How to turn bad online reviews into good business decisions

Word-of-mouth and peer recommendations have always been a crucial part of customer attraction for businesses. Well before companies moved online, good words from friends, family and acquaintances had a huge impact on the decision-making process. Today, this is a fact that still holds true, albeit in a different guise – the system of trust-based recommendations has transferred to the internet, creating a digital word-of-mouth environment where the reviews and comments of others can make or break a business.

Why online reviews are important

Online review sites such as Yelp, HomeStars and Tripadvisor to name a few, are increasingly the go-to resources for consumers before they make a purchasing decision. The amalgamation of ratings, stories and past experiences that people have had with a company, product or service is becoming a highly trusted gauge for potential customers looking to determine the value they will get for their spend. In fact, 90 percent of consumers claim online reviews influence their buying decisions, and 85 percent read online reviews for local businesses.

When you think about, this trend makes perfect sense. People want the best they can get for their money. They are looking to reduce the risks that come with making purchases, and online reviews provide a frame of reference that helps them achieve this.  Prior to reviews being readily available online, customer attraction was largely served through mass advertising and repetition. Now, consumers trust organic presence and credibility more than advertising. A lack of presence conjures doubt; it means that the consumer is venturing into the unknown. Online reviews and recommendation sites lend credibility to a brand and provide a sense of comfort, because consumers can determine a) that others have used that company and b) the quality of their experience.

Furthermore, positive online reviews can help improve search engine rankings, especially on Google where citations and other social signals are used to determine relevancy and utility. They provide feedback and a mechanism for making improvements in the public eye, and can serve as a route to grow customer loyalty.

But what happens when the reviews aren’t favorable? Here are a few tips on how to approach online reviews to improve not only the perception of your customer service efforts, but also to ultimately benefit your bottom line.

The smart way to approach online reviews

1. How to respond positively to negative online reviews

It is very unlikely that every customer who has used your service or product is going to love it. Bad experiences happen, and when they do, the people who were subject to those experiences have many forums in which to voice their disappointment. On the surface, a negative review or complaint about your company may seem like a bad thing, but in fact, it presents you with an opportunity. People are more likely to make judgments not on the complaint itself, but on how you respond to the complaint. Never respond aggressively or sarcastically, regardless of the tone of the complaint. Instead, exercise tact, apologize when necessary and ask for the customer’s input on how you can resolve the situation. This provides you the opportunity to not only win over the person who gave the negative review, but also convey to other potential buyers that customer satisfaction is a top priority for your business.

2. Do not create or solicit fake reviews

Receiving negative reviews online may be detrimental to your business, but attempting to have positive fake reviews posted can be even worse. Many companies have tried this, and while some have probably gotten away with it, review sites and search engines alike are getting better at identifying disingenuous postings. They don’t like when companies try to game the system, and they are reacting accordingly. Yelp, for example, has cracked down on businesses who are paying for positive reviews by issuing consumer alerts (285 businesses have been hit), and other sites like TripAdvisor publish similar notices. Being slapped with one of these on any review site will ultimately harm your business and break down brand credibility; in the end, it’s simply not worth it. Instead, you would be better served by identifying and responding constructively to negative reviews, as mentioned above, or encouraging legitimate, genuine online reviews.

3. How to encourage more legitimate online reviews

When people have a very positive experience with a company, product or service, they tend to talk about it in conversation with friends or family. However, this doesn’t necessarily mean that they will write a review or provide a rating online; sometimes this requires encouragement on your part. Any time you get a thank you from a customer, ask if they would be willing to provide a testimonial or review. Be proactive and follow up with clients; it’s a great way to solicit positive reviews, and even if you receive negative feedback, it affords you the opportunity to address and fix the problem.

You could also try to incentivize the writing of reviews by offering promotional discounts, but this is a slippery slope: You have to ensure that you are encouraging customers to write a review (negative or positive), not paying for a positive review, which violates the terms of service of any respectable review site. If you choose to do this, make sure you exercise caution and are not violating the user agreements of these websites.

Today, genuine online reviews matter tremendously to business performance. The more positive reviews you have circulating about your company, the better for your bottom line, plain and simple. People who are in the process of making a purchasing decision are more inclined to trust the opinions of other consumers who have chosen your business than they are to trust advertisements. And while not every review you get is going to be positive, if you take the right approach, online reviews can serve to not only improve the perception of your company, but ultimately increase sales. 

Jeff Quipp is an expert on digital marketing. He is the founder and CEO of Search Engine People Inc. (SEP), Canada's largest digital marketing firm, which has been on the PROFIT 100 ranking of Canada's Fastest Growing Companies for the past five consecutive years and named one of PROFIT Magazine's 50 Fastest Growing Companies in the Greater Toronto Area. Follow Jeff on Twitter at @jquipp or connect with him on Google+.