The Benefits and Challenges of Using User-Generated Content in Ecommerce

User-generated content (UGC) is on the rise because of social media. Customers can now share their reviews and opinions of your brand on their social media channels which can go viral and influence public perception of your brand. Therefore, neglecting UGC in your marketing strategy can decrease your sales and growth rate.

To win the hearts of your customers and add life to your ecommerce business, you need a proper breakdown of how user-created content works. This article will take you through everything you need to know about using user-generated marketing content and how you can benefit from it while overcoming the challenges involved in your business.

What is User-Generated Content (UGC) in Ecommerce?

User-generated content (UGC) is any type of content that customers create to share their genuine opinions, reviews, ratings, and perceptions of your brand. This online content can be in the form of blog posts, video content, text-based posts, and podcasts and is mostly shared on a social media platform.

You can create user-generated content campaigns to attract new customers and convince your leads to make a purchase. The reason is that 70% of consumers use user-generated reviews to judge whether or not to buy a product. 

Benefits of UGC for Ecommerce Businesses in Pakistan

Many successful ecommerce businesses in Pakistan include UGC in their marketing campaigns because of the benefits that come with it. Below are the major benefits of UGC for ecommerce businesses.

It enhances trust

Consumers trust content created by real people. When they can see your products in action without the glitter of traditional advertising and brand-generated content, potential customers are convinced to make a purchase. This can be just as powerful in creating trust as news articles featuring the brand are, and even more so.

It boosts brand awareness

UGC is one of the fastest ways to boost brand awareness because more people are drawn to your brand when they come across a UGC that’s relatable and relevant to their pain points. 

Social media algorithms work in such a way that as more social media users interact with a post, the chances of it going viral increase. This will further expose your brand to new customers. 

Fosters brand loyalty

When you use UGC, it signals to your customers that you care enough about their feedback and thus influences brand loyalty positively. 

Working on brand-consumer relationships is a good way to get them to remain loyal to your offerings and spread your messaging far and wide. 

Improves customer shopping experience

A seamless shopping experience is a value you should strive to offer your customers because they recognize and appreciate it. You can achieve this with consumer-generated content. 

Customers will return to your ecommerce store when they see reviews and photos of real users of the product displayed on product pages. 

It humanizes your brand

Using UGC in your marketing and advertising campaigns can humanize your brand and help you connect deeper with your customers who value authenticity. 

As a result, your brand becomes memorable to old and new customers when they see real people creating UGC about your products. 

It grows your content library

You need content to grow your ecommerce business because it engages and converts leads into customers. However, it can be challenging to constantly plan and create content on your own. 

UGC can be added to your archives for whenever you need to publish engaging and relevant content. 

Increases your conversion rates

UGC works well in increasing your conversions because shoppers consider reviews and ratings from other users before trusting you with their money. 

When you integrate user-generated content into your ecommerce store, it will push customers from the awareness stage further down to the decision stage faster than brand-generated marketing materials would. 

It strengthens social proof

Consumers will not release their money to you if they are not convinced that you are trustworthy. A UGC strategy helps to strengthen social proof, signaling to them that you can deliver value for their money. 

It produces authenticity

You can’t neglect authenticity in the world of ecommerce. Consumers trust authentic content that doesn’t seem forceful like an ad and UGC is the best way to make it happen. 

When shoppers can sense that you are genuine, it becomes easier for them to make purchasing decisions. 

It encourages community engagement

Using UGC in your marketing for your ecommerce business helps you grow a formidable online community that consistently engages with your own content and trusts your offerings. You get your exclusive brand’s community and retain top-of-mind awareness.

It is cost-effective

What makes user-generated content important in the context of a holistic marketing strategy is that it is cheaper. Creating content on your own comes at a higher cost because of the time and human resources you’ll need. 

It boosts SEO

Your website also benefits from UGC as shoppers and users who leave reviews on your website help increase your search engine rankings. The reason is the unique, keyword-rich content that’s regularly updated on your pages. 

Then, when you make a post on your brand’s social media from the reviews published on your website, it directs traffic back to the links which increases your domain authority.

Challenges of Implementing UGC in Ecommerce

UGC can be challenging to implement if you are not experienced. In the paragraphs below, you can see a few challenges you may encounter.

