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Social Media research

Contents
Introduction................................................................................ ...........................2

Souter Consulting and Social Media................................................................2

Marketing Charts.............................................................................................2

Forrester: Interactive Marketing to Hit $55B by 2014............................................3

Nearly 70% of Online Adults Use Social Media, Often Research Products..............4

Nearly 70% of Online Adults Use Social Media, Often Research Products..............4

SocNets Have Tiny Effect on Brand Perception......................................................6

Study: Marketing Execs Must Realize and Learn to Use Power of Social Media......8

SocNets, Web Video Radically Alter Online Behavior...........................................11

Bazaarvoice: Industry Statistics...........................................................................13

Power of Word of Mouth.......................................................................................13

Consumer Demand for Ratings and Reviews...........................................................14

Marketer Demand for Ratings and Reviews.............................................................16

Consumer Demand for Ask & Answer™..................................................................16

Conversion Results............................................................................... ...............17

Average Order Value Results.............................................................................. ...17

User-generated Content Beyond the Web...............................................................17

Email Campaign Results.............................................................................. .........18

Search Engine Optimization Results.......................................................................18

Return Rates and Customer Satisfaction.................................................................18

Evolution of Advertising and Media.........................................................................19

Search...................................................................................... .........................19

Syndication.......................................................................................... ...............19

Social Networks & Blogs More Popular than Email...............................................20

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Introduction
Souter Consulting and Social Media
I put this document together to support the work I do in Social Media for my
company, Souter Consulting Limited.

Marketing Charts
These incredibly useful numbers / quotes etc. were culled from the Marketing
Charts website – a veritable mine of data!

If you’re interested in which report I go the data from – go to the Marketing

Charts website, and search for the titles of a particular section: it should bring up
the original report.

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Forrester: Interactive Marketing to Hit $55B by

2014

The latest forecast from Forrester Research predicts that interactive marketing in the US will hit
nearly $55 billion by 2014 and will grow - at a compound annual growth rate of 17% - from 12%
of overall ad spend in 2009 to 21% over the next five years.

According to Forrester’s Five-Year Interactive Marketing Forecast Report, search marketing - which
now composes more than half of 2009’s overall interactive spend, will continue to make up the
biggest portion of interactive dollars, rising from $5.4 B in 2009 to $31.6B in 2014 at a compound
annual growth rate of 15%.

Social media marketing and mobile marketing will experience the highest growth rates among the
digital tactics, the report stated. Social media, which represents only $716M today, is expected to
balloon to $3.1B by 2014, and grow at the highest compound annual rate, 34%. Forrester noted
that owned social media assets (such as internal blogs, community sites) are currently the only
emerging media getting traction in today’s economic climate.

Similarly, mobile marketing, which accounts for $391M in 2009, will grow to $1.3B in 2014 at a
compound annual growth rate of 27%.

Email marketing, which expected to grow at a compound annual rate of 11%, will experience the
least growth proportionately, though the amount of spending on it will still rise from $1.2B to 2.1B
in five years.

Ad Budgets to Shrink

Forrester also believes that advertising budgets overall will decline over the next five years as
dollars migrate from more-expensive forms of traditional media to less expensive, more efficient
and more measurable interactive tools.

Despite this shift, Forrester VP and analyst Shar VanBoskirk believes that many marketers will find
ways to hold onto their hard-won budgets.

Rather than relinquishing their marketing dollars, smart marketers will “allocate unused
advertising dollars into investments like innovation, research, customer service, customer
experiences, and marketing-specific technology and IT staff, in order to further marketing’s
strategic influence within their companies,” she said.

Nearly 70% of Online Adults Use Social Media,

Often Research Products

More than two-thirds (68%) of online Americans say they visit online blogs, communities or social
networks, and 33% engage in product research online to help them make purchase
decisions, according to (pdf) the August/September 2008 Insight Report from MarketTools.

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The frequency of social media visits also is on the rise, with 42% of adults saying they visit these
sites more now than they did six months ago.

Social Media by Generation

Nearly one in five of all adults (19%) say they visit blogs, communities or social networks daily,
with a higher percentage of women saying so (22% vs. 16%). Percentages of daily visitors
decrease as respondents get older:

 33% of Generation-Y respondents (people mostly in their 20s) visit these sites every day.

 17% of Generation X (mostly in their 30s and early 40s) visit these sites daily.

 11% of Baby Boomers (in their mid 40s to early 60s) visit social media sites daily.

 8% percent of Seniors visit daily.

Social Media for Product Research

Many Americans visit blogs, communities and social networks with the specific intent of
researching products:

 33% of visitors say they visit these sites to engage in product research before making a
purchasing decision.

