As more and more people are sharing their everyday experiences on the world wide web, online reputation has become an important factor in determining whether a business will go bust or become a roaring success. Did you know that 90% of consumers read online reviews before visiting a business? Whether you run a simple burger joint, a restaurant offering unique culinary experiences or a luxury hotel overlooking the sea, what people are writing about you on the internet can make or break your business. Let’s take a look at some of the most crucial ways in which online reviews have the power to influence the successfulness of your business:
Social reach and trust building
We live in a time where, due to massive false advertising with sole intent to gain bigger profits by deceiving potential customers, people have simply stopped blindly trusting businesses when they promote their own services to others. No matter how amazing your business is, self-praise will only get you so far; research shows that consumer reviews are nearly 12 times more trusted than descriptions that come from businesses. Nowadays, people seek real advice from real users, sharing their honest and unfiltered opinion about their experience with the business, which is why reviews have become the best way for businesses to build a bigger social reach and establish valuable trust which instantly converts potential customers into paying customers — a study shows that 92% of users will use a local business if it has at least a 4-star rating.
Priceless feedback for business improvements
Although one might think that negative reviews can do nothing more but severely harm your business, that is actually not the case at all; in fact, negative reviews can help you achieve a thriving success by engaging with your customers and improving your business according to their desires. A study showed that when retailers replied to negative reviews, a third of customers either deleted their original negative review or replaced it with a positive review and nearly a fifth went on to become loyal customers. So, the main factor in determining how reviews will affect your business’ success is actually not the ratio between positive and negative reviews, but how fast and well businesses response to them. What people want are instant, honest and personalized interaction, feeling that the businesses like engaging with them, value their opinion and that they are striving to realize people’s recommendations — case in point, a study by Cornell University professors discovered that sales go up each time a business responds to a review.
Better reviews equal better profits
It is not surprising to discover that better reviews with higher ratings directly correlate with increased revenues:
- 76% of travelers said that they were willing to pay more for a hotel with higher review scores.
- Every one star increase in a Yelp rating means a 5 to 9% increase in business revenue.
- Just one review can boost conversions by 10 percent, a 100 reviews by as much as 37 percent and at 200 reviews, the conversion rate could rise by a stunning 44 percent
- Customers are likely to spend up to 31% more on a business with top reviews.
Looking at all available data on the correlation between online customers reviews and businesses, one fact is certain — online reviews hold an immense power over the success of businesses.