Is getting a four-star rating from a customer better than getting a five-star review? That’s one of the questions on the mind of Professor Jeroen Rombouts, Accenture Strategic Business Analytics Chairholder. Earlier this year, Professor Rombouts invited me to speak to a group of graduate students pursuing an MBA or Master’s degrees in Management. Following that presentation, he and I have continued our discussion of business challenges and opportunities – including digital first, the last mile and some surprising insights about online customer ratings.
One of the central themes of my talk was what it means to be “digital first” and how the pandemic has accelerated customer expectations. More specifically, I talked about how that would look when starting a new business. Professor Rombouts has said the students were intrigued by my advice to focus first on the digital presence you want to create – not the products you’ll sell: “You made a clear impression that it’s important to build the customer experience online before even considering the physical world. If you’re starting a restaurant, for example, you need to determine how to link your kitchen to the digital world long before selling any food.”
What’s interesting is that even as entrepreneurs need to be “digital first,” they also share a key challenge with businesses of all sizes: the last mile. How to deliver in a timely, reliable and sustainable fashion is emerging as the great challenge and opportunity of our time.
Professor Rombouts agrees: “Whether customers are buying a book or a meal, they want to receive their purchase in a two-hour slot and they want real-time tracking along the way. But they also want their delivery done in a green way. Here in Paris, that means having it delivered via bicycle. Young people don’t want an old truck pulling up to their home while spewing air and noise pollution. That’s something we weren’t seeing until the past two or three years. These are among the challenges we can solve using data and analytics to optimize last-mile logistics.”
Another area of interest for Professor Rombouts is the role of online ratings, which have become paramount in this “digital first” world. His secondary research has uncovered some interesting findings about which ratings are most likely to be viewed as credible by customers. Companies with low overall ratings may be hard pressed to attract new customers. But companies with too many five-star ratings may also encounter skepticism.
As Professor Rombouts explains, “Businesses would be wise not to strive for 100% five-star ratings. Customers may assume that excessively positive reviews are coming from family members, employees or other people sympathetic to the business. When a company receives a two-star review and responds authentically to the negative feedback, those online dialogues can be more impactful than a deluge of five-star ratings.”
“In the end, it’s better to have a thoughtful four-star review that shares an interesting story rather than having a short five-star review that says, ‘Everything was great and I love this company.’”
As we continue to navigate the digital first world, customers will increasingly care about more than the number of stars in a review. They’ll look for recency. And they’ll demand relevance. Professor Rombouts says personalization of ratings represents another opportunity: “How couples rate their experience at a resort may be less interesting to parents booking a trip with young children. And someone looking at a product available in many colors and/or sizes may want to filter reviews based on precisely what they’re evaluating.”
I thank Professor Rombouts for our continued collaboration, and I encourage everyone to explore other thought leadership on digital transformation and the last mile.
By Edwin Van der Ouderaa
