Why are reviews important for businesses?

Posted on Jan. 10, 2012  by Ping Tsai - SEO Analyst

Online business review sites are as ubiquitous as restaurant upstarts fighting for a surviving stake in a busy metropolitan city. Chances are, for someone who owns one of these competitive eateries, or any other local business for that matter, product and service reviews are a familiar and integral part of daily dealings and the overall business plan. If it isn't, it certainly should be. Depending on how the pendulum swings, reviews can be like the turbo boost in the engine of a business or conversely, road bumps and potholes slowing it down. We know that they are there and we know that they need to be dealt with. Understanding why they are important can help business owners find a way to use reviews in their favor.

Reviews can attract new customers.

Back in the day before information and opinions existed in a mass pit of electronic data known as the internet, people relied on good old word of mouth to determine where to dine, where to shop and what to buy. Luckily, this hasn't become a prehistoric occurrence just yet but evidently, more and more people use the internet to aid in their spending decisions. According to Google Public Data, 78% of Americans use the internet. That is a huge number of people that can potentially be reached by information that is posted about a particular business. Someone looking for a new sushi place to try can go online, read a positive review about a new place, like what he is reading and make a reservation to try it that night with his girlfriend. That's a new customer gained from an online review. Imagine that situation on a scale of hundreds, thousands or even millions and it becomes clear the tremendous impact that reviews can have. One verbal comment about a business can reach one other person or perhaps a handful of people but the number of people that one online review can reach is unlimited.

Reviews can help Google ranking.

There are millions of businesses online and every one of them is at the mercy of the Google god making offerings in hopes that they will be picked sooner rather than later in a never-ending cue of names. Ranking high on Google and getting on that first page is a coveted position for any local business. Just as picking the right gift for a girl can score a guy points, it helps to know what Google likes too. And Google likes it when a lot of people are talking about a business – online that is. Google may see businesses with more reviews as more important, give them more weight and thus award a higher placement in Google Places. Negative reviews in this instance aren't necessarily bad. Google gives more credibility to sites that have a lot of reviews, regardless of whether they are good or bad.

Reviews provide feedback for businesses.

Let's face it. Customer reviews can sometimes be less than favorable. For example, the time when the executive chef partied a little too hard the night before and unknowingly uses salt in place of sugar for every dish that night or when an item is taken off the menu that the owner hates but everyone else loves. Reading these reviews can prompt the owner to label his condiments better and return a beloved menu item. Reviews can be a valuable source of information for ideas of what people like, don't like or suggestions for improvement. The better an owner can answer the needs of his customers, the happier they will be and more likely to return and recommend the business to their friends.

Reviews on the internet are without a doubt a vast and growing library of customer expression. The more effectively a business can harness the power of this virtual talk, the better chances it will have to achieve long term success and survival.