When people go shopping, they usually have an opportunity to inspect the product or get a better idea of the service they are buying. Yet now eCommerce has taken off, thanks partly to availability and convenience. Additionally, the pandemic of the last couple of years has jumpstarted eCommerce to grow far faster than we originally predicted, with people ordering groceries and practically everything online.
Yet, in ordering everything online, we lost a bit of that natural connection, not the product before we bought it. We had to look at pictures and descriptions and hope for the best (and perhaps hope for a decent return policy). Fortunately, most people can use online customer reviews alongside reviews by experts to get a clearer idea of what they’re getting. The system isn’t perfect by any means for reasons we’ll get into, but it is something that is growing and perfecting itself.
Here’s what you need to know about online customer reviews in 2023:
Online Reviews in the Real World
Before we talk about online reviews in the context of the internet, one thing we want to stress is they have powerful, real-world effects and implications. Online reviews don’t just affect online orders and eCommerce. No, there are plenty of online reviews for physical locations, restaurants, and places you might visit weekly. If there’s a business, there’s a page with reviews. You most likely use them yourself and might not always think about them.
- And people will read about a business before entering it or while in it. About 80 percent of shoppers will use a mobile device to read reviews outside a physical store to learn more about it.
- At a time, everyone was considering Yelp reviews, with some reviewers getting a little too self-important in their opinions and influence. Nonetheless, it was necessary, and store owners would often capitulate to demands or try and ensure people wouldn’t leave bad reviews.
- Interestingly, when people could experience less of the real world, they turned more toward online reviews. During the pandemic, 31 percent of people read more reviews. We theorize it’s a combination of needing to know more about products they can’t buy in person and understanding businesses around them in an effectively new environment.
- More reviews across the board mean better business. In fact, according to one study, having more reviews mattered more than having higher scores (to a certain extent, we doubt that people will frequent a business with 400 one-star reviews).
- If you ask yourself, “does my Google review matter in the crowd of hundreds?” it does. It matters, if only because it adds to the total.
- It could also affect the bottom line for businesses. It turns out that 58 percent of consumers will pay more to support a company that gets good reviews. Obviously, a business cannot raise the price too much, but reputation matters.
- Similarly, it affects discoverability. Looking at the graph below, you’ll see that people care about reviews when considering businesses they haven’t visited before.
- Combine reviews (which are heavy on Google these days) with things such as Google my Business and other Google business services. You’ll find that it all adds up to needing a solid online presence to compete in terms of discoverability.
Who Uses Online Reviews? And Where? Do Consumers Trust Them?
While we think reviews are simple, they’re anything but. A lot is going on behind the scenes when it comes to trusting them and who trusts them. People have different experiences and different perspectives on similar experiences.
- Not everyone uses or writes online reviews equally. However, practically everyone uses reviews. About 97 percent of consumers use online media to shop locally. It is almost a requirement for a local business to have an online presence.
- About 30 percent of consumers under the age of 44 (the original survey considers a younger customer) will use a review for practically every purchase.
- Yet reviews are not all as relevant or essential as one another. Readers generally look for recent reviews. It makes sense, given that businesses change regularly. They could have new management, products, or undergo other significant changes. An online search will also usually prioritize what’s recent or allow users to prioritize it easily.
- Additionally, just because people read and trust reviews don’t mean they trust them as much as personal recommendations. They don’t trust them without reservations. Only 19 percent of people feel that way and will always trust an online review. Interestingly, the same survey indicates that only 22 percent of people are generally distrustful of online reviews as of the last data point. Most people lie in the middle, trusting them in certain circumstances.
- About 62 percent of consumers believe they’ve seen a fake review for a local business in the last year, according to Brightlocal. The reasons they think so include the reviewer not revealing their identity, the review being over-the-top in praise, and the review being too similar in content to many other reviews.
- Yelp is still a huge site, with 224 million reviews as of December 2021. About 26,830 reviews per minute are being posted on the site currently. And yet Yelp is also more helpful than other sites where certain services are concerned. There was little except word of mouth for some services such as lawn care, contract work, and the like. Yet now is it not so large of a player, being eclipsed by Google (which in most categories eclipses everything else).
- Yet while Yelp is big, as seen in the graphic above, it doesn’t hold a candle to Google, which hosts 73 percent of all online reviews for a business. And while there are alternatives to the top four, only 12 percent of reviews are on those sites.
