5 Best Practices for Monetizing Ecommerce UGC (Plus 7 Examples!)

May 19, 2022
by
Elise Dopson

5 Best Practices for Monetizing Ecommerce UGC (Plus 7 Examples!)

May 19, 2022
by
Elise Dopson
Back to the blog
Get the latest straight to your inbox
Thank you! Your submission has been received!
Oops! Something went wrong while submitting the form.
Share on:

User-generated content (UGC) is content created and contributed by real customers, like reviews, photos, and videos. 

Ecommerce brands who lift this content from the original source—usually social media—and place it on their website influence even more potential customers to purchase. 

Often, ecommerce brands write off UGC as a “nice to have” feature on their website; one that has only minimal impact on conversions. 

But as Custom Neon’s Clare Jones says, “Without a bricks and mortar store, online retailers have to work harder to prove that they are a legitimate business—and rightly so.”

User-generated content has evolved into an essential part of many customer’s purchasing process. So much so, a third of Gen Z consumers and nearly a quarter (21%) of Millennials won’t purchase a product if there are no photos or videos from other consumers who have purchased it before.

Ready to take advantage of UGC for your ecommerce store? This guide shares how to monetize this customer engagement, with examples of DTC brands successfully using user-generated content to drive revenue for their scaling store. 

The benefits of UGC in ecommerce

As an ecommerce brand, collecting content produced by existing customers should be high on your priority list. 

Other customers’ content gives shoppers an unbiased look at what it’s like to own your product. In fact, 24% of customers find UGC highlights non-obvious information

As growth advisor Barry Hott says, “Using UGC on your website and landing pages can make your potential customers more comfortable with trying the product. 

“UGC pairs really well with user reviews and testimonials to provide social proof that helps make visitors more comfortable with buying. It can make products feel less formal, more accessible, and more authentic.”

While your customers will still purchase without UCG, you’ll notice in the data below that the youngest segment of potential buyers are becoming increasingly hesitant to purchase without seeing user-submitted content, which may signal a trend toward starting to require it on your site:

benefits of UGC
Image Source

How to collect and monetize UGC on your online store

You have hundreds of customers purchasing from your ecommerce store. How do you convince them to create UGC? And more importantly, monetize the UGC once they’ve contributed it?

Maximize the mileage of your user-generated content with these five best practices.

1. Moderate your UGC contributions

Unfortunately, not all of the content contributed by customers will be the right fit for your marketing strategy. Whether the visuals are too poor quality or just not an on-brand aesthetic, moderate your contributions prior to sharing them with potential customers.

“Some ecommerce brands moderate and/or monetize UGC by creating guidelines for content creators,” says Robin Bro, CEO at VIVIPINS.

“For example, GoPro has a set of community guidelines that content creators must follow in order to have their content featured on the GoPro website or social media channels. These guidelines help to ensure that all UGC is high-quality and on-brand for GoPro.” 

GoPro user generated content

Further you can automate the process using a UGC curation tool like TINT. Its artificial intelligence software learns which types of UGC you use most often, showcasing future contributions with similar qualities—without manually hunting for reviews, photos, or videos you can monetize.

“UGC allows brands to make content that people want to consume. It's much easier to do that when it doesn't blatantly look or feel like an ad.” — Barry Hott, growth advisor and consultant

#cta-visual-fe#<cta-title>Ensure your store can handle richer merchandising<cta-title>Learn how Shogun Frontend can help you achieve the exact ecommerce experience you envision. Learn more

2. Showcase UGC across all owned channels

To scale your ecommerce business beyond your existing customer base, give potential customers a reason to pay attention to your branded content in a busy news feed or email inbox. 

Plant the seed early in their mind, nudging potential shoppers down the customer journey, by showcasing UGC across your owned channels. This includes:

  • Ecommerce store, including your homepage, product pages, and even throughout the checkout process.
  • Social media channels, including visual-heavy sites like Instagram.
  • Ad creatives, such as Facebook ads, Facebook video, or TikTok ads. 
  • Email marketing campaigns, particularly welcome and incentive-focused emails. 

