Saturday, February 22, 2014

Consumer reviews - transparency tools or platforms for stealth marketing?

Neha Ladha, IIM Shillong

The advent of social media and e-commerce saw the emergence of the new way in which a customer can interact with the companies, i.e. over the internet. The companies see this as an opportunity to get in touch with the customers, to have insights into the core needs and to develop and improve their products and the best way to do this has been consumer reviews. The benefits of consumer reviews are manifold. It helps companies to depict the trust they have in their product, and enhance customers’ buying and post-purchase experience. The negative reviews are also seen as a way to know better about a company’s offering and reinforce the belief in customers’ mind that you are there to listen to him. They’ve helped businesses figure out customers’ tastes and preferences and adjust themselves accordingly. Many argue that consumer reviews have been used as a means of guerrilla marketing which might be true in some cases like e-commerce sites, but this was not the reason why posting reviews was started and the companies who want to have sustained relations try to keep the process genuine. The best example would be Dell, which launched Direct2Dell to facilitate active dialogue with customers and for crowd-sourcing ideas and bringing service improvements, and saw increase in revenues and retention of loyal customers. If we look from the customer’s perspective also, the reviews are helpful in analysing products and services, weighing pros and cons and letting them know how they can use the product better. Who amongst us would have not looked at reviews before a purchase on Flipkart? It’s evident that consumer reviews have been beneficial for both the parties and with the increase in online marketing witnessed, are here to stay for long, provided businesses work to keep the process transparent.

Pradyut V Hande, SIMS Pune

What once began as a sincere endeavour at gleaning critical consumer feedback, escalating offering awareness, reinforcing purchase decisions and converting suspects and prospects into potential buyers; has now devolved into the unfortunate abyss of questionable marketing practices. Indubitably, consumer reviews have become a covert stealth marketing platform; relegating transparent thought and blatantly honest opinions to the “marketing back burner”. Over time, companies have sagaciously understood the significance of peer driven product/service reviews in an increasingly interconnected consumer community and hyper-competitive operational environment. However, there exists a fine line between grasping an emergent reality and leveraging the same to suit its ever evolving marketing mix whilst straddling ethical boundaries. Consequently, many companies have made the cardinal sin of promoting their offerings in the guise of ordinary customer reviews through paid bloggers, in-house online content managers and other surreptitious avenues. Thus, what companies may believe to be a confidence-building/inspiring measure can transform into the duplicitous act of actually “insulting” customers’ intuition and intelligence. A recent case in point is the massive backlash that Microsoft has received from irate fans and potential users for paying prominent bloggers to post favourable videos on YouTube, promoting its latest gaming product -Xbox One. Thus, in the quest to drive sales; companies can ill afford to adopt such unethical marketing practices as the fallout on being found out can have major negative ramifications. An honest positive endorsement by a satisfied and loyal consumer will translate into long term cumulative word-of-mouth sales; instead of an attempt at duping the very same. Co-creating perceptible value augmented by trust will only fuel greater customer delight and retention down the line. The key lies in achieving a healthy balance between ethical promotional activities and encouraging constructive consumer feedback on a micro-level.

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