- Reading time: 6 mins
- Marketing Strategy
- Sales & Customer Retention
- Social Media
A couple walks through the door of your restaurant, are greeted warmly by your host or hostess, seated promptly, receive excellent customer service, and are delighted by the dishes you’ve quickly placed in front of them for their meal.
What that couple doesn’t know is that you’re fully staffed, fully stocked, and don’t have many customers – a confluence of factors that contribute to a wonderful dining experience. Much to your delight, they both leave glowing online reviews.
Two nights later, a customer walks through the door of your restaurant, is greeted by a 20-minute wait time, the waitress forgets to refill their drink, and their meal (a second choice because you’re out of what they wanted) takes longer than usual to arrive. What that customer doesn’t know is that you’re under staffed, have run out of product, and it’s the busiest night you’ve had in months. They leave a negative review – one that accurately represents their experience.
The important thing to keep in mind is that it doesn’t matter what the customer doesn’t know – that’s not how they form their impression. Rather, they develop opinions of your service or product based on their individual experience with it, which can vary greatly from customer to customer. Therein lies the danger of allowing online reviews. However, there are plenty of reasons why you should allow customers to provide their feedback. Opening your business to praise and criticism from the public is a stressful, but important part of being a successful entrepreneur.
Here are five reasons why you should encourage your customers to provide online reviews of your product or service:
Consumers read online reviews to make purchasing decisions
According to statistics presented by SCORE, 50 percent of respondents to an online survey done by Ask Your Target Market check online reviews before making a purchase, which means that potential customers want to know about the experiences of others before they decide whether they’ll invest in your product or service.
If consumers view a product or check out a service that has no feedback, they have nothing to base their purchase on and may move on to someone else with a more robust portfolio of reviews. Here are some more important statistics from an in depth local consumer review survey from Bright Local:
- “84% of people trust online reviews as much as a personal recommendation
- 90% of consumers read less than 10 reviews before forming an opinion about a business
- 54% of people will visit the website after reading positive reviews
- 74% of consumers say that positive reviews make them trust a local business more”
Online reviews are a rare commodity
According to SCORE, 35 percent of people rarely leave reviews, and 20 percent never leave them. Reviews are rare, and they’re a commodity because they influence purchasing decisions. If consumers buy based on reviews and you have none, then they may be less likely to purchase your product.
Negative online reviews can help your business improve
The American Marketing Association recently published an article about online reviews, focusing on a few different businesses and their experiences with them.
A business called ReviewTracker, which provides research about consumer behavior, such as online reviewing, gave this feedback: “Online reviews have become the fountainhead of the modern customer journey. Monitor and engage them, and see your image rise in consumers’ estimation. Ignore them, and you leave your marketing to the mercy of the masses.”
By using negative reviews to engage customers, you can follow up on their experience and try to remedy the situation. By ignoring them, or not allowing reviews at all, you allow that negativity to flourish. It’s better to meet issues head on, rather than ignore them outright. Kenney Moor of Hwy 55 Burgers, Shakes and Fries was interviewed by the AMA for this article, and said that they welcome negative feedback. “The focus on product reviews has extended to hiring an employee whose job duties include reaching out to customers that report bad experiences and, ‘turning it into a positive.’ So far, the system has resulted in the average rating for Hwy 55 locations jumping from 3.8 to 4.1 stars. Same-store sales are up as well,” the AMA reported.
Negative online reviews can actually boost sales
No, you didn’t read that wrong. According to Harvard Business Review, bad reviews can lead to boosted sales. Keep in mind that this research was based on book reviews and, the research pointed out, it depends largely on whether or not consumers were already aware of the product.
“Good reviews, as expected, increased sales across the board, with gains from 32% to 52%. For books by established authors, negative reviews caused a drop of about 15%, on average—also not surprising. But for books by relatively unknown authors, bad reviews caused sales to rise, by an average of 45%. This held even when the criticism was extreme: After one particularly scathing review, for instance (“the characters do not have personalities so much as particular niches in the stratosphere”), sales more than quadrupled.”
So why was this the case? Their analysis showed that “by making consumers aware of a book they would otherwise not know about, even the harshest review can be a boon.”
Interesting data, to be sure. The important thing to remember, however, is that even when the negative reviews do show up, they should be addressed properly, as we mentioned above.
Positive online reviews can also boost sales
On the flip side of the coin, positive reviews can do nothing but good for your business. If 90 percent of customers search through reviews before buying an item and see a lot of positive feedback, and 88 percent trust online reviews as much as personal recommendations, they will be more likely to purchase your product or service.
Overall, allowing customers to leave reviews may seem like a dangerous step, but encouraging them to leave reviews when they’ve had a great experience and monitoring negative reviews and addressing them promptly can help increase sales and build brand awareness – a win-win.