 Affluent visitors (with annual incomes of more than $75K) are most likely to research
products online before buying (43%).

 Baby Boomer visitors are significantly more likely than other groups to read or post
comments about products and services on these sites (37%).

 Baby Boomers (63%), along with Generation X (59%), are significantly more likely than
other groups to visit the corporate websites of product or service providers.
Impact on Purchasing Decisions

The research also indicates that blogs, communities and social networks have a direct impact on
purchasing decisions:

 47% of all respondents say that these sites have influenced their decision to purchase
particular brands or services to at least some extent.

 26% of all respondents actually changed their minds about buying a product or service
because of what they read on a blog, community or social network.

 Women are significantly more likely (29%) than men (22%) to change their minds about a
purchase because of these sites.

 Those in middle-income households (those with yearly income of $35K to $75K), at 30%,
and those from Generation Y (35%) and Generation X (30%), are the most likely to
change their minds because of the information they read on social media sites.
Additional findings:
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 MySpace, eBay and YouTube are the sites selected most often from a list of social-
networking sites. About one in three adults visits each of these sites.

 51% of visitors say the reason they visit social networking sites, communities and blogs is
“to have fun.”

 Other popular reasons for visiting these sites include reading/posting about current events
(42%), social networking to meet/date (40%) and to educate themselves (38%).

 The most popular types of “regular” websites visited include company websites (56%),
news (56%), search (50%), weather (50%), entertainment (45%) and health/medical
(41%).

“Our research sheds new light on just how ingrained blogs, communities and social networking
sites have become in our daily lives,” said Beth Rounds, SVP of research solutions at MarketTools.
“Insight into what drives consumers to buy, how to tailor content to different demographics, and
even how to better engage with target consumers in these increasingly influential online forums,
will all have a significant impact on organizations’ success and competitive advantage in the
marketplace.”

About the research: MarketTools Insight Reports are regular reports of findings on topical, national
issues of interest. Data is based on feedback from 1,000 online US respondents age 18+, drawn
from ZoomPanel, MarketTools’ proprietary online sample source.

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SocNets Have Tiny Effect on Brand Perception

Though many big brands are diving headfirst into social networks with hopes of enhancing their
image, an overwhelming 96% of employed consumers say their opinion of a product brand does
not change if that brand has no presence on a social networking site, according to a study
from WorkPlace Media.

In fact, just 12% of respondents say their opinion of a brand actually changes if that brand
maintains a significant social networking presence and only 11% of social networkers report
following any major brand through a social networking site.

Moreover, while 25% of respondents have recommended a business or a product on a social

network and 33% have received a recommendation, only 18% say they have actually acted upon a
such a recommendation, WorkPlace Media said.

These findings from the “Brand Impact Social Networking” study, suggest that big brands may face
an uphill battle in moving the perception needle because “the overall impact of a brand’s presence
on social networking sites was shown to be minimal in terms of impact and perception.”

To this point, a recent blog post by Caroline McCarthy, entitled “Social Media Will Not Get Me to Eat
Your Gross Pizza,” also appears to anecdotally confirm this sentiment.

The research, which polled office internet users, revealed that 55% maintain at least one social
networking account (Facebook, MySpace, Twitter, LinkedIn, etc.). However, of these social
networkers, only 43% report accessing their accounts at work - a place where they spend a large
chunk of their day and are potentially open to many other types of brand messages. Even among
those with social-network access, 78% report spending less than 30 minutes per day on their
social networking site(s).

Additional survey findings:

• Facebook is the clear winner in terms of users: 89% of respondents reported having a
Facebook account (40%: MySpace; 31%: LinkedIn; 18% Twitter).

• When asked what appeals most about social networking, the leading response (89%) was
that it “allows me to stay connected to friends/family.”

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• Of the 18% who reported acting upon a business or product recommendation on a social
networking site, the leading categories were: Entertainment (53%), dining out (50%),
groceries (23%), beauty care/cosmetics (21%), apparel (20%), electronics (15%) and pet
care (15%).

“When it comes to influencing brand perception and purchase decisions, the data shows that social
networking still has a long way to go,” said Stephanie Molnar, CEO of WorkPlace Media. “Most of
our meaningful recommendations continue to be old-fashioned, word of mouth recommendations
from friends, co-workers, and/or family.”

Recent research from Mintel confirms this assertion, finding that real-life product and brand
recommendations still beat out those found online.

Similarly, a study by the Conference Board found that though online social networks continue to
post dramatic growth, users still see them as as a way to communicate and interact with one
another, rather than a means for conducting e-commerce.

About the survey: The survey was conducted by WorkPlace Media in May 2009 among 753
American workers who have access to the internet at work.

