Build Loyalty with Customer Satisfaction Ratings and Brand Trust

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Published on Tuesday, 01 May 2012 07:10

By: Ray Benedicktus

 

Online businesses must establish a trustworthy brand to engender a comfort among customers, which paves the way to repeat business. As the founder of OC Marketing Analytics, I have published three articles in A-level marketing research journals, two of which explore consumers’ online trust beliefs.

 

These articles examine the effects of brand, physical store presence, customer ratings, and consumer suspicion on trust in Internet retailers (Journal of Retailing) and the ways in which consumers apply consensus ratings (Journal of Business Research) in making online trust judgments. I have highlighted the managerial implications of my research here for the OC AMA community.

 

1. Focus on brand image

A major challenge faced by all businesses is the development of a consistent and differentiated brand image. In the presence of a strong brand, trust cues like privacy policies and third-party certifications have limited impact on trust. 

One emerging technique is lexical semantic text analysis, which can be used to determine online brand position and to understand brand association structures. Internet monitoring applications (for example, Vocus, Radian6, and Alterian SM2) give managers relevant, up-to-date information regarding what consumers are saying about their brand in forums, social media sites and on rating sites.

 

2. Highlight bricks-and-mortar locations

About 71 percent of online consumers search for evidence of a physical location prior to making online purchase decisions. Click-and-mortar firms that do not yet have an established online service record should ensure information related to physical locations is in obvious view for website visitors. Such information gives consumers an indication that the firm is trustworthy because consumers generalize perceptions from previously successful “physical store” encounters.

 

3. Monitor and influence customer sentiment Whether or not you sell online, your existing and potential customers are using the Internet to talk about your products and services. Overall, Internet users are more likely to share negative opinions than they are to spread positive sentiment. Thus, online ratings tend to be negatively skewed. To encourage all customers to participate, educate customers regarding availability of third-party feedback sites, reduce obstacles to accessing the sites (provide hyperlinks) and offer incentives for feedback if practical. Encourage direct complaints by identifying unsatisfied customers and resolving issues in a timely manner so that such instances are not broadcast widely on the web.

 

4. Focus customer attention on ratings on your website

Online services such as Yelp, Review-script.com, BazaarVoice, and PowerReviews/Buzzillions now allow businesses to display customer ratings on their own websites. Managing ratings information is not only critical for online operations but is a primary driver of offline business as well. Service providers are reporting that up to 80 percent of their new offline sales stems from customers reading online reviews and then contacting the company for service.

 

5. Understand how consumers use ratings

The importance of customer ratings generally increases as product risk (price and complexity) go up. In addition, results show that customers not only use ratings to make trust judgments, but also to form pre-purchase service quality expectations and to anticipate satisfying experiences. On average, consumers categorize ratings of 89.6 percent and above as high, 78 to 89 percent as moderate and 77 percent and below as low. However, even retailers in the high range whose ratings shift close to the range threshold are in danger negatively affecting consumer perceptions.

 

For a PDF copy of the full research articles, please visit http://analyticsoc.com/articles.

 

 

About the Author

 

Ray Benedicktus is the managing consultant and founder of OC Marketing Analytics.  Ray specializes in customer decision making, satisfaction and loyalty, research for analytics, and analytics training.  Ray has been a speaker and trainer for many professional organizations, including the American Advertising Federation and the Small Business Administration.