Are reviews important?
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DAC Group’s Nasser Sahlool sums up the study this way: "Once a simple add-on, online digital is now a proven high-performing element in earning a piece of consumers' wallets,” he says.
But while reviews—on Yelp and otherwise—are perceived as important by potential customers of businesses like restaurants, they seem less important to business owners. That’s the upshot of a survey of 261 businesses conducted by Woodbury University on behalf of review management service provider ReviewInc. The study found that while 49 percent of businesses monitor customer reviews more than twice a month, the other 51 percent simply do not.
That number was surprising because businesses owners seem vividly aware of the impact customer reviews can have. Eighty percent of this study’s respondents said that a one-star rating improvement would translate to at least a one percent gain in revenue, 65 percent would expect a five percent increase while 38 percent think they would see 10 percent gain if their online ranking improved by just a single star.
But what if a business’s rating were to decline one full star on a key review site? Seventy-five percent expect revenue would decline by at least one percent, 56 percent think they would take a five percent revenue hit and 29 percent would brace for a decrease of 10 percent or more.
This study looked at a variety of businesses, not just restaurants. But keep in mind how prominent restaurant reviews are on Yelp. On Yelp’s list of most frequently reviewed businesses of 2013, the top 10 were all restaurants.
The Yelp/Yahoo alliance means that Yelp will be spreading the word about your restaurant to a wider audience. Potential customers used to have to go directly to Yelp’s site to find out about your restaurant. Now they’ll get that information as the result of more general searches performed on Yahoo. Let’s hope the reviews that show up there are helpful to both your guests and your business.