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Why Brands Need to Leverage UGC During the Recession

June 21, 2023 | Author:  Guest
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It's no secret that the economic downturn caused by multiple world-shaping events has put a strain on businesses everywhere. With traditional marketing strategies unable to keep up, many online brands have turned to user-generated content (UGC) as an effective way of engaging their customers and staying ahead of the competition.

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User-generated content helps e-commerce platforms leverage their existing customer base to create brand awareness, build trust, and establish customer loyalty while also driving sales.

This article will explore why leveraging UGC during this recession is essential for online sellers who are looking to stay afloat in these challenging times. We’ll look at how user-generated content can help increase visibility, drive engagement, generate leads, and boost conversions while saving money in the process.

By understanding how your customers are viewing and using user-generated content in their online shopping decisions, you can leverage it effectively to get through this difficult period with success!

What Is UGC?

Put simply, user-generated content (UGC), sometimes known as user-created content, is any type of content that has been created and shared by customers instead of by an official company or brand.

Common forms of UGC include:

  • Photos
  • Videos
  • Audio content
  • Reviews
  • Testimonials
  • Comments
  • Blogs
  •  

User-generated content examples can appear on a variety of sources, including official company websites, social media,  platforms, online forums, and channels produced by Internet  influencers.

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A testimonial submitted directly to your online shopping site? That's UGC. A user comment on your official store Facebook? That's UGC. A YouTube video discussing the pros and cons of an influencer's latest purchase from your e-commerce brand? That's definitely UGC.

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Why E-Commerce Brands Turn To UGC During Tough Economic Times

When times are tough, such as during a nationwide or even international recession, e-commerce sellers turn to creating UGC. This is because online businesses can use information gleaned from user-generated content to learn what their customers want and need even as they have less cash to spend.

By getting a better handle on consumer desire and demand, your online shopping site can create the right user-generated content strategy to stay on top of customer engagement and produce more sales.

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Calculating the ROI Of User-Generated Content

One of the best ways to understand the potential benefits of UGC for your e-commerce brand is by learning how to determine its efficacy. Calculating the ROI of user-generated content requires an analysis of online customer engagement, overall reach, and sales impact.

To start, calculate how much it cost to leverage user-generated content in terms of time spent creating or curating content. Then, determine the genuine engagement level that UGC has created for your company. This should include analytics such as likes, shares, and comments generated by UGC posts.

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With this information, you can measure the return on investment for each individual piece of user-generated content and determine whether or not developing that content was worth the effort.

You should also measure the impact that user-generated content has had on your e-commerce brand’s visibility and sales. You can do this by looking at how many visits to your online store were driven from UGC, as well as by checking for any increase in sales or loyalty that resulted.

Once you've collected and analyzed this information, you can make decisions about how to leverage UGC more effectively in the future for greater impact.

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The Benefits of Using User-Generated Content

Making use of UGC can be a boon for you as an e-commerce seller, especially during times of economic difficulty. Advantages range from drawing in more potential customers (even when they’re less willing to spend) and maximizing conversions to establishing a solid ROI and raising your SEO rankings.

When added up, the assorted benefits of user-generated content combine to create more value for your money while expanding the reach of your brand to additional future buyers. Perhaps most importantly, it establishes the kind of  trust and social proof that your online shopping business needs in order to maintain a long-term customer base. That kind of customer loyalty can follow you long after the recession is over.

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UGC Has Been Shown to Attract More Customers 

Research has consistently shown that leveraging user-generated content in marketing campaigns can help to attract more customers and drive the higher levels of engagement your e-commerce company needs to stay ahead of the competition.

Basically, UGC brings in more online buyers by establishing a baseline level of trust that isn’t as easily created when a prospect is interacting with content that was created by the company itself.

For example, a  survey conducted by BrightLocal found that nearly half of consumers trust content created by other users, such as  online reviews, as much as they trust personal recommendations.

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Furthermore, 89% of respondents indicated that they were more likely to purchase a product or service from a company that interacts with customer reviews and other forms of consumer-generated content.

Because e-commerce customers often find UGC to be more trustworthy, this type of content has a higher chance of creating interest in what your online retail business has to offer. And when people are already reticent to spend their hard-earned money during lean times, that type of genuine interest can make all the difference.

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UGC Increases Conversions

UGC has proven to be an effective way for online sellers to leverage their existing customer base and increase conversions during a recession. For instance, a survey conducted by  MAVRCK found that user-generated content featuring a given brand saw 6.9x greater engagement than posts and other content created directly by the business itself.

In addition, Everyone Social reports that campaigns that include UGC boast a  29% higher web conversion rate than initiatives that don't utilize user-generated content. This means that not only is user-generated content reaching more eyeballs, but it is also netting more attention from serious online customers who are willing to spend real money.