- People who use reviews generally filter at the four out of five-star level. When searching for a business, 70 percent of people will use a rating filter at some point. As we’ll mention in more detail later, having too low of a review score is terrible for a business.
- By this logic, wouldn’t having a perfect review average of five out of five stars be advantageous? Not necessarily. Some speculate that people might be more mistrustful of such a score and those reviews. Additionally, there is little negative feedback or concerns for a customer (and a business) to work with. Such a lofty goal as a perfect goal can also lead to a strain on employees and resources. A business can’t please everyone, and some customers don’t deserve to be fully satisfied (if they ever can be).
Who Writes Online Reviews?
No one would read online reviews if there were no reviews to read. This begs the question of who is writing the reviews and if there is anything to say about them. Here’s what we could find:
- According to information from Statista, people in the age bracket of 25-34 are most likely to post reviews online, with 52 percent worldwide posting reviews online. From the same source, people aged 55-64 were the least likely (only 28 percent post reviews). People from different demographics may have various concerns when reviewing a product.
- Some people are incentivized or paid for writing reviews. It might not be the most ethical of practices, but it nonetheless occurs and is a reality people need to navigate in the modern online world.
- The people who write reviews generally are not there to write an essay on the product. More reviews are only a few sentences long, and Reviewtrackers compared the average length to an extended tweet.
How do Businesses React to Online Reviews?
Businesses pay attention to reviews and often need to act on them. Small businesses particularly care about what customers write about them, to the point where they will monitor them and respond to them, either thanking positive reviews or trying to fix the problem with negative ones. Now, this doesn’t happen universally, and everyone will run their business differently.
- Businesses should note that 40.5 percent of U.S. internet users consider product reviews and recommendations as a reason to shop on Amazon. It pales compared to the top reason (79.8 percent said free and fast shipping), though it has a significant impact. Of course, it doesn’t equate to all business models, but anything similar should note that having a space for reviews is essential, but key services are still more critical. Amazon sellers and other businesses will likely want to cater more to this population segment, ensuring good reviews.
- Businesses, at least the most successful ones, respond promptly to reviews and other concerns. Businesses that respond to their reviews quickly are perceived as having a better reputation.
- It’s probably good that they do. About 53 percent of customers hope businesses will respond to negative reviews within a week. Some have even less patience.
- What do businesses usually say in their responses to reviews? It depends on if the review was positive or negative. Reviewtracker had a breakdown:
- With positive reviews, the focus was often on reinforcing the good things mentioned, inviting the customer to return, and thanking the reviewer.
- Negative review responses primarily focused on thanking the reviewer for their feedback, discussing the customer service experience, and asking a customer for a more direct line of contact to discuss the matter further.
- Some businesses will censor or delete negative reviews, but this is not recommended except for seriously unhelpful and abusive reviews. Brands that engage in review censorship will not get the support of 62 percent of customers.
- Yet how do most businesses react to negative reviews? They don’t. About 75 percent of businesses do not respond to negative reviews.
- And if you want a more personal touch to the reaction, go and ask small business owners you know in your area how reviews have affected them and how social media presence has affected them. Considering these factors in a local context can bring home and humanize many of the statistics mentioned here.
- And in some communities, it isn’t the review platforms that get all the reviews. Positive and negative comments can be spread on community forums and social media pages. Such posts might get lost over time, but they can have a huge impact in the short term and can jumpstart (or finish off) a small business.
Business to Business Reviews
Customers and standard consumers are not the only people who leave reviews. Businesses (or rather their representatives acting in such a capacity) also leave reviews of other businesses. And it affects what people eventually get and how businesses interact with the public in the long run. Here are a few quick things to consider:
- 92 percent of businesses are more likely to work with another business based on a recommendation.
- B2B reviews are less likely to be on Google and Yelp than on other platforms that are a bit more specialized. Interested parties might want to look at G2.com, Upcity, or Clutch. co. And as the last statistic suggests, the recommendations or reviews are often not so formalized.
- Now, the exact content and importance of reviews are likely to be quite different than what you’ll see in an average restaurant or corner store. Individual reviews will likely have more weight (there are fewer businesses than consumers, after all, and most B2B companies will focus on quality clients rather than random short-term contracts unless they have a nationwide reach in several sectors.
