The surprising power of negative reviews (and it’s not what you think)

2 Comments | This entry was posted in Events

Sam Taylor, the CEO of Oriental Trading Company, made a strong case at the last session today about the value of customer reviews. While he sang the praises of positive reviews, and said that using testimonials in catalogs and featuring top-rated product pages have boosted sales, what he had to say about the value of negative reviews was incredibly fascinating.

Oriental Trading Company did have reviews before Taylor came on board, but his predecessor was so concerned about negative customer feedback that he took them down after just four days. Taylor believes that was a missed opportunity. “Oriental Trading lost all of this value,” he said. “I wish we had two years of data because we would be two years ahead of where we are.”

While negative product reviews are often a concern among many in senior management, Taylor insists that negative reviews–more than positive reviews, in many cases–teach a company valuable lessons, increase customer loyalty, and can actually lead to sales.

When reviews and ratings were added to the site, Taylor saw them as a huge opportunity. He and his team read every single one- and two-star review to try to understand if there is an issue with a particular product or if the company has made a mistake.

On one occasion, Taylor read a review from an angry bride who wanted to use some autumn leaf decorations for her upcoming wedding. (He acknowledged that this absolutely the last person you want to irritate.) She said she would not recommend them to anyone and that they were “awful.” Based on that feedback, Taylor said members of his team went down to the warehouse and opened up the product. Sure enough, it was awful: a new vendor had not delivered what they had promised. Taylor took the product off of the website, and has since taken down dozens of top-selling products due to bad reviews. “Take them down until you can fix them,” he said. “How many times is a customer going to buy from you if you keep disappointing them?” That experience, among others, Taylor said, has given the company grounds to go back to suppliers to demand new shipments or make claims.

In another instance, the company received several negative reviews on a particular package of bulk candy. The reviews said the product didn’t look at all like the picture. It turns out, the reviews were right. The picture was updated and information about the ratio of hard to soft candy was added to the product description. Oriental Trading also added a comment inside of the reviews to let new customers know that the photo had been changed.

In his final example, Taylor illustrated how negative product reviews can actually help retailers make money. A customer wrote that a child’s craft project was too difficult for children to put together and said she had to use a glue gun to make the pieces stick together. What the woman didn’t know (and the company was either poorly or simply not communicating) was that she should have been using glue dots to adhere the pieces.

Enter an up-sell opportunity. Today, when the company is selling crafts for kids or items that may be particularly tricky, it adds in the product description that glue dots are a useful accessory. Customer service representatives are trained on this as well, not only to ensure that crafty moms and their snowbound counterparts have everything they need to make a project seamless but also–you guessed it–to add to the company’s bottom line.

Since then, customers have written positive reviews on the same items mentioning that they purchased the crafts even after reading the negative reviews. In learning from others’ mistakes, they have said, they used glue dots and the kids had a great time.

The merchant team is using this feedback, too, and took this particular challenge one step farther. Instead of guessing how crafts should best be assembled, they brought their children into the office to determine–product by product–which adhesive worked best. (I imagine this experiment was likely a win/win and that the kids loved it, too!)

Although implementing product reviews does take a bit of faith, Taylor made a strong case for how all reviews–positive or negative–can keep customers coming back for more.

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One Comment

  1. Posted February 18, 2009 at 5:42 pm | Permalink

    Companies that take the time to address a complaint will build their online reputation and word of mouth and earn the loyalty of their customers

One Trackback

  1. By Value of Negative Customer Reviews for E-commerce on February 7, 2009 at 12:51 pm

    [...] correct your mistakes. E-commerce giant Oriental Trading Company’s CEO Sam Taylor has some great case studies about how they have corrected their mistakes after some negative customer [...]

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