Thursday, February 21, 2008

How To Profit From Negative Reviews

Kudos to for allowing negative reviews on their site. These aren't just negative reviews on toys, these unhappy customers are calling for hammers!

So my 4 year old has been coveting this Star Wars transformer toy for some time, and after a great report from school I thought what a great time to buy it for him. I then went to, found the item and started reading the reviews. 24 out of 29 reviews said basically "don't buy this item" for a number of reasons that were directly relevant to me. So I did not buy the item and further did not select another item to purchase. So they lost a sale? yes.

But what did they gain?

Trust and increased credibility - next time I am on their site and the reviews are on the positive side they will hold more weight. Now I *trust* reviewed content on Trust is tough to get.

Increased LTV(Long term value) - my trust in has risen and will translate into more sales from me over the long term. They allowed their customers to float the good stuff and flag the bad stuff and this has value to me as a customer.
sound familiar to outbrain's mission?

Positive WOM - here I am blogging about it! Toysrus can't get much better than that. Even better, they avoided a negative word of mouth event (in the shape of a scathing blog post) if I bought the item and experienced the problems that were revealed in the reviews.

Parent Osmosis - they saved me from making a bad decision, and spreading the negative news to my wife. With toys, if one parent has a bad experience, it gets directly relayed to the other parent - the end result, toysrus would have torpedoed two customers for the long term - me and my wife.

Yes toysrus lost a $49 dollar sale, but they gained so much more - my trust and appreciation for not wasting my time and money.

This same concept travels to bloggers and blog content as well. If you believe in ratings on your content, then having negative ratings actually delivers value to the blog by helping your readers sort and filter. Allowing negative reviews/ratings balances out the positive content and this breeds trust. And who doesn't want the trust of their audience/customers?


L0R3N said...

But your son was left toy-less?

John LoGioco said...

Good question - actually I bagged the Internet and went on a walking mission in NYC. I found a great little toy store in Chelsea and bought him an indoor mini-golf set. He loved it.

דניאל said...

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