Customer reviews

How customer reviews can boost your Google ranking, conversion rates, and revenue.

Customer reviews were around long before Web 2.0 – people have always exchanged opinions about products and services. But some things have indeed changed over time: word-of-mouth marketing used to be exclusively limited to personal interactions between friends, family members, and acquaintances. Today, however, customer reviews and ratings have become overwhelmingly digital and have established themselves as a crucial element of online marketing. Digitalization has increasingly moved customer reviews and product recommendations into the online arena where customer review platforms, online shops, and social media channels dominate.
Genuine customer feedback is a potential gold mine for businesses, yet many still doubt its effectiveness. The idea that a solid product or service is enough to attract new business is still widespread. However, studies have shown that two out of every three service providers get almost 70% of their new customers through recommendations, regardless if they came from online product reviews or personal recommendations from friends. Advertising slogans alone do not generate the trust needed to attract new business, especially in industries where the competition is stiff and nearly all products and services make the very same promises. In order to set yourself apart from the competition and generate trust in potential customers, you need to leverage the power of independent customer reviews. Product reviews and recommendations, after all, are a clear reflection of customer satisfaction.

How do customer reviews affect Google rankings and conversion rates?

Customer reviews help companies generate trust and an image of authenticity. Customers on the hunt for the right product or service often turn to independent customer reviews in order to make an informed purchase decision. After all, how can something be bad if other people think it's good? Multiple studies — including one by Tomorrow Focus — have shown that online reviews hold considerable sway over the purchase decisions of consumers. Products and services backed by positive reviews sell over 200 times better than those without any customer feedback. This leads to considerable improvements in conversation rates. Customer reviews, therefore, have a direct and demonstrable effect on revenue.

With improvements in revenue come boosts in online visibility, too. Aggregating your reviews and ratings from different platforms and displaying them on your organic Google search listing (Google star rating) is an effective way to quickly communicate your customer satisfaction levels and generate trust in potential customers.

Similarly, improving your Google ranking enables you to drive more clicks and improve your lead conversion rate. Google recognizes customer feedback as unique, user-generated content and accordingly gives it a higher ranking.

But customer reviews aren't merely useful in terms of lead generation and increasing revenue — they also have a positive impact on a company's quality management and quality assurance. Critical feedback helps businesses identify their strengths and weaknesses, optimize products and services, and better understand the needs of their customers. The logistics company DHL is a good example of this. Several years ago, the company introduced its Track & Trace express service, which makes it possible to register and track packages and shipments electronically, allowing customers to find out exactly where their express packages are and when they're expected to arrive. The service was introduced following customer complaints about packages not arriving in accordance with the reported delivery date and time. This example shows how effective complaint management can turn customer feedback into improved products and services.
Almost all that we have here and now, and how we expanded the business came from the customer saying "I need" or "I want."
Charles Lazarus (*1923), entrepreneur, Founder of Toys'R'Us

Should I be active about collecting customer feedback?

Although customer reviews lead to more new customers, higher revenue, and more visibility on Google, there is still a large number of companies that are't fully on board with this approach to marketing. They believe that by distancing themselves from customer review platforms, they can automatically rule out consumer opinions. But the truth is that products and services are being reviewed online whether companies like it or not. Platforms like automatically gather information about businesses from directories and create pages where customers can leave ratings and reviews of their own accord. These ratings then end up on Google and can either speak well of a company or suggest that consumers steer clear — all of this without the company having to lift a finger. The problem in letting reviews and ratings handle themselves is that the company's public image is then defined by a mere handful of reviews. The lower the number of incoming reviews, the more impact each has on the company's overall rating.

Dissatisfied customers are much more likely to express their opinions about products and services online than their satisfied counterparts. Actively collecting customer feedback can help create a much more balanced picture of a company and can also motivate other customers to leave reviews of their own. According to a Bright Local study, three out of every five consumers recommend companies they feel positively about to others — one more good reason to be proactive about collecting customer feedback and improving your recommendation rate. Actively seeking out reviews and ratings from customers can help businesses avoid generating a bad reputation and losing revenue. It also puts them in a position to address criticism and improve their products and services.

However, it's important to keep the review process as simple as possible. Customers shouldn't have to sign in to an account to leave feedback, and the interface should be easy to understand and use (e.g. a simple rating star system). A list of simple ways to collect customer feedback is available in the ProvenExpert blog.

Which industries benefit the most from online customer reviews?

It might be easy to think that online customer reviews are meant first and foremost for e-commerce websites such as online shops and marketplaces, and it is true that customer review systems for these types of businesses were established early on (e.g. Trusted Shops). But the efficacy of customer feedback doesn't depend on the type of business or the industry — it works just as well for online services as it does for local businesses. With the arrival of the Web 2.0 era came a massive increase in the amount of information available online. Today, consumers seek out information about products, services, and companies almost exclusively online. When it comes to making purchases, customers trust product and service recommendations, whether they come from friends or strangers online. Balanced customer reviews are a defining factor in how consumers see a company, which is why it's so important to actively manage your online reputation.

Active review marketing is also useful for brick-and-mortar businesses. Studies have shown that 88% of consumers use their smartphones to check the Internet for information about local businesses, and half of these visit the shops in question within one day. Even service providers that don't sell anything, or only operate on a pro bono basis, can be found on customer review platforms. And while interest in customer reviews on the part of volunteer organizations is still limited, this sector stands to benefit from positive feedback and recommendations in a big way to boost awareness and attract new volunteers.

How a negative review every now and then can be a boost for your business

Every customer is different. Each person has a different set of expectations and demands that determine how they will feel about your products or services. It should come as no surprise, then, that dissatisfied customers are an unavoidable part of running a business. But there's no point in being afraid of negative feedback if you know how to make it work for you. According to a study, nearly two out of every three consumers place more trust in service providers with both positive and negative customer feedback. Nearly all participants in the study (95%) even reported that they find exclusively positive feedback indicative of dishonesty, manipulation, or censorship. A balanced overall rating is, therefore, more trustworthy than purely uncritical praise.

The question, then, is "how should you deal with negative feedback?" First of all, under no circumstance should you ignore it — failure to publicly respond to a negative review makes a bad impression on potential customers. Posting a response shows that you're open to criticism and that your company is truly interested in making its products or services better. You can find a helpful series of instructions for dealing with negative feedback here.

Customer reviews and feedback are a gold mine for businesses: they open the door for active review marketing, they improve your online reputation and visibility, and they boost revenue. Customer feedback provides crucial insights into a company's products and services — insights one would otherwise have to pay for — and promotes better quality management. Customer reviews are therefore absolutely necessary for business success.
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