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Study: Marketing Execs Must Realize and Learn

to Use Power of Social Media

Senior marketing executives in several countries agree that the use of social media for corporate,
brand and product marketing is not a passing fad - with nearly half saying it is a vital component
- according to research sponsored by TNS media intelligence/Cymfony.

Some 49% of execs say social media should be monitored at the executive level and be allocated
significant resources:

Among the highlights of the study:

 Some 30% of marketing executives agree that social media is an unconventional new
opportunity that businesses must grasp with a sense of urgency.

 95% say they believe that social media will grow in significance over the next five years.

 Asked about the uses of social media, respondents endorsed it as a strategic tool to gain
consumer insights (37%), build brand awareness (21%) and increase customer loyalty
(18%):

Below, additional findings release by TNS media intelligence/Cymfony.

Influencing Consumers: Listen, then Act

The potential business impact of social media was similar from country to country, but the US has
a stronger point of view on the value of market research in social media:

 Some 88% of US respondents and 65% of global respondents were in agreement that
reading and analyzing social media to understand unfiltered consumer perceptions would
have the most impact on the future of their businesses.

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 Word-of-mouth campaigns were cited as having the second greatest impact: All countries
were in broad accordance at 62%, but the US once again led with three-quarters agreeing
on the effects of these marketing campaigns.
Respondents endorse the role that blogs and other social media channels play in an integrated
product launch campaign:

 The potentially most effective use of social media, selected by more than 50% of
respondents, is creating a user community of bloggers to provide user experience
feedback.

 Some 47% also say using social media vehicles, such as YouTube, to generate a viral
campaign would also be very effective in a product launch.
‘Revolutionaries’ Pull Ahead of the ‘Wait-and-Sees’

Early adopters (”Revolutionaries”) are more advanced in their understanding and execution of
social media marketing initiatives than more cautious marketers (”Wait-and-Sees”):

 Nearly five times as many Revolutionaries are already implementing social media in their
organizations.

 Three times as many Wait-and-See companies are only at the learning stage.

 Revolutionaries are far more optimistic about the future of social media:

 81% of Revolutionaries agree it would grow in significance over the next five
years.

 Just 33% of the Wait-and-Sees agreed social media would grow in significance.
Asked about how they would use social media to influence their marketing initiatives…

 Wait-and-See companies put more emphasis on using social media for new types of
marketing campaigns such as viral marketing and videos, while Revolutionaries focus more
on listening to consumer and bloggers’ points-of-view.

 One area where they are in accordance is that most Revolutionaries (95%) and most Wait-
and-Sees (60%) are eager to connect with other colleagues to study consumer feedback
and learn from it.
Organizational Barriers

The leading barriers to social media adoption were the lack of both senior management
commitment and best practices, followed by the absence of controls, standardization, time and
resources.

Respondents also criticized marketing service suppliers for not providing sufficient expertise to
help businesses understand and exploit blogs and social networks.

They noted that many agencies lack practical experience in social media initiatives and tend to
apply traditional tactics that may not be effective in this emerging media space.

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About the research: In late 2007, TNS media intelligence/Cymfony, in coordination with TNS UK,
TNS media intelligence France and TNS Canadian Facts, conducted a survey dubbed “Harnessing
Influence: How Savvy Brands are Unleashing the New Power of Blogs and other Social Media.”
Some 70+ marketers from leading companies around the globe were polled about their
experiences incorporating all types of social media tools in their marketing strategies. Represented
countries include the United States, Canada, the United Kingdom and France.

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SocNets, Web Video Radically Alter Online

Behavior

The growing popularity of online social networking and video content is deepening web users’
engagement with the internet and is causing a dramatic shift in the global online landscape - both
for consumers and for advertisers, according to a report from The Nielsen Company, which was
distributed at the ad:tech conference in San Francisco.

Nielsen’s research shows that since 2003, the interests of the average online user have shifted
significantly, evolving from use of “short-tail” portal-oriented browsing sites - such as shopping
directories, guides and internet tools - to sites that contain more specialized “long-tail” content
geared to specific and interactive user interests:

This change is manifested by the fact that video and social networking sites are the two fastest
growing categories in 2009, and will necessitate new ways of thinking about online marketing,
Nielsen said.

Major highlights from the Global Online Media Landscape report (pdf) regarding online video
and social networks:

 The number of American users frequenting online video destinations has climbed 339%
since 2003. The unique audience for online video surpassed that of email in November
2007.

 Time spent on video sites has shot up almost 2,000% over the same period.

 In the past year, unique viewers of online video grew 10%, the number of streams grew
41%, the streams per user grew 27% and the total minutes engaged with online video
grew 71%.

 There are 87% more online social media users now than in 2003, with 883% more time
devoted to those sites.

