complete UGC picture highlighting that level of trust. In this case, this brand is putting their product out there to be judged. By inviting consumers to openly share their opinion, this reinforces the belief and confidence that a brand has in the quality of their product. They're putting themselves out there to their customers and asking them to share their opinions, good or bad.
And as a result, consumers are smart. They sense this. And it generates a new level of trust that just wasn't available before for Internet retailers.
And then the final, fourth function is fan celebration. And, while this doesn't necessarily have a short term tie to revenue and it's much more of a long term play, featuring UGC gives brands the opportunity to celebrate their fans in really unique ways. And this type of engagement validates your customers' purchases and actually transitions them from casual, normal fans, to fanatics.
And this is actually a real world example from one of our clients Urban Outfitters, who has their own image gallery on site. This Instagram user came across Urban Outfitters gallery, saw that she was featured, took a screen shot of it, and then posted that to Instagram, really showing an amazing endorsement for Urban Outfitters. You can read her comment here. "One of my fav stores. BRB. Hyperventilating." So she's pretty much freaking out that she was featured on Urban Outfitters site.
And this type of brand loving, brand affection, you really can't put a dollar on this. It's impossible, the amount of advertising, the amount of marketing that you can do, there's no way to pay for this type of love. And so we've mentioned a few retailers in this discussion so far. Bob's going to take a much deeper dive at the IR 500 and really show you how brands are starting to leverage UGC in this top industry.
Robert Moore: Great, thanks Brendan. As I mentioned before, we had an opportunity to pull some data from among the Internet Retailer 500. For those of you not familiar, that's a list of online retailers as determined by Internet Retailer that are the 500 largest in terms of annual revenue.
We were able to analyze their website, and identify the use of user generated content on those sites. As you might have been able to guess, product reviews and product ratings, very, very prevalent among that population. I was actually surprised to see that it's only 73 percent of retailers with product reviews from among that population of very large online retailers. And 19 percent of them are using some form of collaborative filtering. That's the feature that I mentioned before around customers who also purchased this also purchased these other items.
Now those are within the category of onsite user generated content. The real question that we had was, what happens when we start looking at the social piece of this? Just how engaged in social UGC is the Internet Retailer 500?
Well, if you look at what is being actively used, and also promoted by the members of the IR500, Facebook and Twitter, obviously, are the champions there. The vast majority of retailers in the IR500 with a Facebook and Twitter presence. Pinterest and YouTube at the bottom of that list. Right around half have some kind of presence on those social networks. And it's really Instagram and Google plus that kind of bring up the rear there.
And, specifically looking at the Instagram and Pinterest side of the universe is where you start to see a picture of how images and user generated content that is not necessarily review based, or text based, starts to become relevant. So, you see those numbers on those networks, still substantially lower than the percent that are using product reviews on site, but definitely a meaningful percentage, and one that is growing for sure.
And when you look at social onsite, so this is basically taking information that's somehow generated through those social networks and re-purposing it or placing it back on the Web, this is where we see a lot of these large retailers still behind on the maturity curve. Really, only the most innovative 3 percent or so are able to use videos and photos from the social channels that they're engaged with, and bring that back into the Web environment where the actual conversion and purchases are taking place.
We would be willing to place a very strong bet that these numbers continue to climb, honestly probably in all three of these categories. But you can really see where the biggest gap exists is between that social participation and actually using that social information on site at the point of conversion to help increase that lift.
And as Brendan showed with some of the statistics he was providing, the difference between a somewhat anonymous online review, or a review from someone who you don't know personally, and an endorsement from a friend or a peer is very, very substantial. And again, we're looking at these conversion rate lifts as being one of the most valuable things that an online retailer can achieve by taking advantage of any strategy, including user generated content.
The take away here, really, is that it's early days, and there are a lot of opportunities for innovators to come in and do really interesting things with user generated content, particularly within online retail. And, with that said, Brendan's going to show you a few of them. And some cases where retailers who may, or may not, even be on that IR 500 list are doing really innovative things with their UGC in order to help drive a better consumer experience and lift conversions.
Brendan Lowry: Yeah, thanks, Bob. And, as you've mentioned, there are significant opportunities available. We've seen this throughout the transition of social. Brands who are early to Twitter, Pinterest, Instagram, they were able to really capture this type of engagement that just wasn't crowded yet.
And, as you saw there, only 3 percent of the IR 500 are actually using user generated images on site, which I'll show you in a moment the brands that are actually taking it seriously and bringing that content into their marketing and into their e-commerce site are seeing some really, really good results.
We'll discuss a few forward-thinking brands. And the first that we'd really like to focus on is dessy.com. A major challenge for Dessy was keeping visitors engaged longer while on site. They were in need of more content to display. And for a site that sells bridal clothing, this made a ton of sets. And why not?
Newlyweds are already posting all of their wedding photos in every possible corner of the Internet, and across social. So why not capture all of that excitement, and all of that high quality photography and bring it onsite to tell the story about their product?
And so the solution was a user driven wedding style gallery where they invited users to add and upload their wedding photos whether it was from Facebook, Instagram, desktop, and even mobile. And they saw serious results.
