Customer testimonials and references are key indicators of customer satisfaction. They have the extra benefit of driving word of mouth advertising. When a customer likes a product or service and tells their friends, the friends are more likely to buy from that vendor than if they just absorb advertising from traditional means.
That is why companies invest in customer satisfaction programs. They need to know who is satisfied and who isn’t and why. And they need to gather customer references and testimonials.
The Wisdom of Crowds
A trend has evolved over the past few years where companies don’t gather the references and distribute them, the customers do. We know the review sites like Yelp and complaint sites like Complaints.com that exist on the web provide consumers with the opportunity to share with people they don’t know who might be considering the product or service a company is offering. Call this the wisdom of crowds. If enough people enter good or bad comments, those who might be considering buying from an organization will look for the wisdom of crowds, often in the form of reviews and lack of ‘complaints’.
But many times, the reaction by an organization faced with these reviews it to discount the bad ones, on the grounds that this ‘bad review’ or complaint is from a competitor trying to make trouble or a disgruntled former employee and that there are many false reviews on the web. I found an interesting graph on the Yelp FAQ site that shows that the vast majority of reviews are positive and only a small fraction (17%) are rated as one or two stars.
I think these organizations need to review their thinking on these reviews and investigate them further. There may some truth to the complaints.
The Wisdom of Friends
The newer trend is far more powerful: the wisdom of friends. If friends like a product or service, and share that information, the credibility of the review rises significantly.
Web based services and mobile phones have enabled the wisdom of friends to be very visible. Facebook places and services like Foursquare and Gowalla, allow users to ‘check in’ at a location they are visitng. This checking in process is often accompanied with an incentive from the location to encourage check ins.
In the case of Foursquare, the person who has the most check ins at single location in a month becomes the ‘Mayor’ and the Mayor gets something special from the business. It could be a free meal, a free coffee, a free service. In this way, everyone is encouraged to ‘check in’ because they might become the Mayor that month.
Indirectly each of these check ins forms the wisdom of friends. Foursquare allows users to form communities of their friends. When someone checks into a place, their friends are notified. This is great if a group of friends want to join each other but don’t know where their friends might be located. There is great power to this as the user does not have to be sitting at their computer to be notified that their friend has checked in. The notification goes to the user’s cell phone.
Facebook places allows people to check in as well, notifying their friends on Facebook where they are. Facebook Deals allows companies to offer discounts or other incentives to users who check in to their location. This is a further incentive for visitors to check in.
Since a high percentage of interactions on Facebook are done via the cell phone (I have heard figures of 50%) users who check into a location through Facebook can distribute this information to their friends who are already connected to Facebook on their cell phones. This creates a viral method to share ‘reference’ or ‘testimonial’ information.
The web and mobile technology is changing how customer testimonials and references are gathered and disseminated to users. Facebook Places, Foursquare and Gowalla allow friends to share where they are visiting, creating a dynamic reference system. Organizations need to understand and adapt to this new technology and join in offering incentives to users to ‘check in’.
Do you think this is a positive trend for your organization?