For a merchant trying to build a compelling assortment, ensuring that you have the right coverage of the top brands in each category is critical.
Brands significantly influence consumer purchase decisions. But aside from carrying the top brands, it is also essential to track and manage your “Share of Voice” for those brands.
In today’s online retail world, consumer voices are easily accessible in the form of reviews, which are an important demand signal that gauge the popularity of products and brands. The best way to understand a retailer’s Share of Voice (SoV) for specific brands is to compare the reviews for brands across retailers.
But you may ask, “Why does ‘Share of Voice’ matter? And why do I need to track it?”
For starters, knowing your Share of Voice will help you:
- Identify your closest competitors -- Share of Voice gives retailers a sense of their competitiveness for key brands, and insights into their closest competitors for those brands.
- Link with sales – SoV reflects past performance on a brand (a growing number of positive reviews indicate a popular product), but it can also impact future sales. If consumers see many positive reviews for a product on a retailer’s site, they are more likely to view that product (and retailer) positively and be more likely to convert.
- Drive organic search traffic -- Better content, especially consumer-generated content such as reviews, also drives search ranking. Therefore, a high SoV can result in more search traffic to your site.
- Input for pricing – Once you identify your closest competitors (see #1 above), you can adapt your pricing strategy based on SoV. For example, your prices may be inelastic for a competitor who has a much lower Share of Voice than you. If that competitor lowers prices on a brand’s products that you also carry, you may not need to react at all.
In the four brand charts below, we plotted the retailers on the following variables:
- Number of reviews across all retailers for the brand’s products carried by the retailer (X Axis)
- Number of reviews on specific retailer sites for the brand’s products carried by the retailer (Y Axis)
Let’s take a look at the results. In this chart, a bigger bubble means that the retailer carries a higher number of products from the brand. Bubbles that are further to right indicate a higher number of brand reviews on the Internet. Retailer bubbles that are higher on the Y-axis have the highest number of customer reviews on their site only.
A quick glance at the percentages next to the bubbles gives you a snapshot of their Shares of Voice.
Consider the graph for Nike (top left). You’ll notice that Foot Locker (the black bubble) stands out with the highest Share of Voice – with about 4,000 reviews for the 87 Nike shoes on its site. There are a total of 5,600 reviews of those same shoes across all retailers, so Foot Locker has a 71% SoV. Despite carrying more Nike shoes (94), the retailer Finish Line (blue-grey bubble) has a far lower SoV. Therefore, Foot Locker has the possible edge for being able to convert more customers looking for Nike shoes.
Amazon doesn’t carry Nike* and isn’t included on that chart, but for the remaining three key brands, Amazon has the highest Share of Voice. Amazon’s SoV dominance is most visible (its orange bubble stands alone) for Asics, the brand with the highest number of reviews, and for New Balance. For those two brands, comparing yourself with Amazon may not be relevant and it would be more effective to compare your Share of Voice with other retailers. For example, for New Balance shoes, Zappos (51%) is doing much better than Foot Locker (10%) with capturing consumer feedback.
Once you start tracking your own Share of Voice, you’ll discover how much your customers think of you as their go-to destination for specific brands. Consider programs that can drive organic reviews on your site.
Want to track your Share of Voice for key brands in key categories? We can help…
*Amazon doesn’t carry Nike, but Nike shoes are available through third-party retailers on Amazon Marketplace.
Savino Lobo is an AVP at Ugam and is part of its retail analytics solutions team and oversees the assortment intelligence solution. He is passionate about leveraging democratic data to help retailers make better assortment decisions. Savino has over 12 years of experience developing research and analytics solutions. Outside of work, Savino enjoys traveling and trying cuisines from around the world besides spending time with his twin 3 year old boys.