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The Impact of User Generated Content on Businesses

Why is there a tsunami of reels every time you log in to Instagram or Facebook? Well, the answer is obvious. The world, these days, seems to be revolving around user-generated content (UGC). According to a Billo article, 93% of all marketers who utilize user-generated content believe it gives them better results than traditional marketing content. And this isn’t a miracle. Apparently, it’s human nature to trust a brand only after we see a considerable number of people talking about it positively.

In fact statistics prove that ads with UGC embedded in them have about 4 times higher click-through rates than normal ads online. So, let’s find out how you can leverage this fascination with UGC and apply it to get the most of your business marketing plans!

8 Benefits of UGC for Your Business

The use of UGC can make or break your digital marketing strategy. Likewise, integrating social media with UGC is equally important. And not all social media channels may be apt for your business or content strategy. But before you venture into the right UGC strategy for your business, let’s look at a few benefits that UGC can bring to your brand.

  1. The trust factor

Social proof is one of the biggest driving factors these days when it comes to purchasing decisions. In fact, a Salsify report stated that about 40% of buyers believe UGC is extremely crucial for their purchase decision. The numbers are far higher when compared to product comparison charts/graphs (39%) and product-related videos (37%).

And the B2B market isn’t immune to the impact of UGC either. According to an article by the Winterberry Group, 44% of B2B buyers believed that “peer reviews and user-generated content” have a major role in their buying decision-making process.

  1. The cost factor

Most of the UGC that we see online comes for free or at a minimal cost (in exchange for some samples of your product/service, vouchers, gifts, etc.), unless you hire well-known influencers for content creation. Research too has backed this statement.

According to a Nostro article, 85% of marketers believe visual UGC is a lot more cost-effective than other means of visual digital marketing. In fact, they rank real customer photos much higher than those sourced from even paid influencers, for their cost-effectiveness.

  1. Better feedback

UGC through discussions and genuine user reviews in brand communities, social media groups, or review websites, generates better feedback. What’s better is the fact that you can even rely on a whole pool of consumers/clients who provide user-generated solutions to various consumer/client issues.

So, as a new-age business owner, all you need to do to feel the pulse of your target market is to keep your eyes and ears open to the feedback you receive through UGC.

  1. Transparent communication

Brand communication, as part of your online content strategy, should be a two-way street. And UGC offers an avenue for transparent communication and customer engagement. Public forums, such as social media platforms are places where you have nothing to hide as a brand.

And UGC often offers a raw version of your consumer’s view of your product/service. This enhances the genuineness of your brand and its “connect” with your target market, thus enhancing the potential customer experience. People know it’s not a polished commercial that they might come across on TV.

  1. Fresh content

UGC solves a lot of your content marketing issues, and this is one of its best advantages. Here’s how UGC helps you offer fresh content to your target market:

  • Regularity: Regular updates come in from the users, which means you don’t need to wrack your brain to update content from time to time.
  • Better SEO: UGC and SEO benefits go hand in hand. All you need to do is share the updates from your clients/consumers, and that will contribute to the SEO factor, as platforms that have regular engagement tend to get more eyeballs and vice versa.
  • Diversity and innovation: Since the content comes in from a vast pool of clients/consumers, your content creation strategy isn’t limited to a handful of in-house content creators/writers/vlog makers. This ensures a wide variety of ideas and a diverse range of content.
    Local visibility

The more customer testimonials and reviews you get and the more local influencers/customers showcase your brand, the more hits your page/social media content will get from local audiences. Google (and other) bots are becoming increasingly intelligent in tracking consumer preferences and showcasing the content that is aligned with the interests of your market.

This also covers the geographical factor, which means every local hashtag and every mention of your region in the UGC will fetch more people from the geographical regions you cater to. This has the potential to generate local and more convertible leads automatically. This also improves the overall customer experience, as people tend to find what they’re looking for without much hassle.

  1. Organic brand awareness

Closely aligned with the cost-effectiveness factor is the organic marketing factor. UGC offers the perfect tool for those marketers who believe in creating organic brand awareness instead of relying on paid SEO. Organic visibility most definitely creates a high-value consumer base, that has its roots in word of mouth.