 In the past year, time spent on social networking sites has surged 73%.

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 In February 2009, social network usage exceeded web-based e-mail usage for the first
time:

Online Advertising Down But Not Out

With the global recession in full swing, Nielsen reported that online display advertising has
plateaued at 20% of total online ad spend in the US. Not surprisingly, online advertising by
financial services, automobile and retail companies has declined steeply as a result of ongoing
troubles in those industries.

On the other hand, several key industries that historically spend significant amounts on advertising
- such as healthcare, consumer products and telecommunications - appear to be moving even
more spending online, Nielsen said.

As a result, though online advertising appears to have lost some of its “favored child status,” the
longer-term prospects for global online advertising when the recession abates are brighter, Nielsen
said, suggesting several reasons why online advertising will continue to be critical:

 Led by social media, search and video, the internet’s share of total ad spend will continue
its steady upward trend as global economies emerge from the current recession.

 Given the increased focus on digital marketing by leading packaged goods companies, the
internet’s share of commerce will continue to rise as well.

 Marketers are being forced to adapt to social networking capabilities. In the age of Twitter,
feedback barriers have all but disappeared, creating a near friction-free environment for
playing back brand experience, campaign reactions or brand events. Recent public cases
involving Motrin, Amazon, and Domino’s show that marketers must be quick and savvy to
react to these unprecedented channels of instant feedback.

 The growing use of the mobile web is supporting increasing consumer engagement with
web content, in more places and at more times. Some 30% of U.S. mobile subscribers
recalled seeing some form of advertising while using their mobile phones, up from 18%
one year prior.
“The internet remains a place of continuing innovation, with users finding new ways to integrate
online usage into their daily lives,” said Charles Buchwalter, SVP, research and analytics, Nielsen
Online. “In recent years the Internet has changed dramatically as people seek more personalized
relationships online. In particular, time spent on social networks and video sites has increased
astronomically. Advertisers are starting to positively re-assess the value of the online experience
and create more meaningful relationships with consumers.”

The Nielsen report, which examines trends in a multitude of countries on several continents, also
noted that advertisers are increasingly starting to look at their media mix more holistically than

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ever before. For example, consumer-generated content has gained inclusion into the “earned
media” club of marketing preferences. The big question going forward, Nielsen said, will be how
paid and earned media share the marketing expenditure pie.

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studies.
Power of Word of Mouth
• "Person like me" still most trusted source for information about a
company and, therefore, products. (Edelman Trust Barometer, November
2007)
• Recommendations from family and friends trump all other consumer
touchpoints when it comes to influencing purchases, according to
ZenithOptimedia. (AdAge, April, 2008)
• Recommendation is the number one reason for choosing a particular
site. (Royal Mail's Home Shopping Tracker Study, September 2007)
• Users who contribute product reviews or post messages visit sites nine
times as often as noncontributors do. Contributors also make purchases
nearly twice as often. (McKinsey & Co./Jupiter Media Metrix study, January
2002)
• Review users noted that reviews generated by fellow consumers had
a greater influence than those generated by professionals.
(comScore/The Kelsey Group, October 2007)
• Adult Internet users surveyed chose recommendations from friends as the
one type of promotion they consider most worthwhile. (DoubleClick, May
2007)
• Consumers trust friends above experts when it comes to product
recommendations (65% trust friends, 27% trust experts, 8% trust
celebrities). (Yankelovich)
• Consumers say that word of mouth is still the number one influencer in
their apparel (34.3%) and electronics (44.4%) purchases (Retail
Advertising and Marketing Association/BIGresearch Study, November
2008)
• According to a global Nielsen survey of 26,486 Internet users in 47
markets, consumer recommendations are the most credible form of
advertising among 78% of the study's respondents. (Nielsen, "Word-of-
Mouth the Most Powerful Selling Tool", October 2007)
• The two leading reasons people contribute content to social shopping sites
are the need to feel part of a community (31%) and recognition from
peers (28%). (IBM Institute for Business Value, August 2007)
• There were nearly 116 million US user-generated content consumers in
2008, along with 82.5 million content creators. Both numbers are set to
climb significantly by 2013 (eMarketer, February 2009)
• Online social network users were three times more likely to trust their
peers' opinions over advertising when making purchase decisions. ("Social

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Networking Sites: Defining Advertising Opportunities in a Competitive

