Back in high school, reputation was everything. People knew who had the good or bad reputations.
Reputation was your “street creds”. It impacted what people thought about you and whether or not they would let you into their social circle. If you didn’t have a good reputation, it could be very hard to shake, whether it was really warranted or not.
Thank goodness we are done with that! But are we really? Maybe not.
Consider whether you’ve done any of the following online:
- Researched a hotel on TripAdvisor
- Checked out a movie review on Netflix
- Read a product review on Amazon
- Looked up a star-rating on an eBay seller
If so, then reputation IS still important in this day and age. It influences our decision to do business with a company. Most of us have examined the reputation of some business, product or service online over the past few months. Some of us have even contributed to the reputation of a business by writing a review on Facebook, Google, Yelp or other review sites.
Whether you own a business or work for just about any type of company, reputation DOES matter. The more you understand about online reputation management – and how to use that reputation to market your company – the more effective your online presence will be.
What is your online reputation?
Fundamentally, online reputation is a numerical rating of a company’s brand, products and services. It is typically created when consumers go to one of many websites offering the opportunity to review a business or brand by leaving a star rating and comment about their rating. Managing your online reputation involves monitoring your standings on these websites and working to either improve or, as sometimes is the case, restore your brand’s reputation.
Why care about managing it?
The main reason for you to care is because consumers use online reputation data when considering a purchase.
First, it reduces their risk of a bad outcome in a purchase decision. No one wants to experience buyer regret, so consumers strive to make the best possible decision the first time. According to a study by Go Fish Digital, 67.7% of consumers indicate that their decisions to buy are influenced by the reviews they read online.
Second, it helps them make the decision faster, requiring less involvement. The process is shorter because they can use reputation data to “rule out” and “rule in” possible product/service suppliers.
For the business owner or company, it shortens the sales cycle. You get through the buyer journey much quicker. That means it should take less time and marketing dollars to move your prospect to the point of buying.
Impact of a negative reputation on your business
The research bears out that online reputations are something to be managed…and have a real effect on sales. The study by Go Fish Digital referenced earlier, showed the impact of just one negative review or write up. Not only can they hurt sales, but they could literally drive a company out of business. Imagine losing 70% of your potential customers. You wouldn’t be able to stay in business very long at that rate.
Not having and reviews on top review directories are almost as bad as having negative reviews. If you have no star rating on a directory, such as Yelp, and your competition has 4-5 stars, who do you think the prospective buyer is going to choose? That’s right… your competition.
Does the visual of a high star rating matter? It does. The numerical ratings are seen as an objective measure of a business’ quality. Translation: one-star makes you seem low-quality whereas four or five-star gives you an air of high quality. And numerous studies have shown that consumers are dissuaded from purchasing a product or service with 3-star ratings or lower on review sites.
Hotels provide the perfect example of how the star-rating can be a deal-breaker. When I look for a hotel, I’ve got a minimum threshold in mind. If the hotel I’m researching online doesn’t have at least a three-star rating, I won’t go a step further. Three stars are my “threshold” and four is really my ideal. In talking with other folks, I’ve found they have similar thresholds for hotels, restaurants and other services. If consumers have thresholds for these types of businesses, it’s logical to assume they would for your type of business too.
What a positive reputation can do
So while a negative reputation can repel potential customers, what can a positive reputation do? In a study by economists at the University of California Berkley, online reputation management has proven to increase business. Companies that increased their star-ratings on online reviews by ½ a star saw a 19% increase in business.
According to Jim West, owner of West Online Media, who we partner with to provide our clients with online reputation management, a “five-star” reputation can:
- Create instant trust
- Bring you pre-sold customers
- Increase advertising conversions and reduce advertising costs
- Give insight into your target audience
- Improve your local SEO
- Position you as the authority in your local market
Through our work with West Online Media, we’ve even seen how reputation management can provide impactful content for marketing too. What better content for social posts, email marketing and your website than real testimonials from customers who endorse you and your products? It’s a content marketer’s dream!
Take the test – check out your online reputation
So here’s some homework for you before our part-two blog on this subject. Get a free report card on your online reputation. It will highlight problems with the directories (review sites) where you are listed, evaluate your reviews and give you a grade. It shows your star rating for all the top review directories and gives your business an overall reputation grade. You’ll see what your potential customers see.
Once you’ve got your report card in hand, we can talk about what you can do to improve your grade and fix problems.