The ease with which consumers can post inaccurate comments and negative reviews about their experiences online can, if ignored, have a negative impact on businesses. Rebecca Nottingham looks at the emerging threat of the internet and how retailers can protect themselves against bad reviews
The rise of the internet and its impact on the KBB industry has been well documented over the years. Kbbreview, for one, has certainly done its fair share of reporting on the positives and negatives of the World Wide Web.
What with the availability of heavily discounted goods eroding retailer margins and availability of counterfeit goods, the internet phenomenon has certainly been the cause of a few headaches. However, at the same time, we’re constantly being reminded that the internet is here to stay and that the industry needs to embrace its potential rather than view it as a threat to business.
According to the latest figures from market consultants Capgemini, for the first time ever online retail sales broke through the £100 billion barrier in 2014, representing growth of 14% for the UK’s online retail market. E-retail now accounts for an estimated 24% of the total UK retail market. Capgemini predicts that £116bn will be spent online in 2015, representing 12% growth.
Despite this, KBB industry experts claim that in terms of competition from the internet, where sales are concerned, retailers are now over the worst of it.
In fact, Heritage’s general manager Gareth Griffiths was only talking about how the cycle in the KBB market has changed back in the July issue: “As much as online sales are growing, consumers still need to be able to see and experience big-ticket items like bathrooms and kitchens. I don’t agree that the internet is still damaging the market or that there is no money to be made in KBB retailing. If that were the case, we’d have seen retailers taking Heritage displays out of showrooms left, right and centre, and we haven’t. So, obviously, our retailers are finding ways to make money.”
And many independent retailers, including Tina Riley, KBSA chair and managing director of Leamington-based KBB retail business Modern Homes, agree that while online competition remains, the impact on independents has lessened.
“Discounting of appliances and consumers comparing appliances is far less of a worry now than it has been over the past few years,” she explains. “This is down to a number of factors. The launch of partner programmes by many leading brands has helped protect retailer margins. Not to mention the fact that we are finding more and more clients who want us to provide and deal with everything rather than looking for deals online.”
Elizabeth Pantling-Jones, managing director of Lima Kitchens in Milton Keynes, agrees, saying that while they still come up against online suppliers on price, its effect on her business has lessened.
“We still find ourselves coming up against internet-based suppliers and it can be extremely difficult to compete on price,” she explains. “But it is something we have adjusted to. We have adapted our approach to help us identify consumers that we feel would benefit from a personal service. This has been strengthened with both literature on our website and in the showroom with a focus on working in partnership throughout the process. We have found that, from the outset, this helps potential clients, and us, identify their priorities and tip the balance more towards service from price.”
So, while independents may still come up against online competition and discounting, the problem appears to be under control as retailers have changed the way they approach the market and because many consumers are well aware of the benefits of buying through a retail showroom.
But, with the rise of social media, is a new threat to independents and the wider industry emerging?
The growth in popularity of social media sites like Twitter and Facebook mean that companies and brands, big or small, now have a variety of platforms on which to market their businesses and sell to consumers. However, along with online review sites, these platforms can also leave brands and businesses wide open to negative reviews and criticism. The biggest issue is that there appears to be little, or no, control over what can be posted, leaving businesses at risk from negative comments that can have serious consequences – not just in terms of revenue, but also reputation.
“Social media is a powerful tool and although for some businesses it is still not regarded as an important part of the marketing mix, sites such as Facebook and Twitter have been growing in popularity for over 10 years,” says Kirsty Darcy, in-toto Kitchens PR and marketing communications executive. “Like them or not, they are a hugely influential part of consumers’ lives and although public posts can feel like an uncontrollable threat to businesses, social media can also provide many opportunities, even if the customer is expressing concerns or dissatisfaction.”
And, it’s not just large companies and high-profile brands that are at risk from online reviews and complaints. Leicester-based bathroom business QS Supplies is just one independent KBB retailer to have fallen victim to negative reviews online.
Following my visit to its showrooms in July, a quick Google search of the company brought up a very mixed bag of comments posted on various customer review sites regarding the service they had received from QS Supplies.
