New data released by leading social commerce company Reevoo demonstrates that the most efficient way to increase conversion rates is to engage the customer into discussing and reviewing company products online.
These latest figures show that retailers and brands that embrace reviews and recommendations into their online retail strategy see a sales uplift of around 18 per cent.
This uplift is worth a potential £8bn to UK retailers on top of the UK’s existing £44bn of online retail sales. “This will translate into a 20 per cent decline in market share for those retailers that don’t implement social commerce”, says Richard Anson, CEO and co-founder of Reevoo.
Of the 18 per cent total increase, 11 per cent is due to conversion improvements, 5 per cent to increased average order value and a further 2 per cent to repeat visitor uplift.
When reviews are read by consumers, the data shows how:
• Conversion rates increase by 177 per cent • Average product purchase value almost doubles • Visitor return rates rise by 13 per centmd5-b271dae7a15c3490c074f005fe1be315
“Retailers who implement social commerce can enjoy up to 18 per cent uplift in sales, while those who don’t risk market share loss of up to 20 per cent,” added Richard.
Reevoo’s data was collected through its work with more than 100 partners who, between them, generate £1bn in online sales per year. The figures reflect the typical uplift realised by Reevoo’s partners during 2010 - with some partners experiencing much larger increases.
Its findings and consequent recommendations have been collated into a new white paper entitled ‘The Six Essentials of Social Commerce’. The paper analyses common mistakes and how to avoid them - for example, opening up an online retail site to invalid or fraudulent reviews; limiting review volume or confining content to too few locations; and even blocking reviews perceived as negative, irreparably damaging consumer trust in the site’s brand.
It looks at how and why many companies are still hanging around the bottom of the learning curve in respect of social commerce, in some cases getting only half the conversion rate uplift that they should be getting. The ‘Six Essentials’ take the online marketer through the rationale, the obstacle, the lesson, and the benefits.
As content Publishers continue to analyse conversion and returns from their merchant partners, social commerce could well be a future important part of the mix when deciding upon whom to promote.