One of the great things about the democratization of the Internet is that it allows users to share experiences and make recommendations about a product or service. This is especially true for platforms like Google, Yelp, Facebook and TripAdvisor. These channels allow regular, everyday users to post comments about their experiences at restaurants, hotels, retail stores, auto repair shops and more – no matter how good or how bad. Prospects often read through these sites before making a buying decision and many swear by their recommendations. While this may appear helpful to the buyer, it’s important to remember a few things about review sites; online reviews are populated by anywhere from 1.5% to 5% of actual users, online reviewers on these sites do not represent the average customer, many online reviews are from people who never made a purchase or used the product, and online reviews can’t provide insight into the heart of any customer-engagement or product issue. With this understanding, do review sites like Yelp and TripAdvisor really help your organization provide an exceptional customer experience?
Who’s providing reviews?
It shouldn’t be a surprise that a tiny percentage of buyers actually leave feedback on a review site. It’s true that some reviewers are real, dedicated shoppers that want to shout from the rooftops about their experience, but most don’t bother. The irony here is that too many people read reviews and make decisions based on those reviews.
According to a study conducted by Dr. Duncan Simester, professor of management science at the Massachusetts Institute of Technology (MIT), reviews on web sites may not provide a representative sample of customers’ opinions regarding a product or service. In one particular case, one retailer’s review section on their site was shown to have reviews by only 1.5% of customers. In other words, out of 1,000 customers, only 15 wrote reviews. Of those reviews, a percentage were shown to have been provided by people who never purchased an item.
It’s also worth noting that people conducting research prior to making a purchase tend to pay more attention to negative reviews. According to a New York Times article, Simester explains the reason people are drawn to negative reviews. “The infrequent nature of negative reviews may help to distinguish them from other reviews.”
In addition to Dr. Simester’s findings, the Journal of Consumer Research also found that online reviews, which were viewed as less objective, had little correlation to ratings provided by Consumer Reports, which is seen as more objective. In short, people leaving reviews are a tiny subset of actual customers and are typically not representative of the average.
Understanding the root causes
Let’s say that a restaurant, hotel or retailer relies heavily on Google and Yelp. What they eventually get is feedback from a very small percentage of customers (with the understanding that some of them may not have actually purchased an item or used the service). They also get no insight into the cause of the actual customer experience. What’s needed by organizations is an understanding of what may be causing issues and whether any of those issues are related to customer engagement. Proper insight and analysis is required if organizations want to truly understand what’s happening when customers are engaged and online reviews simply can’t do that.
How to know what’s really going on
Rather than rely solely on online reviews (whether they be Yelp, TripAdvisor or company-owned website), organizations must dig deeper into the customer experience. A number of evaluation organizations, such as Coyle Hospitality, are equipped to engage customer-facing staff using real, live customers. Those real customers then provide a comprehensive analysis and report of their experience, helping organizations understand what’s at the root of their customer engagement. There are a host of secret shopper organizations out there, but not all use actual customers (i.e. those who fit the socio-economic profile of the company’s target audience) in order to provide that feedback. To get actionable feedback and have it done the right way, organizations must leverage solution providers that have relationships with real, live buyers rather than staff reviewers.
Online review sites have carved out a nice little niche in the area of consumer feedback. For companies that value real, actionable feedback from actual customers, companies must take the next step and leverage the services of a true evaluation service provider.