Word of Mouth
Online reviews are effectively an online form of word-of-mouth marketing. People will ask friends and loved ones for opinions on a business or product. Alternatively, you probably have heard someone rave about a product online or in person, perhaps persuading you to pick it up or at least check it out. So, to understand the importance of online reviews, we should look at the following statistics regarding word of mouth:
- Word of mouth accounts for 13 percent of all sales and $6 trillion in annual global spending. It is the word that keeps the economy moving.
- About 64 percent of marketers think it’s the most effective form of marketing.
- There’s a reason they think this. It is far more effective than paid ads and leads to multiple times more sales than paid ads.
- 43 percent of marketers use word-of-mouth marketing.
- While marketers cannot naturally create word of mouth by its very nature, they can encourage people to talk about a product or service and incentivize customers to talk about this. Part of this is incentivizing customers to leave a review. Chances are you’ve seen such an offer yourself.
- Nearly a quarter of all people talk about their favorite products or brands with people they know daily. A shocking 78 percent talk about recent experiences every week.
- If a brand is recommended by someone, even someone a person doesn’t know, 90 percent of people are more likely to trust it.
- Yet there is another side to this. Negative word of mouth can wreck a business, much like how a bad review or a string of them can cause many problems for a brand. Losing just one star on Yelp could reduce revenue by 5-9 percent.
- While exact results may vary from person to person, in general, 3.3 (out of five) is the minimum rating a customer will accept to engage with that business. Anything less, and most customers will move on to something else.
- About 80 percent of customers have changed their minds about a potential or recommended purchase after reading a negative review.
- If a business is incompetent or unfortunate enough to have a one- or two-star rating, only 13 percent of customers will consider it. It is effectively a death sentence for a business unless they can turn things around.
Potential Problems and Biases
Not everything is perfect about reviews. They are a system (or a set of smaller systems, depending on how you look at it), and systems are flawed. Here are some of the problems you should be aware of:
- The most apparent bias that most people encounter and can think of is the simple fact that happy customers (or merely content customers) are satisfied just getting the product and going on with their lives. It takes a strong emotional impression for someone to go, “I was so satisfied or dissatisfied with this that I’m going to spend 15 minutes writing a review online about it.” And out of the people who have that reaction, disproportionately, the people having a bad time will write more reviews.
- Additionally, now that companies and brands know about the power of an online review to make or break them and the importance of having a bunch of them, they want to control the narrative a bit. That means that marketing efforts partially go into ensuring the reviews are solid around the internet, whether professional or not. Customer support might ask that someone who left a negative review change their comment after an issue has been fixed (though it is still the customer’s prerogative whether to do so or not).
- In even less ethical circumstances, some Amazon sellers and other online outlets will pay people for positive reviews, offering free products or simple cash for anyone willing to spend a little time writing their very happy thoughts on the listing. Naturally, such a thing is against the terms of service not only on Amazon but on most sites, but there is only a penalty if the infraction is discovered.
- On most platforms, online reviews are anonymous or semi-anonymous. There’s minimal stopping someone from creating a new account with a fake identity and writing either good or bad things about a product. Online platforms and even a search engine can try to root out such things and verify a review from an actual buyer, but there are few perfect systems that every platform can implement.
- Furthermore, platforms can heavily penalize retailers that don’t play by the rules regarding reviews, but this too is limited. An established brand would be damaged, but a seller with no attachment to their work thus far. Hence the importance for consumers to work with more established brands online, especially on those larger platforms. It causes difficulties for startups and smaller retailers, but it seems necessary to keep reviews as fair and honest as possible.
- One also needs to consider the level of expertise of the reviewer. Sometimes a review might be bad because a business cannot deliver something that is impossible or because the reviewer was terribly rude and the business responded appropriately. People might have been disruptive at an establishment and kicked out and therefore want to write a bad review as a form of revenge. In short, people are biased and often untrustworthy, which can appear in their reviews.
Online reviews are interesting because they can all vary in structure and effectiveness. Still, despite this, their impact on eCommerce and general internet life can not be understated. By giving a voice to regular customers, online reviews have a chance to keep retailers and service providers honest and accountable. The systems for online reviews are changing and need to be perfected, but we hope this article has shown you how important they are and will be in the future. We encourage you to do more research and to return to this page as you find the need.