Reviews are important for any product sold online, from a bar of soap to a toaster.
For hair regrowth products, they are even more important, says David De Nino, director of e-commerce at DS Laboratories, an online retailer of hair-care and hair regrowth products.
“Our category of hair regrowth is saturated with false promises and letdowns,” De Nino says. “Consumers are totally used to being let down—expecting to be let down—by those products. Suspicions are super high.”
The best way to combat skepticism is not with a marketing message from the brand, but with a verified customer review, De Nino says.
The purchase likelihood for a product that has five reviews is 270% greater than for a product with no reviews, according to the recent study, “How Online Reviews Influence Sales” from the Spiegel Research Center. The study analyzed more than 100,000 SKUs and 15 million page views of reviews from two consumer packaged goods retailers and one high-end gift retailer over the course of a year.
DS Laboratories has sold its products directly to consumers since 2014, and since July 2016 has sold its products on Target Corp.’s website. While having product listings on Target.com is a great way for the hair-care retailer to increase sales, De Nino knew the products would not generate many sales if the listings had no reviews.
DS Labs works with Baazarvoice and its Brand Edge software to gather the reviews for Target.com, De Nino says. DS Laboratories gives Baazarvoice its list of thousands of customers who have purchased something from DSLaboratories.com. Bazaarvoice contacts those shoppers asking for a product review that will show up on Target.com, and then collects and publishes them on the Target site. DS Labs also will post these reviews on its own site. Most retailers require merchants to use a specific review vendor so the retailer can guarantee to shoppers that the reviews are valid and verified. This also means that the reviews Baazarvoice collects do not necessarily show up on other retailers’ websites where DS Labs sells its products, such as Costco.com.
Within the first four months of launching on Target (No. 20), DS Labs’ overall sales increased 235%, De Nino says. Though the reviews cannot be directly credited for the sales surge, he says he is confident they influence the likelihood that a shopper will buy a new brand.
“Online purchases are super reliant on proof—not just social proof—but consumer-generated content, namely customer reviews,” he says.
When it comes to reviews, more is better, De Nino says. For DS Labs, he estimates that five reviews would be enough to get the product off the ground, but 10 would be much better.
Today, DS Labratories’ five SKUs on Target.com have anywhere from 68 to three reviews. De Nino says he would prefer to have higher numbers, but he knows he would not have even is he had tried to get them on his own, without the assistance of a vendor.
“68 reviews is fantastic,” De Nino says. “If we were to wait for 68 reviews organically—God knows how long it would have taken.”
“Each one matters,” he adds.
Just getting one review on a product can increase sales 10%, and once a product has more than 200 reviews retailers on average receive a 30-40% lift in sales, according to Baazarvoice customer data, says Jake Swenson, vice president of product marketing at Bazaarvoice.
Costs for the Brand Edge review service start at $2,500 per month and go to more than $10,000 a month, according to the Bazaarvoice website.
DS Labs generated more than $3 million in U.S. direct-to-consumer, online sales in 2016, De Nino says. In addition, DS Labs has a business-to-business arm that sells products directly to beauty salons.
Of DS Labs’ 2016 online U.S. sales, about 45%-47% took place on Costco.com (Costco Wholesale Corp. is No. 8 in the Top 500), 45%-47% of sales on its own online store and 8-10% came from Target.com, Amazon.com Inc. (No. 1) and other small marketplaces and niche beauty websites, De Nino says. The retailer started selling on Amazon in May and expects sales there to increase, he says.
The retailer has sold its products on it own website since 2014, and De Nino says more than 70% of customers are repeat buyers.