On Wednesday, Sam has an important business lunch scheduled with a potential client.
It’s not just any old client, though.
It’s that one client that he’s been trying to convince to meet with him for months; that one client that Sam really wants to work with.
Despite Sam’s hesitations, the client has tasked him with choosing the lunch venue. His secretary let it slip that he’s a fan of Thai food, so Sam wants to take advantage of that information and use it to help win him over.
Now, put yourself in Sam’s shoes – you live in a city of 500,000, but you need to find the best Thai restaurant in town to impress your client.
What’s the first thing you’re going to do?
Well, if you are like most consumers today, I bet your first thought was to do an online search and check out the online reviews to find the best option.
And, if your first thought was to consult online reviews, who’s to say that’s not exactly what potential customers will do when searching for businesses like your own?
After all, 90% of customers admit that their buying decisions are influenced by online reviews.
Whether a consumer is finding the most trustworthy mechanic or looking to purchase a new computer, the answer will be the same.
So, what does that mean for you and your business? And why should that knowledge be important for you?
Let’s dig right into some of the top benefits of having online reviews.
1. Build Customer Confidence and Trust in Your Business
Especially if you are a new business, reviews will go a long way in simply getting customers to take that first step through your door.
For example, let’s say Christine just moved to a new town and needs to find a new dentist for herself and her family.
It’s a small town, so when she searches online for dentists, she only gets 3 results.
The first option has about 20 reviews, all falling into the 4 and 5-star category.
The second option looks promising, but it only has half the reviews of the first.
The third option has no reviews.
Which one do you think Christine would choose?
Well, according to Bright Local’s 2016 Online Review Survey, 74% of consumers say that positive reviews make them trust a local business more. That same study also found that 88% of consumers trust online reviews as much as personal recommendations.
In other words, consumer reviews play a big role in forming your customer’s opinion about your business… all before they even purchase one of your products or services in the first place!
With these two stats in mind, I think we can safely say that Christine would choose the first dentist.
Even if the third option was actually the best dentist of the three, Christine would never know and that dentist would be losing out on a lot of business just because he or she didn’t have any reviews.
2. Score Some Free Advertising and Marketing
Traditional forms of advertisement are expensive and can be especially difficult for new small business owners to afford.
Unfortunately, if business owners can’t get the word out about their great product or service, they just can’t compete with the big guys!
Fortunately, online reviews are a great way to generate free advertising for your business with minimal effort.
Once you’ve set up a convenient and easy way for your customers to leave you a review, your customers will take over your marketing for you!
Just think of each review that rolls in as a mini free “ad” that’ll help promote your business and encourage customers to choose you over your competition!
3. Find Your Unique Value Proposition
Often, business owners are convinced they know exactly what their customers want.
For example, the owner of a Christmas tree farm may think his customers want nothing more than a tree to put in their living room.
But when a customer comes to his farm to buy a tree, is that really all he thinks about?
Chances are there’s a bit more to it.
Perhaps one customer visualizes the family bonding and togetherness that he expects to occur while decorating the tree; perhaps another customer identifies the tree with the feelings of nostalgia or comfort from her childhood Christmas traditions.
See the conflict between what the owner thinks about his product and what his consumers think?
The difference between these two things right here is a classic example of a unique selling proposition vs a unique value proposition. (You can read all about these two and tackle a beast of an article dedicated to Customer Value Optimization here.)
Knowing your brand’s unique value proposition (exemplified in this case by the customer’s feelings of togetherness and comfort) is essential in successfully communicating with customers – and thus generate sales.
By looking at customer reviews, you can see exactly what it is that makes customers love your business. Sometimes, it might even be for a reason that you never expected!
Knowing this, you can create a unique value proposition that really resonates with your customer. After all, what could possibly resonate more with customers than their own words and perceptions.
4. Increase Your Revenue
This benefit is pretty straightforward:
more positive reviews = more customers coming to your business = more revenue in your pocket
But the question is just how much more revenue? Well, according to The Harvard Business School, a one-star increase in your Yelp rating leads to a 5-9% increase in your revenue.
