SEO

Do Online Reviews Have the Power To Decide The Fate Of Your Business?

March 1, 2018

It's been years since consumers started to see themselves as their own most trusted product reviewers, when E-commerce sites like Amazon opened the floodgates for their customers to assign star ratings and post reviews of the products they had purchased.

Yelp brought this paradigm of consumer-as-reviewer to hometown brick-and-mortar stores, and now, with rankings, ratings, and reviews attached to nearly every online marketplace, and plenty of forums and opportunities for consumers to lay down their judgment on products, apps, services, and experiences, it can feel like online reviewing has reached a saturation point. But is there such an abundance of consumer opinions, with cheerleaders and detractors for almost anything you can think of, that online reviews don't really matter anymore?

Online Reviews Have the Power To Decide The Fate Of Your Business

It's been years since consumers started to see themselves as their own most trusted product reviewers, when E-commerce sites like Amazon opened the floodgates for their customers to assign star ratings and post reviews of the products they had purchased.

Yelp brought this paradigm of consumer-as-reviewer to hometown brick-and-mortar stores, and now, with rankings, ratings, and reviews attached to nearly every online marketplace, and plenty of forums and opportunities for consumers to lay down their judgment on products, apps, services, and experiences, it can feel like online reviewing has reached a saturation point. But is there such an abundance of consumer opinions, with cheerleaders and detractors for almost anything you can think of, that online reviews don't really matter anymore?

Hardly. Studies have shown that online reviews still have a huge influence over consumer decisions. Customers tend to give online reviews the same weight as personal recommendations, and spend more money at places that have overall positive reviews. Negative reviews, in some cases, can drive away as much as a quarter of a company's business.

Online reviews can affect a company's reputation, sales figures, profitability, conversion rate, and product awareness. As tempting as it can be to write off bad reviews as the inevitable sour grapes of cranks and internet trolls, they can do real damage to your business. Conversely, positive reviews are well worth striving for and seeking out.

The value of a good review

Consumers trust their fellow shoppers' online reviews, and when they see positive reviews, that trust is given to the company receiving them as well. There's a direct line between good reviews and increased revenue: consumers will pay more for products from well-reviewed businesses. Each star out of a five-star reviewing system can represent as much as nearly 10% increased revenue!

 The cost of bad reviews

 On the flip side, even a single negative review can have a disproportionately powerful impact on a company's bottom line, and when multiple negative reviews stack up, the consequences for a struggling business can be devastating. Three negative reviews can cost a company nearly two-thirds of its customers. Over 80% of surveyed customers state that they won't patronize a business with negative overall reviews at all, and almost all shoppers check reviews before they decide whether to do business with a new company. Nearly half of consumers will insist on a rating of four stars or better.

Customers are savvy, too, and look for authenticity. Companies that puff up their online reputation with glowing reviews from family and friends won't necessarily sway the types of consumers who read online reviews. Fake reviews aren't always easy to spot, but today's consumers are keenly aware of their existence, and look for reviews with the ring of authenticity.

Reach for those stars

Any company that wants to stay successful, popular, and profitable in this day and age needs to make customer satisfaction a top priority. Then, funnel customer satisfaction into bolstering reviews, ratings, and online reputation.

Over two-thirds of customers will leave an online review if asked. Online reviews are now an inextricable part of any company's strategy for self-promotion and reputation-building, and smart business owners will embrace any opportunity they can to score high marks.

WRITTEN BY
Gregory C Bennett Sr.

And now, Greg is working with Localmatterz World Wide to see where it takes us, and how we may help even more small businesses succeed. His passion is, and always has been small business.

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