How Generative AI Helps Companies Tap into the Potential of UGC

2023-07-04

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According to a study conducted by Stackla in 2020, 61 percent of marketers believe authenticity is the most important component of effective content, yet the content they believe is most authentic—brand-created content—is not the content consumers view as most genuine. Consumers are 2.4x more likely to say user-generated content (UGC) is authentic compared to brand-created content, while marketers are 2.1x more likely to say brand-created content is authentic compared to UGC.

UGC is simply content produced by your customers in the form of text, video, etc. posted on social media and other websites. UGC includes unboxing videos of apparel, cosmetics, or merchandise that any consumer makes and posts on social media channels.

The sheer authenticity and reliability of UGC motivate customers to engage with them. Hence, understanding UGC and how one can use it to enhance their company’s brand image is a key factor in influencing customer engagement and increasing conversion rates.

“Consumers are 2.4x more likely to say user-generated content (UGC) is authentic compared to brand-created content, while marketers are 2.1x more likely to say brand-created content is authentic compared to UGC.”

7 UGC Advantages

Listed below are seven key reasons that make UGC an indispensable tool for marketers.

#1: Establishes Brand Loyalty

UGC is invaluable as it comes from a third party and is objective. UGC is a unique and great way for your customers to become involved with your brand’s growth rather than simply being an onlooker. It helps in building and growing a community where there is a two-way interaction between the brand and the customer.

#2: Authenticity and Relatability

The sheer authenticity and relatability of UGC entice customers to engage with them. UGC is akin to word-of-mouth advertising as it influences customers’ buying decisions. It can be used across social media and other mediums like email, landing pages, etc.

Companies must shy away from faking their user-generated posts as audiences will easily spot then and it can result in serious damage to their brand. UGC must always come from the following: customers, cohorts, and brand loyalists.

#3: Winning Trust

Today, companies have to make efforts to win their customers’ trust to stand out in the crowd. Since consumers trust UGC over content created by brands, UGC is the perfect format for businesses to level up their trust score.

UGC acts as a reliable and trustworthy source for end-consumers, mostly millennials. It’s similar to the way they would seek validation from their friends and family.

#4: Converting Customers

UGC has an enormous impact during the last stages of your customer’s purchase cycle. It removes doubts from your customer’s minds that they should go ahead and buy your product. For instance, when your customer finds that people who are just like them are using your product, it motivates them to purchase your product.

#5: Adaptable and Flexible

You can use UGC as an omnichannel approach in your marketing campaigns. For instance, UGC images can be used in an abandoned cart email for nudging the prospective buyer to buy or insert UGC to landing pages to increase conversion rates.

#6: More Economical Than Influencer Marketing

Seeking the services of an influencer to endorse your product can be very costly but endorsing your products via your customers doesn’t cost anything. UGC is an economical way to grow your business by introducing a new marketing strategy. You can also save money by hiring an advertising agency for producing brand assets or content.

#7: Social Commerce

These days customers find it very convenient to shop on social channels as it allows them to directly interact with their audience. It allows you to tap on a product, learn about it, make a purchase decision, and buy the product through the app. So, UGC and social commerce are a great match as UGC drives conversions.

The Role of Content Moderation in UGC

So, now that we have understood the value UGC adds to your marketing campaigns, we need to focus on ensuring that through content moderation we can protect our brands, customers, as well as communities. Content moderation is also helpful in locating content that can be used on other channels.

Your company’s brand image is important to you and that’s why you must ensure that you join hands with the right content moderator. Some companies do not invest time in evaluating the right firms and face consequences.

The Impact of Generative AI on UGC

Now let’s look at how Generative AI can impact UGC and digital marketing.

Intelligent and Dynamic Representation of UGC

Generative AI can help intelligently represent UGC. It is capable of looking at UGC ranging from text to videos to images and displaying it intelligently and dynamically. Generative AI assists brands in identifying the most important pieces of UGC collected through the platform to ensure it is represented in the right areas.

Going a step further, AI tools can view the search history of new visitors to your website. After analyzing the history, it can offer the visitor a bunch of UGC which include pictures of products or testimonials that can lead to a sale or repeat visit.

Directly Targeting Customers

Generative AI enables brands to target customers directly. It is ideal for going through large data sets and locating hidden patterns. Machine learning enables AI technology to pinpoint customers who will potentially buy or attach to your brand as per demographics, visit history, and previous purchases. Targeting customers will only become stronger with the adoption of AI tools and generative AI algorithms.

Mass Content Creation

Generative AI will affect marketing and UGC marketing campaigns through the creation of content on a mass scale. As social media and the Internet are moving at a rapid pace, you need to create many content pieces per week ranging from social media posts, videos, blogs, etc. Creating all the content can prove to be very expensive and result in a waste of time. Using Generative AI, much of the task can be offloaded onto AI tools. Within minutes, Generative AI generates accurate articles relating to trending topics in your industry.

Personalization

Generative AI can assist you in making money by creating marketing materials and web content that resonate at a deeper level with your target audience. E-mails and marketing messages tailored as per every reader’s interest can be sent at the time your target audiences are likely to engage with them. Only highly relevant website content will be displayed as per visitors’ online activity and location helping in improving conversion rates.

Hence, there is no doubt that Generative AI is bound to make a sea change in the marketing industry in a couple of years. By personalizing and tailoring content that’s tailored to single customers, brands are likely to collect more data around conversion and the way it’s related to the content that’s shared.