The user gallery is now driving a 40 percent engagement rate. And users are spending an additional 33 seconds onsite, so they're achieving exactly what they wanted to when they set out to display and collect these new user images.
And although Ben & Jerry's isn't an Internet retailer, their use case is very, very compelling. They wanted to activate dormant customers and use, basically, user images for a national ad campaign. They identified that their consumers are really telling their story in a very compelling way, and they wanted to bring that into their advertising.
And so they actually created a user image campaign where they invited users to share those moments when they were enjoying Ben & Jerry's with the hashtag #captureeuphoria and offer the users a chance to actually end up in their next ad campaign. So, for Ben & Jerry's customers, this was really, really exciting. They're already enjoying their product, they're already sharing photos of it. Why not be featured and get a chance to get involved in their advertising?
And it was a massive hit for Ben & Jerry's. There were more than 15,000 images submitted via the #captureeuphoria hashtag. And the team then went on and took this content in TV, print, and social and generated more than 70 million media impressions through their advertising. And this again, this is content that they're not paying for, that they're collecting from their fans and from their consumers.
And another e-commerce example is Rent the Runway which actually allows users to come in and rent much more expensive dresses for proms, weddings, all types of very big events. And so their challenge was, as a consumer when you're going to rent this dress it's for a very specific, and a very big occasion. You need to make sure it fits right. You need to make sure the quality matches your demands. And so they really wanted to provide users with confidence when renting, and really increase those conversion rates for users on site.
And so they crowdsourced user generated images to display on the product pages. So now instead of just seeing a model in that dress, or the product photography of that dress, they're actually seeing real people wearing it out in the real world. They're seeing the quality, they're seeing the fit and how it may fall on their own body. And again, tremendous results for Rent the Runway as well.
They're seeing a 200 percent increase in conversion rate now, when users actually visit these product pages, and UGC is now their main component of their e-commerce. And they're continuing to invest time and money into user generated images.
And then Urban Outfitters, of course, has been mentioned a few times throughout this webinar. They're really leading the way in terms of e-commerce sites and retailers. Their main challenge is that there are hundreds of thousands of brand endorsements of Urban products across social. Whether people are sharing photos to Instagram or Facebook, people are saying they love Urban, and here I am wearing this product, and living this lifestyle.
And so Urban really wanted to capture all that content and all those endorsements and use it as momentum for their marketing, and for their e-commerce platform. So they decided to create an on site UGC gallery, which actually links to their product pages. And this is actually another example of Fanreel where a user is now sharing, and then it's ending up in the Urban Outfitters product gallery for UGC. And people can now click through and buy that actual product that they're looking at.
It's this new level of social proof where, not only is the brand telling me this is cool, and not only is a model displaying this product, this is a peer, someone just like me wearing this product and showing that it's a quality product and that it's something that I should consider.
And they're seeing fantastic results as well. They're increasing their on site engagement. 35 percent of users that visit this Fanreel are engaging with it, so they're hovering, they're clicking, and they're interacting with the images. And of that 35 percent, 15 percent of those users have been actually clicking through to shop on those items.
So we're talking about a massive conversion rates. Traditionally commerce, just changing a percentage, or half a percentage can really move the needle. We're talking really big numbers.
And so Bob's going to go a little bit more about, as a brand you can capitalize and actually use UGC today.
Robert Moore: These are really just some short takeaways that I think everybody can hopefully put to good use, based on the information from the presentation here today. And, of course, hopefully each of these sections will come back to everyone in the form of our follow-up email with slides where you can really dive back in if you want to share these findings with your colleagues.
Really just a few bullet points. Number one, make sure you're using an e-commerce platform that has a ratings and reviews component built in. You would think that this would be second nature to every e-commerce platform out there at this point. But even as you stall there, close to one in five people in the Internet Retailer top 500 actually are not using ratings and reviews within their e-commerce stores. And I imagine that the numbers down the long tail from the IR 500 are even worse than that. So definitely have an eye to those ratings and reviews because the data that we have seen on the impact on conversion lift is quite incredible.
Number two, incentivize user generated content on social media. Contests, promotions, these things have proven to be very effective at engaging customers, building more loyal fans and, most of all, if use creatively, actually driving more sales and bringing people back to the point of purchase where additional transactions can take place.
Which obviously leads to the third bullet, which is really just the third step in that UGC maturity model, which is to take the things that you've accomplished in social and find ways to call to action back in store and to the extent you can in product packaging or through other opportunities that you have to interact with your customers. It can be extremely valuable to really pull together that natural environment of peer to peer, collaborative content creation that is the social universe to your point or purchase and your e-commerce store.
With all of these things rolled together, you have these combining factors about increasing lift and conversion at each step. And the combined effect is very, very meaningful. So we hope that everyone will take that message away as being something that is very, very real, and we're seeing a lot of retailers do with quite a bit of success today.
Content wise, that about wraps up our webinar here right on time. We have had quite a few questions rolling in through Twitter, and a lot of activity on that #ecommerceugc hashtag. We'll start diving into that Q&A right now, but while we're going through that, definitely feel free to take opportunity to follow us all on Twitter. You'll see our handles there. RJMetrics, Curalate being the two companies. And we want to thank everybody for coming and participating today.