How Online Reviews Shape Business Success

11th March 2024

In today’s business landscape, customer reviews hold significant importance. They serve as a digital equivalent of traditional word-of-mouth recommendations, comprising comments, ratings, and testimonials from individuals who have utilised a product or service.

Consumers now heavily rely on these reviews to guide their purchasing decisions and shape their perceptions of businesses. According to Bazaarvoice, customers trust and value reviews three times more than brand advertising.

Fourmeta UK believes that for local businesses, online reviews offer a multitude of benefits. They provide social proof, act as a reference point for consumers seeking reliable establishments and contribute to enhancing their reputation. Moreover, reviews can attract more customers and positively impact a business’s local SEO ranking, ultimately leading to increased visibility and sales potential.

These reviews are easily accessible across various platforms, including online marketplaces, business websites, and social media channels. Recognised platforms such as Facebook, Google, Yelp, and TripAdvisor offer dedicated spaces for customers to share their opinions and experiences.

Significance of Google Reviews

Google Reviews are highly significant among online review platforms due to Google’s widespread usage as a trusted search engine and mapping service. The accessibility of the review process, which only requires a Google account, makes it free and user-friendly, resulting in Google Reviews receiving significantly more visibility compared to platforms like Trustpilot. Consequently, when individuals search for a business on Google or navigate via Google Maps, reviews prominently appear among the displayed information.

Google reviews serve as a trusted source of information for consumers, especially for small businesses. Elements such as star ratings, review volume, and recency greatly influence consumer confidence levels. Research suggests that nearly half of consumers trust online reviews as much as they trust personal recommendations. Seventy-seven percent of local consumers habitually turn to reviews when evaluating a local business before making a purchase, and digitally-native Millennials and Gen Z heavily rely on online reviews from peers, to the extent that they tend to adopt an almost crowdsourced approach to decision-making.

Moreover, reviews play a crucial role in cultivating brand trust and significantly impact a brand’s reputation, which is essential for enhancing credibility, standing out against competitors, and driving sales. In turn, feedback from reviews provides businesses with valuable insights into consumer perceptions, enabling them to continuously improve their products and services and address customer concerns promptly.

Finally, positive reviews contribute to improved search engine optimisation (SEO) rankings. Google’s algorithm prioritises businesses with high-quality, genuine favourable reviews when determining whether a business meets the required standards of expertise, authority, and trust needed to rank well.

In essence, Google Reviews are vital for both businesses to bolster their online reputation, attract customers, and for consumers to gather information, gain confidence in the brand, and offer feedback.

Reviews as a Local Ranking Factor

Reviews are indeed a crucial factor in local SEO, significantly influencing the visibility of local businesses and their rankings in local listings and search engine results pages (SERPs) by providing fresh and unique content.

In today’s digital landscape, where online reviews heavily impact purchasing decisions, it is clear that reviews and SEO are deeply interconnected. Both aim to connect users with the most relevant products, services, or information. Search engines, especially Google, consider reviews as indicators of a business’s credibility, reliability, and overall quality, just as consumers do. Google emphasises the importance of both positive and negative reviews, recognising that a mix of feedback contributes to a business’s trustworthiness.

Google reviews, in particular, play a vital role in achieving visibility in Local Pack results, a critical aspect of local SEO strategies. When determining Local Pack rankings, search engine algorithms carefully evaluate review signals such as quantity, velocity, diversity, and star rating. A high star rating and frequency of positive reviews signal to search engines that a business is popular and offers customers a positive experience, resulting in premium placement in search results.

Over the years, the significance of reviews in local SEO has steadily grown. Review signals now contribute to 17% of the search engine decision-making process for Local Pack rankings, up from 12% in 2014.

Reviews as a Conversion Factor

Customer reviews wield significant influence over conversion rates, which gauge the percentage of people taking a desired action. Whether positive or negative, these reviews can profoundly sway potential customers’ decisions regarding making a purchase.