Gaining of the UGC Content Rights

Before posting or repurposing content generated by users on your social platforms, you’ll need the permission of the original creator. Without gaining content rights from the user, you may face legal action.

Gaining user rights from each original content creator can be challenging when you are using UGC in your marketing across different communication channels. To ease this challenge, you’ll need user-generated content rights software that can assist in acquiring content rights from different content owners to integrate UGC on your various social media platforms effortlessly. 

Maintaining Content Quality and Relevance

Another challenge of implementing UGC is the inconsistencies in content production when users submit content. You already have a set of internal guidelines for maintaining content quality but users will not always meet them. 

This can be frustrating but you can solve this challenge by using a social media aggregator tool that comes with a content moderation tool. This will help to integrate valuable user-generated content and exclude insignificant content to maintain the quality of the selection of your UGC.

Managing Negative Reviews and Feedback 

You can’t control the content created by the users to express how they feel about your product or service. This can be challenging because negative content can damage consumer trust. 

You must manage and moderate it so that it does not undermine your marketing strategy. To achieve this, use software tools and platforms that allow you to exclude and pick out UGC that breaks your guidelines and standards. However, be open to constructive and honest feedback that is relevant to your brand.

How to Encourage and Manage UGC for Your Brand

UGC can help you build a relevant and engaging content bank. 

Follow these tips to manage and encourage users to share UGC for your brand: 

• Request feedback from users: Users will leave a review when you ask them to. You can send an email to remind them about dropping a review and they will gladly oblige. 

• Start unique branded hashtags: Creating a unique brand hashtag that easily stands out will help to promote your business on different social channels and find your brand’s user-generated content easily. For example, the #SpotifyWrapped hashtag helps users to identify with the brand. 

• Observe customer trends: Customer trends can help you judge and analyze the types of user-generated content that customers prefer. You’ll also learn the topics, themes, or formats that work best in encouraging your customers’ content creation.

• Organize an Instagram photo contest: You can get more user generated content for your brand when you organize a photo contest on Instagram. You’ll also increase brand awareness, enjoy new social media followers, boosted engagement, and new leads as add-ons.

• Monitor social media mentions: Customers randomly share their recommendations on social media and you can get a mention. A way to manage your UGC marketing strategy is using social media automation platforms to track mentions in real-time. This will enable you to appreciate them quickly and request permission to repurpose or repost the UGC.

• Create an employee engagement initiative: Your employees can help to drive the most memorable UGC for your brand. You’ll be surprised that they might be doing it already without your direct permission. And with a network that’s 10X larger than your company’s follower base according to LinkedIn, creating a social media account for your employees to publish content that they’ve already created can boost UGC for your brand.

• Start an ambassador project: An ambassador project will boost the morale of your users. Brand advocates and brand ambassadors have exclusive perks and benefits while you enjoy them creating rich UGC for your content bank. As you launch this project, ensure to notify your fans and followers about the terms of the program and other benefits that come with it. 

And lastly, you can offer incentives. Offering freebies works well in encouraging UGC for your brand. Focus on the outpour of amazing content your followers and users will create rather than the cost you’ll bear. Ensure that your incentive is motivating enough to encourage users to create their best UGC but don’t go beyond your budget.

Best Practices for Using UGC in Marketing Campaigns

There are many forms of successful UGC implementation for your marketing campaigns and here are a few best practices you can follow:

• Always credit back the original content owner: When you repost or share user-generated content, ensure you credit the original creator by tagging them in your caption. When you do this, you’ll benefit from more exposure, especially on Instagram where your post will appear on your page and that of the account you tagged. 

• Request permission to use visual content: You can’t use photos or videos in your marketing without the direct permission of the content owner. Send an email or a direct message and be clear on your compensation package. Don’t move forward with the content in your campaigns if you don’t get a reply from the owner. 

• Simplify the creation process for users: Increasing the UGC in your content repository starts with a concept that’s simple to create. Complex concepts take more effort and may discourage users from participating in the creation process. An example of this is during the Coca-Cola Share a Coke campaign that only required customers to take a photo of their name on a bottle and share it on social media along with the hashtag.

Finally, never fake it. Faking UGC is counterproductive because the purpose of most user-generated content is to create trust and authenticity. 

