What do Marketers Misunderstand About Online Reviews?
In a recent article in Harvard Business Review, Itamar Simonson and his co-authors discussed what marketers misunderstand about online reviews. They proposed that consumers’ ratings and reviews help bridge the gap between marketing and engineering by revealing the bargaining power of customers. This approach can improve the customer experience and lead to improved brand perceptions.
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Positive reviews increase brand trust
Customer feedback is an excellent way to increase brand trust. According to a recent study, more than 72% of consumers are willing to trust a brand after reading a review. In addition, they believe that a brand is more trustworthy if the customer has a good experience. Positive reviews on social media such as Facebook and Google can help brands improve their reputation and increase their sales.
Moreover, many consumers trust online reviews just as much as they trust their friends’ recommendations. If a business receives just one negative review, it can lose up to 22% of its customer base. Fortunately, there are several ways to increase brand trust: first, be open to customer feedback. For instance, you can ask your current customers to leave reviews online if they’re happy with the product or service. This will help you build more customer loyalty since customers will feel like you’re interested in their feedback.
Negative reviews increase bargaining power
Negative online reviews can be a valuable tool for shoppers. They can reveal issues that have not been resolved with a product or service. Moreover, they can provide insights that can help improve the business or product. This way, negative reviews can improve the performance of a business and boost its social capital reserves. Faith Hinz, a freelance writer for SaaS companies, explains how negative reviews affect a business.
For example, a bad review of a children’s play kitchen could indicate a problem with the product, leading to an increase in return rates. A high number of negative reviews could also lead to a more effective quality control process and improved brand performance.
Influence of online reviews on the buying process
Consumers are often influenced by reviews of products or services they’re considering buying. Although these reviews are promising data sources, they can also be a risk factor. Consumers’ perception of risk can influence their intention to buy and their behavior once they’ve made the purchase.
Customers consider many factors before deciding to buy a product or service, including its appearance and performance. Positive reviews on the product or service have a strong impact on the first stage of the buying process. According to a BrightLocal survey, 85% of consumers read online reviews when looking for a product or service. Another study by Harris Interactive revealed that 42% of Americans searched a business’s online reviews before doing business with them. In addition, 28% of consumers said they would spend more if they found a positive review.
Impact of online reviews on SEO
Consumers read online reviews as a way to gauge a brand’s reputation and quality. In turn, a brand that has positive reviews is more likely to get higher rankings in SERPs. So how do online reviews help your SEO strategy? First, consider that Google considers reviews as content. As such, it will crawl reviews and use them as part of its search engine ranking algorithm. Second, reviews will likely contain relevant keywords that Google will use to understand your business.
Getting online reviews is important for any local business, especially if you are trying to increase visibility. Consumers value the quantity and freshness of reviews, so it’s vital to have enough of both.