However, Austin Dowse, CEO of Aimvein, has a word of warning: “While UGC can be a great way to build social proof, it can also be overwhelming for customers if they're bombarded with too much of it.

“To strike the right balance, focus on using UGC in key places like your product pages and marketing collateral,” Austin advises. “You can also use UGC to drive traffic to your website or blog through social media and online communities.” 

3. Encourage contributors to reshare

The best UGC comes from people who love your brand—to the point they voluntarily share images and videos without prompting. 

Connor MacDonald explains that for The Ridge:

“This means responding to DMs, responding to comments, and making posts a place for people to share their opinions. The more relationships created between customer and brand, the more UGC will be shared.” 

The Ridge user generated content

Once you’ve collected this UGC and showcased it across your owned channels, continue relationship-building by encouraging contributors to post about their feature. Customers have an even greater reason to share product pages if their own content is featured on it. 

Remember: More eyeballs on your product page equals more opportunities to sell. 

4. Rely on UGC for product development

User-generated content isn’t just marketing material. Feedback from customers helps you fine tune the product so you can build brand equity, stand out from competitors, and charge a premium for products. 

“Many companies are now using UGC to get feedback on new products, crowdsource design ideas, or even get testers for new product prototypes. This can be a great way to involve your customers in the development process and improve the quality of your products.” — Kate Zhang, founder of Kate Backdrop

Let’s put that into practice and say TikTok creators produce UGC that shows how your noise-canceling headphones improve focus when working in a loud coffee shop. 

After realizing this new use case and making the product more user-friendly for workers (by editing the product design to collapse and fit in a satchel), you open a new, untapped revenue stream for your ecommerce business. You wouldn’t have found that without UGC!

5. A/B test your UGC

Which type of UGC performs best for your business? While gut instinct sometimes shows the best pieces of content to use, you won’t know whether UGC is performing as well as it could be until you test different variations. 

If you haven’t already, start by replacing product photography with UGC. Some 77% of consumers always or regularly seek out visual content from others who have already purchased a product, and A/B testing two variations will highlight which one your customers are more likely to convert through. 

Further, as you start to curate more data about which UGC format works best, expand your testing to discover which messaging has the biggest impact on conversions.

  • You might find, for example, that customer reviews mentioning how ‘sturdy’ your iPad case is has a 3.5% conversion rate—still better than the 1.74% average. But an A/B test unveils reviews focusing on ‘how it folds when traveling’ has a 4.7% conversion rate. 

So, when asking previous customers to contribute a review, point them in this direction with leading ideas upfront on what they might like about the product based on the messaging you know converts. This way, you’ll collect more of the UGC proven to influence new purchases. 

#cta-visual-fe#<cta-title>Ensure your store can handle richer merchandising<cta-title>Learn how Shogun Frontend can help you achieve the exact ecommerce experience you envision without performance tradeoffs. Learn more

Awesome ecommerce UGC examples

Once you’ve collected UGC from your existing customers, it’s about how you use it across all those channels we mentioned. Let’s take a look at seven examples of UGC being successfully monetized by ecommerce brands. 

Oliver Charles ran a UGC ‘challenge’

You can leverage your customers’ competitive streak when strategizing ways to collect user-generated content.

Take it from Oliver Charles, a clothing retailer that runs a 1-week challenge with the sole purpose of collecting UGC. Co-founder Slater McLean says “The goal of the 1-week challenge is to get people to rethink how they buy and wear clothing—all while generating 100s of pieces of UGC for us a month.

“The way it works is we ask customers both upfront and after they purchase if they'd like to participate in the challenge,” Slater adds. “In order for customers to complete the challenge, they have to wear our sweater for seven days straight, take a picture each day, and submit a video testimonial at the end.

As an incentive for them to contribute, the brand offers a $50 refund and 20% discount code on their next order. The result? User-generated content, like the example below, to fill product pages and entice website visitors to purchase. 

