My company, Vagaro, provides a marketplace for service-based businesses within the self-care industry (e.g., spas, salons). Initially, clients were wary of using the marketplace because they were afraid customers would see competitors and book appointments elsewhere. To ease this anxiety, the team and I built the capacity to gather verified customer reviews in the marketplace. By building and maintaining this system, we established clear best practices that companies and customers can lean on to understand what’s going on in the business.
Just How Powerful Are Reviews, Really?
In a 2017 survey, 93% of consumers surveyed admitted that online reviews have an influence on the purchase decisions they make. Respondents who don’t trust reviews at all represent only 3%, down from 17% of respondents in a survey given in 2014. But how exactly does this translate to the bottom line?
On the negative side, data from ReviewTrackers found that 94% of consumer respondents have avoided a business because of what a review said — that is, people tend not to take the risk of moving forward with a transaction if they read something that’s not favorable. But on the positive side, excellent reviews can increase customer spending. In an older study, this increase was found to be 31%. Any jump can help a company, but it’s especially significant for new or small businesses, which typically don’t have budgets that leave room for error. Even small profit increases can make the difference between failing or being able to scale.
How To Interpret the Reviews People Leave
A basic rule of thumb is to assume that not all reviews are going to represent the reality of the business. It’s not unusual for someone to vent about a company just because they need a scapegoat on a bad day, and similarly, some people leave glowing reviews on purpose to help a company gain traction, even when the product or service isn’t particularly outstanding.
Once you understand that some of the reviews are likely to be outliers, assess how many reviews there are. A lack of reviews might indicate that the company simply hasn’t done a lot of business yet. But people are more likely to write a review, for better or worse, when the company has produced a strong emotional response through their product or service. So lots of positive reviews are a good sign that the company is doing a good job building deep relationships with customers. Ideally, you should see plenty of reviews for all of a company’s products, not just a select few.
Secondly, look for some kind of verification on the review. Some businesses have manual verification systems where a representative cross-references customer data and correspondence to ensure the transaction occurred. But many companies use software to do this automatically, especially once they grow to have thousands or even millions of customers. Either way, verification helps prevent people from leaving false reviews that misrepresent the business.
Next, assess quality. Good reviews provide specific details about the transaction or product. They stay oriented to what’s relevant and don’t blame the company for issues that weren’t the company’s fault (e.g., the customer’s kid spilled coffee on the brand new laptop, the buyer forgot their subscription renewed despite reminder emails and texts). Big red flags that the review is fake or biased include poor (or too-perfect) grammar, extreme emotion, many talking points and a star rating that doesn’t match the star rating provided.
Quality also ties to the frequency of the review and who is posting. It’s normal to see a slight uptick in reviews after a product or service launch, as the launch drives new sales for both the new item and whatever in the catalog is related to it. But a huge, sudden surge can indicate that the business or a specific customer is suddenly trying to pad the reviews for a different impression. If the reviewer has left multiple reviews for a company, compare those reviews to see that they’re relatively consistent and balanced.
Finally, sort the reviews so your newest reviews are at the top. Sometimes, companies improve vastly over time. Conversely, businesses might start out great and sour with the passage of months or years. By sorting the reviews, you ensure you’re seeing what represents the business in the present.
Bad Reviews Aren’t Always Bad for Business
Good reviews can show you what your business is doing really well so you can continue those actions. But bad reviews hold opportunities in that, if you are keeping a close eye on customer feedback, you can address issues quickly, sometimes even in real time. Most customers will respond positively if they know that you are trying to help, so if you see a negative review, that’s your chance to ask the customer how you can make it right or to provide some kind of compensatory offer. This ties to the sorting of your reviews. As a customer, you should be able to see what the company has done to rectify a problem that happened earlier or that the business is trying to take steps to improve.
You shouldn’t give in to the temptation to remove bad reviews you see. Customers can become suspicious if all of your reviews are positive. So focus on fixing what occurred rather than whitewashing it.
Do Great Business and the Good Reviews Will Come
In an increasingly competitive global market, many companies feel the pressure to create a perfect review page. But a good customer-business relationship isn’t built on perfection. It’s built on transparency and honest communication.
To that end, your goal should be to use the tips above to dissect every review, good or bad, and ask yourself, “How can I use this to be better?” And ultimately, getting the positive reviews you want is a matter of doing great business. Focus on delivering your absolute best, because the better you perform, the more customers will naturally want to give you feedback that helps your business thrive.
