User communities

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Why 9 in 10 Consumers Rely on UGC When They’re Low in the Funnel

Now more than ever, consumers rely on user-generated content when they are researching purchases. The reason: UGC offers authenticity that branded content can’t match.

Purchase intent can be closely mapped to reading user-generated reviews, a study commissioned by Yelp shows.

The study, the results of which were released this month, found that 92 percent of people make a purchase after visiting Yelp.

Notably, more people are now using review sites when they expect to buy something. Between 2014 – the last time this survey was conducted – and 2017, the percentage of people who said they buy within a few hours of browsing Yelp rose 212%.

Why 9 in 10 Consumers Rely on UGC When They’re Low in the Funnel

To improve its effectiveness as a marketing platform, Yelp tries to make merchant-consumer connections as seamless as possible. The site lets users communicate with merchants via private message, and also helps merchants attract new customers by publishing coupons.

For this reason, it’s important to take this survey data with a grain of salt. Linking review consumption with purchase intent – like this study does – ultimately props up the Yelp business model.

Still, it’s hard to ignore how much more popular reviews are, compared to three years ago.

Other research supports Yelp’s findings. BrightLocal, an SEO analytics company, says 50% of consumers read online reviews regularly – compared to just 33% in 2015.

And Pew, the independent social research organization, has found that just 4% of consumers aged 18 to 29 never use online reviews.

The fact that this cohort (Millennials) relies so heavily on reviews tells us a lot about where online engagement is headed. For Millennial consumers, who grew up alongside the internet, doing online research before making a purchase is simply second nature. Not only that, we Millennials were some of the earliest users of social networks (MySpace, anyone?). That means we enjoy sharing our thoughts and opinions with our peers on the web.

Combine these two trends and you see why user-generated reviews are so popular. Sites like Yelp tap into consumers’ demand for authentic content that helps them make smarter purchase decisions.

We see this desire for authentic UGC on the inSided platform, too. One inSided customer – a European telecom company – found that traffic to its online store from its inSided community converted at a much higher rate than traffic from its social ads. The reason is that a community offers pre-sale help and advice that social networks do not. And to get the most out of person-to-person connections, UGC has an important role to play.