Landscape," JupiterResearch, March 2007)
• 86.9% of respondents said they would trust a friend's recommendation
over a review by a critic, while 83.8% said they would trust user reviews
over a critic. (Marketing Sherpa, July 2007)
• Two thirds of UK social networkers (66%) are more likely to buy a
product as a result of a recommendation, compared to 52 per cent of non-
social networkers. (Royal Mail's Home Shopping Tracker Study, September
2007)
• Tech decision makers give user-generated sites equal importance to
traditional media sources when considering tech purchases. Decision
makers consider their personal experience (58%) first when short-listing
tech vendors, followed by word-of-mouth and industry analyst reports, tied
at 51%. Advertising (17%) and direct marketing (21%) were listed as the
least important information sources when short-listing possible vendors.
(Study: "Tech Decision Maker," Hill & Knowlton, January 2009)
Consumer Demand for Ratings and Reviews
• Online reviews are second only to personal advice from a friend as the
driver of purchase decisions; user reviews are more influential than
third-party reviews. ("Web users and web community," Rubicon
Consulting, Inc. October 2008)
• 81% of online holiday shoppers read online customer
reviews (Nielson Online, December 2008)
• 86% of consumers read online business reviews before making
purchasing decisions; 90% of whom say they trust these reviews.
(Kudzu.com survey of 600 users, December 2008)
• The Trust in Advertising survey of 26,000+ found that Consumer
Recommendations are the most credible form of advertising. ("Social
Media Marketing: The Right Strategy for Tough Economic Times"
Awareness, 2008)
• Nearly 49% of shoppers have made a purchase based on a
recommendation through a social media property; respondents most relied
on the following sources when making a purchase decision: 60.53% user
reviews; 20.48% comparison charts; 15.41% editorial reviews; 3.58 shared
shopping lists. (Razorfish, October 2008)
• Almost two-thirds (62%) of consumers read consumer-written product
reviews on the Internet. (Deloitte & Touche, September 2007)
• When asked what sources of information they are "very likely" to consult
before making a decision about their entertainment options, 62%
named Web sites with user reviews as their top choice, even beating
out a knowledgeable friend (59%). (Marketing Sherpa, July 2007)
• 46% of Britons now read online reviews or recommendations on a specific
product before buying it and 32% are willing and able to publish a review
online - but only 19% would be prepared to write a letter to a retailer. (1&1
Internet survey of 1600 consumers, December 2008)
• Seven in 10 (69%) consumers who read reviews share them with friends,
family or colleagues, thus amplifying their impact. (Deloitte & Touche,
September 2007)

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• As of October 2008, almost half of US online adults read ratings and

reviews at least once a month, and 19% post them. Nearly twice as
many read reviews compared with 2007. (The Growth Of Social Technology
Adoption, Forrester, October 2008)
• Nearly half (49%) of shoppers intend to do their holiday gift buying online
(versus in-store), and 72% are planning to research products online
prior to purchasing (vs. 65% in 2007). ("Mindset of the Multi-Channel
Shopper Holiday Survey," e-tailing group, October 2008)
• 74% agree-including 14% who strongly agree-that they choose companies
and brandsbased on what others say online about their customer
service experiences, the survey shows. (Society for New Communications
Research, May 2008)
• 58.7% of shoppers said they used product reviews to make
decisions. Reviews rated higher than clearance sale pages (56.4%)
and featured sale pages (51.3%). (Shop.org, November 2007)
• Compared to a base group that didn't read or contribute product reviews
at all, people who read a review were 30% more likely to purchase a
product and visitors who wrote a review were 80% more likely to convert,
based on analysis across several Coremetrics clients. (Coremetrics,
reported in BtoB, March 2007)
• Among the 46% of respondents who had posted or planned to post
reviews about their online shopping experience, 88% said those reviews
either were, or would be positive. (Nielson, 2007)
• More than eight in ten (82%) of those who read reviews said that their
purchasing decisions have been directly influenced by those reviews.
(Deloitte & Touche, September 2007)
• 55% of surveyed Internet users consulted other people's opinions online,
making reviews the #1 resource for product research. (Avenue
A/Razorfish "Digital Consumer Behavior Study," October 2007)
• In a study of 2,000 shoppers, 92% deemed customer reviews
as "extremely" or "very" helpful. (eTailing Group, 2007)
• 59% of their users considered customer reviews to be more
valuable than expert reviews. (Bizrate, October 2007)
• 63% of consumers indicate they are more likely to purchase from a site
if it has product ratings and reviews. (Major consumer electronics
retailer/iPerceptions study, January 2008)
• 81% consider the availability of customer reviews to be "very
important" (33%)"somewhat important" (48%). (Major consumer
electronics retailer/iPerceptions study, January 2008)
• 86.9% of respondents said they would trust a friend's
recommendation over a review by a critic, while 83.8% said they would
trust user reviews over a critic. (MarketingSherpa, October 2007)
• 84% of consumers earning more than $150,000 annually visit sites
where customers review and rate products and services including
restaurants. (The Luxury Institute, April 2007)
• 71% of UK online shoppers seek out ratings and reviews. (NetExtract,
2007)

