Online customer reviews increase loan sales
2010-07-01
While the idea of allowing customers to post their own comments about particular products can be frightening for many companies, Bank Technology News reports that many financial institutions have found increased customer interest in their product line after including moderated comments on their websites.

The loan network LendingTree told the magazine that while it had collected reviews for many years, the comments weren't available to the public. After hiring a screening provider to handle issues like profanity in the comments, the feedback went live in July 2009. A few months later, the company said this addition to its customer loyalty solutions had already made a significant positive impact. Analysis of the comments found that those who read comments by other customers were 83 percent more likely to pursue a loan.

"Customers expect to read other consumers' reviews of products and services, and it can be great from a viral marketing perspective. In the future, those [financial institutions] that don't put this information on the site will be at a disadvantage," Tom O'Neill, director of site innovation at LendingTree, told the magazine.

Forrester analysts told BTN that the situation is reflective of what happens with most banking products, and people are more likely to rely on the recommendations of others - whether online or otherwise - before choosing a particular institution or banking product.

"This technology fits in with how people make decisions anyway. I think this is very interesting," Brad Strothkamp, principal analyst of e-business/e-commerce at Forrester, told the magazine.

Another institution that has seen a positive response since allowing customer reviews is USAA. Insurance Networking News reports that since starting the program, the company has seen an improvement in the proportion of people who view a product online compared to those who start an application.

Before the bank launched the comments online, it said that 28.4 percent of shoppers who looked at auto loans on its website started loan applications in the same session. Since the switch, that percentage has risen to 30.1 percent. A similar improvement was seen with the institution's auto insurance policies, which saw the same statistic jump from 30 percent to 31.2 percent.

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