Building a Successful Go-to-Market Strategy: A Comprehensive Guide

Posted on Sep 22, 2022Nov 4, 2022 by Emily Louise Spencer

When launching a new product or entering a new market, you would want to get the best possible results in terms of sales, brand awareness, ROI, or other KPIs.

However, you will likely lose more than you gain without a documented marketing plan. That’s why businesses rely on a go-to-market (also known as GTM) strategy to increase their odds of achieving their goals.

Creating this plan is relevant for all businesses – from SMBs and startups to the enterprise level. Moreover, refreshing the one you used for a previous launch is always a good idea as circumstances, and people change.

In this complete go-to-market guide, you’ll find everything you need to get you running, including:

What is a go-to-market strategy is.
Why it is important.
The key components of an efficient go-to-market strategy.
How to craft a successful one on your own. And,
Examples from leading brands.

Let’s get started.

What is a go-to-market strategy?

A go-to-market strategy is a comprehensive plan that outlines how a new product would reach its end customers.

Generally, every go-to-market strategy outlines the value proposition, target audience, entire marketing plan, and sales strategy.

Sounds like your regular run-of-the-mill marketing plan, no? Well, there are a few key differences.

Go-to-market strategies vs. marketing strategies

If you’re in the early stages of launching your brand, your go-to-marketing, and marketing strategies might be fairly similar, but once you’re well established, they will diverge and become very different.

You can sum the differences up as follows:

Go-To-Market Strategy	Marketing Strategy
short-term	long-term
driven by a specific product	business-wide
designed for product launch	covers all time periods

Why are go-to-market strategies important?

Strategy is key to success in today’s markets. Creating a quality, data-driven, clear marketing strategy helps businesses to understand their aims and goals.

First, it clarifies the reasoning behind the launch of a product or service, identifies the target market, sets a pricing strategy, and outlines the ways to draw and engage customers to a brand.

Secondly, a go-to-market strategy provides some quality control.

The design of a go-to-market strategy forces a business to evaluate and consider all the issues customers might have with their product or service.

Identifying and mapping potential pitfalls helps brands to improve their customer experience – from product development to informing sales and support teams – creating positive sentiment and maintaining customer loyalty.

Let’s talk about what makes for a good go-to-market strategy and what difference it can make for your success.

What are the components of a go-to-market strategy?

go-to-market strategies have several layers, which we’ll discuss in more depth later. In general, a solid document will contain your:

Objectives: What you plan to do and how to achieve your goals.
Customer attraction strategy: How you plan to attract customers and convince them that you’re the best option for them.
Sales strategy: Your sales model and how you intend to promote your product.
Delivery strategy: How you plan to get your products to customers, whether via direct shipping, through a middleman, etc.
Customer support strategy: How you plan to handle potential issues and support your customers when they have difficulties using your products.

While every product launch should focus on the “objective” part, the other aspect will be prioritized differently, based on conditions such as the market and the product itself.

For instance, launching an iterative piece of software will require you to focus efforts on customer support, and a new yogurt flavor may need a clearer sales strategy.

To understand how to slice your pie the best way, you’ll need to perform quality market research and dive into the data.

Here are some points to consider.

4 key points about data-driven go-to-market strategies

Like many other marketing solutions, when done right, the go-to-market strategy is very useful and improves a brand’s sales and earnings.

There are a few components for an efficient and effective go-to-market strategy. One main thing to consider when creating a marketing strategy is its market definition.

A good go-to-market strategy has to define the consumer market for a product or service, helping optimize short- and long-term marketing efforts.

Another important aspect is the focus. The marketing strategy needs to focus on the product or service and its benefits to customers in the current market. It should highlight what a brand can offer customers that competitors can’t.

Additionally, an efficient go-to-market strategy should be flexible. In an ever-changing market, innovation is key. A successful go-to-market strategy is pliable and can be modified to match brand innovation.

Solving customer pain points

A pain point is a problem current or potential customers are experiencing with a product.

Pain points can be present in many different parts of the customer experience:

Financial: Customers spend a lot on the current product or service and want to reduce costs.
Productivity: Customers waste too much time using the current product or service and want a more efficient solution.
Support: Customers aren’t getting the support they need along the customer journey stages.

Moreover, many customer pain points combine issues from several categories.

To successfully deal with customers’ pain points and present your brand as a viable solution, you first need to identify the problems.

A quality go-to-market strategy relies on data collected to do just that.

Improving product marketing

Product marketing is the term for promoting and selling a product or service.

It entails deciding on product positioning and messaging, launching the product, and more. Successful data-driven product marketing relies on quality information.

And to get that information, you’ll need to perform market research.

This will provide you with information about potential customer markets, along with the needs and pains that affect them.

One way of performing market research is by listening to your customers.

Social media has become a platform for customer reviews, customer service, and product promotion.

Through this, social listening is a great way to assess what messaging will work best and learn what social sentiment a brand is creating.

The go-to-market strategy provides a sturdy base for more focused market research and voice of customer analysis.

Using a well-constructed strategy ensures the messaging is consistent and in tune with buyer personas and attitudes, helping sales teams to optimize marketing and get better sales and revenue.

Innovating your brand and product

As we said earlier, innovation is key in today’s highly competitive market. Businesses innovate using two main ways:

The first is product innovation, meaning a new solution to a problem many consumers encounter. A brand can offer a product that addresses a formerly untouched issue or one that addresses the problem in a different way.
The second is brand innovation, which is when a brand does something new. This can be launching a new product or making changes to an existing one.

Creating a go-to-market strategy is a great foundation for a successful innovation of any kind, especially when it’s data-driven.

Having a strategy helps focus innovation efforts around set goals.

Moreover, It maintains priorities and sharpens innovative ideas. This creates an improved innovation process that is more likely to aid brand growth and survival.

Crossing into new territories

Cross-border ecommerece shopping is taking the world by storm. It’s set to exceed $1.9 trillion In 2022, growing even further in 2023.

As consumers shift more and more to online shopping, businesses must prepare themselves and expand their ecommerce abilities to new territories.

But before opening up your wares to international shoppers, it’s imperative to prepare a strategy to penetrate these new markets.

A few essential steps to make before the expansion include product research, cross-border taxes, logistic costs, language barriers, and more.

Gathering data for a data-driven go-to-market strategy

Now that we reviewed the aspects and advantages of the go-to-market strategy, let’s talk about how you can get the data needed to create a data-driven one.

Performing customer-centric market research provides insight into customer desires, needs, and attitudes.

Revuze offers AI-powered Customer Experience (CX) analysis to help you better design marketing strategies.

Revuze developed the first self-training, low-touch AI technology that collects and analyzes data automatically and delivers consumer insights valuable for data-driven go-to-market strategy design.

How to build an excellent go-to-market strategy?

By now, you might be thinking, how exactly do I build a go-to-market strategy? I’ve read all of this information on what they’re about and what they do, but I have no clue how to build one.

Fear not. We’ve outlined nine simple steps to take you from novice to expert.

#1 Find your product-market-fit

Every product launch should be designed to solve a problem.

A great product looks at what consumers want, addressing their pain points and drawing customers to it.

There’s no use in providing a product that a competitor makes cheaper, sturdier, and easier to use.

It’s a concept known as product-market-fit, the ability of a product to satisfy a demand that the market creates.

If you manage to nail down your product-market-fit, you’re off to a great start.

#2 Define your target audience

Every product launch has a target audience. Those people who ideally will be the ones to buy your product. If you want to define them, you need to look at the following factors:

What problems does your product solve?
Who has these problems?
How much are they willing to pay to solve said problem?

If your product only solves a minor problem, your price must reflect that. Customers aren’t usually willing to spend a lot to satisfy a minor issue.

#3 Research your competition and the current market state

Unless you’ve spotted a gap in the market that no one else provides, you can expect to see competitors already existing within your market space.

In order to get a leg up on them, you need to know them. Asking the following questions will help see the full picture:

Who already provides a similar product?
What demographics and geographic areas do your competitors consider their target audience?
Are your competitors meeting the demand that customers create? Is the market oversaturated, undergoing scarcity, or somewhere in between?
What do you provide that your competitors do not? Conversely, do your competitors’ products have any features that yours lack?

Competitive analysis, as it’s known, is key to understanding your position within the market, your strengths & weaknesses, and any opportunities & threats that might come your way.

#4 Decide on your key messages

Once you know who you’re targeting, you need to decide what messages you’ll convey to them.

Each demographic you target will require a personalized approach since they will react differently to the same message.

You should create what’s known as a value matrix. This is a summary of:

Their pain points.
How your product might solve said pain points.
How do you plan to convey that to your customers?

Buyer personas will assist you greatly here, as well as simulations of customers with their problems, values, and goals.

You can use these to get an idea of what a particular demographic might want and how they might respond to you.

#5 Map out your customer journey

The customer journey is the sum total of interactions that a customer has with you, from first hearing about you and your products, all the way to the point of purchase.

The way to map out your customer journey is to identify:

What touchpoints exist between you and your customers?
How do you want to influence your customers at those touchpoints?

And from there,

What type of interaction is needed to facilitate your ideal influence?

The best way to visualize your touchpoints is in the buyer’s funnel. This splits the customer journey into three sections:

Top: Customers have a problem but are not yet in contact with you.
Middle: Customers know you exist but aren’t sure if you are the best option out of the range of potential products.
Bottom: Customers decide whether or not to purchase your products.

The touchpoints within each funnel section will roughly aim to grab the customers’ attention in the top phase, convince them what you offer is best for them in the middle phase, and convince them to commit to buying from you in the bottom phase.

With the combination of your aims at each step and your target demographics, you can work out exactly what you need to communicate to your customers and how you should do it.

#6 Choose your marketing channels

Marketing channels vary wildly, from TV commercials to internet adverts, newspaper prints to marketing emails.

Each demographic will have its preferred way of communicating, and it’s up to you to align with your customers’ preferences if you want to stay relevant.

Generally, you should choose your marketing channels based on how your demographics consume content. If you have multiple target demographics, choose multiple channels accordingly.

Further, we recommend using different marketing channels for each customer journey stage.

For instance, a YouTube ad might make customers aware of you and push them down the top of the funnel, whereas an email or presentation will help them pick you out from among dozens of other products within the middle.

#7 Choose your sales plan

Ultimately, a go-to-market strategy aims to generate sales and revenue. Thus, you need a sales plan.

There is a myriad of different sales strategies you can use, but some of the most common ones are:

- Self-service: Customers find you and purchase from you on their initiative.
- Inside sales: Your sales team forms a relationship with your customers and convinces them to buy from you.

Field sales: Your sales team focuses on closing big deals, focusing on enterprises.

Channel sales: You pass your product on to an external partner, who sells your product for you.

Inbound sales: Sales processes are adjusted based on buyer actions.

Outbound sales: Sales processes are adjusted based on seller actions.
Cross-selling: You focus on selling your product in conjunction with others.
Up-selling: Your sales team takes existing customers and encourages them to upgrade.

Each of these models has its strengths and weaknesses, and the decision to use is ultimately up to you. You should pick one that aligns well with your product and business model.

#8 Decide on your goals

Goals are factors such as sales figures in a specific amount of time, sales figure growth, amount of consumers contacted, etc.

They tell you whether or not your strategy is working and whether carrying on the way you currently are is the best way to continue.

Goals often fall under frameworks such as:

Key Performance Indicators (KPIs).
Objectives & Key Results (OKRs).
Specific Measurable Achievable Realistic Time-Bound Goals (SMART Goals).

You can use one of the above to set your goals, a combination of two, or even all three!

#9 Lay out the steps that will help you achieve your goals

Now that you know what you want and how you can achieve it, it’s time to set out the steps to help you get there.

Creating a clear and well-crafted go-to-market strategy means working backward, seeing the obstacles that might appear in your path, and how to avoid them.

For instance, you might have a goal of selling 10,000 units of your product within a month.

However, an obstacle you foresee is that your sales teams might use different strategies, only some of which are effective.

The solution to this problem is to find the optimum sales strategy and communicate this to all teams.

Of course, these steps aren’t the be-all, end-all.

Once you have a go-to-market plan, you may need to adjust it based on new information.

This doesn’t mean that you’ve failed to create an effective strategy.

A go-to-market strategy, by its nature, treads into untested waters, so there are bound to be a few hiccups.

Keep your steps clear and flexible in case you need to re-evaluate your strategy. Share any updates you make with your teams, stakeholders, and management so that they know what’s going on and, most importantly, why it’s happening.

You should be all set by now, ready to draft a winning go-to-market strategy. But before you go and do that, let’s check out some winning examples from leading brands.

Winning go-to-market strategy examples

Smart Coach by Fitbit

Fitbit manufactures activity trackers. A few years ago, they launched a premium service and personal training app, which can be integrated with the user’s Fitbit.

Fitbit’s go-to-market strategy for the Smart Coach involved:

Using paid and owned channels to reach the target audience.
Understanding their target audience consisted of people who own Fitbit devices.
Leveraging push notifications, social accounts, and emails to reach potential customers.

As a result, Fitbit earned around $192 million in revenue through its GTM strategy.

Key Takeaway: If you are releasing a new feature, inform your existing customers first.

Eight Sleep’s partnership with IFTTT

A smart mattress manufacturer, Eight Sleep, created a go-to-market strategy for a new feature of their existing product.

Eight Sleep partnered with IFTTT, a free service that lets you create conditional statements and integrate various apps. Together, they developed a new feature that allows its customers to simplify their night and morning routines.

Users can connect their mattress with their smart home system to:

Turn lights on or off.
Start their coffee machines.
Lock the door.
Activate bed warming.

Customers could perform all these activities from their smartphones and virtual assistant devices.

Eight Sleep’s go-to-market strategy for the new feature involved:

Sending emails to the entire user base to help them realize the possibilities.
Creating a dedicated landing page to inform and educate users about the new feature.
Highlighting the benefits and use cases of their feature on Facebook and Instagram.
Getting themselves included in the IFTTT guide and newsletter.

Key Takeaway: Apart from informing your existing customers, leverage social media marketing and get featured in major publications to broaden your reach.

Upscope leveraging live chat to target a new segment of customers

Upscope is a screen-sharing software. When it was founded, many screen-sharing software packages were already available in the market.

To make themselves stand out, they created a GTM strategy that consisted of:

Creating ways to use live chat to target a new segment of customers (technical support, onboarding specialists, and customer success teams).
Leveraging content marketing to drive traffic to their website.
To get listed on their websites, partner with existing live chat companies such as LiveChat, Zendesk, Drift, and Intercom.

As a result, Upscope has acquired over 600 customers and is increasing.

Key Takeaway: Partner with other businesses with a complementary audience to yours. Use their existing reach to boost your brand awareness.

The new storytelling feature launched by VSCO during COVID-19

VSCO allows users to capture and edit visuals (photos and videos) and launched a new tool called “Montage.”

It is a multimedia creation tool that brings visual storytelling to life in a new dynamic way through a video.

