Online Customer Reviews: Why They Matter
Online customer reviews have been making waves for some time now. They originated in the world of e-commerce, but have quickly spread to virtually every type of business. There are even entire websites dedicated to nothing but allowing customers to review the businesses they patronize. Why do online customer reviews matter so much? What is it about these reviews that allows them to have such a dramatic impact on businesses large and small?
Why Online Customer Reviews Matter
Perhaps the single best summation of why online reviews matter is that they are read and trusted by other consumers. A recent survey found that 90% of internet users read reviews before visiting a local business and that 85% of those consumers trusted the reviews as much as they would a personal recommendation from a family member or friend.
It goes beyond this, though. Customers are using those reviews to inform their shopping and spending habits. For instance, if a business has excellent reviews, consumers are likely to spend 31% more money with that business than with another one that has lower reviews. Note that this has nothing to do with product price, the perception of quality, level of service, or any other traditional metric. It is predicated strictly on the number and rating of reviews.
Why is that, though? Seventy-two percent of consumers say that it is all about trust. A business with positive reviews, particularly a local business, is seen as much more trustworthy as one with no reviews, and definitely more so than one with negative reviews.
Customer Reviews: The Impact for Local Businesses
As mentioned, customer reviews have an impact on all businesses, large or small, local, national or international. However, they have more of an impact on smaller, local businesses than they do on international conglomerates. For instance, Joe’s Shoes is going to be much more affected by a negative review from a customer than larger national brands.
What does that mean for local businesses? Simply put, a good reputation is imperative. Ninety-two percent of consumers will buy from a local business if they have at least a four-star rating, and 72% of consumers will buy from a company only after reading a positive review. That means a negative review has the potential to knock your star average down, but also to prevent a significant number of potential customers from walking through your business’ doors if it isn’t properly addressed
Really, it comes down to trust. And trust can be hard to build without online reviews. For instance, 8% of consumers state they read no reviews before buying from a company, but 24% said they read two to three reviews. Thirty-two percent report reading four to six reviews before deciding to buy from a company. The magic number seems to be four to six reviews, as consumers trail off beyond that point. 18% of consumers report reading seven to 10 reviews, and only 8% report reading 11 to 20 reviews.
Consumers point out that they use online customer reviews to determine several important traits in the businesses they patronize. For most consumers, the critical traits are professionalism, expertise, and reliability.
As you can see, online customer reviews are of vital importance for businesses, particularly for local companies. It is essential that business owners monitor online conversation, and take action. All reviews should be responded to, including positive ones, but negative reviews must be handled with care.
Infographic by- Invesp