The 2.7 Billion Dollar Question

By Kathryn • Mar 20th, 2009 • Category: 26th Story, Big Ideas, Web/Tech

amazon.comI had no idea Amazon made money off of customer reviews.  Did you?

Jason Kottke linked to an article on User Interface Engineering which explains how it works:

“As we’ve watched Amazon customers make purchases on the site, we can clearly see that promoting the most helpful reviews has increased sales in these categories by 20%.(One out of every five customers decides to complete the purchase because of the strength of the reviews.) From this, we can project it has contributed to Amazon’s top line by $2.7 billion.”

The 2.7 Billion Dollar Question begs its own question: what other little steps have produced revolutionary results?

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  • And it also makes me even less likely to trust Amazon reviews. These aren't genuine responses to books, they're just advertising that's manipulated in multiple ways by multiple people. It's becoming impossible to find any corner of Web 2.0 that isn't tainted by manipulation. Yuck.

    The fascinating thing to me is that the "seller review" practices of eBay are leaking onto Amazon, so that a seller who gets five stars for delivering a used book quickly turns into a five stars for the book - and vice versa. Your carefully edited, lovingly published book? Better watch those reviews like a hawk to make sure a buyer who was unhappy with a second-hand retailer doesn't destroy its reputation. I'm sure you have lots of free time to do that.

    Emily - I'm with you. This sucks.
  • That's a neat way of putting it ... a single software feature adds $2.7B to the topline and presumably hundreds of millions to the bottom line.
  • Interesting side note: Amazon won't let you post reviews if you haven't made a purchase through them. I suppose this isn't surprising, but it is disappointing.

    Despite being an often uncompromising indie bookseller, I wanted to write a review for an author I know. I was even willing to create an account in order to do so. But after all of that, they wouldn't publish my comment because it had been "too long" since my last purchase.

    People hang around my store, don't spend any money, and then purchase books on Amazon. Can't I hang out there without spending money as well? Apparently not.
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