Posted by There is no doubt that allowing customer reviews on any website creates more sales. But, there’s something else that is happening too…
Like you, I’m a huge fan of consumer reviews (or customer reviews or peer reviews – depending on who you ask). The statistics speak for themselves. In fact, if you haven’t seen much info on the power of letting your consumers talk about your brands, products and services, check out this page from Bazaarvoice: Bazaarvoice statistics. Basically, most people seek out real reviews from their peers prior to making a purchase (and they take what is being said in those reviews very seriously).
But, it’s not all about closing the sale.
Just today, I was interviewed for the radio show (and podcast), Spark, on the CBC with Nora Young. The segment revolves around a Bed & Breakfast owner who had one very negative review and could link it directly to the loss of several reservations. It took the owner a while to realize that those cancellations were because of a customer review online, and from there he did everything possible to rectify the situation.
Here are 6 top-level reasons why customer reviews matter more than you think:
- They force us to pay attention – the owner of this bed and breakfast would probably not have lost other customers had he been using simple listening tools like Google Alerts.
- You can’t control them – even if you don’t allow people to review your products/services on your site, they can do it elsewhere online (like Yelp, etc…). On top of that, they can simply use Twitter, Facebook or even their own Blog to review you.
- They force us to be better – it’s hard to argue with the fact that we live in a world where anybody and everybody is now a published critic. This is not like the old days of a local news crew creating a sting operation to get someone their money back. Now, everything is (or can be) recorded in text, audio, video and images and published to the Web in real time. Simply put, your products can’t suck anymore and they can’t be inconsistent either.
- They force us to be naked – if your product isn’t up to par, you will hear about it fast and from many places. On top of that, those critiques are now a permanent record on the Internet. They are findable, searchable and linkable… to put it bluntly – they are very simple to spread.
- They are a free (and huge) focus group – with over 1.5 billion people online and over 80% of people seeking out peer reviews prior to purchasing anything, it’s clear that people ask their own online social network before buying just about anything and everything. Search has come a long way. Tools like Twitter Search, Technorati and Google Blog Search let you "listen in" to what people are saying – out of their own free will. You’ll hear all about the products and services you sell as well as those of your competitors. You can even follow conversations around the industry you serve… and more. If that is not one of the most amazing tools ever created for business, I don’t know what is.
- They force us to innovate – if your product does suck, you’ll know why and even get suggestions on how to fix it. When was the last time you could actually innovate and push your products/services to the next level without a serious investment in consultants and the like? The amazing thing about great consumer reviews is they not only tell you what they like or dislike, they also try to help you be better through suggestions and ideas.
We know that brands who embrace consumer reviews get more sales. We also know that – statistically – most reviews are positively glowing (and not negative), so why are so many companies still on the fence when it comes to really opening up?
Never another podcast episode or article 
Yes you are right that the customer reviews are out there whether we like it or not & I agree with your 6 reasons. One reason given by companies who don’t want to facilitate customer reviews on their site is that it can be manipulated by competitors. Trip Advisor for example is getting flack for having manipulated reviews. Any thoughts?
Your 6 points are right.
In my opinion, one of the reason why the companies are still on the fence concerning being open to the community, might be about their field of buisness.
If I take the exemple of Lottery Corporations, Casinos Resorts, Beer Companies; they are all attached to their “image” and must act wisely for not being bashed by tv, radio and newspaper.
How can you deal online with these constraints when a lot of people have moral problems with “the consequences” of what you’re doing as a buisness, such as compulsive gaming or drunk drivers ?
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Alexandre Poitras
Mitch, another great post. I’ve just starting reading your stuff and like it a lot. Too bad your book’s sold out at Chapters and Indigo. Let’s hope they restock soon!
Amazon’s success is in no small part due to the wealth of user created content. What I’ve never figured out is why amazon.ca doesn’t bother replicating it. You’d think doing so would give them a tremendous advantage over Indigo in Canada. Amazon’s the most obvious example, but there are lots of other Canadian retailers not replicating reviews as well. Any ideas?
Very well said, I think that my favorite point that you make about these customer reviews is that you can’t control them. This is what makes consumer reviews so authentic and great, you can’t change them or put a good light on them. However, a positive customer review can do wonders for your business and lead to a flood of sales opportunities.
figured out is why amazon.ca doesn’t bother replicating it. You’d think doing so would give them a tremendous advantage over Indigo in Canada. Amazon’s the most obvious example, but there are lots of other Canadian links of london sweetie
links of london sweetie ring One reason given by companies who don’t want to facilitate customer reviews on their site is that it can be manipulated by competitors.
Illuminating post, Mitch.
The impact of online reviews in the service sector continues to surprise, confound, and sometimes intimidate. They create the exigency for businesses to act because clients are talking with or without them.
I am personally working with a company called Customer Lobby that focuses on service-business reviews acquisition and management. They are business-facing, aiming to proactively collect positive reviews from actual clients so that their online reviews better reflect their total client base.
Companies are choosing the easy path because its EASY to choose it. When it starts affecting *really* affecting their business (which it is already) then they’ll switch to paying attention.
Companies feel it is easy to hide from reviews through “security by obscurity”. Well, as more and more reviews get written and found, these companies/products/services will realize their days of hiding are over!
I could say that I belong to those people who seek for product reviews before making a decision. In fact, online reviews greatly affect my thought of buying. I believe consumers who took the time to make a review, especially those negative are worth reading and considering. Companies should definitely listen to these reviews as these are wake up calls towards change and improvements.
I believe social media is a very powerful tool which can be used constructively and vice versa.
Very often the business organization is the major problem, especially in old-economy companies: rigid command and control structures have ultimately led managers to focus on their immediate environment when making decisions and there are no consumers to be found there.
Reviews are a double-edged sword. Even though having a bad review can cause a temporary decline in business, having great reviews brings much more business so it is worth the risk – and as Mitch points you you can’t keep people from reviewing you elsewhere.
From Local Search Directories to Shopping portals to niche blogs, more and more sites are adding review functions. Since you can’t control them anyway the best strategy is to use them to learn what your customers REALLY think and continually improve your business.
I wrote about the importance of reviews in the post I’ve linked to this comment to make it easy to find. That story has a follow-up I need to add. The mechanic I mentioned had his reviews at Google hi-jacked. His business dropped so dramatically for several weeks that he went searching for the cause.
He was able to get his good reviews back and claimed his Google account to make sure that didn’t happen again. This illustrates how important those reviews are – and he only had three or four when that happened. I will add that update and how to protect your business from that issue to that post shortly.
I will also add a link to how a business can claim their listings and am currently working on identifying which major Directory sites include reviews. Wise businesses will start pointing out their reviews. Add a review page on your own site and link to them. Your customers ARE going to find them so you may as well help them.
One more point: the most valuable reviews are those that are not all roses. No business is perfect and people can always have preferences that you do not want to provide. Realistic reviews that include both pros and cons are best for your business.