The value of peer reviews in the software decision process

SUMMARY:

Are software review sites enterprise-ready? Can peer review sites impact the enterprise buying decision? Barb Mosher Zinck took her skepticism into a chat with Michael Fauscette, who recently moved from IDC to buyer review site G2 Crowd.

peers-on-keyboardIt’s time to purchase a new CMS, or an ERP, a CRM, or maybe a marketing automation platform. What does your purchase process look like? A few years ago you might have announced an RFP and then waited for vendors to send their responses in, or you might have done a quick Google search, picked a couple of vendors and contacted them to get information. You may even have asked an analyst firm to tell you which vendors were the best options. But it doesn’t work that way anymore.

If you’re like 74% of B2B buyers, then your journey to purchase starts with a lot of online research before you even think about contacting an actual vendor. That research includes finding out what others think of the software you need to buy. That’s the genesis of online business software review sites. G2 Crowd, Trustradius, Software Advice, GetApp, there seems like no end to where you can go to see what others think of the software they use.

I’ve always wondered how trustworthy are these sites? Can you trust the people submitting the reviews, especially when you know that many do so because the vendor has somehow requested them to? It’s like a Case Study, but on a wider scale and the vendor has less control over what the customer says about them.

When I heard that Michael Fauscette, VP of the Software Business Solutions division at IDC had left his position to become Chief Research Officer at G2 Crowd I was a little surprised. What would make a well-respected industry analyst take on a position at a business software review site? Was it G2 Crowd’s continued attempt to disrupt the power analyst firms like Forrester and Gartner have over software purchase decisions (something I just couldn’t see happening)? I asked Fauscette about this, among other things. The answers I got made me rethink the true value of review platforms like G2 Crowd.

There are two sides to this discussion worth looking at – the buyer’s perspective and the vendor’s perspective.

Using peer reviews in the decision-making process

The first thing to understand is that B2B buyers are continuing to take a page from the B2C world. Enterprise software buyers are getting comfortable using these reviews in the decision-making process, just like they trust consumer based review sites for things like food, hotels and so on.

Fauscette pointed to things like verified reviews from trusted sources, reviews from peers as reasons why B2B buyers look to review sites when researching the best software to purchase. Once they start using these reviews, they get comfortable, and it becomes a part of their purchase process.

I was curious to know if these types of review site are better for small to mid-sized companies and software vendors, over enterprise ones. Fauscette said there’s a place for every size company, it’s how the information is used that may be different.

For example, in a small company there’s usually only one or two people making the decision to buy software. Here the process tends to be more streamlined and quick, and peer reviews have the ability to play a primary role, maybe even the only role, depending on the situation.

In an enterprise, there’s a lot more people involved and the process tends to be much more complex. First the decision is typically made by a selection committee that includes representation from across the company: security, business, IT, legal, etc.. In this case, the use of peer reviews is only one input among several other sources of information. It’s important, but not necessarily a driving factor. And it may be more important for influencers of the decision (where you also see analysts), who then provide insights and feedback to the decision makers.

Vendors buy into software review sites

Fauscette conducted research while at IDC, in partnership with Salesforce on the B2B buyer’s journey and found that 64% of buyers had already made a decision to purchase before they even spoke with the vendor. That’s a high number, and it’s disrupting sales teams in companies everywhere. It’s why marketing has such a key role to play, and it’s why these software review sites are getting so much attention from the vendors themselves.

So does that mean the vendors play a key role in getting reviews of their product on a review site like G2 Crowd? Yes and no, according to Fauscette. Initially, he said the community suggests most reviews, and it grows organically. But what happens then is the vendor starts to see these reviews used by their clients and prospects, and they recognize that it’s important to elevate the number of reviews they have on the site to ensure their standings are from a large representative group.

That’s when you start to see vendors requesting clients to review them, and they start promoting their standing on the review site. Marketing plays a role here because they understand that they need to be where their customers and prospects are.

Of course, no vendor wants a negative review. This is where trust and credibility are important. Fauscette says G2 Crowd wants to ensure that the reviewers are trusted and credible sources and when that’s the case you have to believe what the person says, whether positive or negative. He also added, that if you went to a review site and read only positive reviews, wouldn’t you think something wasn’t quite right?

All reviews, both good and bad can help the vendor. Fauscette said that G2 Crowd is getting attention from the strategy/product side of the software organization. The datasets that come from reviews can help these product teams improve their products. It’s a way to infuse relevant feedback into the design process.

Fauscette’s role and G2 Crowd’s true influence

Fauscette’s role with G2 Crowd comprises a number of things. Part of his job is to find ways to get people to review software on the website. These reviews aren’t simple yes-no questions, the questions are more detailed and nuanced to ensure the response give a lot of insight into why the reviewer bought the software and how it’s working for their specific needs. Once they have the reviews, which are essentially datasets, similar to survey data, he’s working to figure out how to use it to guide other purchases. Interesting note: Fauscette said that ten reviews is the typical number read before making a decision.

Along with capturing this data, as Chief Research Officer, Fauscette is figuring out what other content G2 can provide that makes the dataset more consumable by buyers and other potential consumers. For small business, along with presenting the data, G2 Crowd might want to find ways to help them use it. In the enterprise, they want to ensure that data is used in the decision-making process, and possibly combined with input from a consultant or analyst – the key is to make the data more relevant to the decision-making process.

G2 Crowd’s Grid reports don’t just provide reviews but aggregate the data for a comprehensive look at the software. Fauscette’s role is to build on this, to understand how to make the reports more relevant to the buyer, including information such as market presence, financial stability, employee reviews (from sites like Glassdoor), and so on.

