For Belkin this was a PR disaster of the highest order. Popular blogs such as Engadget and Gizmodo pounced. Amazon even suspended Belikin listings for a short period. However, to Belkin's credit it did post an official apology within 48 hours and it did appear to be an isolated incident.
The Belkin case, and the others that have come to light, illustrate that online review systems have both become important and dangerous for companies selling across the web.
Product reviews provide a critical element in the decision-making process for consumers. Research recently carried out by one of the UK's largest electrical retailers has revealed that reviews have increased conversion rates by up to 14%. The retailer selected three products and randomly served site visitors a page with or without reviews over a five month period. The results were conclusive; the products with reviews experienced a significantly higher conversion rate.
Further research by Jupiter has also demonstrated the effectiveness of customer reviews. In a recently conducted study, 97% of UK consumers indicated their willingness to trust reviews, with two thirds of those asked agreeing that they play a significant part in selecting a product or supplier online.
However, it's worth remembering that customer reviews can take many forms from a comment and rating system (such as on Amazon and eBay) to sponsored blog posts and even fake product blogs or "flogs".
According to the blog index site Technorati, there are approximately 100,000 bloggers using their sites to indirectly generate income and an elite group earning enough to make it a full time job. Companies such as Chitika.com, ReviewMe.com and PayPerPost.com are supporting the growth in blogging as a business by connecting bloggers with companies willing to pay for reviews.
The model generally works in a similar way to PPC (Pay Per Click) advertising. Bloggers write product reviews, embed images and links and are paid a small amount each time a visitor is passed to another website of the product, often an online affiliate.
By Ben Dyer, Product Development Director, Sellerdeck. Originally published in www.businesszone.co.uk.