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• 70% of online consumers said they use the Internet to research

everyday grocery products. (Prospectiv, January 2008)
• 67% of UK consumers research products via the Internet before
shopping in a store. (Accenture, April 2007)
• 91% of millionaires say they always or often look at reviews before
buying luxury goods; 68% of ultra-affluent shoppers use consumer
reviews. (Unity Marketing/Google study, reported in AdAge, October 2008)
• Mobile user-generated content will generate $5.7 billion
worldwide in 2012, up from $576 million in 2007. ("Mobile Social
Networking: Opportunities & Forecasts 2008-2013," Juniper Research,
October 2008)
• Satisfaction for those who recalled customer reviews on the retailers' site
is 10% higherthan those who said there were no reviews offered. Loyalty
increases, too: 7% higher likelihood to purchase online, 8% greater
likelihood to purchase from the retailer next time they're buying similar
merchandise and 11% greater likelihood to recommend the site to others.
(30 UK Online Retail Satisfaction Index, ForeSee Results, January 2008)
• 83% of shoppers said online product evaluations and reviews influenced
their purchasing decisions. (Opinion Research Corporation,
an infoGROUP company, July 2008)
• In an online survey of 4,000 consumers, 70% said they had done internet
research on "everyday grocery products," and 63% said they had
done so for health and beauty products. (Prospectiv, 2007)
• 57.2% of U.S. toy purchasers are influenced by product reviews online.
(Ad-ology Media Influence on Consumer Choice, Fall 2008)
Marketer Demand for Ratings and Reviews
• 79% of online UK retailers surveyed reported that the main benefit of
consumer-generated rating and reviews was that they improved site
conversion rates. (eMarketer, 2007)
• 68% of online marketers believe "media is in big trouble and will lose
dollars to user-generated content." (iMedia Connection, February
2008)
• 58% of the E-Commerce Guide 100 retailers implemented ratings
and reviews in 2008, up from 50% in 2007; 24 percent sell by top-rated
products. (e-tailing group's 11th Annual Mystery Shopping Survey, January
2009)
• 84% of marketers agree that building customer trust will become
marketing's primary objective (1to1 Media survey of the 1to1 Xchange
panel, April 2008)
• 43% of retailers have reviews - double in one year. (Marketing Sherpa,
February 2007)
• 76% of US retailers said user-generated content would have a greater
impact on their marketing goals in the near future. (SLI
Systems/Zoomerang, November 2008)
• Of merchants who adopt customer reviews, 58% said improving
customer experiencewas the most important reason for adding reviews
to their sites, followed by building customer loyalty (47%), driving sales

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(42%), and maintaining a competitive advantage(37%). (eTailing Group,

June 2008)
• By 2020, 84% of marketers agree that building customer trust will
become marketing's primary objective, and 82% agree that collaboration
with customers will prevail over marketing. (1to1 Media survey of the 1to1
Xchange panel, April 2008)
• 11% of retailers reported a 20% or more overall increase in
conversions as a result of adding reviews to their sites, 21% reported an
11% to 20% increase and 5% reported a 1% to 10% increase. (eTailing
Group, June 2008)
• 81% of marketers surveyed say that their social media spending will
meet or exceed their traditional advertising spending within the next
5 years. (TWI Surveys/Society for New Communications Research,
November 2007)
• 56% of UK website owners say that user-generated content lifts
conversion levels; 77% say it increases traffic; and 42% say
it increases the average spend on site.(eConsultancy survey of 360
website owners across all sectors, November 2008)
• Dave Seifert of Bass Pro Shops noted at a Shop.org round table discussion
that Top Rated Products were "the #1 merchandising technique ever
utilized on their site." (Bass Pro Shops, June 2008)
• After their order, PETCO asked customers, "What online tool most
influenced your purchase decision?" The #1 answer was product
ratings and reviews, with site search coming in a distant second.
(PETCO, June 2007)
• The Shop.org State of Retailing Online study, conducted by Forrester
Research, found only 26% of the 137 top retailers surveyed offered
customer ratings and reviews, but 96% of them ranked customer ratings
and reviews as an effective or very effective tactic at driving
conversion. (Forrester, 2007)
Consumer Demand for Ask & Answer™
• 76% of online shoppers surveyed report that content is insufficient to
complete research or purchase online "always, most often or some of the
time." (eTailing Group, June 2007)
• Online businesses lose as many as 67% of consumers due to a lack
of online product information. (Allurent, January 2008)
• 83% of online shoppers would make purchases if sites offered
increased interactive elements. (Allurent, January 2008)
• One in four (24.5%) shoppers said they left a store because of a lack
of assistance. (Shop.org, November 2007)
• 90% of UK shoppers surveyed said they wish they could
communicate directly with businesses - using live chat, forums or call-
me-back facilities - via their websites; one in three require it from the UK
businesses they currently use. (1&1, October 2007)
• 42% of consumers said they prefer being able to find the answers
they need online on their own if they had a question or wanted help
while shopping online. (Harris Interactive, May 2007)

