How Reviews Affect Conversion Rates for Niche Businesses
If you’re a small business, or niche business with a specific audience, every customer – and every customer’s experience, will have an impact on your business. The customer experience, be it in-store or online, the type of products you sell, the way you operate your business and your code of business ethics all come into play. When all of these elements operate harmoniously, your customer has an incredible experience. On the other hand, if these are not aligned, your customers will perceive these things matter, too.
Why? Two words.
Customer reviews.
As silly as it may sound, customer reviews can make or break a business. Positive reviews position your business for success, while negative reviews can quickly decimate everything you’ve built in days.
Today, reviews take many forms. The most prevalent are digital (social media, reviews platforms like Yelp, or directly on your website), however, printed and word-of-mouth still carry weight. What people are saying about your business, your products, and the way you run your company matters.
So, why are customer reviews so important and why do they matter so much to your business? Join us as we explore some of the key factors of customer reviews and explain how they can directly affect your company for better or for worse.
Negative Reviews Discredit Your Business
We live in a different era of business now – it’s not just focused on the way people perceive businesses, rather characterized by millennial buyers who take those perceptions to build foundations upon the world around them. In fact, according to Joy Healey, about 68 percent of millennials trust online customer reviews as the mecca of information for deciding on whether or not they plan to purchase from a company. What’s more interesting? About 90 percent of consumers read less than 10 reviews before forming an opinion on something, so if the 10 or less they choose to read happen to be negative, then you can kiss their business goodbye.
The reality is, there are millions of options at our fingertips in the modern world for purchasing products – one of the most prevalent ways to narrow down one’s options is to read customer reviews.
At the core of the idea, it’s important to remember this: you’re a small company, so maintaining your reputation is of paramount importance. A few negative reviews here are there are going to dramatically affect your business because you don’t have a big name (or a larger pool of reviews to average the negative ones out) to back up your credibility.
No Reviews = Just as Bad as Negative Reviews
If you’re a small or niche business, it goes without saying that you’re not going to be wading through hundreds of customer reviews about your business, but that doesn’t mean you can settle for no reviews at all. In fact, no reviews on your company is almost as bad as having negative reviews on your company because, in essence, they same the exact same thing. In the era of digital marketing, word of mouth, and customer reviews, a total lack of customer feedback sends the message of “why bother with this company at all.”
Positive Reviews are an Invaluable Push
So, aside from the fact that consumers are more likely to consider shopping with you if you have positive reviews, what’s the real benefit of having those positive reviews? They’re actually more likely to shop with you. For every star a business gets in their rating, their sales revenue is said to increase anywhere form 5-9 percent. Now, how about those negative comments? It’s possible that 22 percent of consumers will choose not to purchase a product from you after reading just a single negative review about your company or product. Those little numbers have a huge impact, don’t they?
Furthermore, even products with lukewarm or mixed reviews will have a higher conversion rate than those without, as the consumer enjoys the transparency and the ability to weigh the concerns raised by others – and whether those same concerns apply to them and their own needs.