Predicting the future is hard in any subject; arguably it’s hardest of all in the field of technology. Indeed, as the technology journalist Warren Ellis wisely points out, “it’s best not to get involved in the business of prediction. It’s a quick way to look like an idiot”.
But there are things we do know that can help us look at future in a better context leading to more accurate predictions and less sounding like an idiot.
One of the current technology predictions is that brands are going to die due to Amazon and its product reviews.
It’s obviously important to keep an eye on what is now one of the worlds most powerful companies – especially as their business continues to expand into more markets and more countries. However, to think that user reviews are going to kill brands really is verging into the idiotic space.
The main reason the ‘brands are dead’ crowd gives for the untimely passing of brands is that user reviews are more trusted than advertising. This claim has a number of flaws.
Firstly, it implies that marketing needs to be trusted to work. However, a quick glimpse through several of the more effective campaigns of recent times—John Lewis, Old Spice, Cadbury Gorilla to name a few—suggests that this is not really true. There’s no real message to trust or distrust, just likeable stories about a travelling snowman, a drumming Gorilla or a topless horseman (though clearly trust is an outtake from the campaign likeability).
The second flaw with the ‘reviews beats advertising because they’re trusted’ line of thinking is just how untrustworthy consumer reviews really are. Short of some of the recent Facebook data they’re possibly one of the least trustworthy sources of data on the Internet. They are almost always based on a single product experience so rather than trying all possible cameras or toasters or cars in a given price range and then reviewing which one was best they review only one product. This is an okay system for pointing out utterly dreadful products (which are extremely rare) but it’s terrible for working out a ‘trusted’ ranking for products. Furthermore, every person has a different list of important features with which they judge a product's rating and this number is then also influenced by differences in how people might feel about the numbers themselves – for every person that thinks that 3/5 is a good score there will be someone else who thinks 3/5 is a pretty lousy score.
There are a host of other issues that further discredit the trustworthiness of user reviews such as how representative the user review base really is (is it biased by a distorted number of lovers or haters?), how many reviews there are in proportion to the total number of buyers (is it statistically valid) and also, somewhat ironically, the influence of brand perception on product experience. This latter point has been studied at length and is the reason why similar people can rate even the exact same product so differently.
So it’s little wonder that in 2016 a study from the University of Colorado comparing user ratings with ratings from evidence-based consumer reports across 1,272 products in 120 categories, found virtually no correlation between the two numbers at all. Among other things, they found the consumer reports to be predictive of resale value whereas the user reviews were not.
It’s hardly the first time brands have been about to die; social media was also supposed to achieve this. But it’s fairly easy to put to bed both of these claims by using a rudimentary understanding of human behaviour and/or statistics. Although, personally, I’m rather grateful to the people that continue to make these types of wild accusations because they’ve given rise to a number of very enjoyable talks from the likes of Mark Ritson and Bob Hoffman.
Without wanting to get too much into prediction and risk sounding like an idiot, (or as my friends would probably say sounding like even more of an idiot) I expect Amazon to continue to have a substantial effect on the retail sector as it expands around the world and gets the likes of Alexa up and running but if it does kill brands (which I think extremely unlikely) it will not be because user reviews are more trustworthy than advertising.
- Simon Bird is the group strategy director at PHD.