Should you be investing in User Generated Content?

By Will Gillingham

You’re probably familiar with product reviews. In the digital age in which we live, it’s increasingly easy to leave a trail of commentary dotted around the internet. Reviews have permeated the boundaries of the dedicated review sections of product websites, and have exploded onto the social media scene. Pictures can be uploaded in seconds, and a tirade of Tweets can be launched from the Tube carriage on the morning commute. Is it possible for retailers to take advantage of this flow of conversation?

On 12th July, IMRG and LiveArea hosted a webinar which discussed UGC and an up-and-coming (possibly already here, even) phenomenon in online retail: social commerce. IMRG’s Director of Strategy and Insight, Andy Mulcahy, sat down with Geeta Randev, Performance Marketing Manager at LiveArea, to discuss the pros and cons of implementing UGC in your business strategy.

Read on for the top takeaways from our UGC debate or access the full webinar: Building trust and authenticity in your brand with user-generated content.

‘Today, people can react to things in real time’ – Andy Mulcahy

‘Instant gratification’ is a phrase that is used time and time again to describe today’s populace. ‘In the modern day, technology enables you to do whatever you want, whenever you want’ (Mulcahy), with this predominantly being true for media newsfeeds. The average Brit checks their phone 28 times a day, skimming over their notifications and scrolling their social channels.

It’s no wonder, then, that this new-fangled habit is impacting on retail. Like it or not, customers are discussing products: commenting on late delivery, posting pictures of new make-up. On YouTube, there are 20 million search results when you type in ‘unboxing’. Customers expect this instant lifestyle to be present in their communication with brands, also. They want queries to be answered imminently: ‘real-time interaction is very important to integration with the customer’ (Randev).

Man on phone at a train station

Some brands have already begun to streamline their online presence for the digital age. The photo-based social media site, Instagram, has a button which allows people to instantly buy products directly from their site, while eBay have recently launched an image-search software, which allows people to take pictures wherever they are, and search for alike products on the site through uploading the image.

From this, you may believe that increasing your UGC resources seems like a no-brainer. But, Mulcahy warns, it’s to be taken with a pinch of salt. He says, ‘What social commerce can do, if implemented in isolation, is remove everything that is logical about shopping. There’s a risk with social commerce that you’ll use it to sporadically sell as much stuff as possible. People might end up buying things in the spur of the moment, and then simply end up returning them.’

Will social commerce generate revenue?

The numbers say yes. You are 5 times more likely to get clicks on an ad that contains UGC, and this is owing to the fact that ‘we automatically resonate with a product that has a human element’ (Randev). Further to this, there are statistics to show that 93% of customers say UGC helps inform their decision, there’s a 29% increase in sales when UGC is implemented, and 69% of customers will upload a selfie with their purchase.

Retailers also have the ability to incept their own UGC. Interacting with social movements or campaigns which align with their customer base allows a relationship to grow between the customer and the retailer based on common values, which in turn can increase sales. For example, ‘Missguided encouraged people to celebrate themselves on National Women’s Day, which boosted sales without them pushing their own product’ (Mulcahy).

But before you schedule an emergency UGC meeting, there is, as always, a flipside.

Likes on social media

The flipside

UGC, despite its surface appearance, isn’t free advertising. In fact, ‘to manage and track UGC, it can be quite expensive’ (Randev). Even if your brand offers a dedicated platform for customer interaction on your website, you also need to be clocking every other debate about your products, to the best of your ability. The influx of discussion across multiple channels can be difficult at best to monitor, and an in-house monitoring team may be necessary (depending on scale).

There are also two specific sectors that are ‘revelling in social media success’ (Randev), namely, make-up and fashion. It’s not a universal wishing well. ‘It might be harder to implement if you don’t fit into one of those verticals’ (Randev), and because of this, UGC can represent a risk if not handled carefully.

And the risk isn’t only sectorial. Arguably, the most potent risk is in its novelty. ‘Social commerce is new, and is evolving rapidly. We don’t know where it’s going’ (Randev), and any investment made without historical assurance is liable to have a ‘short shelf-life’ (Mulcahy). However, with these challenges acknowledged, the implementation of UGC is certainly a conversation worth having.

Plant beginning to grow

How to get started with UGC

There is an important factor to be aware of when utilising UGC, and that is to remember that it is not primarily a revenue generator. It’s a way to increase brand exposure. It’s a ‘mechanism for people to talk about your brand outside of the platform’ (Randev), which, in turn, will hopefully drive traffic to your site. A rule of thumb to work by is that ‘a consumer will shout about it if it’s worth shouting about’ (Randev).

Whether you’re aware of the discussion or not, people are talking about your brand. ‘People aren’t going to retailers for advice – they’re going to other people’ (Randev), and there are two specific elements of the customer journey which they will be discussing: ‘the purchase and the delivery’ (Mulcahy). It is recommended, therefore, to make these the best they can possibly be. Give people a reason to advocate your product, rather than disparage it: control the flow of social content.

And ‘don’t think tech-first’ (Randev). If you opt for a third-party partnership, ‘link with a company that will grow as you grow’ (Randev). UGC should primarily be about expansion: expanding your brand’s exposure, expanding your interaction with the customer, solidifying your relationship with these social influencers. That’s what UGC and social commerce are all about, and you and your partners need to be ready to progress at the same speed.

Two people shaking hands

Key takeaways

For those who have skipped straight to the bottom of this article (and, indeed, those who came the long-way around), here are the key takeaways from the UGC webinar:

  • UGC and social commerce is about adding value to your brand, not just bringing in money.
  • Before you take the leap, ensure you have the right skillset in-house to monitor the UGC.
  • UGC is an assistant. It will assist conversions, not become its own channel.
  • Implementing UGC may present costs. Be prepared for these.
  • Hope for the best, plan for the worst: social commerce is new and vibrant, and there’s no saying which way it will go.

Listen to the full webinar: Building trust and authenticity in your brand with user-generated content.

Will Gillingham, Content Executive, IMRG

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