Online reviews:
Know your basics

Amazon, Yelp, Google my Business, Choice, Trip Advisor, social media, etcetera: enter the maze that can make or break sales and services. Reviews have deeply transformed the buying process. For better or worse, they take persuasive power away from businesses and give it to consumers. As experts like to put it, gone are the days when self-praise was doing the heavy lifting.

There is a lot to say about reviews and already plenty of listicles out there that explore the ever-growing digital landscape of platforms1. So we have decided to collect useful data on user behavior to give you food for thought. Whether you are doing B2B or B2C business, here is how and why reviews matter so much.

On reviews and platforms

Reviews have historical significance. They provided a satisfactory solution to the “trust issues” that – analysts once said – would plague the emerging online business model, making it unsustainable. What happened next is history. In the meantime, built-in or dedicated review platforms have proliferated. There is mounting evidence that reviews are now an integral part of the sales process2. According to the Spiegel Research Institute, “nearly 95% of consumers read online reviews before making a purchase”. And for businesses, “displaying reviews can increase conversion rates by 270%”.

The way readers are presented with information is important. Retail platforms are generally the most consulted, perhaps because of the convenience for prospective consumers to check out reviews and make the purchase from one single location3. However, they may look for additional features elsewhere. As research has shown4, the perfect platform - yet to be created - balances credibility and usability characteristics. Credibility is essentially influenced by qualitative reviews (a marker of user-friendliness and trust), total number of reviews for a certain product and self-disclosure (visible identity of a reviewer). Usability, on the other hand, is maximized when users can access quantitative & qualitative reviews as well as average rating, get media support and have sorting options.

Reviews: a glimpse into how they may influence consumers

Not all reviews are equal, and not everyone reacts to them equally. Qualitative reviews − emanating from someone clearly identified − are deemed more trustworthy than quantitative ones. Which makes sense because of the emotional bond they create and vivid experiences they convey.

Also, demographics matter. The importance of reviews varies between older and younger adults. A recent survey5 (von Helversen, Abramczuk et al. 2018) has shown that younger people usually go for the higher rated product … but a great review or a bad experience expressed in vivid terms can make or break the deal. In other words, young people use every type of information available, with different weightings (average rating, positive and negative rich-affects reviews). Older people display a different behavior. Negative entries appear to have the most impact. In fact, it seems to be most useful piece of information to them. A single negative comment is usually a deal-breaker, even though the product or service has received an average rating6. Conversely, they won’t quite be sold on an item just because some people are raving about it.

Interestingly, a mix of good and “not so good” reviews helps build credibility. Fake or biased reviews are indeed quite common and may be hard to single out7. There is a peak star rating between 4.0 and 4.7, at which point the aggregation of reviews is considered both a solid endorsement for the product and trustworthy information. According to the Spiegel Research Center, this is where the likelihood of purchase is the highest. Closer to 5.0, the rating has the effect of sending the consumer on another hunt for information … if he doesn’t disregard the information altogether or worse, doubt its accuracy.

An efficient monitoring of main and emerging platforms is thus key and it starts by understanding how people go about using reviews. Answering comments, especially negative ones, helps project the image of a brand that welcomes (and incorporates) feedback. Acting on reviews is just another way to create and nurture dialog with consumers - and a powerful one for that matter. So it comes as no surprise that a common strategy for brands is to encourage reviews and comments after purchase (using coupons, for instance). What about yours?