Their go-to-market strategy involved addressing the current environment and our challenges as humans.

Their product announcement message was also crafted keeping in mind how their product helps us connect in the age of social distancing.

Their email copy reads, “as the world slows down, we know that these times can be difficult and uncertain. And in a small way, we hope our community connects you with others around the world.”

This is great because they first addressed the current situation and then how their product helps us solve this problem.

Key Takeaway: In times of crisis, aim to help your community. Explain how your product can help your customer in difficult times.

Nisolo launches new slippers to make Work From Home more comfortable

When most people around the world stay at home due to the fear of COVID-19, Nisolo launched a new slipper to make work from home more comfortable.

Nisolo ensured their marketing message doesn’t look promotional and showed how they care about their customers.

Nisolo’s email copy first focuses on the email subscribers’ emotional well-being and then announces its new slippers.

Key Takeaway: Create unique products that focus on helping your target audience rather than selling to them.

Huawei’s entry into the Indian market

Huawei is one of the most prominent telecom suppliers in the world. However, the telecom equipment market was overcrowded when Huawei was planning to enter the Indian market. Their biggest challenge was to make an impact to outdo their competitors (Apple and Samsung).

To increase its chances of succeeding in India, Huawei developed a go-to-market strategy that involved building local R&D centers to hire locals and show commitment to creating value for the country.

Further, Huawei partnered with a leading Indian English-language news channel to sponsor a contest. In the competition, Huawei smartphones were projected as aspirational products, contrary to the popular belief that Chinese products are low quality.

As of now, India is Huawei’s second-largest research base outside China. In the first three quarters of 2017, Huawei grew 60% in India’s enterprise business, higher than the global average (43%). Huawei India’s global production increased steadily until 2021 when the 2019 US sanctions against China caused the business to drop production.

Key Takeaway: When entering new markets, identify your biggest challenge and create strategies to solve them first.

TaxJar’s content marketing strategy to build trust

TaxJar offers tax solutions to businesses. When launching, the company looked at itself as a technology company first and a tax company second. Their primary aim was to make a better product than what was available in the market.

They also noticed that most of the content on the internet related to tax was either hard to find or difficult to understand.

TaxJar started publishing the best possible educational content to help its target audience understand everything about sales tax.

As a result, TaxJar built trust with its target audience and started getting customers.

When it comes to sales tax, more than 20,000 businesses and developers trust TaxJar.

Key Takeaway: Conduct market research to identify gaps in the current market and fill them to build trust with your audience.

Symyx’s plan to penetrate new market segments

In 2008, Symyx created a GTM strategy to ensure the successful launch of its ELN (Electronic Laboratory Notebook).

Symyx’s go-to-market strategy included:

Print advertising to boost brand awareness and build confidence.
Author or appear in 12 feature articles in target publications to emerge as a thought leader in the ELN market.
Publish case studies to demonstrate the effectiveness of their product.

In the same year, Symyx generated $9.6 million in revenue.

Key Takeaway: Make the most of PR strategies and demonstrate what value your products can generate.

Slack’s product-led go-to-market strategy

Slack is one of the leading business communication platforms in the market.

Slack’s go-to-market strategy was to rely on product features and usage to increase customer acquisition, retention, and expansion.

They didn’t aim to sell software. Instead, it sought to sell a positive user experience.

In the memo shared by Stewart Butterfield to his team before they released the product, he said, “People buy “software” to address a need they already know they have or perform some specific task they need to perform.

However, if we are selling “a reduction in the cost of communication” or “zero effort knowledge management” or “making better decisions, faster” or “all your team communication, instantly searchable, available wherever you go” or “75% less email” or some other valuable result of adopting Slack, we will find many more buyers.”

Slack ensured that its product was better than any other business communication platform. They also ensured that their product was user-friendly and easy to use. Slack created a “customer development team” to better serve its customers.

As a result, Slack became the fastest-growing SaaS company of all time. Slack grew from $0 billion to $4 billion in valuation in four years and currently earns over $250 million a quarter as of 2022.

Key Takeaway: Make your product better than your competitors. Create an excellent customer support team to help your customers make the most of your product.

Go-to-market strategies in times of crisis

COVID-19 is somewhat behind us, but it taught us much as marketers.

Launching a product during a crisis is different than entering the market on regular days. You need to be very cautious with your sales strategies, marketing messages, and who to target.

Get yourself ready for the next turmoil by following these tips.

Optimize your messaging, targeting, and pricing

As a business owner or a marketer, it is your responsibility to ensure your messaging doesn’t hurt your target audience’s sentiments.

For example, during the COVID-19 times, using words like “get in touch” or “meet our team” wasn’t a good idea. Instead, we used phrases, such as “call our sales team,” or “let’s get on a video call to discuss business opportunities.”

Make sure to optimize the people you are targeting. If you were targeting small businesses before COVID-19, check if they are operating now or are adversely affected by the crisis.

At the same time, the world economy is taking a hit. Many people and businesses are struggling financially. If you can afford it, reduce your product’s pricing for a limited time.

For example, ABB has waived the fee for its numerous software services until the end of 2020 including ABB Ability Connected Services, RobotStudio, ABB Electrical Distribution Control System, and iUPSGuard software for hospitals.

Focus on making things easier for your customers

In any type of crisis, people are going to be stressed.

To help reduce the stress, look to eliminate any barriers to helpful information, offer additional access to support resources, and reach out to existing customers to understand their situation.

Campaign Monitor sent an email to all its subscribers that gave them an option to “pause the marketing emails for 30 days.” They also added a link to new content relevant to the times of COVID-19.

This is great because not everyone wants to receive promotional emails at this time. When a brand takes the initiative to make its customers’ life easier, it will be remembered for longer.

Help the community to earn a good name for your brand

Helping the community shows you are not just here to make money, and you care about the people around you.

Therefore, it is crucial to help your community in any way possible. It doesn’t matter how big or small your contribution is.

For example, to help first responders fight COVID-19, Under Armour delivered 20,000 face masks to Johns Hopkins Health System.

Under Armour also donated $1 million to Feeding America to support hunger relief efforts due to current school closures and quarantines.

Think beyond the immediate crisis

While optimizing your go-to-market strategy in times of crisis, it is crucial to think beyond the immediate crisis, as each presents lingering effects.

Most people may be done with face masks, but social distancing is still prevalent.

Brands with offline stores must consider ways to sell products and accept payments while prioritizing social distancing.

Companies that relied upon on-field sales agents to sell their products will have to think of new ways to get their products across, such as self-service or inside sales business models.

The best way to “think beyond the immediate crisis” is by building a team of creative people who can brainstorm and predict how the world might change.

Note: It isn’t only about your company or your industry but about how the world might change after the crisis. Think about how you can use it to create new business opportunities.

Wrap-up and takeaways

A go-to-market strategy helps you ensure your product launch succeeds and acquire customers in the tough competitive market.

It’s important to remember it’s ever-changing. A GTM strategy that proved true and successful last time won’t necessarily yield the same results.

You must keep up with the times and the people.

Data-driven market research will help keep an eye on what customers need and what pains them.

Only then you’ll be able to devise a successful and fresh strategy to launch your brand new product and service.

And what happens after? You’ll need to start getting feedback and analyzing it. But that’s a story for a different blog. Read it here.

Sentiment Analysis For Brand Building

Posted on Sep 9, 2022 by Emily Louise Spencer

They love me… they love me not.

It’s a question most people ask themselves about loved ones. But what about asking this question from the position of a CEO or a data analyst?

When you do that, you’re conducting sentiment analysis, albeit without stripping a flower of its petals.

When building your brand, one of the most important things you can do is read your audience.

How people feel about your product is imperative to its success. And understanding the nuances of these feelings will help you get a leg up over your competitors.

It’s not just about a general “they love my product; they love it don’t.” It extends to minor details that make up your products or services and how you present them.

If there are things that rub customers the wrong way, keeping on top of them is key to success.

What customers want isn’t always obvious and consistent. If something works in one place and time, there’s no guarantee it’ll work in another. This is certainly true in trendy industries like fashion, where there’s an emphasis on culture and everything changes quickly.

So how do you keep on top of consumer perception and your response to it? Especially in the internet age, where social media posts and website reviews are published every few minutes. There’s simply too much data to analyze manually.

That’s where sentiment analysis comes in.

What is sentiment analysis?

Sentiment analysis, also known as “opinion mining,” is the automated process of analyzing a text and interpreting the sentiments behind it.

Through machine learning and text analytics, algorithms can classify statements as positive, negative, and neutral.

Companies and brands often use this process as a strategy to manage large amounts of data coming from Yelp, Twitter, Amazon, you name it.

This data allows businesses to learn more about customers’ feelings for their products and competitors’ offerings.

How sentiment analysis works

Sentiment analysis relies on an AI engine powered by machine learning (ML) and natural language processing (NLP) to extract information.

Machine learning allows the software to learn independently and become more accurate at predicting the outcome of analysis without being programmed for that explicit scenario. Essentially, it allows the software to “learn” from past examples to improve itself over time.

NLP analyzes human language and the meaning behind it. This covers text segmentation, grammatical analysis, and terminology extraction.

Which algorithms are used for sentiment analysis?

ML and NLP are tools to help the sentiment analysis algorithm produce the final results. There are three types of algorithms that are usually deployed:

Rule-based – This is the basic and easy approach to implement. It’s based on manually pre-defined rules, helping the system analyze the text it reads. The drawbacks are clear, with having to rely on manual inputs that take plenty of resources and aren’t able to evolve automatically.
Automatic – This is the advanced approach, using both NPL and ML. The system is first fed with thousands of expressions that are pre-defined as either negative, neutral, or positive. This is the “training” stage. Then, with its newfound knowledge, it can venture into its “prediction” stage, understand new terms and classify them appropriately.
There is a downside here, though. The algorithm is bound to make some mistakes, and it’s often hard to pinpoint exactly why this happened.
Hybrid – It’s the best of both worlds and the most effective algorithm. This approach Enjoys the high accuracy of the rule-based algorithm while running through new terms and expressions in the blink of an eye.

With these sophisticated algorithms in place, the sentiment analysis tool can go over the endless text and score it based on negative, neutral, or positive sentiment.

Further, when dealing with customer experience, it can also break down the text to topics such as:

Product quality.
Speed of service.
Ease of communication.
And more.

Let’s look at a couple of examples to understand it better.

Due to the large variety of cordless vacuum cleaners and the breadth of functions, people will often turn to customer reviews and see something like this.

How does the sentiment analysis AI understand it? It breaks down this piece of text into smaller ones, such as:

“It’s lightweight, compact, and a brilliant all-round hoover.”

“I’d buy another in a heartbeat.”

“The tank is small.”

The AI then assigns a sentiment for each block of text. The first is very positive, and so is the second. The third is somewhat negative, though it can be considered neutral when taken into the larger context.

Decision makers can then understand what customers think about specific parts of the product or look at the overall – in this case, positive – picture.

Another industry where understanding customer sentiment is vital is the beauty industry.

This eyeliner review paints (no pun intended) a somewhat negative picture.

The review starts with “The pencil itself is great,” which the AI can mark as a positive sentiment. But then come blocks of text saying how it “breaks and is impossible to sharpen,” which are very negative. The review ends with a scathing “will not be buying another.”

Sentiment analysis will help the brand understand that the customers are disappointed with their product and why. In this case, they’ll know work is needed on the durability of the pencil rather than its quality.

As you can see, it’s something a human can do. But the key differentiator for sentiment analysis is the speed and accuracy it can analyze these reviews, something even a team of experienced analysts can’t achieve.

How Revuze performs sentiment analysis

The general themes of NPL, ML, and the various algorithms play a crucial part at Revuze. But to give our customers a competitive edge, we take a step further, using a personalized model for our automated sentiment analysis, helping to maximize accuracy and success rate.

We do it through “local models,” which allow us to adapt our technology to the specifics of each case study or client. We can generate local dictionaries and models within just a few days with 90% accuracy.

Here’s how it works: Revuze’s AI algorithms extract many unique topics, ranging from high-level ones (like user satisfaction and price) to granular topics (such as “softness” for toilet paper or “moisturizing strip” for disposable razors).

Instead of limiting ourselves to only 8-15 generic topics, we analyze 40-80 topics that are highly specific to each business or product we work with.

When you want to understand consumer sentiment around a certain product’s features, you cannot afford to use a sentiment analysis tool limited to generic topics. Personalization is key, and more on that later.

What are the challenges in sentiment analysis?

While algorithms can be very advanced, some text can be difficult for a machine to dissect and interpret.

Sarcasm

Users may write: “We had to wait 45 minutes to get a table. Great!” To a human being, it’s clear that the adjective “Great!” is used sarcastically.

How do we know it? Because of context.

We read the previous sentence, which talks about a long wait time, and we understand that the comment is not positive.

A good sentiment analysis tool has to be able to detect sarcasm from the broader context. Otherwise, you’ll get inaccurate data about your brand at the end of the analysis.

Nuance

Another issue has to do with nuance.

The comment “The movie was not bad” is saying that the movie was not bad, maybe even good. But it also implies that the expectations regarding this movie were so low that the movie is not as bad as one would have expected. This is called “negator.”

“Intensifiers” can also be challenging for sentiment analysis. A user who writes, “The company’s comment on this issue was pretty good,” creates a nuance that would not be there if we read the same sentence without the word “pretty.”

In conclusion, it’s important not to rely on basic sentiment analysis tools, which will not capture the complexity of human sentiments expressed through text.

Why is sentiment analysis important, and what can it do for you

Sentiment analysis gives you more information than simply whether an individual’s interaction was positive or negative.

Using advanced AI techniques, the specific emotion behind a person’s communication can be extracted, leaving you with a much better idea of how they felt when they wrote those words.

Ultimately, ecommerce customer experience is about emotions, and good customer experiences aren’t just about the end product.

A top-of-the-line service in which you were treated poorly will have a far more negative impression than a middling service in which you were treated well.

The specific emotion behind the text being analyzed indicates how you should proceed when continuing the interaction.

Is the customer angry at a perceived slight? Apologetics and problem-solving are the tones you want to set.
Is the issue that the customer dislikes a certain aspect of your product or service? You can point toward similar products that solve these issues.
Is someone excited about a new release and is sharing it all over the internet? Appreciation and thanks go a long way towards building a relationship.

As you can see, sentiment analysis isn’t just about correcting problems or gaining information on cropped-up issues.

You’re trying to build a brand – build a personality, as it were – which requires you to interact with those consumers who have positive words to say about you too.

Now that we have plenty of information let’s explore how you can actively use this data to improve everything surrounding your brand.

6 ways to boost your brand with sentiment analysis

In brand building, it’s important to focus on what information sentiment analysis can give you about your current positioning within the market – your reputation, product strengths, weaknesses, etc.

To that end, we compiled a list that will first help you understand your status, complemented with actionable strategies to improve it.