The other piece to his role is to provide thought leadership and expertise to buyers to understand how to use this data and to vendors to understand why it’s so important to them and how they can leverage it to improve their products.

Does this outbound influencer role mean that G2 Crowd wants to be an analyst firm? Fauscette didn’t think so. He said an analyst firm provides educated opinions and experiences, but it’s the opinions of individuals sometimes based on experience with the technology and research and discussions with vendors and software users.

G2 Crowd’s influence doesn’t come from individual voices, said Fauscette, it comes from the crowd. G2 is simply interpreting the crowd’s opinions and presenting them in a way that buyers can use. G2 crowd doesn’t want to color the input from the user; they want to find a better way to present the opinions of the crowd. He said the two (what G2 Crowd does and what analysts do) were complimentary.

My Take

I went into this interview not totally sold on the benefits of software reviews sites. I understand how the buyer’s path to purchase has changed, and that research is a key component of the decision-making process. It’s why I’m in the content marketing business after all. But most of these sites haven’t been around that long, and while they are slowly building their datasets, there’s still a lot of work to be done.

At the same time, Fauscette has made me look at sites like G2 Crowd in a different light. I can see the benefits to the product/strategy teams who want to take relevant impartial customer feedback and improve their products. I also see how buyers can use the data to see if a product is the right fit for them, especially once G2 wraps in other additional relevant market and vendor information.

I think G2 Crowd was smart to bring a resource like Fauscette on board. It not only provides credibility to what they are doing, but it ensures that the insights and guidance they deliver in their reports will remain that of the buyers, delivering true value to the process of buying software. Now we just need to see the data, and what G2 Crowd does with it.

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    Comments are closed.

    1. says:

      What makes sites like G2 more credible is that the vendors can’t influence the reviews from the buy side This is very different from the usual analyst style of relationship where you know that on a top down basis, the vendor is in control at least 70% of the time and at an IT level – not business function level.Reference

    2. Amber Green says:

      You guys may also want to check out CrowdReviews.com; they have a similar concept as G2Crowd. They seem to be making waves right now.

    3. says:

      Barb,

      Nice article. The research we have been doing at Gartner, show that buyers (in all size organizations) value reviews—but user reviews have gone done in the ratings somewhat from previous years. We believe this is because of some of the issues you cite—like being confident about the authenticity of the review.

      On the other hand, reviews by someone the buyer perceives to be an expert are the most valued source of information about a provider products, that the provider is not producing. So, if you have a user that is perceived to be an expert. That is gold.

      The range of peer review sites continues to grow. Beyond G2, there is ITCentralStation and 3 companies that Gartner now owns (Software Advice, Capterra, and GetApp), among others. I am not the spokesman on this for Gartner (i.e. your are getting my opinion), but we see these companies as providing insights that help smaller enterprises (that can’t afford a traditional analyst relationship) buy the right things.

      We’ve even taken the concept to the enterprise, with Peer Insights, a moderated review approach that is targeted at our enterprise clients (but accessible to some degree by everyone).

      My final take on this. No buyer should make decisions based on one source of information, whether that be a review, a Gartner Magic Quadrant (while great documents, these might be the riskiest “single source” of information given the market breadth they cover), or provider information.

      The trick is figuring out the right mix to help you make the right decision and be successful.

    4. says:

      Barb – thanks for covering this area. I’m CEO of TrustRadius – one of the companies you cite in your article.

      I wanted to respond to Hank’s comment. User reviews are indeed valued by companies of all sizes and buyers of all titles. Fundamentally buyers trust peer insights ahead of messaging from vendors. While they place value on analyst insights, they also crave unvarnished, first hand insights from those in the trenches working with the tools day in and day out. I cannot speak for other review sites, but we see an even mix in usage on TrustRadius among large enterprises, mid sized companies and small businesses.

      You rightly discuss the issue of trust in your article. Trust is an issue with all review platforms. In B2C, the leading sites are contending with fraud challenges. In B2B, a bigger issue is, is the data representative. This is not just an issue of sample size but also how the data is collected. As review sites like TrustRadius and G2Crowd have become more influential with buyers, we’ve observed that some vendors have deployed strategies to try and steer ratings, by introducing selection bias, i.e. only steering known promoters to review them. While these are valid customer data points, when a buyer users a review site they have an expectation that the data they are consuming is representative – and do not expect it to be tilted. When they read case studies or are passed customer references to talk to, they understand they are a curated sample of happy clients. We observed a material skew in ratings driven by vendors vs. those we independently sourced, so we introduced an algorithm to correct for this bias called trScore.

      We also believe that it’s imperative to be transparent about how a review was collected – whether an incentive was used and who drove the review. Using incentives to motivate reviews is a common practice in B2B – though frowned up in many B2C venues. It’s often necessary in B2B because of two factors – you need to drive a much higher participation rate among users/customers to drive to a critical mass, B2B reviews are much longer than B2C reviews, so you’re asking more time from the individual. For example, the average review on TrustRadius is 406 words and the average reviewer spends 22 minutes writing their review. The FTC guidelines stipulate that when a vendor uses an incentive to encourage a review or testimony that the reviewer needs to state this on their review. We believe being transparent in this area is not just important for FTC compliance, but also to earn and sustain the trust of our members.

      Sincerely,

      Vinay

      Vinay Bhagat
      CEO, TrustRadius
      @vinaybhagat