Consumer Buying ProcessGetting Online Reviews

How Heavily Do Consumers Weigh Online Reviews

The average business owner understands that positive reviews can be a good thing and negative reviews a bad thing.  But the effect of online reviews is becoming far more apparent as studies come out showing the effect on a business’ bottom line.bottomline

Online reviews play a large role in more than customer perception.  Search engines, Google specifically, place a lot of importance on online reviews as discussed here. Consumers are also very impacted by online reviews, both negative and positive.  Last year, 49% of consumers said they read online reviews regularly. Not just once or twice a year, but regularly, as they search for local business.  This number has been increasing more and more every year, as well. Consumers are looking for both positive and negative reviews, each of which will have it’s own drastic effect on the consumers perception and buying decision.

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Positive Reviews

Positive reviews are going to help a consumer commit to a single local company and help make them confident in their buying decision.  ‘87% of consumers have had their decisions to purchase products or services reinforced by online reviews’ [source].  This means that these consumers most likely already had a company in mind, most likely from a word-of-mouth referral, and looked them up online before making their decision. If almost 9 out of 10 of your consumers will make a purchase decision based on something you had direct control over, would you try to do that thing? Of course! In addition to helping consumers make a purchase decision, a study shows that 72% of consumers say positive reviews make them trust businesses more [source].  Having a customers trust, before going into business will make every business owners life that much easier.  When a customer trusts a business, they are more understanding of potential mishaps and searching for problems and red flags far less, because they already feel like they know and trust this company.
Now, lets talk about the bottom line.  All of this is great, but do positive online reviews do anything for revenue?  To be direct, yes! A Harvard Business School study said a one-star rating increase on Yelp lead to a five to nine percent increase in revenue.   Click here to see how to get a steady flow of positive online reviews.
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Negative Reviews

Negative online reviews can ruin a business. They are nothing to take lightly or ignore. Remember that situation we discussed with positive reviews, of a consumer looking a business up online and confirming their purchase decision, well the same situation can happen but a far different result if they find negative reviews. 80% of consumers have changed their minds about purchases based on negative information they found online [source].  Having a customer choose you over your competition is hard enough, but to then lose them because of negative online reviews on your review sites is something most businesses can’t overcome. 80% may also sound like a staggering number, but it isn’t quite as dramatic as the 90% of people today that will not buy a product that has bad reviews [source].  Those are huge percentages of consumers that are black listing companies with bad reviews.
Although these are serious stats that are not to be taken lightly, there is a positive side of negative online reviews.  According to Kruse Control, there are 3 positive effects of negative online reviews:

  1. You get to hear what customers think about your business in real time
  2. You are served up a learning opportunity for your staff
  3. Future customers get to witness how you handle negative customer experiences

Also, negative online reviews are NOT a death sentence.  You can recover from negative online reviews.  The goal is to give your happy customers a louder voice.  I know I’ve said this before, but some unhappy customers is the nature of any business.  You can not make everyone happy.  But, a good business will have many happy customers for every unhappy customer, the difference with what is represented online is the amount of time the unhappy customers are willing to use to share their bad experience with others, via online reviews.  The best approach to recover from negative online reviews is to have the positive online reviews outnumber the negative online reviews. Check out the SurveyLocal tool here if you have negative online reviews affecting your bottom line.

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