The various facets of customer experience

Real-time reactions

The key to dealing with customers is to factor in their emotional state and respond accordingly.

This is easy to do face to face but isn’t quite as simple when you’re performing these actions over a text-based medium such as email, social media, or other messaging services.

Sentiment analysis brings a vital aspect to customer service with its ability to flag negative comments or communications for quick responses, allowing you to respond promptly and hopefully end the problem before it spreads.

One disgruntled customer complaining can hugely damage your reputation as the story of their experiences spreads, especially when the reason for their bad experiences is one that other consumers will resonate with strongly.

In this case, sentiment analysis is paired with social media monitoring and other forms of software which will feed into it in real-time, letting you know as soon as a crisis of PR crops up and identifying the emotions behind it.

The approach to solving these crises will depend entirely on the emotion behind the negative PR, whether that’s an outrage, sadness, disappointment, etc.

Improving your product and service

The other way sentiment analysis can assist with CX is linked to product improvements and SWOT.

Identifying problems in your service or deficits with your products and improving them is a definite PR win. More importantly, it comes from listening to your customers and acting accordingly.

Consumers often rank wanting to feel heard and have their experiences taken into account as among the most important factors when choosing a brand or company to provide a service.

If you’re in the service field, paying close attention to what sentiment analysis can tell you about what your customers desire is crucial.

By monitoring the sentiment around your brand before, during, and after changes to your products or services, you can easily judge whether or not those changes were a success.

Because this is happening in real-time, it can all be measured to provide you with information on how you’re doing in the CX world and how to improve future relations with your customers.

Market research opportunities

Sentiment analysis isn’t just for customer experience. It can be used when you’re doing research too.

When performing market research, sentiment analysis helps you dive deeply into your audience’s attitudes in ways that a human being could simply not do.

Most traditional forms of market research use controlled surveys, star ratings, and other similarly structured forms of data.

While it’s certainly useful to use traditional forms of market research like controlled surveys, they are prone to human biases such as leaving feedback only after a particularly good or bad experience. These biases can skew information, affecting your ability to make data-driven decisions.

True, sentiment analysis uses reviews to provide you with information. But to give a more rounded picture, it can search the internet and take information from areas that talk about your market specifically, such as forums, social media groups, and blogs.

Information about what customers desire and what they’re willing to pay can be extracted from these areas, giving you deep insights into your target audience and how you want your business strategy to appease them.

Customer segmentation

Not only can you analyze customer sentiment with sentiment analysis, but with the right tools, you can break it down into segments that show a very different pattern than the whole. After all, not all groups of people are the same.

For example, customers who interact with you via a mobile app or website will have a different experience. Slicing and dicing your data by demographic factors such as age or gender may yield interesting results.

Each group will likely have a different sentiment towards different aspects of your product, and this information will help you cater to them.

Idea generation

Using sentiment analysis, you can analyze people’s behavior when certain topics are brought to light and examine what potential leads you might be able to follow up on.

For instance, a tin of paint sold in a certain size that a significant portion of your customers has been vocal about being too small for their daily uses.

It would be worth investigating whether you can produce the product in a larger tin or multipacks so that these customers might be satisfied.

You can also take positive sentiment and turn it into ideas for future usage.

Did you know that bubble wrap was originally sold as textured wallpaper? As time went by, the creators took note of the positive sentiment surrounding its ability to protect fragile items in transit (and how fun it is to pop!), adjusting their marketing approach until it had radically changed from their original intentions.

Competitive Analysis

Sentiment analysis doesn’t just give you information on your standing within the market. It can give you insight into how your competitors are doing too.

Online reviews and social media buzz are open and visible to anyone. Using them as a source of competitive intelligence is perfectly acceptable in the business world.

Sentiment analysis can give you information on how the consumer base feels about your competitors, whether as a brand or on an individual product-by-product basis.

Revuze has taken the step to combine consumer sentiment with other forms of data in order to give powerful pieces of information and insights into the minds of your competitors. A few examples of such are:

Sentiment vs. star rating: The perceived expectation of quality that a brand or specific product has in the eyes of consumers.
Sentiment vs. total sales: The ability of a brand or specific product to maintain customer satisfaction across a broad spectrum of consumers.
Sentiment vs. total product variations: How easily a brand can maintain overall customer satisfaction while expanding into a diverse range of products.

Our AI insight engine, Sentimate, can help you perform these analyses in great detail, from examining a brand as a whole to an individual product out of thousands.

Using data extracted from online reviews and chatter, you can gain an incredible amount of useful information as long as you have the tools to analyze it.

Ratings and reviews across an industry

Ratings and reviews are part of the User Generated Content (UGC) realm. It is exploding and is expected to be over 90% of the world’s data soon.

UGC (ratings and reviews in our context) is important to millennials, with 86% saying it’s a good indicator of a brand’s quality.

Further research from Spiegel shows that reviews by verified purchasers vs. anonymous ones can bump purchase likelihood by 15%.

This is why brands encourage customers to leave reviews and provide feedback.

Now imagine being able to gather all these consumer opinions from online retailers and analyzing them for sentiment and topics.

What consumers like or not – why they buy, what they like or hate about a product, a service, or a shopping experience.

This is possible across an entire industry – all brands, all products, all reviews, and ratings, analyzed via sentiment.

The reason it’s so valuable and important is because of the breadth of the information and the depth. This is the high-quality raw material (ratings and reviews) and is highly focused on this medium of commerce, meaning:

Low ratio of noise-to-insights (Low “chatter”).
High level of granularity.
Store-specific feedback (Walmart has it in stock, Amazon doesn’t).

Getting started with sentiment analysis: the four main steps

As we dig further into understanding this powerful marketing and branding tool, let’s look at the pipeline of steps usually applied in sentiment analysis.

We’ll consider sentiment analysis for a company or brand in this pipeline sample.

Step 1: data gathering

First of all, we need the data that we will later analyze.

We can gather data from social media, namely Twitter, using scraping tools, APIs, customers’ data feed, and so on. We can also gather data from user reviews on services like Google and Yelp.

We’ll be looking for all mentions of the company or brand over a specific time.

This practice is very common in all forms of social media listening.

Step 2: text cleaning

Text cleaning tools will allow us to process the data and prepare it for analysis by:

Removing stopwords (a, and, or, but, how, what…).
Taking out punctuation (commas, periods…).
Reducing words to their stem.

These tools will allow us to “clean” or “strip” the texts from anything that might be irrelevant to the analysis.

Step 3: analyzing the data

At this point, we can use our sentiment analysis algorithms to analyze the data we have gathered.

As we saw earlier, the most common classification is the spectrum between “positive” and “negative.” However, more refined tools may also identify more complex sentiments such as anger, sadness, etc.

The algorithms will use a sentiment library to identify opinions and classify them.

Step 4: understanding the results

At the end of the process, we should be able to see the data grouped into major categories. We should be able to see if we have more positive, neutral, or negative reactions.

Having each sentiment tagged with its original date is particularly important, as a timeline will show us if we had “peaks” (surges of positive sentiments) or “valleys” (surges of negative sentiments) at specific moments in time.

We might therefore be able to find correlations between something that happened on a specific date and a surge of opinions regarding our brand.

While we might identify a peak or a valley while performing sentiment analysis, the opposite might happen—we might notice a surge in mentions on Twitter and use sentiment analysis to understand the reactions.

So far, we have talked extensively about ideas and strategies. While it’s all well and good talking hypotheticals, nothing beats seeing sentiment analysis in action to get a feel for how useful it is.

Sentiment analysis examples

We’ve handpicked some examples from our Revuze Explorer & Sentimate engines to give you an idea of what this sentiment analysis looks like and how it can be used.

Sentiment analysis using product review data

Sentiment analysis using product review data is perhaps one of the most important things every company (and consumer insights expert) looks after. After all, the best way to understand if your customers like your product or service are by understanding their sentiment towards it.

The easiest way to find out what your customers think about your product is by asking them to review it. The job doesn’t end here. Not all reviews are created equal!

You must collect all the relevant reviews for a specific product, arrange them into the relevant hierarchies, and compare them against the industry and your competitors.

A good example we can share would be the sentiment analysis using product review data we did on Lysol VS Clorox.

In the report, you can find exactly how Revuze deciphered the relevant product features by tapping into the consumer sentiment and understanding what’s working and what’s not.

Further, these millions of verified purchasers’ feedback on your competitors’ products and yours can each be cross-referenced against its product rating.

You can learn which topics are positive drivers for 5-star reviews and which are drivers of negative reviews.

This correlation can be quantified with sentiment analysis to let you know the exact percentage of driving terms towards product ratings.

In this example, it’s clear here that the top drivers for 5-star reviews are:

Fit.
Comfort.
Shipping.

What is also pretty clear here is that this product could have gotten MANY more 5 stars if it was:

True to size.
Not suffering from fake sales.
More durable.

This is a measurable, quantifiable way to boost your product rating for consumer products and services in an industry that includes ratings and reviews:

SWOT analysis

Sentiment analysis can also provide SWOT analysis, which stands for Strengths, Weaknesses, Opportunities, and Threats.

SWOT analysis is used in product design and marketing to great effect, as it shows not only the strengths and weaknesses of your product or service but also those subjects which may become strengths or weaknesses in time.

Using sentiment analysis, you can measure customer satisfaction rates of a specific aspect alongside its importance.

This example shows a SWOT analysis of a 24” laptop.

Looking at the chart above, we can see the following listed as strengths:

Display.
Color.
Compatibility.
Size.
Speed.

These are the areas of the product which customers are greatly satisfied with. More importantly, they’re areas where customers expect high quality. These can be assumed to be the main drivers of good reviews and high sales.

The weaknesses are as follows:

Battery & Charging.
Audio Devices.
Camera.

These areas are those in which the product is lacking and needs to be improved ASAP.

Product design teams should focus on improving these areas in the next model or making accessories that circumvent these weaknesses.

Further, you can see some opportunities in:

Performance.
Assembly.
Quality.
Mouse & Touchpad.
Upgrades.

These areas are where the product greatly satisfies customers but aren’t that important to overall satisfaction.

The laptop manufacturer has a couple of options. Emphasize these aspects to niche users, improve them further to give the product an edge over the competition, or simply leave them be.

Finally, the following threats were identified:

Keyboard.
Ports.

Threats are low-rated product features, but ones with a low importance rating to customers.

Threats aren’t currently problems that need solving immediately, but you need to keep an eye on them as times change, product uses shift, and what was once irrelevant becomes very important.

Let’s take a step back and look at the bigger picture, starting with the top two drivers of purchase are:

Color.
Display.

These two factors are rated the highest in customer expectations while also being highly rated. As color rates are higher in customer expectation than display, greater care should be taken to maintain quality in the next iteration.

However, this laptop could have gotten more sales and higher customer satisfaction for the least effort if the battery and Charging had been addressed.

Since battery & charging are rated the most important to consumers, they should be tackled first. Following that are two other weaknesses, slightly less important to consumers: camera and audio.

As the camera function is not only rated as more important but boasts a slightly lower customer satisfaction rate, it should be placed in priority before the function of the audio device.

Using sentiment analysis, we’ve identified the main features that drive purchases of this big-screen laptop. When tackled, we also identified which weaknesses would give the greatest theoretical return on investment.

Of course, this assumes that all weaknesses cost the same amount to overcome, which is incredibly unlikely. However, using SWOT analysis and cost estimates combined, you can judge which weaknesses will have the greatest benefit for the smallest cost.

Monitoring chatter to track overall sentiment

Customers’ importance on product features isn’t the only way to sort product features.

There’s also the volume of sentiment around said features, which lets you judge which topics will please the most customers rather than indirectly.

Let’s look at this 12-cup coffee maker and the chatter surrounding it.

As identified in the graph above, the product’s functionality is the most commonly discussed topic. This has an overall negative sentiment, which means it should be high on the list of adjustments.

Looking at the most negative topics, we can identify the water reservoir capacity, durability, and the lighting on the coffee machine as topics that create very negative chatter.

However, those topics all consist of a much smaller proportion of talk around the machine than that of functionality.

This means while fixing them will create the most positive sentiment in those who were unsatisfied, the overall numbers might not lead to as much of an overall increase in customer satisfaction.

Market comparisons

Another factor that you may want to consider in product design is the overall state of products in the market.

A quick look at the coffee maker mentioned above can make the following comparisons to the market averages.

The vertical lines above represent the market average sentiment for each feature, with the red and green dots representing the sentiment around those particular features.

Looking at the chart, we can see that while the functionality of the coffee maker is below the market average, it is only by a hair. Thus, improving the functionality of the coffee maker is something that would make it stand out.

Similarly, the machine’s durability is quite close to the market average, meaning that while the chatter around this topic is negative, it’s a market-wide issue and not a specific weakness.

Switching to the water reservoir feature, we can see that the sentiment is far below the market average for a machine of this type. Not only is this a problem, but it’s likely one that causes a lot of negative reviews. Similarly, product defects seem quite severe, causing a lot of negative sentiment.

In conclusion, comparisons to the market averages tell us our coffee maker should prioritize its water reservoir in the design stage.

Additionally, the manufacturer should take a look at their production to limit the number of defective products that seem to be received by customers. This can be achieved in various ways like stricter quality control.

Wrapping up

Product ratings and chatter are the gold standards that drive online sales and higher conversion rates. Finding a quantifiable, measurable way to analyze and impact them is imperative.

Sentiment analysis is an incredibly useful tool for extracting information, but when you pair it with other forms of software, the true strengths start to shine through.

With AI-powered engines capable of using machine learning to grow and expand when new factors are introduced, sentiment analysis software will continue to grow and adapt to the language, slang, and syntax changes.

This constant evolution will help sentiment analysis keep up with the growth of ecommerce ratings and reviews, offering a way to align with the top of mind of customers in your industry and what they like and dislike.

This is done by leveraging sentiment analysis across retailers, brands, and products. With this, you can drive conclusions as to what drives product rating success (or failure):

For your product portfolio.
Learning from your competitor’s portfolio.
Comparing across retailers/audiences.

Then, you can analyze, change and impact any product rating by:

Optimizing what consumers are happy about on a Product Description Page (PDP).
Fixing product issues that consumers care about and drive low product ratings.
Addressing product rating differences between retailers.
Understanding shopping experience and customer service impact on the product rating.

All of this is possible when you select the right sentiment analysis tool. We recommend that you prioritize solutions that are:

Holistic: Providing the data, data cleansing, and analysis all in one spot.
Cross-level: Provide sentiment analysis by product and feature, not just brand.
Self-serve: Do not require experts in the loop but allow direct use by business users.
Ecommerce focused: Focus on eCommerce retailers as a data source (Verified buyer’s feedback)

If you want to give Revuze a go, we’d be happy to show you around the platform.

5 Ways To Improve Ecommerce Customer Experience in a Post-COVID World

Posted on Sep 1, 2022Dec 15, 2022 by Emily Louise Spencer

5 Ways to Improve Ecommerce Customer Experience in a Post-COVID World

The COVID-19 pandemic completely transformed the way our society works. Suddenly, almost overnight in some cases, people went from crowded trains and bumping elbows in stores to having to stay away from each other for their own safety.