Farook Member, the owner of QS Supplies, says: “The negative customer comments posted online are 100% related to purchases made through our internet store. And every one of those complaints is related to the same issue – consumers who do not understand how to order such complex products. We are very strict on our returns policy, as we are governed by our suppliers, so invariably it ends up in an argument between the customer and ourselves.”
Member was unaware of the stream of negative comments posted online, but is now addressing the issue by encouraging happy customers to place comments online in order to create a more balanced picture.
“They [QS Supplies] were shocked to find that even when they fully addressed customers’ complaint, by replacing a faulty item, for example, unless the consumer agreed to update their review, QS could do nothing about it,” explains Bill Miller, managing director of the Kitchen Bathroom Buying Group (KBBG). “One customer promised to remove their negative review, but it is still online.”
The anonymous nature of online posts is also a fundamental part of the problem, as people are highly likely to say things they wouldn’t face to face. Not being able to identify the nature of the complaint, or the individuals, can lead to businesses receiving very unbalanced reviews and unwarranted criticism. There is even scope for rival businesses to post ‘fake’ reviews online.
“We have been the victim of trolling and received negative comments,” explains Pantling-Jones at Lima. “Although in some of these circumstances you can challenge the content, it is not always possible and it often remains visible. It is also surprising the number of [social media] profiles that are created without any, or very little, activity other than a negative review on your business’s profile. We are pleased to say that, to date, we have not received a ‘genuine’ negative review, but that is not something an onlooker would know.”
Another concern is that, on some review sites, such as Review Centre, Yelp and Google, as any user can set up a listing for any business and leave their own feedback, there may be reviews online about your company that you aren’t even aware of.
No matter how good a service or how great a product you provide, it is inevitable that from time to time the customer experience will not be as perfect as you would like, and you are exposed to public review online by a disappointed customer.
“Review sites and social media are part of the marketing wheel,” explains Paul Crow, managing director of bathroom franchise business Ripples. “Ask any hotelier about TripAdvisor and I know what they’ll say. Perhaps in our industry, there should be a specific review site, so that people can post realistic feedback on a service.”
Most consumers will understand that the majority of businesses are unlikely to have 100% positive reviews. Therefore, when handled correctly, good and bad feedback can actually be beneficial and perhaps, if a business receives a lot of negative feedback, this should be looked at as an opportunity to analyse why and what could be done differently.
In-toto’s Darcy adds: “No matter how good a service or how great a product you provide, it is inevitable that from time to time the customer experience will not be as perfect as you would like, and you are exposed to public review online by a disappointed customer.
“The feedback we [in-toto] get, good and bad, is valuable. It gives us the opportunity to identify our strengths and areas of improvement that can be harnessed, and it means we can put right any grievances at an early stage.”
So, how much of an issue is this and how can retailers and brands protect themselves from negative online posts?
“Internet reviews can be very damaging and potentially could shut down your business,” warns the KBSA’s Riley. “The problem with these comments is that they can spread like wildfire, but the key is to respond quickly to try to diffuse the situation. My advice to retailers is to contact the client as soon as possible and ask for any further comments and discussions about the issue to be dealt with off-line.”
Darcy at in-toto agrees: “The challenge of social media is that users expect an instant response. The influence these sites can have on consumers should not be ignored. In order to manage a company’s reputation, there should be a dedicated person responsible for monitoring social media pages and review sites, so that negative comments are addressed quickly and professionally. The longer that damaging comments are left unseen or unanswered by your company, the bigger the impact it can have on your brand reputation.”
Focusing on your strengths as an independent retailer and making sure you can deliver what you promise is another way to protect your business from the threat of negative reviews.
“Social media and specialist review sites definitely reflect how a business is perceived and can be very influential in generating enquiries and delivering confidence to potential customers,” says Matthew Parnum, owner of Ice Interiors in Berkhamsted, Hertfordshire. “It’s impossible to please all of the people all of the time, but treating customers fairly and delivering what they expect, and clearly communicating with them throughout the process, can alleviate a lot of misunderstandings and possibly harsh reviews being posted in the first place.”
A suggestion offered by Charlie Mullins, founder of Pimlico Plumbers, is that review sites should introduce proof of purchase to help authenticate reviews and protect businesses from ‘fake’ bad experiences. While Ripples’ Crow agrees that negative reviews could, over time, potentially destroy a business, and that steps should be taken to help retailers protect themselves against the issue, he believes introducing a proof of purchase policy may not be the answer.
