Reviews will bring transparency | KPMG | NL

Reviews will bring transparency to consumer financial services

Reviews will bring transparency

Whenever a new phone hits the market, I instantly check the reviews. Is the camera finally good enough to beat the good old Iphone 5? Will the battery get me through the day? Does the 5.5 inch screen really fit in my pocket? I have come to a point where I have stopped buying a new phone every year, but still find myself checking the reviews of the latest products just to know the state of technology.


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Online reviews impact consumer choices every day. Actually we are more inclined to buy upon reviews than on product information provided by the manufacturer. Reviews for consumer electronics are very common, over the past decade we have seen a rise of reviews for more intangible services as well. This blog touches the rise of reviews and the increase in reviews on financial services.

The value of online customer reviews becomes more prevalent
Customer’s purchase decisions are affected by a combination of three things: prior experiences, information from marketers, and input from other people. The rise of global internet makes it very easy for people to receive this information and social media amplifies the voice of customers. As a result, reviews are becoming more ubiquitous.

In order to make better reasoned choices, more and more customers read online reviews before making a purchase decision. In line with this trend, the trust in reviews is increasing: the majority of customers relies on online review sites as much as on personal recommendations and many indicate that positive reviews make them trust a business more. In conclusion, customer reviews have gotten more important for businesses over the years, resulting in the fact that positive reviews appear to be having a bigger effect than in the past.[1] Additionally, it is not plausible that consumers used to the richness of online reviews will ever return to relying on traditional marketing.[2]

On reviews for services
Reviews of restaurants and hotels are now very common. The reason these reviews work so well is that they bring transparency to basically a black box experience. How to choose a hotel in the center of New York if all the hotels you find have a four star rating and similar facilities? How to choose your room (and host) in AirBnB? Reviews give leeway to the voice of the customer and sometimes are used to strike back if the service did not match the expectations.

Apart from consumer electronics, restaurants and hotels slowly but surely consumer reviews start to matter for consumer facing financial services. Choosing a healthcare insurance plan in the Netherlands can be a daunting task, I for example can choose from 72 different plans. One way to navigate through this is to use the online reviews to get a feel for the quality of the service. The main challenge here is that there are still a lot of reviews that are used for complaining. Next to health plans I welcome reviews for bank accounts: it would be great to get a feeling of the service, quality of the app and features of the portal before I actually become a customer.


There is one large flaw with many of the review methods, in many cases the reviews contain open text which enables users to evaluate the service on their own terms. This works great for usability but makes comparing reviews and estimating the overall value far from easy.


A startup called Wonderflow, we have met through the Rockstart accelerator, has made an attempt to crack this nut, using data & analytics to text mine these reviews. Forget focus groups, you want to learn from the consumers that actually buy and use your product in the first place. Wonderflow’s initial focus lies on consumer electronics but recently they have started to apply these techniques for healthcare insurance plans.[3]

I wonder where this trend is headed, it makes perfect sense to help the consumers find their way in choosing the right financial services by providing good reviews. Reviews help to provide transparency, especially when the amount or nature of the product features makes it difficult to estimate the value up front. It would help if the major platforms would come up with a rating framework to go beyond the revenge of an angry customer. But well, as long as there are data & analytics companies to sift through the text and provide the insights, we will get there. Eventually.


Author: Daniël Horn, manager Assets & Investments




[3] Wonderflow is based in Amsterdam, results for the health plan analysis are available upon request via:

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