And when people couldn’t get into physical stores, more and more turned into online shopping. This change has happened swiftly, and many retailers were caught off guard, scrambling to make the necessary adjustments, resulting in a mixed ecommerce customer experience when visitors attend their virtual shops.

This isn’t a passing trend, and shoppers are taking a liking to shopping online. Businesses have to up their game and find creative ways to improve their ecommerce customer experience if they want to generate new sales and retain existing customers.

Luckily, it’s a goal that can be achieved.

Read on to find out how to provide your customers with the best ecommerce customer experience possible.

But first things first.

What is the ecommerce customer experience?

As opposed to User Experience (UX), the Ecommerece Customer Experience (a.k.a ECX) focuses less on the technical and functional aspects of the experience and more so on the overall feeling.

It starts from the customer’s first touchpoint with your brand and accompanies them every step of the way – before they purchase anything, and some would say until the end of time.
In every one of these steps, thoughts and emotions arise. Together, they’ll dictate engagement, conversions, and retention. All of these tie into the broad term of ecommerce customer experience that shapes how customers interact with your brand.

It’s understandable why it’s such a big deal. And the data backs it up, with 73% of respondents mentioning customer experience as an essential factor in their purchasing decisions.
Yet businesses aren’t prioritizing it, as only 49% say companies provide a good customer experience.

There’s a clear gap here and a fantastic opportunity for you to differentiate your brand by providing an excellent ecommerce customer experience that will increase customer loyalty and generate new ones.

How COVID changed ecommerce

2020 marked a noticeable shift in many aspects. Ecommerce was no exception to the rule, with the impact of the pandemic being felt far and wide throughout the market.
Thanks to being based digitally, ecommerce was able to dodge most of the changes that crushed other forms of trade and, in fact, only increased in market share during this time period, with it hitting 30% of overall UK commerce during the lockdown periods.

When such a massive behavior change occurs over a very short time span, it means systems are being thrown off balance.
Let’s review how the digital market rearranged itself to better understand how to provide shoppers with a better ecommerece customer experience.

Increased demand

With consumers unable to enter their local brick-and-mortar stores, whether due to restrictions or simply not having the time, they tend to switch to online forms of purchase. This is especially true of the younger, more tech-savvy generations, though older consumers also got in on the action.

In response to this, plenty of retailers upped their delivery game. Curbside pickups, increased number of delivery vehicles, and more flexible means of delivery were heavily emphasized, with ready-to-ship stock also favored.

Wider customer bases

As mentioned above, the number of those using e-commerce increased over the course of the pandemic and its subsequent restrictions. Something that also increased was the range of consumers using e-commerce.

It’s a common stereotype for those in the older generations to not know how to use new forms of technology. When a new form of technology is introduced, and you’ve grown up and lived without it, you can often carry on and get by just fine without ever learning to use it.

This isn’t the case in the middle of a global pandemic, especially one to which older people were considered more vulnerable. Whether it’s the elderly learning to use the internet or their children doing it on their behalf, the audience for online purchases definitely got wider as time went on.

The switch to pure ecommerce and the demand for interactivity

With the ratio of ecommerce to walk-in stores rising, many businesses found that it was actually more efficient and cost-effective to switch to a pure ecommerce approach than continue using brick-and-mortar stores.

Change is never easy, and though consumers weren’t likely to make the switch themselves simply due to habits, the pandemic was the perfect time to showcase the advantages of pure ecommerce.

The technology used in ecommerce also leaped. Virtual showcases, more detailed descriptions, and even interactive forms of media such as 3D models became widely used to improve the ecommerce customer experience.

Consumers like to try before they buy, a fact that has kept traditional retail stores afloat, but in the age where technology has become so advanced that you have ways of doing that from your living room, there’s very little need for them.

For example, Australian accessory company Bellroy leaves nothing to the imagination, showing potential customers what their wallets would look like.

Furniture companies employ 3D models that allow you to examine your new comfy chair from every angle to replicate the retail customer experience.

With the shift to online forms of communication, the demand for quick answers and information has shot up.

If you have questions about a product or service, asking in-store has traditionally been the go-to method of obtaining information. With restrictions in place and limited numbers of stores allowing full face-to-face contact, those who ask these questions have had no choice but to turn to online methods of communication.

Fast responses and clarity are the main concerns. If communication is slow and confusing, customers will likely shop with another provider who will answer their questions if a clear and quick answer isn’t provided.

This leads me to my next point.

Willingness to switch brands

Customer loyalty declined during the pandemic, especially in pure ecommerce stores.

When you’re walking down the street or through a shopping center, it’s not easy to find the motivation to browse alternate stores when the one you usually go to is lacking.

You might settle for a different brand or a lower quality item instead of taking the time and effort to travel to another store. With ecommerce, that other store is merely a click away.
To keep potential customers in your virtual store, you must provide the best ecommerce customer experience possible.

Here are our top 5 ways to do that.

5 superb tactics to up your ecommerece customer experience game

Naturally, the shift in consumer behavior means you will have to switch approaches to running an ecommerce store if you want to satisfy them. This is especially true of customer experience since the lowered loyalty levels mean consumers will likely switch away from your business after having a single bad experience with you.

If you want to keep up with your CX game but are unsure where to start, don’t fear! We’ve analyzed five major changes that have seen success over the past few years and cataloged them below so you can understand what they are and how to start using them.

Building a community

You might think that building an online community is as simple as running social media pages for your brand, but it’s not entirely true. This view doesn’t take into account the nuances of what your audience wants and the values they hold.

Forming a community is less about your business and your products and more about how you shape these to meet the desires of the people you cater to – from Millennials and Gen Z all the way to baby boomers.

For example, the younger generations care deeply about sustainability, with more than 50% saying that sustainability is important when making purchase decisions.
These people have grown up seeing the effects of climate change and the impact of unsustainable business practices on the world around them. They are willing to pay a premium if it means purchasing from a sustainable source.

International shoe brand TOMS caters to this audience by putting sustainability and the community front and center on its website, with the help of informational videos and articles to educate shoppers.

Older consumers, on the other hand, have been shown to care more about things that affect their own health and comfort, including a focus on luxury items that emphasize relaxation and security above all else.

How to build your community

The first step is simple – you need to know your audience.

No matter how it is performed, all commerce is limited by what consumers are willing to pay for. This extends to your company, your values, and how the population sees them.

In business, there are no absolutes. You need to change your strategies, processes, and approaches when there is a shift in the priorities of the community you serve.

When building a community around a brand, the first area you look to is often more straightforward areas such as social media pages or forums, rather than the expensive and time-consuming process of overhauling your website. This will help you spread the word about who you are and what you do immediately and at a minimal cost.

A brand’s community is all about emotional context and familiarity. Consumers’ attention spans are shorter than ever, so try and keep your messaging short, simple, and easy to comprehend if you want to expand your community.

Those who have an emotional connection to your brand, and through that to each other, will reach out to you if you make it possible. These consumers are already willing to communicate with you and share their opinions and desires, you simply need to make it happen.

From there, regular engagement, affiliation programs, and creating community platforms where consumers can discuss your brand without your input are sensible next steps. Which of these is most effective and how you should approach them depends entirely on the individual brand in question.

Social media interactivity

Using social media isn’t just a case of engaging with customers and giving out information upon request; there are actually many facets to it. Four of the main components that can be utilized are:

Social media listening: Using software to capture customer insights based on publicly shared information.
Social media marketing: Outreach and brand awareness, traditionally thought of as advertisement and spreading information.
Social media reputation management: Taking action on reviews or feedback left on social media, acknowledging customers’ difficulties and how you can solve them.
Social media engagement: Talking to your customers directly when they have questions, solving issues that they have in a publicly viewable way.

Each factor brings new information and new ways of improving ecommerce CX to the table.

Social media listening can grant you access to information from posts that both are and aren’t directed at you. In contrast, social media marketing allows you to present new information and opportunities to your consumer base.

Social media engagement allows you to directly connect with your customers in a publicly viewable and easy-to-see way, both forming an emotional connection with them and allowing others to directly witness solutions to possible problems that they can utilize themselves.

Social media reputation management consists of responding to reviews or feedback that isn’t directly visible to the average viewer unless they’re looking for it.

Interact with customers in both public and private depending on their preferences. This allows you to go into more detail and have fewer limits imposed by platforms.

Two good examples of social media reputation management in action are FAQs or customer questions on product pages within social media. Questions can be responded to either directly on the page or in a DM to the customer in question.

A good case for publicizing the answer would be to solve a similar issue for others. On the other hand, answering in private can help save face and avoid any potential embarrassment that might arise from certain questions.

While social media listening & marketing can be done formulaically and on a schedule, the other two facets require active monitoring as they’re reactive rather than proactive.

How to get started with social media interactivity

To begin, you need a social media page. Once that’s set up, you should assign duties to your CX team based on each of the four above categories of interaction.

An automated service can do the listening part of social media listening. Later on, it’s recommended that a team member will sift through and analyze the data for actionable insights.

Social media marketing can mostly be done routinely. That said, you should always strive to keep your content fresh and interesting. Using the same templates and information repeatedly will lead to consumers scrolling past you as their brain filters out your posts.

In addition, you need to consider each social media platform’s unique rules and limitations and the audience that frequents them. Tailor your posts to each one rather than simply copy-pasting.

Twitter, for instance, limits your text, so placing some of the information in image form. This will both make the post more eye-catching and circumvents the character limit. The end result is a post that will gain and hold readers’ attention.

Social media reputation management and social media engagement are both far more unpredictable. Consider assigning a dedicated night owl to manage these aspects. Social media runs 24/7 and won’t stop just because it’s after 8 PM or a weekend.

Another factor to keep in mind is speed. Like a series of dominoes, posts can come one after another, leaving your reputation in ruins. The same dedicated team can spot fresh posts mentioning your brand, respond promptly and avoid any potential fallout.

Personalizing the ecommerce customer experience

The idea of a personalized shopping experience is nothing new, it stretches back to the oldest forms of commerce on record. It’s the idea that what customers are exposed to should be relevant to them.

This isn’t just a theoretical idea. A vast majority of customers expect a personalized shopping experience. And when they don’t get it, they get frustrated. You can guess what will happen next.

How to get started with personalization

Personalization can happen in any form of communication. On your web pages, emails, SMS messages, and more. You just need a platform that can accomplish this magic and a wealth of data.

Here are some of my favorite ways to tackle personalization:

Localized content: language, interests, and region-specific information. Check out this example from Paul Valentine, as it recognizes the customer’s geo-location and sends them to the relevant region.
Recommended products: in side/banner adverts, suggested products, and email promotions. I’m sure most of you have received a “We thought you might also like” email filled with products that complement the one you just purchased.
Targeted discounts: relevant products in emails, pop-up promotions, and bundles.
Navigation adjustment/dynamic layouts: adjustment of website or app navigation functions and layouts based on the previous interactions a customer has had with you.

Dynamic supply chain planning

With the increase in online shopping, ecommerce demand and turnover have remained high even with COVID-19 restrictions being a thing of the past in most countries.

Those consumers who entered ecommerce during the pandemic largely did so as a replacement for in-store purchases. They demand instant processing and same-day dispatch where possible. They treat a website exactly like a brick-and-mortar store – a place to find answers and obtain products immediately.

This is complicated by the fact that the pandemic disrupted supply chains all over the world. Ships were stuck in port, flights were grounded, and vans were told not to start. While the gears of global supply have started turning again, various global factors have left it in less than optimal condition.

And this dramatically affects the ecommerce customer experience.

Fortunately, there are several factors you can plan for that allow you to make up for most bumps in the road when it comes to your supply chains.

The first step is to assume that there will be problems you cannot predict or fix yourself, as that’s true of any dynamic involving two or more parties. Once you’ve accepted that, you can begin looking at your supply chains and predicting what obstacles might crop up in your path, then start planning how to avoid them.

How to get started with supply chain alternatives

There are several things you can do to up your supply management game, all of which involve the use of technology to some extent.

Fear not, for during the course of 2020-2021, alterations were made to supply chain management (SCM) software, and most of the bumps have already been determined and accounted for by the experts.

Finding local alternatives to international materials/goods. With international trade being among the most disrupted, finding local alternatives to goods that you usually purchase from abroad is a must. This ensures that supply chain disruption is minimized and nets points with consumers who love to shop locally.
Factoring in scarcity. One of the main issues facing manufacturing in the current times is a shortage of rare materials and goods, either due to mines and plants operating at reduced capacity or supply chains having been diverted.
In any case, if you rely on these components or goods as the main facet of your ecommerce business, you will need to adjust prices and margins to account for the increased cost of acquisition. In addition, you need to be prepared for the possibility that supplies will dry up further and stockpile to keep your operations moving while the supply chain issues resolve themselves.
On the flip side, simply because shortages exist now does not mean they will continue to do so. The bullwhip effect, as it is called, is a well-known effect that causes supply shortages to be passed up the chain, overcompensating each step until an overabundance is created.
Using omnichannel for inventory management. Inventory management is a nightmare at the best of times, and when you’re dealing with ecommerce, where you might have multiple storage locations across different cities, it’s especially challenging.
Omnichannel approaches combine all your information into one database, often using cloud software to instantly transfer information. With demand for instant answers and speedy deliveries at an all-time high, knowing precisely what you have access to and where it is located is crucial for an excellent ecommerce customer experience and success.
Accounting for delivery delays and transportation issues. There will always be delays and other transportation issues. That much is inevitable even if the times of lockdown seem to be behind us. While you can’t stop these from occurring, what you can do is account for them in your delivery estimates.
Overestimating delivery times is often your best bet, especially in cases where the mode of transportation you use experiences regular delays. A customer who expects their order within fourteen days and receives it within seven is a happily surprised one, compared to the opposite scenario.
The uncertainty of demand. In the current market, it’s not always clear whether customers will continue their current spending habits or alter their behavior. The entire summer vacation of 2020 basically did not occur. It was a massive blow to retailers looking to capitalize on this regular, predictable demand increase for certain items. And with inflation rising, we may see purse strings tighten in the upcoming months.

In contrast to the advice given above, if demand is uncertain and you’re not sure if consumers will continue to purchase your products, do not stockpile. Some ecommerce stores have even switched to a model where they order goods from the manufacturer only after a customer has made an order. It may adversely affect the customer experience but will keep you in the black.

Informative & interactive product pages

When shopping online, consumers are unable to physically see products in person before purchasing.

Viewing a product remotely and fully analyzing its capabilities is an attractive proposition. It saves consumers time and effort while allowing them to view products from all over the country.

It’s long been believed by the general public that when you order online, buyers beware, but creating informative and interactive product pages puts this fear at ease.