Similar to the benefit listed above, this is likely because the social proof created by UGC is more convincing to customers than marketing content that has been produced by the company itself. The name of the online shopping game is trust, and consumer trust matters even more during an economic downturn.

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UGC Is a Powerful Marketing Strategy 

One of the reasons that UGC is such an effective and game-changing marketing tool for e-commerce brands is that it helps to leverage existing customers, increase visibility and engagement with buyers, and drive leads and sales.

One of user generated content’s greatest strengths is its ability to make an online company and its products seem more personable and approachable. For instance, nearly half of marketing experts surveyed by TINT in 2018 reported that they believed that UGC was able to humanize their marketing.

As more businesses are closing their digital doors thanks to the recession, standing out from the competition has become more important than ever.

Strong Return on Investment

User-generated content provides a great return on investment for e-commerce sellers who are trying to take advantage of every spare penny during a recession. For example, research reported on by Annex Cloud found that leveraging UGC in marketing campaigns yielded an average of  5X return on ad spend, meaning significantly more bang for your buck.

User-generated content is also a great way to make use of existing data and leverage customer engagement to maximize the return on investment during times when budgets are tight.laptop computer on glass-top table

UGC Has Been Shown to Increase Sales, Even During a Recession

Research has shown that a UGC campaign can help to increase sales, even during a recession. Prospective leads are  41% more likely to be converted to sales when they see real reviews left by real customers on a brand’s website.

Plus, millennials and members of  Gen Z, demographics that have a higher view of UGC's credibility and are more willing to share user-generated content, are growing older and consequently garnering a higher disposable income. Even as the economy faces a downturn, members of these demographics are still interested in making online purchases based on user-generated content.

Improved SEO Rankings

Using UGC to leverage existing customer data while simultaneously increasing visibility and engagement with buyers can have an incredibly powerful effect on your e-commerce business' search engine optimization (SEO) rankings.

For example, web users spend nearly  twice as much time on product pages that feature photos, videos, and other forms of visual user-generated content. The more time visitors spend on your online retail website, the likelier that Google and similar search engines will view your site as a high-quality resource. This improved view of your e-commerce store means a higher spot in search engine ranking pages (SERPs).

The strengths of UGC and the fundamentals of SEO intersect at multiple points, including the importance of content marketing, the use of keywords that are important to your specific demographic, and the power of online user experience.SEO text wallpaper

UGC Can Help E-Commerce Sellers Create Engaging Content to Sell More Products

User-generated content can be a big help for online retail companies when it comes to creating interesting and engaging content. To take one example, Comscore found that customers are 28% more likely to engage with a brand if they are exposed to a combination of UGC and brand-created video content.

This means that leveraging UGC is a great way to stand out from your competitors and capture the attention of potential digital customers during a recession. Furthermore, when it comes to producing dynamic content, especially on social media, collaborating with online influencers or leveraging digital customer reviews can be a great way to get the most bang for your buck.

Not only that, but the social proof created by UGC makes online customers more willing to pay more to match prices that have been increased during a recession. This creates a win-win situation where consumers get exactly the products they want while allowing brands to survive during an economic downturn.

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UGC Is Redefining Branded Content

User-generated content has evolved significantly in recent years and is now redefining the meaning and perception of branded content on the web. Customers are increasingly looking for meaningful interactions with e-commerce platforms, so they prefer content generated by people they can relate to rather than traditional marketing messages from companies.

Authentic user-generated content can help e-commerce sellers build trust and relationships with customers, which is especially paramount during the uncertainty and ambiguity of an economic recession.

How To Get Started With UGC For Your Company

There are a few practical steps you need to take to implement UGC for your own e-commerce brand:

  • Establish a clear vision and objectives for taking advantage of user-generated content.
  • Consider the different types of user-generated content that are available and decide which ones are right for your business. This could include anything from customer reviews, influencer marketing, or product unboxing.
  • Put your strategy into practice by creating content guidelines and incentivization plans (if applicable).
  • Take decisive action on feedback from consumers by responding to reviews, complaints, and social media comments quickly and professionally.

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Don't be afraid to utilize UGC in your own marketing efforts, including your email campaigns and website copy.

As you explore the many avenues of user-generated content available to your e-commerce platform, you should keep track of results through analytics tools that measure the effectiveness of your campaign. At the same time, you should analyze data collected from customers about their preferences for product features or other aspects of their experience.

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Together, these two streams of analytic data can empower you to create the ultimate online image that your company deserves. Plus, tracking the success of your user-generated content campaign allows you to determine ROI and measure your overall success.

Conclusion

As e-commerce brands thrive to survive during the recession, UGC can be an effective way to take their sales to the next level. By following our advice, you can create engaging branded content that resonates with consumers.

Start leveraging UGC today to ensure your online business stays afloat and builds trust through these challenging times!

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