Second in a series of fact sheets on "Online reviews and your business," presented in partnership with the EDA Center at the University of Minnesota Crookston.
Author: Adeel Ahmed
Managing online presence is now an essential business practice. This includes monitoring and responding to reviews that are posted on social media sites such as Yelp and Trip Advisor. Online reviews create awareness of a business and when handled well, enhance customer loyalty and retention.
Managing online reviews starts when businesses incorporate practices that ensure good customer experiences. After that, businesses should keep track of what is being written about them online.
Online reviews run the gamut from positive to negative. A great many reviews come from consumers who were pleased or neutral about their experience, and they simply want to help others make decisions about a product, place or service. Positive reviews benefit a business and require relatively little handling by business owners to realize those benefits.
This fact sheet focuses on managing negative reviews, which research indicates are more influential. Included are broad research-based guidelines on how to respond to negative reviews.
Responding to online reviews
Online reviews create awareness of a business, and new research shows that consumers trust other customers' reviews more than many other advertising efforts (Ahmed, 2013).
But how should you, as a business owner, respond if your business starts getting negative reviews on one of the many review sites out there, such as Yelp, Google Plus, Trip Advisor? Before answering that question, you should focus on business fundamentals.
Unfortunately, many businesses ignore customer service issues at point of sale that ultimately are revealed online because they do not know how to address the issues. It is well established that it is much less expensive to retain existing customers than to spend marketing dollars to attract new ones.
Research suggests that both customer retention and loyalty are enhanced when complaints are handled well (Johnston & Mehra, 2002). This entails carefully examining complaints and taking appropriate action to remedy the situation for existing and potential future customers (Tyrrell & Woods, 2005).
In other words, handling online reviews is important, but not as important as:
- Embedding processes in a business that will ensure positive customer service experiences, and
- Allowing customers to contact the business directly if service failures occur (Singh & Wilkes, 1996).
Steps in managing online reviews
Step 1: For business owners, the first step in managing online reviews is to track them (Malthouse, 2007). In order to track (and subsequently respond) to reviews, you will need to create a business account on the popular sites. Some sites are specific to the type of business, others are broad-based.
The popular sites you will definitely want to consider are Yelp, Google Plus, and Trip Advisor. Once you register your business you will receive notifications in your email each time someone posts a review about your business. If you want to give your business a quick online reputation audit, check out the sites described in this article on hubspot.com.
Step 2: Next, see what has already been said about your business online. You can do this by running a search for your business name in Google or another search engine. You also can set up Google Alerts to automatically search the web and send you regular email updates about your business, including news stories and what reviewers are saying about your business on the web. For instance, if your business name is "Trail Wind Lodge" then set up the alert system as follows:
Some types of businesses are more likely to get reviews than others. For example, research shows there are more reviews on lodging establishments and restaurants than of retail stores (Xiang & Gretzel, 2010). Restaurants and lodging establishment offer experiences that are paid for and evaluated - like staying in a room with a lake view or eating rare steak -- whereas retail stores do not cost anything to enter and customers have little reason to search for or write reviews on them. However, many customers do review retail products on sites like Amazon.
As a business owner, you shouldn't be afraid to read reviews. Let down your guard and open yourself up to what they have to say. Comments might be constructive and provide information for you to run your business better.
And don't let one negative review daunt you. Instead, look for patterns that tell of poor service, poor product quality, and unmet customer expectations. Assess whether the allegations have elements of truth and then get to work to address these concerns.
Step 3: Finally, determine how and when to respond. After you have created business accounts on popular review sites and set your alerts, you can begin the actual process of managing online reviews. According to Lee and Song (2010), there are three strategic approaches to managing online reviews:
- No Response, No Action
- Defensive Response
- Accommodative Response
Businesses often choose not to respond to negative reviews for fear of a backlash from consumers. But owners should take several factors into account before deciding not to respond.
First, consider whether customers seem to want a response or are simply venting. If you believe a customer wants an answer, go ahead and respond. Whatever the customer's motivation, a timely, polite, diplomatic response builds good will and might even yield positive reviews from other customers (Lee & Song, 2010).
On the other hand, if you believe a customer is just venting, no response can be the best choice - although silence in the face of negative reviews is often acceptable only to people who already have strong favorable feelings for the company (Smith, 2002).
From this perspective, "no response" strategies run the risk of allowing undesirable information about a business to stand unchallenged, which can damage its reputation (Lee & Song, 2010). No response also might suggest that a company minimizes complaints, or doesn't take them seriously.
One more thing about venting: Some customers might vent with vulgar language. These reviews should be reported to the website managers who usually have policies against abusive language.
In summary, deciding whether to respond or not respond is a subjective matter. But research shows that an accommodative response to negative reviews is usually more beneficial than no response. Read on for more information on that.
