The power of online reviews

There are more than 183,809 members of the Iron Man 2 movie’s Facebook page. Punters just love that movie and they like chatting about it. On the flipside, the new Australian movie I Love You Too‘s Facebook site has just 686 members. Ouch.

Social networks deliver instant feedback on a product, person or service.

“The second you put your brand out on the internet, it doesn’t belong to you anymore,” says Rob Moore, Village Roadshow’s new digital marketing manager.

“When you make the decision to be in this space you accept that you will not always get great feedback,” says Moore, who has worked in social media marketing for the past five years, previously with major British firm StarCom.

Moore likes to keep an eye on everything said about Village Roadshow online, from the popcorn to the main attraction.

“I don’t have a problem with receiving bad feedback. It helps the business to grow.”

Australian businesses are getting into social media in record numbers. The Nielsen Community Engine 2010 Social Media Business Benchmarking study estimates that 70% of Australian businesses will do some social media activity this year, up from 40% in 2008. This shift will take adjustment for firms used to traditional push-style marketing.

“Companies are used to shouting their messages at people and now they are going to have to listen,” says Scott Rhodie, social media director at Hothouse Interactive.

Australian businesses and their brands are clamoring to get into the social media action. With eight million registered Facebook users in Australia (as at March 2010), plus Twitter, MySpace and LinkedIn et al, that’s a massive online marketplace.

Market researcher Forrester estimates that if the page impressions that feature peer reviews from both social networks and posts were combined, they would total 500 billion impressions a year. That’s big.

Whether it’s iPads, films, eBay sellers, advertising campaigns, wine, doctors, shops, tours, you name it, you’ll find frank and fruity reviews and feedback on social media sites, blogs and forums.

There are even new sites like Unvarnished, (in its beta phase) which allow users to post anonymous reviews about the people they work with that can be used by potential employers. Individuals have never had more opportunities to tell companies, peers, anyone, what they think of their people, products and services, which forces companies to reassess how much customer reviews really matter.

Businesses that are great at what they do don’t have anything to worry about. Being in a successful enterprise is all about being close to customers, for better or worse.

“There is so much anxiety around social media,” says Davis.

“There are assumptions made that the only things that people are going to talk about on the web are bad things and that is simply not true.”

So who’s writing the reviews?

In Rules of Thumb, Fast Company founder Alan Webber discusses the 90:9:1 rule. For every 200 people, 90 will be happy to spectate, 9 will make some contributions and one will make pretty much all the contributions.

Major US researcher Forrester agrees that it is a small, vocal minority that will generate the lion’s share of comments, estimating that 6.2% of adults create 80% of content.

Bad feedback isn’t a new phenomenon, duh.

A sledging on Facebook or TripAdvisor might be a new experience but it is not as if businesses have not had to deal with bad feedback before.

Craig Davis, co-chairman and chief creative officer for Publicis Mojo in Australia and New Zealand says that social media marketing plans often get “shrouded in the mystery and voodoo of new technology”.

Based on Davis’ theory that a brand is the sum total of stories being told about it and the stories the brand itself puts out into the marketplace (eg. packaging, product experience and advertising), he urges businesses take a more humanistic approach to genuine negative feedback that needs to be addressed.

“Don’t lie to people and when you make a mistake, be brave and apologise,” he says.

Social media is creating new levels of transparency

Don Tapscott, author of The Naked Corporation has written extensively about the way technology has heralded in a new age of transparency. In this digital age of maturing social networks, he sees greater transparency as an “unstoppable force”.

He writes: “We really need to wake up and understand. Because it is going to affect the brand, it will affect everything that we know about marketing.”

So how is a company meant to respond to negative feedback?

If customers’ motivations are genuine, and are not representing a competitor’s interest, it pays to listen and respond. Crown Metropol, the latest hotel in the Crown Limited Group, opened on April 20. The hotel has already been reviewed on TripAdvisor, the take-no-prisoners social media site that has more than 30 million hotel reviews on it. Negative reviews on TripAdvisor will often include photos of the offending rusty tap, hair on the mattress or bad breakfast buffet.

For example, there are some good early reviews for Crown Metropol – “wow”, “best 5 star in Melbourne” and “amazing”. However, one of the top reviews as at May 13 just below an “excellent” review reads “what a nightmare” followed by “Definite teething problems here”.

TripAdvisor allows hotel owners to respond to good and bad reviews and each review includes the tag line “This review is the subjective opinion of a TripAdvisor member and not of TripAdvisor LLC. Crown Metropol did not wish to comment on this issue of online reviews.”

Davis recommends thinking of the social media space as being like a community meeting “and everyone is talking about you,” he says.

“You get points for showing up, you get points for standing at the back of the room and listening.”

Damage control can make all the difference

In March, Southwest Airlines made international headlines when filmmaker Kevin Smith was ejected from a plane for being “too fat”. He tweeted his predicament and news spread fast, making world headlines within hours. In the wash-up, Southwest’s fast response, and steady stream of tweets from Southwest in the hours and days after the story broke acknowledging the problem limited the PR damage.

The Southwest tweets were straight up: “I read every single tweet that comes into this account, and take every tweet seriously. We’ll handle @thatkevinsmith issue asap”.

Whatever you do, don’t be anti-social and don’t be a dork

Village Roadshow’s Rob Moore has a consistent analogy for businesses that enter the social media space. Don’t be that awkward uncle at the wedding, sauntering up to the crowd making everyone feel uncomfortable. “The trick is to not go in and start talking about yourself and expecting people want to listen,” he says.

Many businesses make the mistake of turning their Facebook page into a fraternity-style page full of staff updates, new babies and product plugging. Why would customers want to join in?

The impact of social media on brands is hard to measure. Davis has developed a new website Brand Karma that tracks what he calls “the health” of the brand through social media feedback, news and consumer voting. The site’s blog has featured discussions safety of motorcycles, BP’s clean-up approach and apathy towards the Nike brand. The site encourages users to join, share consumer insights and collectively influence brand behaviour. Brand Karma has Top 10 lists – current retail favorites include B&Q and Aldi.

Like Tapscott, Davis sees greater transparency as a by-product of technology. Brand Karma only went public six weeks ago and it is tapping into, says Davis, “the wisdom of the crowd”. People do discuss their buying decisions in social networks, and Brand Karma can tap into that.

Says Davis: “If you are doing a good job, you have nothing to fear.”

Where your company might be being talked about:

General: LinkedIn, Twitter, Facebook, SmartCompany, Business Spectator, Board Room Radio
Advertising and marketing: Mumbrella, Campaign Brief, Coolhunter, Brand Matters
Agribusiness: Agribuzz
Construction and engineering: Concrete Detail, Engineers Australia,
Economics: Debtwatch, Freakonomics
Entrepreneurial ideas: Springwise, Smart Company, Entrepreneur Watch, Entrepreneurs Journey
Financial services and insurance: Hot Copper, Marketstock, Aussie Stock Forums, Uberrima Fides
Health and pharmaceuticals: Bioshares, Pharma In Focus
Information technology: Whirlpool
Media: Crikey
Professional services: BNet
Property: Property Review
Resources and energy: Mining News, Australian Mining Reference
Retail: Coolhunter
Sharemarket: Hot Copper, Marcus Today, Shares Watch
Social media: Laurel Papworth, Servant of Chaos
Technology: Engadget, Gizmodo, Business Tech Talk
Telecommunications: ZD Net, Budde Blog
Tourism and leisure: TripAdvisor, Hotel Chatter, Frequent Flyer, The Boot
Transport and logistics: Logistics, Transport and Logistics News