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• The share of traffic to question-and-answer Web sites has more

than doubled from 2007 to 2008 (HitWise, 2008)
• Yahoo Answers had 25.3 million visits in February 2008 (comScore
Media Metrix, March 2008)
• 68% of consumers trust "people like me" first for product advice.
(Edelman Trust Barometer, January 2007)
• 42% of 1,179 online consumers surveyed have left a site without
purchasing multiple products because they couldn't get a question
answered about one of the products in their shopping cart; 41% decided
not to make a planned purchase because they couldn't readily
find a piece of information about the product or service.
(JupiterResearch, September 2007)
Conversion Results
• MarketingExperiments tested product conversion with and without product
ratings by customers. Conversion nearly doubled, going from .44% to
1.04% after the same product displayed its five-star rating.
(MarketingExperiments Journal, July 2007)
• 79% of online UK retailers surveyed reported that the main benefit of
consumer-generated rating and reviews was that they improved site
conversion rates. (eMarketer, 2007)
• Online shoppers who look at TripAdvisor reviews on the Hayes & Jarvis site
book trips atdouble the rate of online shoppers who have not seen the
TripAdvisor reviews, based on first four months after launch. (TripAdvisor,
January 2008)
• Shoppers who browsed the site's new "Top Rated Products" page, which
features products rated most highly by customers, had a 59% higher
conversion rate than the site average and spent 16% more per order
than other browsers of products. (Bass Pro Shops, June 2008)
• Shoppers who browsed the site's "Top Rated Products" page, which
features products rated most highly by customers, had a 49% higher
conversion rate than the site average and 63% more per
order than other site shoppers. (PETCO, June 2007)
• Giving shoppers the ability to sort products within a category by customer
rating led to asales increase of 41% per unique visitor. (PETCO, June
2007)
Average Order Value Results
• Consumers were willing to pay between 20 to 99% more for a 5-star
rated product than for a 4-star rated product, depending on the product
category. (comScore/Kelsey, October 2007)
• Top-rated products site navigation path featuring 4- and 5-star
products in each category delivered 35% higher conversion and 40%
higher average order value. (Bazaarvoice, June 2007)
• Reviews usage drives higher spending: 27% of users report an
increase of 5-10%; almost 7% report an increase of 20%+. (Avenue
A/Razorfish "Digital Consumer Behavior Study," October 2007)
User-generated Content Beyond the Web

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• 64% of Social Researchers (those who refer to user-generated content

when shopping)research products online more than half the time, no
matter where they ultimately buy the product (store, Web, catalog, etc.).
(eTailing Group, June 2007)
• Online consumers are becoming precision shoppers. For every $1 in
online sales, the Internet influenced $3.45 of store sales.
(eMarketer, 2007)
• 90% of those surveyed say they have a better overall shopping
experience when they research products online before shopping in-store.
(Harris Interactive, October 2007)
• 92.5% of adults said they regularly or occasionally research
products online beforebuying them in a store. (BIGresearch, November
2008)
• Nearly one out of every four Internet users (24%) reported using online
reviews prior to paying for a service delivered offline.
(comScore/The Kelsey Group, October 2007)
• More than three-quarters of review users in nearly every category
reported that the review had a significant influence on their
purchase, with hotels ranking the highest (87%). (comScore/The Kelsey
Group, October 2007)
• 97% of those surveyed who said they made a purchase based on an online
review said they found the review to have been accurate.
(comScore/The Kelsey Group, October 2007)
• Consumers who shop online for digital cameras and TVs spend 10%
more on in-store purchases than consumers who do not search online.
(ChannelForce for Yahoo Search Marketing, July 2007)
Email Campaign Results
• Email study: PETCO realized a 5X increase in email click-through rates
by including relevant ratings and reviews content in the campaign
promotion. (PETCO, June 2007)
• Top rated product email drive 46% higher revenue per email in A/B test.
(Golfsmith, June 2007)
Search Engine Optimization Results
• In a study of a major electronics retailer site of 30,000 monthly natural
language search visitors, converted 60% more often, spent 50%
more, and viewed 82% more pagesthan search visitors to other pages.
(Bazaarvoice case study with major electronics retailer)
• In a study of online UK retailers, 59% reported that the consumer-
generated activity leads to better search engine optimization.
(eMarketer, 2007)
Return Rates and Customer Satisfaction
• During the 2007 holiday season, consumers who recalled seeing customer
reviews on a Web site reported 9% higher customer satisfaction
levels, were 9% more likely to make a purchase and 8% more likely to
purchase the next time they came to that site. (ForeSee Results, January
2008)