Oliver Charles user generated content

Muhoov uses a branded hashtag in post-sale emails

Muhoov is another DTC brand that gamifies user-generated content contributions. 

Order shipping emails contain a call-to-action, enticing new customers to share images of their new sweatshirt on Instagram—a post that’ll earn them a free entry to the brand’s monthly giveaway. 

Co-founder Katheriin Liibert says: 

“Winners are chosen randomly among those who share posts with the #muhoov tag. As it’s a unique hashtag, it’s completely “owned” by our brand at this point, so it works well for potential customers to also see how our products fit.” 

Muhoov user generated content

Put this into practice for your own ecommerce store with a branded hashtag. Shout about it from the rooftops—in your social media bios, order confirmation emails, and online store. The hashtag results page will act as an always-updated repository of UGC.

Best Price Nutrition leverages UCG with email subject lines

For every dollar a brand spends on email marketing, they earn $42 back. That ROI is impossible to achieve if you aren’t convincing people to open the content you’re sending them. (That’s a tricky job in a crowded inbox—a place where people receive more than 100 messages per day.)

Best Price Nutrition is one DTC brand taking advantage of personalized campaigns, relying on UGC to entice subscribers to open emails. 

Its ecommerce manager John Frito says:

“We've been doing some A/B testing on this recently and have noticed that the emails that contain user photos and product reviews get better open rates, better click through rates and drive more revenue than just our normal sales emails.” 

SuitShop reposts UCG on Instagram, plus embeds a carousel  

The simplest marketing tactics often drive the best return on investment. Take it from SuitShop, a retailer that reposts UGC to its Instagram profile—a tactic designed to build engagement and drive social media users towards its online store. 

But UGC isn’t left on Instagram. At the bottom of its product pages is an Instagram carousel, showcasing the most recent UGC posted to the brand’s account. 

Positioning this UGC carousel at the bottom of the page is a smart move. If someone’s not convinced to purchase the product during that browsing session, following the brand on Instagram keeps the line of communication open. SuitShop has the ability to re-engage otherwise lost shoppers. 

SuitShop user generated content

#cta-visual-fe#<cta-title>Ensure your store can handle richer merchandising<cta-title>Learn how Shogun Frontend can help you achieve the exact ecommerce experience you envision without performance tradeoffs. Learn more

Hush Anesthetics leverages expert endorsements 

The most valuable type of user-generated content marketing comes from people your target audience trusts. 

In the case of Hush Anesthetics, user-generated content is contributed by experts in the tattooing space. Tattoo artists share photos of themselves using the cream on their clients, which the brand showcases on its online store. 

“We make numbing products designed specifically for tattoos, so many of the accounts that mention our product are certified tattoo artists. A stamp of approval from industry professionals adds a lot of credibility to our product.” — Ubaldo Perez Jr., CEO of HUSH Anesthetic
HUSH Anesthetics user generated content

Kenko Tea embeds customer reviews on site

“One of the most simple and effective ways to make the most of UGC is to add a review feature to your website,” says Samuel Speller, founder of Kenko Tea.

Data backs this up: as many as 93% of online shoppers consult customer reviews before making a purchasing decision. Some 31% spend more on a business with excellent reviews—a figure that could represent thousands of dollars in revenue for your DTC brand. 

“[Reviews] show customers and potential customers that you believe in your product and believe it can speak for itself. It positions you as a trustworthy, transparent business with a good product,” Samuel says. “Bear in mind, however, that you must have a decent product—lots of bad reviews won't be very beneficial!” 

Kenko Tea user reviews

Hiya Health features customer’s review videos

Take reviews one step further by inviting customers to record a video of themselves talking about your product. It’s been found the vast majority of people have watched a video to learn more about a product, with 86% saying that they’ve been convinced to buy thanks to one

Combine video preferences with customers reviews and you’ve got a winning combination for improving your product page’s conversion rates.

