UGC refers to content generated by users on social media platforms on the internet.
Over the past few years we have seen the emergence of an internet-enabled capability that has now become ubiquitous in some markets and industries – that of allowing users to generate content about their product experiences, their transaction experiences and their purchase intent – that is available to other users.
The increasing democratisation of online content creation is changing the nature of interaction between consumers and companies, whose strategies are shifting from influencing consumers directly to mediating the influence consumers have on each other. Under this new paradigm defined by the growing reliance on user-generated content, consumers' choices and opinions become more transparent while their views, decisions and interests shape the behaviour of other consumers. Much of this content, both structured and unstructured, has an economic value that can be quantified. This significantly expands the nature of consumer intelligence available to firms. Examples include product reviews, blogs, wikis, microblogs, content on social networking sites as well as multi-media content such as photos, graphics, videos, and podcasts.
User-generated product reviews of electronics products (smart phones, plasma televisions, laptops, etc) have enabled consumers to provide feedback on the design and functionality of these products, which in turn has been taken into account by manufacturers to change their design in future product releases.