How to get started with helpful pages

First of all, check what the platform you use offers. Some have strict limitations on page size and images, while others allow a more free hand.
Amazon, for instance, imposes a title limit of 250 characters and a description limit of 1,000 characters. In addition, only six photos are allowed in the main part of the listing for any individual product.

eBay imposes similar limits, though indirectly, as their pages will cut any description over 800 characters down to 250 characters on mobile devices.

Using your own website will avoid these limitations. But before you run off to the drawing board, consider if the value outweighs the costs and challenges, as creating a website that provides a great ecommerce customer experience can be tricky.

Ultimately, there is no clear line where it’s sensible to switch from a pre-existing platform to your own. It depends on your industry, reputation, and engagement, amongst many other factors.

Once you know your limits, work with them instead of against them. Aim to make your page as informative as possible within the text confines. This can include:

Hitting the right keywords to make sure you show up in searches (SEO).
Adding elaborate descriptions to give consumers accurate ideas of your products, dimensions, manufacturer, model numbers, etc.
Listing the parts included in your product. This is especially important if your product requires batteries or cables, etc.
Naming all the features of your products in order to give the customer an idea of versatility.

In addition, you should ensure that videos and images of your products are not only accurate but have a sense of scale.

Ideally, when customers view your page, they should be able to imagine themselves next to your product after seeing just the media content, knowing its size and weight, etc. Remember how Bellroy used an interactive slider to change the wallet’s look? Think like that.

Further, as consumers often view websites in other countries, it’s wise to have measurements in multiple units, i.e., in both cm and inches, both pounds and grams.

Lastly, ensure your page is optimized for all devices and operating systems. Customers move around between their laptops, tablets, and phones, and you need to make sure your page looks the part in every possibility to provide to ultimate ecommerece customer experience.

What’s after ecommerece customers experience

The world of ecommerce was shaken up immensely by the COVID-19 pandemic and the restrictions imposed on the world. Keeping up with consumers’ expectations is difficult, but after reading this article, you’ll better understand how to improve your ecommerece customer experience.

Remember, though, that the world of CX is constantly changing. What once worked may be rebuffed, and what once was reviled may become commonplace.

Ultimately, the decision about how to approach CX and what aspects to focus on is up to you, and there is no absolute right and wrong answer. Different demographics and industries have different needs, and you’ll need to test and figure out what works best in your case.

If you need a hand in analyzing what customers think of you, check out this blog post for further insights.

How To Improve Your Product

Posted on Jun 27, 2022 by Emily Louise Spencer

How To Improve Your Product

Product improvement is a data-driven process that should not be taken lightly. With the digital revolution well underway and companies seeming to come up with new product modifications on a regular basis, you need to keep on top of features and design preferences if you want to stay competitive.

That being said, there’s such a thing as overdoing it or missing the point. A good example of this is the recent release of Windows 11, which brought many new features, but prevented users from moving the taskbar. This led to a whole host of complaints and caused Microsoft to have to revert the change in late 2021.

Microsoft’s main mistake was to think about features, not usability. It doesn’t matter how brilliant or innovative your designs are if they’re laid out in a way that the users don’t like. People don’t like large amounts of change, and product improvement is no exception to that rule.

What should you do when envisioning new features and upgrades? Think about your customer base and what they use your products for. If you’re dealing with the general population, your products need to be easy to use and understand, at least on the surface level. If you’re looking at a more specialized or niche target audience, you might get away with a less straightforward product that has more available features.

With all this in mind, let’s dive into what happens when you improve your product, and how to go about doing it.

How to get started on improving your product

When you’re starting out, the task of product improvement can seem like a daunting one. Fortunately, there are a few categories of product modifications that you might find yourself looking into, and there are some general rules for each that can be followed in order to get the most out of your alterations.

Exploring new opportunities and avenues
If you want to expand, you’ve got to grow. One of the best ways to do this is by tapping into markets that you haven’t explored before. This kind of product improvement can come in two ways, adding new features to attract new customers, or expanding existing ones so that they reach a wider audience.

New opportunities (the “O” in a SWOT analysis) can be assessed by looking into usage cases of your product that you might have underestimated in the past. That is why completing a thorough SWOT analysis is key when starting to look into product improvement. Let’s say you discover that a consumer-base that does not belong to your go-to audience has been using your product—you would definitely want to tap into it.

It’s also possible to expand into new markets by creating new products specialized for them, but since that isn’t classed as product improvement we won’t talk about it here.

Addressing customer concerns

As evidenced by the Windows 11 example above, upgrades to features aren’t always what your customers want. You need to keep their needs and desires in mind when you implement changes, especially with more specialized products.

This is where listening to the Voice of the Customer comes into play. Only if you monitor your customers’ opinions in online reviews and social media you’ll be able to know their concerns and address them in your product updates.

Changes that address customer concerns are by their nature reactive rather than proactive, happening after you’ve received feedback on your product modifications. For this reason it can be helpful to keep receiving consumer feedback in the testing stages, rather than coming up with a finished design and hoping it goes down well. The term “beta testing” covers this idea, and while it’s mostly synonymous with the software industry it has applications elsewhere too.

Keeping up with the times
All products, but technology especially, can become stale and behind the times. Upgrading your products to match current expectations will keep your customer base interested, as well as have the potential to produce new features.

Or course this doesn’t just apply to technology. Environmental impact and ease of disposal or replacement is a great customer concern in current times, and older, less green products are being rejected over time by more and more of the population.

Keeping up with the times is about knowing what’s expected by consumers, which is distinct from what’s desired. If something is taken as an absolute necessity and you fail to provide it, you’re in for a bad time and bad publicity.

Depending on which of these categories your planned improvements fall into, you can adjust your approach to best suit it.

What can be improved in a product

Once you’ve figured out how you want to improve your product, you need to examine it and figure out what can be improved. You need to keep things practical after all, and whether it’s technological limits or manufacturing constraints there will always be something limiting your ability to improve your product to the “ideal” level.

Cost is another crucial factor in product improvements, as improving revenue and profits are almost always the ultimate aim of any business. There is no clear line that can be drawn at what would be considered worth the cost or not, it’s up to you to decide.

As success of new features won’t be visible in advance some organizations have adopted what’s called the “minimum viable product” approach, creating the most basic form of a product or feature for release in order to get feedback before committing their full budget to any one idea.

You should also prioritize features based on customer use, as these ones will see the most return on investment. Customer feedback will tell you which features are the most used, which are problem points and could do with some tweaks, etc.

What works and what doesn’t

You’re never going to be able to do everything exactly right. There’s always going to be things that have been missed in the ideas stage, unforeseen factors that cause complications and so on. That’s okay, everyone is only human and some mistakes are bound to crop up somewhere along the line. There are several key indicators that your modifications will prove successful, and some that indicate the opposite.

Signs of a great product modification plan:

You’re solving a problem or adding something that consumers desire.
Your plan is customer-centric.
You’ve made your plan flexible enough to get around obstacles.
You’ve defined your manufacturing limits and budget properly.
You’ve factored the product life cycle into your plan.

The last item is especially important when it comes to product improvement as you need to assess how long this product will last on the market before a new one is required, and thus define what the limit of your improvements will be. Those products with relatively short life cycles such as mobile phones or software will receive far less in terms of upgrades with each iteration than products such as car models which require far more in order to be perceived by consumers as worth buying.

Aside from the opposite of the above, there are a few signs that your product plan needs rethinking:

The modifications that you’re making would make your product too similar to another.
There are hidden costs that you didn’t account for.
The work is taking longer than expected.

None of these by themselves are reasons to drop your plans, merely signs that you need to re-assess them. The last point is especially important, as no matter how good your product is, people aren’t willing to wait forever and will lose interest over time. That being said, you shouldn’t rush the work either or you may end up with faulty products that fail to live up to expectations.

If you’re unsure on any of these points, you need to test, test, test! Alpha versions of products can be checked by your in-house team, with beta versions being made available to a small range of volunteer consumers in return for detailed feedback. Your plan should never be static, since new data means new information and new insights into what your customers want and how you might provide this.

How to analyze product data

Data is complicated, and you’re not going to be able to fully analyze it without software since the sheer volume would overwhelm any human who attempts it. Below you’ll find some of the commonly used analysis tools and a brief description of what they do:

Text mining
Text mining is the process of reading through unsorted text and extracting information that might be useful to you. Generally any software that collects information from raw text will also transform it into an easy to read form, simplifying it by factoring in synonyms and other linguistic quirks.
Sentiment analysis
Sentiment analysis is similar to text mining, except instead of simply pulling words out it looks at the meaning behind the words, or the sentiment that the text is meant to convey. This type of analysis is particularly useful for analyzing internet reviews or other short-form pieces of text that may contain slang or metaphors that simple text mining wouldn’t be able to pick up on
Customer sentiment
Customer sentiment is a general measure of how customers feel about interactions with you. It’s gathered in a similar way to sentiment analysis, but goes a step further to sum up all the interactions or feedback you receive into a sliding scale of positive to negative. While simplistic, it’s a great way of checking how your products are doing in the early stages of testing or release.

Sentimate offers customer sentiment on all products within its database, so if you need to find out what is and isn’t being received well, you can simply sign up and access our huge database of product insights.

How to implement your changes

When it comes to making product improvements, you can’t simply put them in and call it a day. If you don’t advertise your new products or features then consumers won’t be aware of them, and if consumers aren’t aware of them they won’t buy them. Marketing is key here, and you need to keep on your toes and keep your marketing department informed of the changes you’re implementing and what you intend to improve on in the future.

Key to this, especially if you’re looking at a long process that might take several revisions, is a vision of what you want to produce in the end and how it will be seen by your customer base. If your vision is aligned with that of customer desires, you’ll be able to use marketing to drum up a buzz and get people excited about it. A consumer base who want to buy your products before they’ve even hit the shelves is a valuable asset indeed.

What examples of product improvements can we see today?

There are all sorts of product modifications going on on a daily basis, some successful and some not. Let’s take a moment to look at some of the more successful examples that you might be able to learn from.

Koumeican Flat Extension Cords
Extension cords are a familiar sight to anyone who’s ever worked around any electronics. They do, unfortunately come with a bit of a drawback. Most extension cords simply use regular circular wires, which can lead to you tripping over them and issues pushing anything on wheels past without ripping the cord from its socket.

Koumeican came up with a brilliant solution to this – a cord that can even go underneath the carpet if necessary, and is flat so as to not be a trip hazard if simply placed on the floor. They looked at an issue that customers were having and solved it in a simple manner, a definite upgrade.

The iPhone
This one is a bit old, but you can’t deny it was innovative. While touchscreen phones, portable music players and devices with mobile internet access had existed before, the original 2007 iPhone was the first to place them all within one device, saving space in consumers pockets and simplifying their device needs.

What the iPhone did was completely transform the way phone technology was used, as well as expanding Apple’s market reach beyond computers and portable music players to reach a whole new range of consumers. Everywhere you look today you’ll see smartphones and similar devices with multifunctional capacities like tablets and smart watches, all offshoots of the original iPhone’s vision.

Using Sentimate to improve your product

Sentimate offers a wide range of features that can be used to gleam insight into your products. There’s a lot of information you can gather from customer feedback, though it usually comes at great effort. Fortunately, we’ve done it all for you and can give you all the insight you need at the touch of a button.

SWOT Analysis
Strengths, Weaknesses, Opportunities and Threats, together called SWOT, are some of the most valuable pieces of information. Sentimate’s analysis is derived from consumer sentiment in order to divide your product’s aspects into one of the four categories.
Not every facet of your product needs changing, in fact it’s best to leave the Strengths of your product alone. Opportunities indicate you’re on the right track, whereas Threats mean that you’re barking up the wrong tree when it comes to what your customer base wants. As for Weaknesses, nobody likes those but they do exist and you need to take those into account when deciding how to alter your product next.

Competitive Landscape
With just one click you can compare your products with those of your rivals and see where you lie in the realm of both customer sentiment and review volume.
You’ll be surprised at the amount of information you can extract from these two figures alone, with high-sentiment low-review count stats being an indicator that your product needs more promotion, whereas the inverse tells you that you need to upgrade the product itself a bit. There’s only one idea place to be on this chart and that’s slap bang in the top right corner, and by analyzing where you stand you can see what you might do to reach that goal.

Comparison Tool
A side-by-side comparison of two products is the best way to assess where you stand in relation to the market leaders (or your closest rival), and Sentimate’s Comparison Tool does just that.
The data we’ve gathered allows you to view different products and see where they stand, but more importantly why they stand there. When combined with the aforementioned Competitive Landscape tool you’ve got an incredible amount of detail into your products’ standing and how you might improve it.
From the advantages and disadvantages that consumers see in each product to key metric comparisons that tell you how customers feel, you’ll be sure to know more than you set out to by the time you’re done.

Hot Or Not
Trends can come and go in the blink of an eye, especially in some of the more volatile industries such as fashion or beauty. By using our Hot Or Not tool you can track customer sentiment at the present moment, see what’s rising in popularity within each category and see what’s dropping out of favor.
By keeping track of rising stars and falling rocks, you’ll be able to tweak your products according to shifting consumer opinions in real-time, even make predictions based on the projected landscape to bring out the next hit product yourself.

What Is Consumer Confidence?

Posted on Jun 24, 2022 by Emily Louise Spencer

What Is Consumer Confidence?

Consumer confidence is an economic indicator, one that measures the overall state of the economy based on how consumers feel about it and their own personal financial situation. It’s measured via either monthly or quarterly surveys targeted at households rather than individuals, with the Consumer Confidence Index (CCI) and the Michigan Consumer Sentiment Index (MCSI) being the main two indexes used in the US.

Both of the above indexes are released monthly, with relative values adjusted according to a standard. This makes reading these indexes at the basic level easy enough for the average layperson to do, with deeper understandings also being available with deeper analysis.

Consumer Confidence vs Consumer Sentiment

What is the difference between consumer confidence and consumer sentiment?

Consumer sentiment is another economic value that is measured via monthly surveys. While the two may seem similar, the term “consumer confidence” usually refers to employment and labor market factors, while “consumer sentiment” places more emphasis on individual household finances. You can think of consumer confidence as a subcategory of consumer sentiment, one aimed at examining employment stability.

While both the CCI and MCSI measure consumer sentiment, only the CCI is seen as a source of information on consumer confidence as the questions it poses are directly related to employment conditions and the financial security these bring.

The Consumer Confidence Index

The Consumer Confidence Index (CCI) is a monthly survey administered by the Conference Board, based on five questions that households around the US answer. Around 5000 households are surveyed each time, spread out according to population density in order to try and get an accurate picture for the entirety of the USA.

The questions the CCI asks are about the following topics:

Respondents’ appraisal of current business conditions
Respondents’ appraisal of current employment conditions

Respondents’ expectations regarding business conditions six months hence
Respondents’ expectations regarding employment conditions six months hence
Respondents’ expectations regarding their total family income six months hence

The answers to the first two questions can be taken and converted into the Present Situation Index, looking at the current situation that consumers find themselves in, with the answers to the latter three forming the Expectations Index, a measure of the outlook for the future. Together they form the CCI, though it’s been argued that the two measures are more valuable when separated than together.

