The Impact of Customer Reviews On Your Business

The Impact of Customer Reviews On Your Business

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Think that entitled woman’s rant on your Facebook business page about your store’s rude service is harmless? Think again. One bad review, if not handled properly, can hurt your business’s reputation and affect your sales.

As the online world continues to expand, it’s not only businesses like yours that find it easier and faster to reach many people and sell your products and services. Customers have also become more involved and vocal about the brands they know and use. The wide reach of the Internet has also made their reviews easily noticed and read by many people, making their opinions more impactful and influential to the public perception of your business.

Because of this, it is important to take an active approach to manage customer reviews.

How Customer Reviews Impact Businesses

The digital era has not only made it possible for people to make purchases online, but it also allows buyers to research about the products or services they’re planning to get before making the purchase. One of the essential information about that would-be customers looks for in the review.

According to 2018 study conducted by Bazaarvoice, 82% of smartphone users do a quick online search about the product or services they are about to pay for and 45% read reviews before making a purchase. This and many other separate studies highlight the enormous influence of customer reviews, especially in the digital era of shopping.

Customer reviews can be either negative or positive. While negative reviews are damaging to the business, positive ones provide several benefits.

Positive Reviews

  • Improves business reputation

Consumers will trust your company over lower-rated competitors. Positive feedback from past customers increases the likelihood of a prospect to choose your company. The more customers write great reviews on your website or Facebook page or talk highly of you on business review sites, like Trustpilot and Better Business Bureau, the more you establish a great reputation and brand recognition in your industry.

  • Higher search engine ranking

Positive reviews signals search engines like Google that your business is trustworthy and is likely the best solution to their users' needs. This will deliver more clickthrough to your site, which will eventually land your website on the top search engines.

  • Increased sales

The more positive reviews your business has, the more you built a reputable image that convinces customers to choose you over your competition and patronise your products or services. Studies have shown that businesses with excellent customer reviews encourage customers to spend around 31% more.

  • Boost marketing initiatives

Positive reviews are powerful marketing assets, especially for attracting new customers. Many people tend to relate more to a random housewife or an office worker who share a great experience with a new beauty cream than with a high-maintenance celebrity. These positive reviews are as powerful as word-of-mouth marketing, especially for brands that are new in the market.

  • Easy to maintain

It’s cheaper to manage and maintain a positive online reputation than it is to repair a negative one or go through a rebranding process.

  • Promotes customer engagement

Reviews provide an opportunity for businesses and customers to build a relationship with one another. Establishing an emotional connection with customers is shown to provide 23% more revenue than with a non-engaged customer. The impact of the customer-business bond is reiterated by Gallup Research, which indicates that in sectors such as retail banking, customers who are fully engaged bring 37% more annual revenue to their primary bank.

Negative Reviews

  • Damages a business reputation

A business’ solid reputation takes years to build, but one negative feedback from an irate customer, especially if it has gotten so much attention, can significantly make a business less trustworthy or shady.

  • Low search engine ranking

Search engines continuously adjust its algorithm and regulations to keep it up to date and fine-tune its search accuracy, but one of the factors that have remained important in SEO is an online review.

How so? Having negative reviews repel would-be customers from visiting your site just one, which leads to a decrease in clickthroughs. One negative review can drive away approximately 22% of customers while three negative reviews can drive away 59% of customers.

  • Lose customers

With your brand’s established reputation tarnished, customers would feel less secure in transacting business with you. They would be likely to take their cash elsewhere.

  • Lose sales

As fewer people buy your products or use your services, your sales start to drop. If not, this would lead to the demise of the business if not properly addressed.

  • Difficult to regain trust

A business with a lot of negative reviews will require more effort and time to rebrand and gain customers’ trust once again. This is one of the reasons why a business would change its name—to disassociate itself from the distrusted brand and create a new positive image.

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How to Deal with Negative Reviews

So if reviews are necessary, but the negative review can drive away customers, what’s a business to do?

Respond promptly

  • Make it a habit to check your Facebook page or Google My Business Listing consistently for new customer review.
  • If it’s a negative one respond quickly as a fox!

Write like a person, not a corporation.

  • This will be a good indication that you take your customers seriously.
  • Connect with them. Writing things like “I understand your dilemma, but we’re very glad to help” increases your credibility.
  • Do not sound like a robot. Do not copy and paste every response. Personalize it.

Be consistent

  • Keep things in mind that customers know if they’re talking to a robot or a real person.
  • Be consistent on how you interact with them while solving the issue.
  • This includes your messaging tone, the length of your message and even the grammar quality of the context should be consistent all throughout the process.

Escalate to resolving it personally

  • The best practice that I can recommend to you in trying to solve negative issues is taking it offline.
  • Respond to their review publicly and then take the whole conversation privately, whether it’s through an inbox or call.
  • Get their contact details and encourage them that you’ll work together to solve this.
  • If an issue is sorted out and with permission from the buyer, you can share how you handled it on the web.


Overall, negative reviews can have a significant impact on a business. Online reputation management is becoming essential in every company’s management toolbox.

In a world governed by the internet, online reviews are bound to drive customers towards or away from a brand. Placing customer satisfaction at the top of the priority list for your business can only help your company’s sales and profitability.

Online reviews are a natural way for consumers to relay their experience with your brand. It’s vital to your business that you monitor and manage positive and negative reviews. It’s the best way to leverage their effectiveness and ensure your brand is accurately represented.

Online customer reviews can make or break a business. But fear not, because it’s part of managing it. How you deal with them is the real challenge.

This is a necessary part of taking your business online. If you want a positive online footprint, you need to invest more in generating positive online customer reviews.

Need financial assistance to start or expand a business? Positive Lending Solutions helps businesses grow and expand with business loans. Call us on 1300 722 210 or complete the online Loan Pre-Approval form.

See also:

TMD Electrical - A Positive Lending Solutions Story

How to Buy an Existing Business

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