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• Reviews drive 21% higher purchase satisfaction and 18% higher

loyalty. (Foresee Results Study, January 2007)
• Online UK retailers reported improved customer retention and
loyalty by 73% once they implemented consumer-generated rating and
reviews. (eMarketer, 2007)
• Products with reviews have a 17% lower return rate than those without
reviews. (Bazaarvoice PETCO Case Study, 2007)
• Products with 50+ reviews have a return rate that is half of those with
fewer than five reviews. (Bazaarvoice PETCO Case Study, 2007)
• One study from IBM Institute for Business Management shows that while
those adults in the UK who use social networking do so to attain a feeling
of community, 17% of the adults surveyed say they do so because
they like to participate with brands they favor. (IBM, August 2007)
Evolution of Advertising and Media
• 75% of people don't believe that companies tell the truth in
advertisements. (Yankelovich)
Search
• SearchVoice study: of 30,000 monthly SearchVoice visitors, they convert
60% higher, spend 50% more and viewed 82% more pages. (Major
electronics retailer case study, August 2008)
• The ability to refine site search results by customer rating led to
22% more sales per unique visitor on a same-session basis and 41%
more sales per visitor on a multi-session basis. (Bazaarvoice)
Syndication
• RSS study: Burpee measured a 43% higher click-through on RSS
feeds with reviews than without. (Burpee, December 2007)

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Social Networks & Blogs More Popular than Email

More than two-thirds (67%) of the global* online population visits social networks and blogs, and
participation in these “member communities” is now the fourth most popular online category -
behind search, portals, and PC software, but ahead of personal email use,according to research
from Nielsen Online.

Use of member communities is also growing twice as fast as any of the other four largest sectors,
and three times faster than the overall internet, states the “Global Faces and Networked
Places” (pdf) report.

Social networking and blogging now account for nearly 10% of all time spent on the internet and
have “become a fundamental part of the global online experience,” said John Burbank, CEO of
Nielsen Online. “While two-thirds of the global online population already accesses member
community sites, their vigorous adoption and the migration of time show no signs of slowing.
Social networking will continue to alter not just the global online landscape, but the consumer
experience at large. This study explains why.”

According to the Nielsen report, Facebook - the world’s most popular social network - is visited
monthly by three in every 10 people online across the nine markets in which Nielsen tracks social
networking use. Orkut in Brazil has the largest domestic online reach (70%) of any social network
in these markets.

Other research findings :

 One in every 11 minutes online globally is accounted for by social network and blogging
sites.

 The social network and blogging audience is becoming more diverse in terms of age: the
biggest increase in visitors during 2008 to “member community” Web sites globally came
from the 35-49 year old age group (+11.3 million).

 Mobile is playing an increasingly important role in social networking. UK mobile Web users
have the greatest propensity to visit a social network through their handset, with 23% (2
million people) doing so, compared with 19% in the US (10.6 million people). These
numbers are an increase over last year - up 249% in the UK and 156% in the US.
Among the markets Nielsen measured, penetration of visits to social networks and blogs was
highest in Brazil, where 80% of the online audience visits such sites:

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The share of overall internet time for which social networks and blogs account is also highest in
Brazil, where nearly one in four (23%) of minutes spent online is spent on these sites:

Germany saw the greatest increase in penetration of social networks and blogs across 2008, from
39% of the online audience in December 2007 to 51% in December 2008 - a relative growth of
39%.

‘Advertising’ Most Closely Associated with ‘False’

The report also provides recommendations for advertisers to help them understand the world of
social media and potential opportunities within it. An analysis of social media sites by Nielsen
BuzzMetrics reveals that the term most closely associated with advertising is the word “false.”
Advertisers need to understand the social media market before they can begin to try to monetize
it, Nielsen said.

“Social networking isn’t just growing rapidly, it’s evolving - both in terms of a broader audience
and compelling new functionality,” said Alex Burmaster, author of the study and communications
director at Nielsen Online. “We felt compelled to analyze the state of the social networking market
globally and consider what implications this has for our publisher and advertiser clients.”

About the research: The report provides insights into the changing size and audience composition
of the global social networking audience and the increasing share of Internet time for which it
accounts. The report also analyzes how the major players are faring and what advertisers and
publishers can do to take advantage of the social network phenomenon.

*”Global” and “World” encompass the following countries in which Nielsen Online has a NetView
panel: Australia, Brazil, France, Germany, Italy, Spain, Switzerland, UK and US.

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