Understanding The Consumer Confidence Index

Consumption is the lynchpin of the US economy. On a basic level, the CCI can be thought of as an indicator of willingness to partake in this process.. If consumer confidence is high, this indicates a willingness on the consumers’ parts to spend more money, thus stimulating the economy. If the outlook is low, spending will decrease and the overall economic health will be lower.

Overall, large drops in the CCI indicate periods of economic recession, while climbing rates indicate economic recovery. It should be noted that the line goes up and down periodically, so while all changes are noted only those of 5% or greater are considered “true economic indicators” by experts.

Going deeper, the two facets of the CCI can be contrasted in order to glean more insight. Below you’ll find the Present Situation Index (PSI) and the Expectations Index (EI) on the same graph for comparison.

As you can see, the two indexes are not always aligned. Since 2014 the PSI has sat above the EI, only dipping below it in early to mid 2020 at the beginning of the COVID-19 pandemic. This contrast indicates that while consumers are fairly confident in their current situation, they expect their economic situation to worsen in the future and thus will look to spend less as time goes on.

On the other hand, there have been moments where the PSI sits below the EI, for example the period between 2009 and 2014. This indicates the opposite to the above case, where consumers expect their situation to improve over time compared to their present.

Taking just the PSI into account, large drops over a relatively short period of time are an indicator of economic recession, as when the economy takes a turn for the worse employment stability is not guaranteed.

As you can see in the two shaded areas of the graph above which represent economic recessions, the EI also may dip but may also remain unimpacted. A dip in the EI indicates a longer-term economic impact, whereas if it remains stable the recession is expected to be short-term.

One crucial thing that you should keep in mind is that these numbers are all based on consumer beliefs, not economic data, and cannot take into account unforeseen problems that impact the economy. The COVID-19 pandemic is a prime example, with consumers being completely unable to see it coming and that being reflected in the EI on the chart above.

How Is The Consumer Confidence Index Measured?

As mentioned earlier, the CCI is based on responses to five questions asked to households around the US. The mathematics of the CCI are rather complex, but a simple explanation is that it is a relative value – it’s compared to a point in the past in order to make the numbers less complex.

In the case of the CCI, that number is currently the value that was received in 1985. All other numbers on the chart are measured as a percentage of that value, with 100 being equivalent to the consumer confidence that was recorded in 1985, less than 100 representing lower consumer confidence and more than 100 being a sign of greater consumer confidence.

Criticisms Of Consumer Confidence

The Consumer Confidence Index is considered one of the most reliable economic indicators in the US, with banks and corporations watching it closely. That doesn’t mean that it lacks flaws though, as no index can take into account every factor that affects the economy. Below you’ll find some of the criticisms of the CCI, and why those criticisms matter.

Strong Fluctuations
The CCI is prone to fluctuations, as can clearly be seen on the charts in the previous sections. Because of this, those monitoring the CCI and using it to predict economic outlooks may have a reaction to a perceived economic boom or downturn, when in reality it’s nothing more than a monthly fluctuation.
Plenty of organizations will ignore fluctuations that are less than 5% of the index in order to account for this, however even this doesn’t cover all cases. Others have started using a moving average of values, however the Conference Board does not provide raw data so these values are pulled from a chart and therefore not completely accurate.
Lagging Indicator
Critics of the CCI have long since classified it as a lagging indicator, one that can only react to changes in the economy after they have happened. While true that it takes time for economic impacts and the news of them to filter through to consumers, in the age of the internet and instant communication this criticism is less valid.
Oversimplification
The CCI covers the entirety of the US, and thus does not account for local economic impacts. For instance, hurricanes tend to hit Florida and the other south-eastern states fairly regularly and have a great impact on consumer spending in that area. The CCI, covering the entire US, will fail to show that impact and any business in those areas that takes it at face value will be in for a bad time.
Consumption vs Sustainable Investment
According to Adair Turner, former Chairman of the UK Financial Services Authority, “if credit finances consumption rather than useful investment, it is more likely that the debts created will subsequently prove unsustainable.”
What does this mean? Well, in short, it’s that using the CCI to make predictions about the economy will lead to organizations creating unsustainable business models that will eventually backfire. Unsustainable debt and an unstable housing market have often been blamed for the 2008 housing crisis and subsequent global recession. In short, consumption as an economic foundation has limits and the CCI can fail to acknowledge these.
Unreliable Data
A final criticism, one mostly aimed at the Expectations Index, is that consumer behavior in the future isn’t necessarily linked to how they expect it to turn out in the present. Minds can be changed, estimations can be wrong, etc. and some critics have slammed the EI as simply being guesswork.

The Business Cycle Indicators

The Business Cycle Indicators (BCI) serves as a means of examining economic prospects from the perspective of businesses rather than households. This index is gathered using similar methods as the CCI, however the respondents are higher ups in the business world with the questions aimed at their organization, rather than them personally. The BCI is far more useful to those who deal mainly in B2B transactions as the economic factors that affect these necessarily aren’t represented in the CCI.

The BCI is a far more complex and detailed report than the simple outlook of the CCI, containing dozens of different factors and indicators that may affect the business world. For this reason it’s often seen as more reliable but in turn more difficult to interpret. Categories of indicators examined in the report include:

New manufacturing orders
Claims for unemployment insurance
Stock prices
Building permits
Interest rates
Manufacturing hours
Export/import ratios

While the report mainly focuses on the US, there are comparisons made available at the end of each monthly report to other countries, including Japan, the UK, China, and Canada, with information pertaining to industrial production and exchange rates being among those included.

While the sheer volume of information may seem daunting – each report is around forty to fifty pages long! – you can narrow it down by focusing only on the information relevant to you. For instance, the manufacturing orders are split into categories based on industry thus you can ignore all not relevant to your business.

The BCI is an extremely useful tool to have in your pocket, and if you can decipher it even a little it will prove a great boost to your business. Information that you can take away from it includes:

The likely interest rate on a business loan at any point in time, taken directly from a chart of interest vs time.
Expected manufacturing output for a particular industry, useful to know as both a supplier and buyer as supply vs demand will affect pricing.
The number of business loans currently given out, as banks are less likely to approve new loans if many are outstanding.
The Federal Funds Rate, which can be thought of as an extremely short-term interest rate charged on overnight borrowing.
Price indexes, which can help you decide what to charge for your products.

Customer Sentiment

While all this is good information on the state of the market at large, it can’t tell you about how a specific product is viewed by its purchasers. Knowing how consumers and businesses alike react to a specific brand or product is known as customer sentiment, and it can be a great help when used alongside consumer or business confidence to determine the viability of products in the current market.

Customer sentiment is aggregated from existing reviews rather than surveys, as making surveys about hundreds of individual items is simply not feasible. Because of this, customer sentiment can be biased heavily towards either the positive or negative as customers are more likely to leave reviews after a standout experience with a particular product or brand, whether that is good or bad.

This doesn’t mean that customer sentiment is useless, far from it. The perception of a brand or particular product in the customer’s eye is a great indicator of how willing people are to spend money on it, which when combined with the CCI/BCI can give you an idea of how much they are willing to spend at any point in time. A low customer sentiment paired with a high CCI/BCI rating can still turn profits, while a high value of customer sentiment might still be a cash cow when the CCI/BCI is low.

Ready to put your data and trend interpretation skills to good use?

Sentimate offers customer sentiment ratings on thousands of different products across a wide range of industries, with comparisons and deep analyses available.

You can put what you’ve just learned about consumer/business confidence to the test by creating a free account with Sentimate today!

What Is Consumer Sentiment?

Posted on Jun 17, 2022 by Emily Louise Spencer

What Is Consumer Sentiment?

In this article, we’ll explore the topic of consumer sentiment, the role it plays in today’s economy, the difference between consumer and customer sentiment, and how you can use it to your advantage.

Consumer sentiment is a measure of the overall consumer opinion on their financial health. Consumer sentiment is important because it’s a means of measuring how well the economy is doing on a short-term basis, as it indicates how willing consumers are to spend money and how optimistic they are that the economy will get better in the near future. Using this, you can make predictions about how well your sales are going to perform and make any necessary adjustments to your current plans.

Consumer sentiment is particularly important in the US economy, where consumer spending makes up over 70% of GDP. How to measure consumer sentiment isn’t straightforward; however, there are two main indexes which can be used:

The Consumer Confidence Index (CCI)
The Michigan Consumer Sentiment Index (MCSI)

Both of these indexes are measured on a monthly basis, as the sheer amount of data required to get an accurate picture of the consumer mindset is staggering. Both are based on household surveys and function through “yes, no, or no opinion” questions, so while they’re not the most nuanced, they still do give a good picture of the consumer mindset.

Both indexes are also based around the whole of the US, and don’t take into account regional factors or other issues that may arise only in certain locations such as wildfires or flooding. Consumer sentiment by state can vary wildly, so if you operate in a narrow range of locations you should look to more local surveys rather than national ones.

The Difference Between Consumer Sentiment and Customer Sentiment

Consumer sentiment is a broad measure, it’s something that tells you about how consumers feel in general about their situation but nothing about how they feel towards specific brands, products or services.

Customer sentiment, on the other hand, tells us the specifics. It’s a measure of how customers feel about individual products, services or brands, with both positive and negative sides. Customer sentiment is extremely important in today’s market, with studies showing that customers are willing to spend up to 140% more after a positive experience with your brand.

You can think of customer sentiment analysis as similar to consumer sentiment analysis , only with a different focus. Generally the data is collected by the brand in question, but there are of course those who want to make comparisons between brands and showcase the differences they found — just look at all the comparison websites that popped up in the 2000’s.

Customer sentiment is about feelings, which in the current market are more important than ever. Perceived negatives and misunderstandings will cause just as much bad press as real faults, so be on the lookout for anything that might be misunderstood by your customers.

What Is the Consumer Confidence Index (CCI)?

The CCI is a survey administered by the Conference Board, based on five questions given to those surveyed. It assumes that if consumers are more pessimistic about the economy’s future they will cut their spending, while being more optimistic will lead to them spending more and stimulating the economy.

The questions the CCI asks can be split into two broad categories, each of which are weighted into what’s called a “relative value,” which takes into account the importance of each question at the time of asking. The questions are as follows:

The Present Situation Index:

Respondents’ appraisal of current business conditions
Respondents’ appraisal of current employment conditions

The Expectations Index:

Respondents’ expectations regarding business conditions six months hence
Respondents’ expectations regarding employment conditions six months hence
Respondents’ expectations regarding their total family income six months hence

Each question can be answered with a positive, negative or neutral answer. The overall value that the CCI gives each month is an average of the two categories, with separate values being available for both.

The CCI is a relative measurement, meaning the values that you read are a measure of how confident consumers are compared to another point in time, in the case of the CCI, 1985. The CCI value of 1985 is set at 100, with each other value being comparable. For instance, if a month had a CCI rating of 105, consumers would be 5% more confident overall about the state of the economy than they were in 1985.

Of course, the CCI isn’t without its downsides. Overall the number of respondents per survey is around 3000, not even 0.01% of the total number of US households. Furthermore, some have criticized it as a lagging indicator, meaning that it would only show information after the changes in the market have occurred. Regardless, it remains one of the top measurements of consumer sentiment in the US.

What Is the Michigan Consumer Sentiment Index (MCSI)?

The MCSI is conducted by the University of Michigan, based on interviews conducted via telephone. While more in-depth than the CCI, the number of respondents is correspondingly smaller. The study asks around 50 questions each month, aimed at assessing three areas of consumer confidence:

Their own financial situation
Their confidence in short-term economic health
Their confidence in long-term economic health

Like the CCI, respondents to the questions have a positive, negative and neutral option for their answers. The MCSI is normalized similarly to the CCI, with the value of 100 being set as the relative consumer sentiment seen in the first quarter of 1966.

The MCSI is calculated by subtracting the percentage of negative answers from positive ones, then adjusting the given data relative to the number recorded in the first quarter of 1966. Barring some adjustments to the number to account for survey design changes, this creates an incredibly easy to understand index.

Many experts consider the MCSI to be the more reliable of the two most used consumer sentiment indexes, with the University of Michigan claiming that the surveys “have proven to be an accurate indicator of the future course of the national economy.”

The MCSI can be split into the Index of Consumer Expectations (ICE) which better represents future expectations, and the Index of Current Economic Conditions (ICC) which reflects the current state of affairs.

How To Interpret The Main Consumer Sentiment Indexes

Both of the main indexes used to measure consumer sentiment are based on relative measurements compared to points in the past, yet they’re still useful. By comparing the values for any given month to those around it, you can see both long-term and short-term trends that indicate how likely consumers are to spend money at that particular point in time.

A trend of increasing consumer confidence month after month indicates that they feel more secure in their positions, and are more likely to purchase goods and retain their income. Thus, manufacturers can step up production as they can expect a higher turnover, with retailers ordering more stock and so on.

Conversely, a decreasing trend indicates that consumers are going to hold onto their money, so manufacturers and retailers can expect a lower turnover. While these one-dimensional analyses alone are good indicators of what you can expect in terms of consumer behavior, you can get more information if you delve deeper.

As seen in the above example chart, 2020 caused a huge dip in consumer confidence. While the overall optimism rose in late 2020 to early 2021, it again fell in the following months. From this data, we can see that consumer spending is continuing to decline and may do so throughout 2022.

Another important thing to note is that the three month moving average cuts out many of the small rises and falls in consumer sentiment that the monthly data shows. Which of the two is more useful depends on your outlook. For long-term predictions, use the moving average. For short-term considerations, the raw data may be more useful.

When comparing the ICC and ICE to the base MCSI, you can expect to see subtle differences. In the above chart, the ICC shows a larger drop at the beginning of 2020 than the MCSI, with the ICE showing a smaller one. From this, we can take away the following messages about that time period:

The ICC values had a sharp drop, meaning consumers lacked confidence in their current financial situation.
Therefore, in the short-term, thinking is that they may have to curb spending.
The ICE values had a drop too, but not as great as that which the ICC showed.
Therefore, while consumer confidence that their situation would improve in the long-term had dropped, it was not as drastic as their confidence in their short-term situation.
When put together, it shows an overall consumer expectation of drastically decreased spending in the short term, with the potential of a slow rise again in the long-term.

It’s important to keep in mind that the data only shows consumer expectations, not what actually is going to happen. While the two are certainly tied together, there can be events that come out of left field to alter the economy.

Governments and businesses often monitor the CCI and MCSI for changes, however they don’t react to every single change in the numbers. It’s important to keep an eye out for large changes, with those of plus or minus 5% being considered significant enough to mark a change in the economy’s direction.

