Mining gold from Amazon reviews

Would you buy a product with an average three-star review on Amazon.com? Probably not. In fact, makes of consumer electronics consider a rating of fewer than four stars the kiss of death.

Ratings and reviews have assumed such importance in e-commerce that an entire industry has sprung up around analyzing and interpreting them. And for good reason: A TrustPilot survey found that nearly nine out of 10 consumers regularly read reviews before buying products.

Whether you sell on Amazon, eBay, Walmart, or your website, you can use reviews to fine-tune your product (and pitch), fix problems before they become crises, and even discover new market opportunities. That’s what Thrasio does. The contract manufacturer started in 2018 selling a milk frother on Amazon and has since built a substantial business acquiring small e-commerce companies, aggregating their products, and applying specialists in marketing, search engine optimization, logistics, and other disciplines to boost sales. Today its business encompasses more than 200 brands.

David Toledo, Thrasio’s vice president of product strategy and development, recently gave me a peek into how the company leverages Amazon reviews and metrics to tweak its portfolio and even develop new products. Our discussion focused on Amazon because that’s where Thrasio sells the vast majority of its products. Every e-commerce site has an assortment of metrics.

Early warning systems

The value of customer reviews is in both quality and quantity, Toledo said. The more positive reviews you have the higher the barrier of entry to competitors. Don’t obsess about the occasional complaint. A 2018 study by G2 Crowd and Heinz Marketing found that two-thirds of B2B buyers like seeing a mix of positive and negative reviews, saying they make the positive feedback more credible.

“I always tell my team we’re looking for problems, not solutions,” Toledo said. “Reviews are where you find problems. If we see something over and over it raises questions.” If the bad feedback starts on day one, there’s probably a design problem. If there’s a sudden spike, it’s probably a bad batch and requires a different solution.

There are plenty of tools to help. Vendors like Helium 10 and Jungle Scout provide a full suite of services for selling on Amazon, including sales trackers, keyword analysis, and trends in customer ratings. Thrasio uses algorithms that look at the words reviewers use to interpret positive or negative sentiment.

That analysis led to a design change in an electronic bug catcher the company was selling. “By far, the most complaints were that it didn’t catch fruit flies well, followed by it being too loud and too bright,” Toledo said. The company added speed and brightness controls to the fan and a capsule that holds apple cider vinegar to catch fruit flies. The average star rating increased from 3.5 to 4, putting it on par with competitors.

Idea generators

“We also look at competitors’ reviews to see what people like about other products,” Toledo said. “Ideas for line extensions come from there.”

For example, the company used Amazon’s brand dashboard and market basket analytics to discover that many buyers of its coffee canisters were also buying coffee grinders. One particularly well-reviewed competitive grinder was drawing some complaints because it lacked a lid. So Thrasio designed a hand coffee grinder with a silicone lid that was “easy to take on and off, dishwasher safe, and had a nice tactile feel,” Toledo said. “It has been performing well since it was launched in 2021 and is consistently within the top 20 performing coffee grinders on Amazon.”

Amazon reports can offer up a bounty of insight. Sellers can see the most-searched-for terms over a specified period and the purchases that resulted. They can also see what other products shoppers compared to theirs as well as the top competing items they bought. All this can yield design changes and new product ideas.

Can you trust reviews?

E-retailers have battled review fraud – with mixed success – since day one. It’s a whack-a-mole game with the manipulators constantly finding new ways to skirt the rules. “People have by and large stopped manipulating their reviews so instead they attack other people’s pages,” Toledo said. One novel twist is to leave fake positive reviews and then complain that the seller has been buying them. Sellers need to keep an eye on their reviews for signs of mischief, since e-retailers are unlikely to catch it for them.

Amazon maintains tight control over communications between sellers and buyers. The retail giant revoked the ability for sellers to comment on customer reviews early last year and now limits e-mailed review requests to just one per purchase. The best practice Toledo recommends, “is to include an insert in the product asking for a review. Don’t try to influence the buyer. Talk about your business in human terms.”

And to answer the question that I know is in your head: The “Amazon’s Choice” label is applied to the best-selling products that match the keywords the customer uses. No human judgment is involved. Are you surprised?

Next read this:

How To Improve Your Product Listing On Amazon

The State of Amazon Reviews in 2021

How to Get Reviews on Amazon (5 Proven Ways)

5 Ways to Get 5-Star Amazon Customer Reviews

How to Get Reviews on Amazon in 2022

New digital storefronts shake up online retail—and advertising