“I think if someone is deliberately going online to make comments against your business then you have a big problem,” he says. “However, having to post proof of purchase could be a deterrent for people that want to leave you positive feedback too.
“Anyone in the industry can protect their business from negative reviews by encouraging all customers to provide feedback, attending to customer needs and by being realistic about what a company can offer to its customers and by living up to that. It’s for us, as an industry, to offer balance through authenticity.”
The overriding message to independent retailers about the internet is clear. Uphold the strong service element that you have worked so hard to build, keep your showroom up-to-date and relevant and ensure you, and your staff, are experts in your field. But use the internet as an important part of the overall retail experience.
Recognise the huge potential that social media platforms like Facebook, Twitter, online blogs and review sites can have on your business but also be mindful of the impact negative comments can have on its reputation.
Be proactive in reducing the risk of negative feedback by maintaining consistently high standards and by acting on any issues that arise; ask satisfied customers to share a positive review before the high of the experience is forgotten; and uphold high levels of product quality and service.
“Any retailer that ignores a negative review about their business, does so at their peril,” concludes the KBBG’s Bill Miller. “To limit the effect online posts may have on business, retailers must respond to them immediately.”
COMMENT: PIMLICO PLUMBERS
Charlie Mullins, founder of Pimlico Plumbers, gives details of his experience of dealing with review sites and offers advice to KBB retailers on how to protect themselves against the impact of negative reviews…
I have no problem with the concept of online customer review sites, provided there are the necessary checks. However, as with a lot of things that happen on the internet, people can, and do, say things that they wouldn’t necessarily feel comfortable saying face to face. Review sites cannot be allowed to become a forum for individuals to make unfounded and libellous statements that destroy the reputations of good companies.
The issue with most review sites is that the companies behind them are not interested in stumping up the cost of policing the comments – making sure that what is written is fair comment, or even from people who have legitimately experienced the negatives, or positives, they say they have.
It’s hard to qualify exactly how negative comments can impact upon businesses in general. For well-established companies like mine that have a large, loyal customer base, that’s been built on trust and reputation over 36 years, the threat of negative reviews could be minimal. However, it’s still a worry that people can damage the good reputation of my business that we’ve worked so hard to build.
But for smaller, younger companies, without the benefit of years of goodwill, a brief onslaught from an unscrupulous competitor, or a disgruntled customer, has the potential to be cataclysmic, and could drive them out of business.
The costs of doing something about unfair reviews are huge. After you call the site, assuming you can actually make simple voice contact, which often you can’t, it gets hugely expensive. Last year, it cost me more than £20,000 to challenge and remove three unfair reviews from ‘users’ who failed to identify themselves. The site concerned wouldn’t tell me who they were and I had to pursue them through the Irish courts to find out who had actually written the comments.
These sites do not seem to be covered by the same libel laws that newspapers and magazines, and even news websites, must follow.
For the most part, unless you have deep pockets, you have to take it on the chin, pretty much as an additional risk of going into business in the modern environment. You can mitigate the problem by encouraging your good, honest and satisfied customers to post positive reviews to dilute the
A customer review must be made by a named person, who is prepared to identify themselves, and there needs to be a right of reply. The original poster must also be required to prove that they are a genuine customer of the business they are critiquing, and by this I mean that they should make consumers post proof of purchase or provide an invoice or reference numbers next to comment.
This would alter the balance and help cut down on ‘fake’ or misleading comments, making them fairer and more useful to users. Then, and only then can, the system approach something fair and useful to other potential customers.
TOP TIPS TO PROTECT AGAINST NEGATIVE REVIEWS
- Search for and take control of any listings posted about your business on internet review sites. Set up alerts so that you can monitor any new reviews.
- Respond quickly to all reviews – good and bad. People have taken the time to review you, so take the time to say thank you or diffuse a potentially
difficult situation by offering a helpful response.
- Reply to the review professionally and to the point. If the situation looks like it’s worsening, provide an email address or telephone number and ask them to
contact you for a more detailed conversation off-line.
- Promote good reviews. Ask satisfied customers to comment online about their good experiences. Social media is perfect for this. Create a testimonials
section on your website, so potential clients get a more balanced view of your business.