If you want to look at longer-term considerations, it’s important to examine the indexes on a longer timescale. The MCSI offers ten year and fifty year charts to be easily viewed, while the CCI boasts an interactive

Other Measures of Consumer Sentiment

While the CCI and MCSI are both strong national indicators, they’re not the only ones out there. They’re both highly focused on the US market, meaning you’ll want to look elsewhere for information on other countries and their economies.

The Organisation for Economic Co-operation and Development (OECD) offers consumer confidence indexes across both North and South America, Europe, Australia and Asia, with interactive analysis across 40 countries being available on their website. This data is particularly useful for those operating in or looking to expand into markets other than the US.

The OECD also offers a Business Confidence Index (BCI) across those same areas, which is useful if you’re primarily aiming for B2B transactions. The BCI is calculated in a similar way to a consumer confidence index, except that the questions are aimed at businesses and their confidence in future developments.

McKinsey & Company has run detailed surveys quarterly in over 30 countries during 2020 and 2021, aimed specifically at examining the effect of the COVID-19 pandemic on consumer sentiment and spending.

These surveys are broken down by both age group and net income, giving insights into differences that different age groups express and how attitudes change depending on income. This particular survey contains more than just a basic CCI, with useful information on planned spending and customer loyalty, so if you’re looking for a more in depth analysis be sure to check it out.

The Nielsen Global Consumer Confidence Index

The Nielsen Global CCI was created in 2009 in an attempt to measure consumer confidence worldwide. The surveys themselves take place online, thus this index better shows a picture of e-commerce confidence and also allows for comparison between different countries and regions.

Currently the results are released by the Conference Board, the same organization which produces the CCI, and takes place quarterly across 65 different countries and surveys over 30,000 people. If you’re looking to diversify into different markets or simply keep up to date with world commerce affairs, the NGCI will be a great help. Notably Africa is mostly missing from their surveys, which can be attributed to the comparatively low internet connectivity in the continent.

Ready to dive into the realm of consumer sentiment?

Sentimate has customer sentiment ratings for hundreds of thousands of products on the individual and product category levels, with comparisons available on dozens of different topics.

You can find insight on consumer and customer sentiment by creating a free account with Sentimate today.

How To Improve Your Star Rating On Amazon

Posted on Jun 6, 2022 by Emily Louise Spencer

Amazon Seller Reputation: Why It Matters

Increasing your seller reputation is never a bad thing. It lets you increase your sales, boosts your reach and lets you track how you’re doing in terms of marketing. Amazon’s star format is one of the simpler ones for customers and those who view you to understand, but it’s slightly more complex when it comes to figuring out how to increase it.

The first thing we’ll get out of the way is this – your seller rating is not the same as your seller feedback. One is determined by the other, but feedback is discarded by the algorithm and doesn’t have an impact after 365 days. Thus, it’s not only important to get lots of good reviews but get them often if you want to keep your star rate high.

The Difference Between Product Reviews And Seller Reviews

Product reviews aren’t the same as seller reviews. One is directly related to the product in question, while one to the seller. One is about the quality of the product, the other the service and experience that the customer had with you. You’ll find both options on your

This might seem unnecessarily complex, but you need to remember that plenty of Amazon stores sell things that they don’t manufacture. It wouldn’t exactly be fair to put the burden of manufacturing errors on those who are just suppliers. It’s important to note that only those who’ve purchased from you can leave seller ratings, and only up to 90 days after purchase.

Seller reviews usually focus on packaging quality, shipping speed and communication by the seller. Anything that involves product description would also count. You might see feedback about incorrectly sized items, misleading photos etc. – these are also seller reviews.

Your seller reputation, in other words your star rating, is concerned only with seller reviews. Given said rating helps determine where you rank in the Amazon search function, it’s important to keep it high.

The Definition – What Are Amazon Product Reviews?

Product reviews are the other end of the stick. They’re reviews that are specific to certain items or groups of items that you and others might sell. They’re written with the intention of helping future customers decide what to buy based on quality, durability etc.

You can leave a product review from the Orders tab just as you can leave a seller review, but it’s important to note that people who haven’t purchased from you can leave product reviews too – they just need to have purchased something from Amazon in the past twelve months. While this is designed to let people who obtained the product elsewhere leave feedback, there’s definitely potential for abuse so keep an eye out for ratings that seem suspicious.

Given Amazon’s feedback system is in the form of comments left on items, you’ll often find product reviews and seller reviews lumped into one string of text. Customers don’t want to write things out twice when once is easier, so you’ll often find product reviews left in the seller review section and vice versa.

Why Are Amazon Product Reviews Important?

So, if product reviews don’t directly impact your seller rating why should you care about them?

Product reviews affect Amazon’s SEO, that is to say that if you have good ratings you’ll appear higher up in the recommended section of searches. They’ll also give you information about your products – quality, potential defects etc. This can be used by you directly if you manufacture your own products, or if you’re simply a supplier, used to decide what products you should continue to purchase from their manufacturers.

Product reviews also help in another fashion, and that’s to do with the psychology of purchasing things online. Consumers are suspicious of products with few reviews, thinking that they might be faked or inaccurate because of their small sample size. In fact, it’s been shown that how recent your reviews are also matters, with ratings from more than six months ago being virtually ignored by consumers browsing your products.

Techniques To Get Reviews On Amazon

So if reviews are that important, you’ve got to use techniques to get them. Most people won’t leave a review out of their own initiative unless they’ve had a particularly noteworthy experience, so a little bit of incentivisation doesn’t actually affect the accuracy of your reviews.

Ask For Feedback

If you want feedback, you can just ask for it! Sending emails to customers asking for a quick review is a good way to get responses, as it’s quick and easy to do.

Consumers are aware of the need for reviews to get good Amazon ratings, and a quick reminder is often enough to motivate them if they’ve had a particularly good experience with you, which will give you the bonus of good feedback.

Include Links To Feedback Pages

If you’re emailing customers, you should include links to feedback pages for the specific items they purchased. Nobody likes having to put effort into something that they’re doing as a favor for someone else, so making the process as easy as possible is advised.

Automate The Process

Of course, sending all these emails by hand is going to be a nightmare. The best way to get around that is to use automated email writing software, which has the added bonus of reducing mistakes made when transcribing links or product titles. The words Bread and Breed might look similar to a human, but to a computer it’s all 1s and 0s.

Amazon’s Vine Program

It wouldn’t be capitalism without a pay to promote option. Amazon’s Vine Program is a paid program that lets you confirm that your reviews are genuine, and provides the option to get your products reviewed by e-commerce experts.

Social Media Campaigns

Social media advertisements are another pay to promote section, but in this case you’re paying to have popups reminding your customers that they’ve purchased from you and a review would be nice. This can border on the level of “knowing too much”, but most consumers these days know all about big data and won’t be fazed by it.

Using qualitative research for measuring brand equity

Posted on May 22, 2022Dec 15, 2022 by Emily Louise Spencer

Brand equity is a great weapon to have in the never-ending battle that is today’s competitive markets. The main benefit of having a strong brand equity is that consumers will buy your products no matter the cost to them, as they perceive them as having innate value or quality based simply on the fact that they came from you.

Being the top brand whenever consumers think of your market sector is the ideal position, but it’s not quite that straightforward. I’m sure you’ve heard of the Pepsi vs Coca-Cola, Apple vs Microsoft feuds etc. No one side can claim to truly be at the top of the market, despite all having strong brand equity.

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What Is Brand Equity?

Brand equity is quite simple to define but more complex to measure.

Put simply, brand equity is a brand’s perceived value according to consumers. It can also be defined as the level of positive feelings that consumers have about a brand, when compared to others in the same market space.

For example, if you order a rum and Coke at a bar, you might be asked if Pepsi is okay. Some would answer yes, some no — that’s brand equity. If you go to buy a new gaming console and are dead set on having a Playstation, that’s brand equity.

Some brands even dominate the market to the point where their name becomes the commonly used word for the item they produce. Blu-tac, Coca-Cola and Sellotape have become synonymous with their markets, despite being only one amongst dozens of brands. That’s strong brand equity at work.

If you have strong brand equity, you have a dedicated customer base and the option to charge premium prices. If you launch a new product, you’re guaranteed to get customers no matter what it is, just from the trust they have in your brand. You need to make sure that your products are still top-quality however, a lesson Microsoft learned the hard way with Windows Vista.

Keller’s Brand Equity Model

It’s worth mentioning the Keller Brand Equity model here. We won’t cover it in too much detail as that would be an article in and of itself, but let’s go over it and give you the general idea.

The Keller model states that in order to get a strong brand, you need to shape the way your customers think and feel about you. This starts at the base level with establishing your brand identity, then works its way up the pyramid by asking questions about what your brand might want to achieve.

It’s a step by step process that makes thinking about how you plan to position yourself, and what feelings you want to evoke in your customers, quite simple actually. Each stage contains crucial components that evoke brand loyalty, so be sure to give it a look if you want to build your brand up to the next level.

6 Ways Of Measuring Brand Equity

Measuring brand equity isn’t straightforward. There are a number of factors to consider, and which one you put weight on will depend on your business model, industry etc.

Brand equity isn’t something you can measure in numbers – it’s all relative! Still, there are a few tried and tested brand equity analytics you can use. We’ve laid out five of them below for your consideration.

Competitive Analysis

Competitive metrics set you up against your competitors and see how you’re doing compared to them. It’s a more aggressive form of analysis which takes their marketing campaigns and yours, sees the results of them and tells you how well you’re doing in comparison. If your competitors are lagging, that means you’re leading, and vice-versa.

Other factors you can look at for a comparison between brands include the relative customer sentiment, acquisition rates, social media engagement etc.

Remember though, just because your competitors are below you now doesn’t mean you can relax. They’ll be looking for ways to improve just as you are, and if you stop to watch you’ll be left behind!

Financial Data

Another metric you can use to measure brand equity is financial data. Market share, profits, revenues, prices – these all tie in to how well your brand is doing, since more brand equity correlates with more customers. Compare these to those of previous years or quarters and you’ll be able to measure brand equity data over time.

Customer lifetime value is another strong indicator. Essentially it’s the value that a customer brings to you during the entirety of their total interactions with you. Strong brand equity correlates to higher CLV, since loyal customers will bring in more revenue for you overall. Conversely, if you need to keep re-attracting customers it might end up lowering their overall value to you, since acquiring a customer is more costly than keeping a current one.

Also worth mentioning is the cost to acquire new customers, which is a huge indicator of brand equity. If said cost is large, it means that it takes a lot of incentive for a consumer to switch from a competing brand to yours, meaning your brand equity is low and you need to work on your image.

Brand Awareness

Brand awareness is another abstract quality that’s hard to measure, but nevertheless it’s very valuable when you’re looking at your brand equity. To put it simply, if consumers don’t know about you then they won’t buy from you. If they know of you only vaguely, you won’t be their first thought when looking for a product.

Having high brand awareness means that you’re synonymous with the market you’re in – like the examples of Coca-Cola and Sellotape mentioned earlier. Being so well known comes with certain risks to your brand, as you lose copyright on any name that becomes the commonly used term for an item, but it’s a definite sign that you’re well up there in people’s minds.

Coca-Cola managed to retain their trademark, since the commonly used term is the nickname Coke, however Sellotap lost theirs when the term was deemed genericized enough.

Ways you can measure brand awareness include:

Surveys
Store traffic
Search volume
Google search rankings

These aren’t the end all be all, but they’re a good start. You can also look to social media for hints, but this information will be highly polarized due to the nature of such spaces.

Customer Sentiment

Customer sentiment is about feelings, specifically customers’ feelings towards a particular product or brand, depending how you measure it. Customer sentiment is a measure of how strong the emotions associated with your brand are, and how positive or negative they are. It’s especially important in today’s markets, as customers are willing to spend up to 140% more after a positive experience with a brand.

Generally customer sentiment is generated by surveys or similar methods, asking customers to rank their experiences based on how they felt about their interactions with you. However, it can also be found by scraping review data with sentiment analysis or analyzing social media chatter.

It’s not straightforward at all to measure customer sentiment, but fortunately Revuze has built the first ever customer sentiment analysis engine, Sentimate, to analyze the data for you. If that sounds interesting, find out more here.

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Brand Audits

Something to consider when you’re analyzing your brand is what’s termed the total value of the brand itself, what it contributes to the business simply by existing. There are a myriad of factors you can measure when doing this, but depending on who you are and what you do some will be more important than others.

In general, things to consider when auditing your brand are:

The cost to build the brand. How much money did you pump into advertising, trademarks etc.?
The market value of the brand, or how much value it brings to stamp it on a product. Can you charge more for a branded product compared to a generic equivalent?

The income value of the brand, or how much money it brings in by making customers aware of your products. Can you launch a new product and expect high sales, or would you need to put funds into advertisement?

Wrapping Up

Brand equity is a strong indicator of your position in the market, but it’s something that isn’t easily measured. Hopefully after reading this article you’ll have some clue of how to do so in your industry, and if not we here at Revuze specialize in helping out.

What are you waiting for? Start measuring your brand equity today!

How To Use Product Insights To Inform Product Strategy

Posted on May 9, 2022Dec 15, 2022 by Emily Louise Spencer

When it comes to improving your products and developing the strategy by which you intend to market them, nothing is more important than knowing what works and what doesn’t. In business, very few stakeholders will want to take a step forward unless there is a decent chance of return on investment.

Unfortunately, we live in a world where changing expectations and shifting culture means that it isn’t always clear cut what will be successful and what won’t. That’s where product insights based on market research can help.

What Is Product Strategy?

Product strategy is a plan encompassing everything that you want to achieve with a specific product, what steps you intend to take to see that through and how that strategy links to the overall goals of your business.

There are a number of elements to a product strategy, starting from the very beginning with the drawing board and finishing up with where you want the product to sit in the market. Each step posits certain questions that you need to ask yourself before moving forward:

Design: What do you intend to sell? How will your design attract consumers? Will your design stand out amongst the market or will it conform to the accepted norm?

Features: What will your product do? How will that set it apart from others in the same market? Are you going to combine multiple features into one item?

Quality: What will your product’s quality be? Are you intending to create disposable or multiple use items? Your product’s quality should match those already within the market at the least, and exceed if you intend them to be reusable.

Branding: Will you market your product as part of an existing line? WIll it be standalone? Brands have reputation and power, something that will help a lot when you’re starting out.

Target Market/Demographic(s): Who do you intend to sell to? Do you have a niche audience or is this new product something anyone would buy? You can charge more for specialized products that few will buy, but there will be fewer sales overall.

Positioning: Where do you plan to position this product in the market? Is it intended to replace the current frontrunners? Is it going to be an affordable alternative?

All these questions are easy enough to answer from your own perspective, but you need to remember that you and your team aren’t necessarily going to be representative of your customer base as a whole.

If you’re going to answer these questions for consumers in general, you’ll need information on what they want and what you can give them – product insights.

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What Are Product Insights?

