How much 1 negative review can hurt your small business?
For a business owner, the ever-ubiquitous online review sites and easy access to them can lead to uncomfortable situations. A negative review that they can’t remove is out there detracting potential customers. Most of the time, businesses take the right step and apologize after which they’ll try to make amends. Whether it is through a free meal, a discount on a dress, or free delivery, those amends can differ from industry to industry.
If this is how you have dealt with a bad rating in the past, you may be in good hands. However, had you failed to respond to the review or worse gotten into a spat on them the internet, you might have caused much more damage!
We have two things to tell you about the importance of online reviews:
- 93 percent of your consumers read them before they make a purchase
- 80 percent of them won’t do business with you if they find negative reviews about your company
You might be beginning to understand how important your online reputation is and why you may need a Reputation Management Tool. As you will see below, even one not-so-flattering review or rating can cost a business much.
But before we get into all that, let us say one thing: there is an inevitability to these reviews, especially for companies that cater to the public directly. There will always be a dissatisfied customer who has issues with a defective product. This remains true even with all the strict QA measures your company may have in place. The best you can do is to monitor your company’s online reputation so that you can respond to ratings promptly.
How one negative review may cost you
Harvard Business School suggested that business, such as restaurants, stand to lose an almost 9% drop in their annual revenue by losing just a star on Yelp. Match a 3- and a 5-star rating, and you will discover a difference of 18%! If such a business even thinks of skimping on customer satisfaction, they could be looking at bankruptcy. Don’t believe us? Do the math: a restaurant that earns $1 million annually starts losing $180,000 due to that 18% drop. How long would they be able to stay afloat?
Bad reviews attract more views
Think about it: you are about to try a new eating place. It is pricy though, which is how you find yourself doing some much-needed research online. It is safe to say that you won’t be interested in the good things previous customers have to say. Well, okay you would, but not as much as you’d be in negative reviews.
Most of your customers will do the same before they do business with you. They’ll check you out on Better Business Bureau or Yelp, as well as, Google Reviews. Other sides like NextDoor and Consumer Affairs are forums where customers post complaints. So, customers look for bad reviews.
You might be scaring away the good fish
You know how they say that it takes only a few bad fish and all that. Well, before millennials even think about joining a new company, they usually visit sites, such as Glassdoor, to check out the reviews. Most of your talent could be scared away because of negative things your former employees say about you. The top talent might decide that the reviews indicate the company is simply not worth their time. Therefore, there is little chance that they will even apply let alone show up so you can explain your side of the story!
Finally some good news…
What is the legal opinion on what a customer can say about your business? An untruth or an exaggeration of what really happened may either be considered libelous or slanderous. If the customer’s review – on social media – is just made to damage your reputation and is untrue, it becomes libel. A defamatory statement that is made orally becomes slander. But how can you expect to let the legal definition help you out? A reviewer describing your hamburger to be as raw as to be road kill might be lying and legally wrong. However, you will still lose potential customers because of that review!
Use a tool for review management
Marketing experts point out that while review management is essential, it doesn’t have to be difficult to achieve. Instead, the following three measures may do the trick:
- Ask your customers to leave reviews. It doesn’t matter if some of them will be negative because either way, reviews help you evaluate your performance
- Next, make sure that you pull off everything from having an attractive website, to assuring quality control, flawlessly. Use the incoming reviews to build credibility
- Now scatter those reviews on your website, ensuring you don’t leave out the bad ones
Is a bad review the end of the world?
No, not really! With a dependable tool on your side, you will receive a notification when someone posts such a review. You can track it down in time and do some damage control. That is a good thing!
So, how should you go about it? Start by reaching out to the disgruntled customer. Then ask them how they’d like you to correct the situation. Make sure that both the negotiation and resolution don’t take place publicly.
But besides accepting that you are in the wrong, you may also adopt an unorthodox strategy. Help your customer find a brand – out of your competitors — that better serves their need. The idea here is to let the customer see that you are willing to do right by them and just diffusing the situation.
Amazing customer service can help companies avoid an outbreak of negative reviews. But while all businesses try to serve their customers capably, mistakes can happen. In such a situation, the company at fault should own up to it and resolve the issue of the angry customer efficiently. It is equally important to realize the effect even one negative review can have on your business!