Positive reviews play a crucial role in enhancing conversion rates by elevating the perceived value of a product or service and fostering trust among potential customers. Such reviews serve as a form of social proof, instilling confidence in prospective buyers and guiding them towards completing their purchase. Conversely, negative reviews can dissuade potential customers, instilling doubts and prompting them to reconsider their intended purchase.

To leverage the power of customer reviews and optimise conversion rates, businesses can employ several proactive strategies. Firstly, they should simplify the process for customers to leave reviews across various platforms, including online marketplaces, business websites, and social media channels. Additionally, businesses should actively engage with both positive and negative reviews, demonstrating responsiveness to customer feedback and a commitment to improving products or services.

Moreover, prominently showcasing positive customer feedback can highlight the advantages of the offerings. Integrating customer reviews into marketing materials, such as product descriptions or advertisements, can further enhance the credibility of the brand.

Importance of High Review Ratings for Consumer Commitment to Purchase

The star ratings displayed alongside business names on Google Business Profiles act as a visual representation of reputation. Generally, a higher rating, ranging from four to five stars, attracts more clicks, enhances brand credibility, and improves the chances of converting potential leads into paying customers.

Recent surveys further highlight the crucial role of online reviews in consumer decision-making. According to one study, 97% of participants acknowledged that customer reviews significantly influence their purchasing decisions, while 92% admitted to hesitating to make a purchase if there are no customer reviews available. Interestingly, 97% of these consumers prefer local businesses with more than two stars, with 40% insisting on a minimum of four stars to even consider engaging with a business. Hence, maintaining a diverse range of positive reviews can give a business a competitive edge, signalling credibility and reliability to potential customers.

Another study revealed an intriguing discovery: nearly half of customers who consult online reviews before making a purchase are inclined to share positive experiences, while 95% express negative experiences. Therefore, the absence of any negative reviews may raise suspicions of inauthenticity. Conversely, a mixture of positive and negative reviews demonstrates that the business is genuine and responsive to customer feedback. However, out of those who read reviews, 86% are cautious about engaging with companies that have many negative reviews. Thus, in establishing credibility and reliability, a balanced combination of 3, 4, and 5-star reviews is more effective than solely relying on 5-star reviews.

Number of Google Reviews for Establishing Trust Signals

Understanding the importance of review volume is crucial for businesses in today’s consumer-driven market. Research indicates that 69% of consumers consider the number of reviews to be a critical factor in evaluating a business, while an equal percentage values the diversity of review sites used by a business. Additionally, 73% of consumers take the recency of reviews into account when making decisions. These statistics highlight the significance of having a substantial number of quality reviews from real customers sharing genuine experiences to meet consumer expectations and build trust. Having zero reviews doesn’t help a business at all; at least a few reviews are necessary to give potential customers an indication that a business is legitimate.

Google also emphasises the importance of review volume, particularly for businesses advertising on Google Ads. Activating the seller ratings ad extension typically requires at least 100 reviews, highlighting the need for businesses to actively collect Google reviews to meet Google’s criteria and remain competitive.

Technically, only one review is necessary to obtain a Google star rating in local search. Star ratings, similar to Google reviews, help potential customers assess a business’s legitimacy and likelihood of providing a positive experience. With 10 reviews, a business is highly likely to observe a noticeable improvement in local search rankings. While 10 reviews mark a good starting point, businesses should continue collecting reviews to further enhance their online presence.

Studies suggest that to maximise customer conversions, having between 20-50 reviews can be highly beneficial. This range of reviews instills enough trust and confidence in potential customers to engage with a business and make a purchase.

It is important for businesses to focus on generating a consistent stream of reviews over time instead of aiming for a sudden influx of reviews. This approach not only demonstrates to Google that the business is active and trustworthy but also helps avoid triggering Google’s spam review filters, which can occur with a sudden surge in reviews.