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What impact do online reviews have on my business?

Posted on by Indos Computer Services

Online reviews have exploded in popularity in the past few years due to the advent of Google Reviews, and many other review aggregate sites. If you’re buying or trying something new, or even going somewhere new, you’d be mad not to check an online review before making a decision.

It begs the question, what impact do online reviews have on businesses? There are various studies that quantify the effects that positive and negative reviews have on the health of a customer-oriented organisation. Included in the metrics are conversion rates, popularity, profitability and, crucially, sales numbers.

Impact of positive reviews

  • Unsurprisingly, there is an increased chance of consumers spending more money when they read consistently positive reviews
  • For every star over 3 stars, a business’s revenue is likely to increase by 5%-10%
  • Customers said they had an increased feeling of trust in a business with consistently high reviews
  • 84% of customers report that they trust an online reviewer as much as they trust a recommendation from a friend

Impact of negative reviews

  • Negative reviews are shown to be damaging to the trustworthiness of a business
  • 1 negative review is estimated to cost a small-to-medium business up to 30 customers
  • If 10% of overall reviews are negative, this is estimated to drive away approximately 22% of a business’s customers

What else?

It’s important that you respond to reviews left by customers, especially if they are negative. Replying to a happy customer is a courtesy that shows you care. On the other hand, responding to a negative review in a professional and considerate manner can also turn a bad situation into a better one.

Customers will see that you have taken the time to consider the negative feedback and ideally they will understand how you intend to improve in the future. Avoid offering freebies, discounts or other compensation in a reply that’s public, as you could then see your negative reviews spike. Yikes!

In summary

  • 22% of customers are scared off if 1 in 10 reviews are negative
  • Consumers are reported to spend 31% more on products and services from businesses that have outstanding reviews
  • 84% of customers trust online reviews just as much as a recommendation from a friend

Indos Computer Services is an IT support specialist who’s been keeping SMEs running behind the scenes since 1980. Our dedicated team provide the best backup services, technical support, email setup, IT training services and expertise in hardware. To get help from the very best, contact us today. We’re number one for IT in Hemel Hempstead, St Albans and Watford.

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