Product insights are a peek into the consumers’ minds when they’re using a product. Put simply, it’s a broad term that covers any and all information you might have that describes a user’s experiences related to a product and the analysis of those. You can split product insights into two types:

Qualitative Insights

Qualitative insights are factors that you might call arbitrary or without a scale. This type of insight is usually found in the more expansive surveys and reviews that users and buyers leave behind on products. Don’t be fooled into thinking that these types of insight aren’t useful because they can’t be measured, they can give you details that mere numbers never could.

As an example, someone stating that they didn’t like your product falls under quantitative insights as it’s a simple yes or no answer. If they state why they didn’t like it, that falls under the qualitative insights umbrella.

Quantitative Insights

This type covers anything that you can statistically measure. It can potentially come from pre-existing data, for instance customer retention rates, ratio of online to in-store purchases, etc.

The trouble is, most of the data that already exists isn’t set in a vacuum. You can say that the sales of a certain item went up at a certain time that coincides with a holiday season, however there are likely multiple factors at work that could influence the shift in sales. Breaking the data down by demographics, location etc. will help but not entirely eliminate this problem, and often product insight teams will find themselves trying to set up surveys to fulfill specific niche questions their existing data doesn’t cover.

In the end, finding quantitative data that’s absolutely controlled isn’t necessary though, as the accuracy in your predictions you get has diminishing returns. There’s a certain point where you call it a day, and it’s up to you to decide where that line lies.

The Value of Data

Product insights come from your consumer base. They’re the ones using your product after all, and will have far more insight into how it functions and where its strengths and weaknesses lie than anyone who looks at it through an analytical lens. Post-It notes were originally created to be bookmarks for example, but found much more success in their main function today as reminder notes.

When it comes to data sources, there are plenty of them out there to pick from. Which ones you put the most weight on will depend entirely on your industry, business model etc. but they’re all generally useful to some extent. Some of the more popular ones include:

Reviews
Questionnaires
Point of Sales Figures
Mobile/Website Data Tracking
Video Cameras/People Counters

What Do You Get Out of Product Insights?

Analyzing product data isn’t easy, but there are software packages out there that can help you. Most of the more commonly used ones contain several key metrics that you can look at in order to determine what you data is telling you, including:

Customer Sentiment
SWOT Analysis
Retention Rates
Referral Rates
Revenue Trends
Competitive Landscaping
Consumer Decision Factors

These metrics are designed to be easy to understand and therefore easy to implement – most reports will tell you their key points at a glance after all!

You need to keep in mind though, that the more specific the issue the more you’ll need to delve into the data. Be selective about what data goes in and you’ll get a more specific answer out, though that will require some understanding of the data you’ve collected.

North Star Metric: Your Defining Vision

The term “north star metric” is one that’s linked heavily to the success or failure of a particular product strategy. The term comes from an old sailing practice, where one would “follow the north star” to find which direction is north at night since the star in question didn’t move relative to the Earth’s rotation.

Essentially, it is the key metric by which you define how successful you’ve been and whether or not you’ve hit your targets and solved the base customer problem that your product team was attempting to solve. You can use the term to reinforce what you’re doing as the campaign goes on, aiming your sights directly at the metric you’ve decided to target.

A good north star metric contains both the problem you’re attempting to solve and the desired outcome. An example metric might be:

“To raise the quality of our product’s manufacturing so that they don’t break as often”.

In this case, the product breaking is the problem and the quality being raised is the vision of what you want to achieve. The key measurable metric in this case would be the number of customers reporting broken products, with a decrease in the proportion being considered a success.

Combining Product Insights With Product Strategy

As mentioned above, a product strategy is set out by defining several characteristics that you want your product to have, based on questions that you ask yourself about the market, your consumer base and the product itself. Let’s break this down and see how product insights can help you when you’re generating a product strategy.

Design

When you look at the information on design preferences, you might find complaints or reviews that indicate flaws in existing designs that you can take advantage of. This could be in the early stages when you’re analyzing what exists already in the market, or later in testing when your product has been designed.

Some folk might be adverse to making changes when the development process is part way through and manufacturing has already taken place, but you shouldn’t hesitate if major issues crop up. A design modification early on in the process is less costly than one further on or your product, or if it fails.

Features

When you’re deciding what features to put on a product, oftentimes you’ll end up with more than it can support in the beginning as every suggestion is noted. Using product insights, you can narrow down that list to a more feasible one.

Product insights will tell you which features are the most sought after, which are seen to work well together and what features can be safely dropped without complaints from customers.

Quality

What you want your quality to be depends mostly on what market you’re going into, and product insights can tell you a lot about that space. An example of high quality products bringing success were the Dualshock game controllers initially released in the early 2000’s, which overtook all others to become the standard in the industry.

Branding

Insights can tell you how likely consumers are to go for branded products vs generic, and which brands they prefer. It isn’t really that useful when you’re pre product launch, but can help afterwards.

Information on how customers are responding to your branding choices can also help you decide when and how to change it with a rebrand or a brand refresh, if the need ever arises.

Target Market/Demographic(s)

This one is fairly self explanatory. By checking the information available you can see how well your target markets/demographics might view your product, what they want out of it and what they expect to find.

Of course, you shouldn’t simply limit yourself to one choice if multiple of them seem promising, but in general if you do this you might need to create a personalized marketing campaign for each in order to effectively promote your product.

Positioning

This one is trickier. While you can have ideas about how your product might fare by looking at existing ones in the market that are similar, you’ll never really know where you stand until you launch.

What product insights can tell you on this front is the minimum requirements to both enter the market, and be a market leader. Using these, you can have a vague idea of where you will end up based on your current features, branding, quality etc. and plan accordingly.

Aims of a Data-Driven Product Strategy

At the end of the day, you use product insights with the intention of making your product strategy more successful. Your north star metric will measure how much you’ve achieved this but at the end of the day there are two main things that drive purchasing, and therefore determine the success of your product.

Customer Wants

How closely have you matched what consumers seemed to ask for? Was it even possible to match their desires whilst retaining a decently low price tag? It’s important to remember, however, that some of these desires are going to conflict and that you can’t please everyone.

If customers do end up having radically different desires, you can always branch out and create specialized products after the general version has been released, but your primary focus should be on creating a good all-round product.

Customer Needs

While it might seem arrogant to assume that you know better than your customers what they need, taking a look at the underlying issues that cause their requests can definitely pay off. People are far more willing to pay for something that solves their root problems than something that simply treats the symptoms of it.

As Henry Ford once said, “If I had asked people what they needed, they would have said faster horses.” Take advice from, but don’t limit yourself by, what consumers want.

How To Generate a Customer Satisfaction Analysis Report

Posted on May 1, 2022May 7, 2024 by Emily Louise Spencer

When your customers are not satisfied with the services you provide, they tend to look elsewhere for their next set of purchases. In the age of eCommerce, where alternative providers are easy to find, over 80% of customers are ready to switch companies after merely a single bad experience. This is very bad news if you want to stay in business, since it’s generally much much easier and cheaper to retain existing customers than it is to attract new ones.

While it’s expected that there will be some people walking away unsatisfied, you need to keep track of the levels of customer satisfaction you provide and act on any deficiencies you notice. There are several metrics which you can use to measure customer satisfaction, with the choice of which to use being up to you depending on your specific needs.

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What Does a Customer Satisfaction Report Aim To Do?

The ultimate goal of a customer satisfaction data analysis report is to measure customer satisfaction levels. This might seem straightforward, but depending on what it is you’re looking at specifically you will want to use different metrics.

There are a myriad of ways to get information, but all have a fatal flaw — you only get answers to the questions that you put on your survey! How specific are you supposed to be in your survey questions? The more specific your questions the more quantifiable your data will be, but overall less specific too as your customers are limited in expressing their views. Using several metrics will give you a good handle on different perspectives, but in turn will make your data harder to analyze.

Types of Customer Satisfaction Metrics

There are several different metrics you can use in order to measure your customer satisfaction score. Below we’ve listed a few of the most useful and commonly used ones, and a little bit of information about them.

Customer Satisfaction Score (CSAT)

The customer satisfaction score is a direct measure of the satisfaction customers had with a particular interaction or process they went through with your organization. It’s usually measured using a scale from one to five, with one being extremely dissatisfied and five being extremely satisfied. Those who rated the interaction a four or five out of five are counted as satisfied customers, with all others being dissatisfied. The percentage of customers who are satisfied with your service is your CSAT score.

The CSAT scale is good for fine details, as each interaction can be rated out of five to get a look at the overall quality of each step in an interaction. You should be aware, however, that there is a cognitive bias involved – people tend to fixate on a standout experience, whether good or bad – thus your responses are likely to be biased towards the extremes.

Net Promoter Score (NPS)

The net promoter score is used in cases where you want to look at the long-term customer satisfaction and/or loyalty to you and your brand. NPS looks at the overall experience a customer has had with you, rated as a percentage of those who would promote you vs those who would actively discourage others from interacting with you.

The NPS has been criticized as flawed by some due to its methodology, which actively ignores those who seem indifferent. The method assumes that, due to the human tendency to only create buzz after either a very good or very bad experience, others who those indifferent customers come into contact with will have no impact on your overall reputation.

Customer Effort Score (CES)

The customer effort score is different to the previous two metrics, as it measures not the experience but the amount of effort that a customer had to put in in order to get what they wanted out of an interaction with you. It’s usually measured in a percentage, similar to CSAT, with customers rating your interaction out of seven and those who score five or above being counted as satisfied.

CES is one of the strongest predictors of whether a customer will return to you, as many consumers seem to prefer settling for a lower quality product or service that is easier to obtain. Think about it – would you fly all the way to another country simply to obtain a slightly better quality product, or settle for one you can find in your local high street?

How To Collect Your Data

Once you’ve decided on a metric to measure, you need to decide on your method. The most common way of gaining data for customer satisfaction scores is surveys, both at the point of sale and after the fact.

The layout and style of your survey is decided for the most part by the metric you’ve chosen, however you can add more questions if you feel like it. Remember though, while shorter surveys give you less information they are more likely to be completed!

The metrics described earlier generally have the following layouts:

CSAT: A series of questions about satisfaction levels, with answers from 1-5 (very bad to very good).
NPS: A single question – “How likely are you to recommend this product or service” – with a rating out of 10 (not likely at all to extremely likely).
CES: A series of questions about how easy customers found it to interact with you, with answers from 1-7 (very difficult to very easy).

Additional questions should be added on after the questions about the main metric, and making the option for additional feedback optional will definitely help when you’re gathering data. Remember, most customers will want to just tick a box and be done with your survey, so forcing them to input detailed information will cause a lot of them to simply abandon their feedback – the last thing you want.

Exactly when and how the survey is distributed will also vary by metric:

CES focused surveys should be issued at the point of sale or immediately afterwards such that the experience is fresh in the customer’s mind.
NPS focused surveys should be issued after several interactions with a customer, and can be done at any point so long as the method of distribution is not intrusive.
CSAT focused surveys can be issued at any point during the sales process, and in fact can be broken down into several questions that are asked at each step in the process so that the experience of each step is examined rather than the overall experience. This is much easier to do in online spaces, where you can have feedback popups appear without disrupting the overall experience too much.

You should try to keep such questions to a minimum however, as repeatedly asking a customer to leave you feedback can get irritating and may even cause them to leave.

Analyzing Your Data: Quantitative Results

Once you have your data, the next step is to analyze it. Using software you can easily filter through thousands of responses to give overall scores, but what that software spits out is decided by you. Computers are very good at working with numbers, so this step should be quick and easy to perform.

Common ways to break down survey responses are:

By demographic
By location
By which product or service is being examined
By the number of interactions a customer has had with you

These categories will all give you more detailed insight into how your customers think. Are there differences between new and existing customers? Is there a particular product that is causing problems? In theory you can assume that repeat purchases are a good sign of customer satisfaction, but are there alternatives available in that particular sector?

Analyzing Your Data: Qualitative Results

If you’ve added space for additional write-in feedback, you’re going to get text responses. This type of feedback isn’t something that can be reduced to a set of numbers, so a more detailed analysis is needed. Luckily, the number of people leaving write-in feedback is usually small, and limited to those who have had a particularly good or particularly bad experience with you. The more detailed information that such feedback provides is more valuable in uncovering a customer’s motivations and feelings than a single tickbox.

Computers can help you with your qualitative feedback in some respects. Text mining and other tools can help separate out those pieces of feedback that are similar, adding some order to the madness that is raw text data. You can also use sentiment analysis to extract the intended meaning of the text rather than simply filtering by the words a review contains, though you will require specialized software to do so.

Overall, quantitative data tends to show you where you stand and what your customers think of you, while qualitative data tells you why that is the case. It’s not perfect by any means, but you can only work with the information customers are willing to give you.

Visualizing Your Results

There are plenty of ways to visualize results. Bar charts, pie charts, simple graphs – all of them have a place in presenting your customer satisfaction data and can be useful at times. Overall, your aim when presenting the data is simple – make sure that the general results can be understood at a glance, with the more specific results being available when you examine them more closely.

What you want to examine determines your presentation. Want to take a look at customer satisfaction before and after a new protocol or procedure is implemented? A score vs time graph is probably your best bet. Do you want to compare across demographics? Bar charts are your friend. Want to produce a simple chart that will give the current satisfaction rates at a glance? Pie charts are delicious.

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Additional: Churn Rate

Another potential source of information is your churn rate, which is the percentage of customers that cease interactions with you without leaving any kind of review or rating as feedback. There will always be those who simply don’t want to leave reviews – they see it as wasting their time and don’t want to provide feedback to an organization they’re dissatisfied with.

If you have a high churn rate, it’s safe to say that you have issues. By taking a look at when and where the customers leave you, you can hazard a guess as to what the underlying issues might be. You won’t be able to get as detailed information as if you had feedback on the topic, but it’s better than nothing at all. Your churn rate can also be used to verify the results of other forms of customer satisfaction analysis, making sure that their predictions match up with reality.

Of course, this isn’t applicable to every industry. When buying a car, for example, a high churn rate would be seen as successful as the customer has settled and is satisfied with the car that the dealership has provided them with. This is something that’s true for every metric we’ve described today, so keep in mind how the specifics of your industry might make things vary.

Additional: CSAT & DSAT

CSAT (Customer Satisfaction Score) has a counterpart in DSAT, or Customer Dissatisfaction Score. While you may think that is simply the inverse of the CSAT score, keep in mind that the CSAT score takes into account only those customers who are deemed “satisfied” and ignores those who are indifferent.

The DSAT is the percentage of customers who are actively dissatisfied with their interactions with you.It’s taken from the same survey as the CSAT, and takes those who answer 1 or 2 out of 5 to be “dissatisfied”. In this way, it counts the truly dissatisfied customers rather than those who merely seem indifferent to their experiences.

The DSAT is important to keep an eye on, some might say even more so than CSAT. It actively identifies problem areas and reasons why you might be losing customers. From the data that the DSAT provides you should be able to perform a root cause analysis and improve the underlying issues rather than simply attempting to smooth over surface level problems.