How Much Can A Bad Review Cost Your Business? The News Is NOT GoodThe Review Stars
What Can a Single Bad Review Cost Your Business?
Let’s face it, your reviews and online reputation are essentially your business credit score.
Many business owners believe that a bad review may not hurt them. Nothing is further from reality. In this new digital age information is posted, shared and transmitted constantly between individuals. What one user can see, their 200 or 300 “friends” also see.
A single bad review is proven to drive away 1 potential customer out of every 10. Bad and fake reviews gain momentum in the search engines and are shared on social media.
It is estimated that as many as 70% of consumers are now sharing their opinions and creating reviews on social media. Facebook reviews are quickly overtaking Google and other review platforms. This is probably a result of most Facebook users being LOGGED INTO their accounts at all times. The average Facebook user visits the site 6 times per day with their mobile app. According to Review Trackers, Facebook has become a major source for reviews, with over 55% of consumers considering that platform as a useful and trustworthy resource to learn about products, services and brands. That includes LOCAL BUSINESS! Facebook users also feel that reviews are more important than comments or related posts. An amazing 72% of these consumers place trust in the reviews. In most cases reviews posted by people they have never even met in the real world.
Any random Facebook or social media user can damage your business with a bad review, even it is not entirely accurate or misrepresents what really happened. Which is the reason that dealing with your reviews, good bad or fake, is of paramount importance now more than ever. A handful of bad reviews become the SILENT KILLER of your business!
So let’s take a look at some REAL NUMBERS and how it impacts your business:
If ONE bad review will drive away a minimum of 1 out of 10 potential customers, and 300 people see the bad review, then you will lose 30 potential new customers. Let’s assume your average sale is $25 (i.e. two people dine at a restaurant) or as high as $100 (carpet cleaning, HVAC service call, etc.). We can quickly calculate that ONE BAD REVIEW will cost you $750 to $3,000 annually. You can easily plug in your average sale to make this simple calculation. And it’s not just losing that INITIAL SALE to a NEW CUSTOMER, you also lose all of the revenue that new customer would have generated over a time horizon. So restaurants, service businesses, local retail and many other types of businesses are looking at a 3X to 5X multiplier of these losses.
BOTTOM LINE: A single bad review could cost you $3,750. to $15,000. or more. The more bad reviews, the higher the losses.
The good news is that you can minimize the damage by understanding one simple concept:
THE SOLUTION TO POLLUTION IS DILUTION! Or in other words, you need to start accumulating as many positive reviews as possible to offset the effect of a bad review. Both the QUANTITY of your reviews, combined with your overall rating or the QUALITY of your reviews in the aggregate, are your secret weapon against the damaging effects of a bad review. Consumers trust businesses with not just a good rating (4.0 stars or higher), but also tend to ignore bad reviews when they are only a small percentage of the total. A business with 20 reviews which include 5 poor reviews has a problem A business with 120 reviews and 5 negative reviews is insulated from a potential customer writing you off at a glance. And at the speed of search these days, a glance is about all you get!
Managing your reviews and online reputation is too important to ignore!
At Review Control, we make the job easy with simple-to-use tools and support.
Get more good reviews, address bad reviews, and remove fake reviews with our assistance. You can never have too many positive reviews.
Visit us at Review Control Center and learn what you can be doing RIGHT NOW to improve and manage your business reputation.