Why Online Reviews Are Important for Small Business Owners

Back in 2017, London was buzzing about the new restaurant that was topping the TripAdvisor charts. For a period of two weeks, it was the top-ranked restaurant in London. The only trouble was it was all a stunt.

The Shed at Dulwich, as the fake restaurant was called, was a prank created by a Vice writer Oobah Butler. The shed was the only real thing in the whole story, being his own and located in his backyard. Butler created some fake photos of the food he supposedly served at the restaurant and then enlisted help from friends and family to write stellar reviews of his culinary virtues. As he reached the top spot at TripAdvisor, he decided to reveal the whole deal and invited some of the people that were pestering him for reservations over for a dinner, consisting of frozen meals from a supermarket. Funny enough, some were delighted and asked to come again.

Of course, this is a drastic example, but it goes to demonstrate how powerful online reviews can be. If a guy can create such a buzz over a non-existing restaurant, and in one of the most competitive markets in the world to boot, imagine what people who offer a quality service can do.

The Importance of Online Reviews

Online reviews are a crucial tool for small businesses in today’s market. Sites like TripAdvisor, Google My Business, and Yelp are designed for the sole purpose of sharing their users’ impressions and discovering what people said about that new place you are planning to visit. Over time, they have become immensely powerful in shaping the public’s opinion, but have also allowed small businesses to compete with their corporate competition and claim a piece of the market. Online reviews are also very helpful when dealing with online services and weeding out scammers. For instance, if you have heard of a new online casino, the first thing you will do is check their reviews and see if they are legit or not, before handing them over your credit card info.

The Impact of Online Reviews

It is vitally important for small business owners to control their image on the consumer review sites. Their page on Yelp is their new front window, which anyone can see and comment on. Every customer that walks through their door is potentially a five-star review. They don’t even have to wait to go home and post a review. The technology has allowed us to do it right then and there, creating a real-time information surge. The best (or the worst, depending on your view) part? More than 84% of people trust online reviews as much as they do personal recommendations, regardless of how strange that sounds.

Negative Online Reviews

Unfortunately, the opposite is also true. Positive online reviews can make your business, but just as easily, bad ones can break it. According to research, 22% of all customers will look elsewhere to spend their money if they see just one bad review of your business. The effect scales up and by three negative reviews, the number goes up to 59%. Four and more means that 70% of your potential customers will walk away. That is a lot of lost revenue and just because of a few bad reviews.

Resolving Negative Online Reviews

But even bad reviews don’t have to necessarily mean a death sentence for your business. According to Sensis, an Australian market service, nine out of ten customers reacted positively to a response made by the business to a negative review. In other words, people tend to ignore bad reviews if you try and explain how it happened or offer your version of the truth.

Even without entering the debate of the morality of alleged shady dealings by online reviews sites, the reality is that online reviews are something every small business owner has to take into account. They can provide you with a real-time information on how your business is doing and should be considered a very important feedback source. Yesterday, it was a word of mouth that was considered the most trusted form of marketing. Today, it is online reviews.