Interestingly, this favors small businesses over large ones. In their study, they found that this increase only happened with independent restaurants; chain restaurants didn’t see the same revenue growth.
5. Enhance Customer Satisfaction
Research conducted by a software company found that 78% of buyers who checked reviews before buying were either “extremely satisfied” or “very satisfied” with their purchase (And keep in mind that a satisfied customer is likely to leave you a positive review!).
Let’s see an example of how this works in action.
Imagine you’re in the market for a new laptop. You’re browsing online when you come across a decent looking laptop for a killer deal.
You take a glance through the reviews and see it’s mostly full of positive feedback and has a rating of 4.5 stars.
There is one thing that catches your eye, though – several reviews have mentioned that the screen occasionally blacks out.
After some further consideration, you decide that small issue is worth it for the good deal you’ll be getting.
Once your computer arrives at your home and you encounter your first screen blackout, you’re annoyed, but not surprised. So, despite this small flaw, you still leave a positive review overall.
Now, let’s say you didn’t check the reviews beforehand. Once your computer arrives and you encounter your first screen blackout, how would you feel?
Chances are you’d be pretty dissatisfied with the product… and perhaps even leave a negative review because of it.
The key difference between these two scenarios is expectation.
In the first scenario, you were expecting a small flaw so your impression of the product was positive. In the second, you were not expecting to find this flaw (and probably had higher expectations for the product than in the first scenario) so your impression of the product was negative.
6. Improve Your Online Visibility
One of the most important reasons to have online reviews is the boost they can bring to your SEO.
(PS: Need a little SEO review? Check out our beginner’s guide to SEO.)
Like it or not, it’s SEO that’ll dictate which businesses your customers see first when they search online for a specific product or service.
And, in 2015, consumer reviews accounted for 8.4% of what Google and other search engines use when ranking search results.
It’s definitely in your best interest to up your review game for the sake of your SEO.
For example, let’s say I do a quick Google search for “lawyers in Pittsburg, PA.” You can see the screenshot of the top 3 search results below. I would have to click a second button to see business names beyond these 3.
As you can see, the top 3 results either have a very high number of reviews or a near-perfect star rating.
Customers don’t always keep scrolling beyond these initial results, so they may never so much as glance at your business if you’re not near the top.
Aiming to increase your reviews is a useful thing you can do to help improve your business’s overall SEO and make sure customers see your business first.
What About the Risk of Negative Reviews?
While many business owners don’t deny the benefits of having positive online reviews, some are fearful of the effect negative reviews can have.
Luckily, there are several ways that negative reviews can benefit you!
To start, having a couple of negative reviews actually make customers more likely to trust your business.
Just think about it.
Let’s say you’re looking at a hotel in Paris that has 200+ positive reviews. At first, you think this hotel looks great!
But as you continue searching, you realize that not one of these reviews is anything short of 5 stars and gushing praise. Wouldn’t you think this looked a little suspicious?
Having a few negative reviews in there actually gives your customer an impression of transparency and authenticity. I mean really, no place can really be that perfect.
It’s that whole “it’s too good to be true” mentality.
However, just having a few negative reviews on their own isn’t enough – it’s the way you respond to the reviews that can really make them a benefit for you.
In fact, research shows that hotels that respond to negative reviews with a polite, friendly voice increased their image of trustworthiness and genuine customer concern.
The benefits of responding in a controlled manner to negative reviews is two-fold: not only will it soften up an upset customer, but prospective customers can also see this response and perceive you as an honest, enjoyable person to work with.
A final benefit of negative reviews is that they let you see where your business’ weak spots are.
So, if you are getting multiple reviews mentioning slow service or a rude assistant manager, don’t just write them off as a picky customer – take a good, hard look at them to see if there are some real changes that need to be made.
Okay, You’ve Convinced Me. But What Can I Do to Get More Online Reviews?
We know that no matter how many satisfied customers you have, it can be hard to actually get them to write those reviews.
That’s why we created The Review Funnel, a product designed to increase your reviews by guiding your customers through an easy process.
Ready to start utilizing the single most effective bit of marketing you can do for your business?