Case Studies: Successful UGC Campaigns in Ecommerce

Successful user-generated content campaigns can improve your social media presence, engage your customers, and boost your overall online sales and revenue.

If you need inspiration, look no further because we’ve compiled a list of examples of successful UGC campaigns for you. 

Check them below. 

Starbucks #RedCupContest

This Starbucks UGC campaign is one of the most successful ever, receiving 40,000+ images on social media when the brand asked customers to share photos of their red coffee cups.

Shein’s “clothing hauls”

Aa a fashion ecommerce brand, Shein, leverages UGC to succeed in driving more sales and engagement online. Shein is known for reposting videos and images of customers trying out their products. 

This campaign has become successful over the years, strengthening the brand’s global presence.

Glossier

90% of Glossier’s revenue is through unpaid word-of-mouth marketing and UGC is part of the makeup brand’s rise to success. 

With the help of popular beauty influencers on Instagram who post product reviews and photos with the #glossier hashtag ahead of their release, Glossier is able to capture a wider user base.

Wayfair

Wayfair is an online furniture store that uses UGC marketing campaigns to drive sales, convert new leads and display social proof. They developed a unique hashtag, #WayfairAtHome and encouraged customers to post their house setups that include Wayfair products. 

The brand then creates social media posts with a shopping link that subtly nudges users further down the sales funnel. This campaign is successful because it uses UGC along with its other marketing campaigns in a subtle yet effective way. 

Body Secrets

Body Secrets is a lifestyle skincare brand that succeeds in attracting new customers with tastefully created user generated content on social media. 

The brand combines user generated content and influencer marketing which transforms user generated content into a relatable standalone advertisement that boosts sales and can also encourage consumers to create UGC about a product they’ve bought from the brand. 

Cold Stone Creamery

Cold Stone warms their way into the hearts of people by posting beautiful shots of their customers enjoying a cup of ice cream. 

This deft incorporation of UGC in their marketing attracts new customers and sustains brand loyalty for the ice cream company. 

Lulus Fan Photos

Last but not least, there’s Lulus Fan Photos. The women’s clothing company allows customers to upload photo reviews indicating their size and body type which are then displayed on product pages alongside the product descriptions for shoppers to see how the clothes can look on a real user. 

This type of UGC has increased conversions and built trust for the clothing brand.

Khaadi’s UGC Campaigns

Pakistani fashion brand Khaadi frequently runs UGC campaigns using the hashtag #mykhaadieidi. 

The brand features customers wearing their outfits on social media, celebrating diverse styles and connecting with customers on a personal level.

Trends and Opportunities in 2023

Here are some trends and opportunities that brands looking to leverage UGC marketing can explore:

• Micro-Influencer Collaboration: This is an opportunity for brands to grow their social media presence along with trendsetters who command a dedicated follower base.

• Customer Loyalty Programs: A brand’s UGC marketing efforts can be maximized into customer loyalty programs to reward contributors and brand loyalists who have helped to build a powerful image and the brand’s story over time for the brand.

• Response to Criticism: Criticism is often feared but it can be transformed into a valuable tool to shape brand reputation in your user-generated content marketing. Don’t hastily delete negative reviews as long as they are not distasteful. Show your professionalism instead by composing an accurate and dignified response, reinforcing your commitment to customer satisfaction.

• Short-form Content: This growing trend in UGC is here to stay with the emergence and popularity of TikTok and the recent introduction of YouTube Shorts. Your brand will benefit from following this trend while leveraging UGC because users won’t stop making short-form videos that are entertaining and user-centric.

• AI: AI is a growing trend impacting the future of UGC. New tools and technologies will be introduced for the creation of captions, SEO and creative ideas for UGC. With the disruption of AI, brands can infuse more authentic and captivating ideas into repurposing UGC for sales and business growth. 
  
• Employee-generated content: Encouraging employees to share their experiences behind the scenes can help humanize the business which not only impacts customer perception but that of potential new talent and brand partners;

• And finally, there’s real-time content. Real-time content creation is an emerging trend that will not die out soon, especially with the present possibility of Live streaming on multiple platforms such as your Instagram and Facebook page. 

Ecommerce platforms are joining this trend, with South Korea’s Coupang offering product reviews and explanations in real-time on the app or website. UGC is therefore growing to become an authentic form of marketing as more brands invite creators to make live content.