Hiya Health is one DTC brand taking this approach. Parents questioning whether to purchase the brand’s kids daily multivitamins are greeted with a video reel of previous happy customers—who are also parents—reviewing the gummies with their children. 

“Our customers write testimonials that speak to the product quality in a way we can't. We owe a great deal of our rapid growth to our customers who take the time to recommend our product online.” — Darren Litt, co-founder of Hiya Health
Hiya Health featured customers

What's the future of UGC?

The user-generated content sphere is changing rapidly. From livestreams to ordinary people quitting their jobs to produce UGC full-time, let’s take a look at UGC trends your business should be capitalizing on. 

UCG Trend 1: From influencer to creator

When I asked growth consultant Barry Hott to share his thoughts on the future of UGC, one thing came to mind: a shift away from the traditional influencer marketing model. Brands are pivoting towards smaller creators, often with much smaller social media followings, to produce content on their behalf. 

“The size of an influencer's audience does not correlate with their ability to make good content that can be used by the brand for other purposes,” Barry says. “Likewise, there are some great UGC content creators who have tiny audiences.

“Also, influencers can be expensive, so instead of putting their eggs in one basket with one or two "big" influencers, marketers would rather place smaller bets and get content from multiple smaller creators.”

Madi UGC Creator tweet
Image Source

Jan Anthun, CEO and founder of BrandZone, thinks this move towards creators is “Not only for financial reasons, but also actual results—people are getting sicker and sicker of fakeness and lack of authenticity. Leveraging real humans to promote your brand is becoming very vital.” 

The creator economy and great resignation produce the perfect storm for ordinary people to quit their day job and become UGC creators. Barry adds, “I'm eager to see how supply and demand change as the demand for UGC should grow, but the supply of creators is growing even faster.”

UCG Trend 2: UGC goes live

To say livestream is exploding would be an understatement. People spent 482.5 billion hours on mobile streaming apps in 2020, contributing to a live commerce market worth $6 billion. 

According to Robert Johnson, director of operations at My Wood Rings, “There are a few trends that suggest the future of UGC is moving towards more interactive and personal content. 

“For example, more brands are now using customer photos and videos in their email marketing campaigns. And, live-streaming platforms like Instagram Stories and Snapchat are becoming more popular, giving brands a way to share real-time content with their followers.”

UCG Trend 3: TikTok takes over

Since its introduction to the social media scene back in late 2016, TikTok has cemented itself in many modern purchasing decisions. Users are 1.4 times more likely to research brands and products on the platform, then purchase said products through the TikTok app. 

This is resulting in TikTok becoming a haven for both UGC creators and the brands scouting them. 

Take the ”TikTok made me buy it” trend, for example. Creators rack up millions of views by sharing which products other users on the app convinced them to buy—like this angle used by ecommerce brand Teema:

TikTok made me buy it tweet
Image Source

The TikTok Creator Marketplace plays match-maker between DTC brands and creators producing UGC on their behalf.

Invite creators to review your products through their TikTok profile, producing tons of high-quality UGC to monetize on your ecommerce store and build trust with potential customers. 

Launch your ecommerce brand’s UGC campaign today 

User-generated content plays a major role in how modern consumers research products online. Without the ability to touch, feel, or see a product in more realistic lighting and scenarios (outside a stylized product photo you might include in your store), many people turn to loyal customers to share their experiences with a brand. 

Try the actionable tips from this guide to start collecting conversion-driving UGC for your scaling store!

From automating UGC discovery to partnering with professional creators, showcase customer-contributed content on your online store…or risk having customers leave in search of it.

#cta-visual-fe#<cta-title>Ensure your store can handle richer merchandising<cta-title>Learn how Shogun Frontend can help you achieve the exact ecommerce experience you envision without performance. Learn more

Elise Dopson

Elise Dopson is a freelance writer for B2B commerce and martech companies. When she's not writing, you'll find her in the Peak Freelance community or on Twitter.