  1. Brand loyalty

UGC initiatives, such as contests, discussions, and hashtags, build a community feeling. A simple example is how people get addicted to social media trends when it comes to clicking selfies with a product or filming reels set to a trending track. This has a two-fold advantage:

  • It generates new potential consumers/clients quickly
  • It contributes immensely to brand loyalty. So, a lot of old community members will tend to stick to your brand because of the continuous connection and customer engagement through UGC

7 Effective UGC Strategies for Businesses

How should you use UGC so that it’s most impactful for your business? Will the UGC plan that your competitor has successfully implemented bring value to your brand too? What are some of the best practices for moderating UGC? Below are the answers to some such questions and a few tried-and-tested UGC strategies for increasing engagement. So, read on if creating effective UGC campaigns is on your to-do list…

  1. Call to action: Hashtag campaigns, contests, and giveaways

Now, this is one of the best UGC strategies for increasing engagement. This involves a “call to action” (CTA) for your target market, by asking them to participate or engage in a contest or a hashtag campaign. Here’s how you can utilize these techniques:

  • Hashtags: Relevant, creative, and catchy hashtags are immensely impactful in generating traffic for your social media page or blog. Asking your followers/consumer base to post content with relevant hashtags generates a lot of traffic that you can leverage on.
  • Contests: Contests that encourage people to post their selfies or slogans, or even just tag a few friends to your social media posts generate a community feeling, apart from stimulating customer engagement and brand visibility.
  • Giveaways: This works wonders in the hospitality, retail, and travel sectors. Sample offerings, such as a day’s stay at a resort or a voucher for a sumptuous meal at a restaurant can be excellent ways to boost sales. Your customers are more likely to bring in or recommend your service/product to their friends and families the next time around.
    Feature UGC on your website, e-mail, and social media profiles

Often, social validation and recognition works better than monetary rewards. And one of the best ways to validate your consumers/clients is to feature them on your content marketing channels, such as social media profiles, blogs, and newsletters. So, do lay stress on integrating social media with UGC and highlighting user reviews on your promotional content.

Such features can highlight their creative content on your products/services. You can also feature customer testimonials and reviews of your product/service. Such a feature can also offer enough social proof for your future consumers/clients and prove to be one of the best engagement strategies.

3. Collaborate with influencers and content creators

Whether you like it or hate it, you can’t ignore it! We’re talking about the deluge of influencer-created content online, mostly in the form of reels. Now, there are primarily two types of such content that you can utilize:

Paid collaborations: This is exactly what it says – a reel/blog/content collaboration in exchange for a payment.

Barter collaborations: This is when you offer them a discount, voucher, or freebies (such as products/services that you deal in).

  1. Build a community

Building a community around your business/brand is one of the most impactful engagement strategies. It helps in multiple ways, such as:

  • The community members feel like a unit and are more engaged in your brand
  • You can directly communicate with your client base or future leads and ascertain the pros and cons of your brand and their expectations

So, you can begin by starting a community such as a Facebook or LinkedIn group.

  1. Moderate and address negativity

The most important part of creating effective UGC campaigns is to make sure the content your clients/consumers post isn’t harmful for your business or for the general public. And below are some of the best practices for moderating UGC:

  • Set strict guidelines: Let people know that the content they post in the group or tag you in should not contain elements such as abusive language, violence, communal hatred, racism, LGBT-shaming, body-shaming, etc. Delete content that goes against the ethics of the group.
  • Stay away from plagiarized content: Copyright issues can have your group/profile banned if you don’t set strict rules regarding the content being original.
  • Fact-check regularly: Weed out content that puts out incorrect or exaggerated information. This builds the credibility of your group/site/social media platform.
  • Don’t delete negative comments: The more you try to delete or deny negativity, the more it can create issues. So, steer clear of deleting negative user reviews, as that may reflect on your denial of the flaws in your product/service. Rather, address them and try to resolve them immediately.
    Incorporate UGC in product design and promotion

This is how brands can leverage consumer/user-generated content in the whole product design and promotion process. One of the finest examples of this is The White Cup Contest that Starbucks has successfully incorporated in the past.

Starbucks apparently invited their customers to doodle on blank or white Starbucks cups and post the photos of the doodles on social media. The winning design was featured on an actual limited-edition Starbucks cup.

  1. Measure the effectiveness of your UGC strategy

Lastly, like any other marketing plan, this will only succeed if you focus on measuring ROI of user-generated content regularly and incorporating the learnings in your next UGC strategy. Here are some tools/platforms that you can make use of tot that end:

  • Google Analytics: You can’t just track traffic but also get an idea on which UGC fetches you how many conversions.
  • Hootsuite: This is apt for measuring social media engagement.
  • Sprout Social: This platform too offers a holistic social media analytics solution.

Key Pointers

  • Statistics prove that user-generated content, or UGC, has a higher click-through rate than normal ads online
  • Some of the benefits of UGC are the social proof it provides, its cost-effectiveness, the transparency it offers, and the diversity and freshness of content it brings in
  • Some effective strategies to incorporate UGC include adding a CTA such as contests etc., fact-checking, setting rules for originality and other factors, and measuring ROI of user-generated content using tools

Final Thoughts

In a world where AI has challenged content creators to a great extent, UGC is still ruling the game. This proves how crucial it is for people to connect to the human element in your marketing plan and be part of a community. If the current trends are anything to go by, UGC is here to stay. So, don’t just sit around planning extensive marketing strategies. Add that much-needed human element through some UGC, and watch the magic unfold!