Defensive responses deny that a problem exists, shifts the blame to the customer or attack the customer who voiced the concern. In a discussion string of dedicated Yelp reviewers, this is what one had to say about getting a reply from a business owner:
"So, I had a business owner lash out at me last night for a one star review that I wrote all the way back in December. I ultimately decided that the best way to handle this was to just post his message publicly on his business's Yelp page as a review update. That way potential customers can decide based on his own words whether they want to do business with him." (See March 28, 2013 review from Shana K at http://www.yelp.com/topic/louisville-business-responses-to-yelp-reviews.)
Although we do not know what the business owner said or wrote to the customer, we can assume that it was defensive in tone; moreover, the business owner waited about three months after the initial review had been posted to respond. This is too late. If you intend to respond to a negative review, do so promptly .
This interaction probably will not bode well for the reputation of the business. Research suggests that a defensive approach is likely to escalate the problem, give the perception that the company was at fault, and damage the company's reputation (Lee, 2005), (Lee & Song, 2010).
Defensive responses deny that a problem exists, shifts the blame to the customer or attack the customer who voiced the concern.
Figure 1 shows a typical example of a defensive response found on Yelp.com. This particular response was found in discussion boards between people who frequently write reviews on Yelp. This shows that a business owner's indiscretions in writing a response can start getting circulated on the Internet apart from the already public space where the original response appeared. Included first is the review, followed by the response from the business owner.
Figure 1. Defensive response from business owner in Yelp.com
Although the reviewer likes the service, she has issues with the pricing scheme of this salon and not knowing in advance what she was going to pay for the services she received. The response is unmistakably defensive (and sarcastic) in shifting the blame to the customer, essentially saying that the customer was getting a good deal and shouldn't complain. This situation provides a great opportunity to offer an apology to the customer for causing confusion over pricing, and then to take a good, hard look at the pricing scheme of the business. Not informing customers what they have to pay for a service until after the fact is a recipe for problems.
Accommodative strategies may incorporate an apology, compensation, or corrective action and are shown to have a more favorable effect on how individuals evaluate the company than no response at all (Lee & Song, 2010). A personal recommendation from a regular Yelp reviewer states that, "The most effective reply is usually an apology. It looks professional, doesn't alienate future customers or clients and doesn't ramp up negative reviews galore."
Accommodative strategies may incorporate an apology, compensation, or corrective action.
Academic literature supports this view, asserting that a timely, accommodative response to an online complaint can resolve the issue with the complainant and put a stop to unnecessary follow-up attacks from other consumers. This also can increase consumer loyalty, satisfaction and positive word of mouth (Noort & Willemsen, 2012). Figure 2 shows a customer's favorable review on Yelp of an accommodative response from a business owner:
Figure 2.Customer's view of an accommodative response
According to Lee and Song (2010), there is a chance that an accommodative response can backfire if the customer deems the response was not on par with the problems. However, on the whole it is better to respond to negative reviews than to not respond - either online or privately by phone or email. Van Noort and Willemsen (2012) assert that accommodative responses to negative reviews evoke sympathy for a business and a more favorable brand evaluation.
The details of interaction need not to be seen by everyone. What is important to the customer and to the viewing public is that the business responded in some way. Figure 3 below contains an example of an accommodative response. Note how the business owner acknowledges the problem and doesn't transfer blame to the customer. Offering compensation gives the customer and review readers a sense of justice that is important in attaining customer satisfaction.
Figure 3. Example of an accommodative response
Accommodative responses do not always have to be apologetic, but they should have a positive tone. For instance, someone may mistakenly write a review of your business for services they obtained at another business. In this case, you must correct the inaccuracies and (in a positive tone) help the writer understand that it was not your business that merited this review. In cases like this, most writers will retract their review .
A key aspect to writing an accommodative response is using a natural conversational voice and avoiding serious or embarrassing grammar and spelling mistakes. According to Searls and Weinberger (2001), one of the most important characteristics of online communication is the "human voice" of the people who form the organization.
Automated responses are easily detected by the average viewer, come off as insincere, hurt the image of the company, and do nothing to address the problem. A conversational human voice is more effective and positively influences a customer's evaluation of the business.
According to Yang, Kang, and Johnson (2010), Searls and Weinberger (2001), and Kelleher and Miller (2006), a business demonstrates a high level of conversational human voice when its communication with customers:
- Demonstrates openness to dialogue,
- Is welcoming and positive in tone,
- Provides prompt feedback addressing criticism in direct, but uncritical, language,
- Shows a sense of humor,
- Admits mistakes, and
- Treats others as human beings.
The fact that customers prefer a conversational voice makes it much easier for businesses, especially small ones, to respond to online reviews. Responding with an accommodative conversational voice will help businesses tame the wild frontiers of online reviews.
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